Europe's Unions: Can They Change?

A new generation of labor union leaders is springing up in Europe. Younger, better-educated, and more widely traveled than their predecessors, they worry about competitiveness, productivity, and trimming government welfare systems.

But will they be effective? So far, the news is not good. Far too many Europeans haven't yet grasped that unemployment rates are in double digits precisely because old-style unionism is still rife. French truck drivers, for instance, are claiming victory in their latest strike. By paralyzing France for 12 days, they bullied employers and the government into conceding full pensions at 55, forking over a $600 one-time bonus, and pay while waiting for loads. It will make France, which has 13% unemployment and 1% economic growth, even less competitive against the U.S. and Asia.

New labor leaders such as Nicole Notat of the French Democratic Labor Confederation are under attack from old-line union bosses who persist in telling workers that they can have it all. When Notat spoke up for moderate cuts in an over-generous welfare system, militants from unions slammed her.

If the new generation of labor leaders cannot displace populist rabble-rousers, there's little hope for Europe regaining its global competitiveness. Irresolute European governments are making the situation worse by caving in to excessive labor demands in the name of industrial peace. If this continues, hardly any European companies will be investing in their own countries in the future.

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