by To date the debate on the 2018 budget in France has concentrated on the question of tax gifts to the most wealthy. De facto, the abolition of the wealth tax and the measures in favour of top dividends and interests will cost the State budget over 5 billion euros. But it is also important to insist on the other side of the coin, in other words the losers in the 2018 budget and, in particular, on the young people sacrificed as a consequence of the fall in student expenditure per capita in higher education. This will also enable me to clarify a number of issues raised by internauts about my last post (see « Suppression of the wealth tax: an historical error« ). Officially, the draft 2018 Budget Bill which the government has just tabled shows a slight increase in expenditure on higher
Topics:
Thomas Piketty considers the following as important: in-english, Non classé
This could be interesting, too:
Thomas Piketty writes Unite France and Germany to save Europe
Thomas Piketty writes How to tax billionaires
Thomas Piketty writes Europe must invest: Draghi is right
Thomas Piketty writes Rebuilding the left
To date the debate on the 2018 budget in France has concentrated on the question of tax gifts to the most wealthy. De facto, the abolition of the wealth tax and the measures in favour of top dividends and interests will cost the State budget over 5 billion euros.
But it is also important to insist on the other side of the coin, in other words the losers in the 2018 budget and, in particular, on the young people sacrificed as a consequence of the fall in student expenditure per capita in higher education. This will also enable me to clarify a number of issues raised by internauts about my last post (see « Suppression of the wealth tax: an historical error« ).
Officially, the draft 2018 Budget Bill which the government has just tabled shows a slight increase in expenditure on higher education. The budget for the programme entitled « Formations supérieures et recherche universitaire » (« Higher education and University research ») – which covers all the operation and equipment budgets allocated to the totality of French universities and institutions of higher education – will thus rise from 13.3 billion in 2017 to 13.4 billion in2018 (see here the official budgetary document proposed by the government, p.39).
If we follow the path of the Finance Laws introduced since 2008 by the Sarkozy and then the Hollande governments we observe a similar strategy in communication : the rise in budgets allocated to higher education is minimal, but they usually manage to present them as on the increase. In total, the nominal budget for the « Higher Education and University research » programme has thus risen from 11.3 billion euros in 2008 to 13.4 billion in 2018. Officially, honour has been saved and the university preserved.
The only thing is that all this is an illusion created by the government and a particularly unrefined one at that. To begin with we have to allow for rise in prices : even if this is slow per annum (it will be about 1% in 2017, and doubtless the same in 2018, which is already higher than the rise of 0.1 billion euros in the nominal higher education budget proposed for 2018). It nevertheless represents almost 10% over 10 years which is enough to absorb a little over half of the nominal rise in the level between 2008 and 2018. If we talk in constant euros, that is after taking inflation into account, we see that the budget for higher education has risen from 12.4 billion euros to 13.4 billion euros in ten years.
Furthermore, and above all, we have to take into consideration the considerable rise in the number of students, which rose from over 2.2 million in 2008, to almost 2.7 million in 2018, or an increase of roughly 20% (I am simply taking here the numbers of students published by the Ministry and the forecasts for 2017-2018).
If we combine the evolution of the budget for higher education (barely 10% in constant euros) and that of the number of students (20%) then the inevitable conclusion is that between 2008 and 2018 the budget per student has fallen by almost 10% in France.
Let’s put it plainly: this decline is totally anachronous and scandalous. Furthermore, it is in flagrant contradiction with the official European discourse which proudly proclaims that the priority aim in Europe is to invest in training and innovation – except that there is no concern to take the appropriate measures to check whether the means have been allocated to achieve these goals. This deafening silence contrasts strangely with the capacity of the European institutions to give lessons, awarding good marks and bad marks to all sorts of reforms. How are we going to become ‘the most competitive knowledge-based economy in the world’ by 2020 (the aim proclaimed by the European leaders in Lisbon in 2000, with 2010 as the first target which has been regularly postponed since then) if we begin by reducing investment per student by 10% in France between 2008 and 2018?
It should also be pointed out that the rise in the number of students is obviously not a problem as such, quite the contrary. It conveys the dynamism of French demography and also the fact that young people are trying to get more and more qualifications, which is anexcellent thing. The high level of training and education is what has enabled French society and the economy to become one of the most productive in the world and that must continue.
However this is conditional on providing the means which is absolutely not the case at the moment. The universities in particular were already very poorly provided for ten years ago and the situation has distinctly deteriorated since. Does the government really think that this sort of policy is preparing the future of the country?
The responsibility for this sad state of affairs is of course shared by the successive governments over the past 10 years and is to a large extent explained by the disastrous management by the euro-zone countries of the crisis since 2008 which has led to nothing less than the sacrifice of our youth. Their lot is one of high unemployment and low investment in the future.
The fact remains that the present government has a special responsability: on one hand because it is high time to adjust aims and recognise the numerous errors made since 2008; on the other hand because the 2018 budget chose to devote 5 billion euros immediately to lowering the taxes of the wealthiest, as compared with 0.1 billion euros for the universities and higher education (immediately absorbed by inflation).
Whatever one may think about the lowering of the wealth tax (and my personal opinion is that it is completely unjustified, given the fact that the top financial assets are doing very well in France and show no signs of fiscal flight) one can only be struck by the comparison of these two figures, which convey a strange sense of priorities.
If the government had chosen to devote these 5 billion euros to higher education it would have been able to increase the 2018 budget by almost 40% (very precisely 37% : 5 billion / 13.4 billion).
By simply devoting half, it would have been able to raise the budget for higher education by almost 20%, which would have been enough to cancel the fall observed between 2008 and 2017, and even to ensure expenditure per student in 2018 roughly 10% higher than in 2008 – a rise which over a period of 10 years would not be excessive, given the relative poverty of the French universities and the means observed elsewhere.
In sum, by choosing for ideological motives to devote everything to the wealthiest (who in practice often belong to the oldest groups in years) the 2018 budget turns its back on young people and the future, whereas the priority ought to be to invest in training and the future.
The saddest thing is that our higher education also needs in depth reforms which have been put off for too long. We have to reduce the distance between the universities and the prestigious ‘grandes écoles’ and we must, at long last, ensure democratic transparency in the working of the admission and allocation system to higher education (the APB). But reforms of this type can only be successfully implemented if at the outset there is an end to the reduction in means allocated to the universities. If the government endeavours to introduce selection over and above austerity (which is merely another form of selection based on means) then there is little doubt that it is heading for trouble.