We still have nearly 8% unemployment in the United States, but the pressure on big companies is to fire people, not hire them.
Because when companies fire people, their profits go up. And the prevailing ethos of American capitalism is that bigger profits are better. Period.
(This is a shortsighted view, even from a business perspective, because one company’s wages are other companies’ revenues, so by cutting wages you’re kneecapping economic growth. But American shareholders have become so obsessed with near-term profitability that they don’t care about anything else.)
Other countries have different attitudes about capitalism.
In France, for example, it’s harder for companies to fire people, because the perception is that companies owe their employees more loyalty than companies do here. That’s not necessarily “better” — it makes the economy much more rigid–but it’s an interesting difference.
Here’s what happened yesterday after the American company Goodyear announced job cuts at a factory near Paris.
Photo: REUTERS/Jacky Naegelen
Protestors scuffle with French CRS riot police in front of tire maker Goodyear Dunlop France headquarters during a demonstration against job cuts in Rueil Malmaison, near Paris March 7, 2013.
U.S. tiremaker Goodyear confirmed in January the project to close a French plant near the northern city of Amiens, which, if undertaken, would lead to the layoff of 1,173 jobs.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.