Busting The "Core" European Myth
Everyone knows that Europe is divided into the Periphery (aka the PIIGS), and the Core (aka the countries that are supposed to be safe). What everyone also knows, is that the core, naively represented by Germany and France, supposedly has homogeneous distribution of economic growth and prospects. That all changed last year, when France moved from being a AAA-rated country, to a fallen superduper angel following the Moody's downgrade to AA+. Yet nowhere is the glaring divergence between these two formerly comparable economies than in the two articles cited below, both from the same publication, and both from today.
Volkswagen's German workers win 4.3% pay rise
May 31, 2012 07:46 CET
HANNOVER, Germany -- Volkswagen agreed with the IG Metall union to raise wages for German workers by 4.3 percent over 13 months, echoing a pay contract signed by the union for the country's industry-wide engineering staff.
The pay rise for 97,000 VW production workers and 5,000 employees at the company's financial services division will take effect June 1, VW said in a statement on Thursday.
The new pay accord also includes provisions to hire 3,000 temporary workers and take on an additional 175 trainees a year.
"This is a very good and acceptable compromise," IG Metall chief negotiator Hartmut Meine said on Thursday at a press conference in Hanover.
VW's new in-house wage deal, signed after all-night negotiations, reflects a salary agreement reached between IG Metall and employers on May 19 for 3.6 million engineering workers across Germany, affecting staff at companies including Daimler and BMW.
"Workers will earn a decent pay increase," Martin Rosik, VW's chief negotiator said at the press conference.
PSA seeks job cuts, pay freeze at French plant, unions say
May 31, 2012 08:58 CET
PARIS -- PSA/Peugeot-Citroen has asked workers at its Sevelnord plant in northern France to agree to a pay freeze, hundreds of job cuts and other concessions, or face possible closure, officials at two unions said.
The company is opening talks on plans to reduce the threatened plant's 2,700-strong workforce, freeze salaries for at least three years, reduce leave and impose more flexible hours, CGT and CGC union representatives said.
PSA declined to comment on plans for Sevelnord. Its ultimatum, if confirmed, echoes tactics successfully employed to win concessions from workers at Fiat's Pomigliano factory near Naples, Italy, and General Motors' Vauxhall plant in Ellesmere Port, north-west England.
"This amounts to industrial blackmail," said Ludovic Bouvier of the CGT, PSA's biggest union. "They want us to set an example that workers in the rest of the group's factories will eventually have to follow."
But if people are finally waking up from their "core" cognitive dissonance, just wait until we actually have to split the atom, or in this case Germany, into its constitent West and East parts, as the second law of thermodynamics confirms that it is far more powerful than any central planner.