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France Running Out of Gasoline; Strikes Now Spread to Nuclear Plants

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Published : May 26th, 2016
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Category : Editorials

France is running out of gasoline thanks to massive strikes at all the refineries.

The strike spread to air traffic control and many flights have been cancelled. Hundreds of thousands of people are stranded.

The strike is now about to spread to nuclear power plants.

I offer this quote of the day: “One cannot just turn off a nuclear plant, it is not like a thermal or hydro plant.”

The BBC reports French Labour Dispute: Strike Hits All Eight Oil Refineries.

An estimated 20% of petrol stations have either run dry or are low on supplies.

Clashes broke out at one refinery early on Tuesday when police broke up a blockade at Fos-sur-Mer in Marseille.

Prime Minister Manuel Valls insisted the labour laws would stand, and that further blockades would be broken up.

“That’s enough. It’s unbearable to see this sort of thing,” he told French radio. “The CGT will come up against an extremely firm response from the government. We’ll carry on clearing sites blocked by this organisation.”

20% Fuel Shortage in Question

24hGold - France Running Out o...

Law be Decree

The union is aiming to cut output by half at the refineries and wants strikes on the railways as well, in an attempt to reverse labour laws that make it easier for companies to hire and fire staff.

There are concerns that the disruption may affect the Euro 2016 football championships, with one former union leader saying the event is not “sacred”.

The government provoked union outrage when it resorted to a constitutional device to force its watered-down labour reforms through parliament without a vote, earlier this month.

The strike is a result of an action by French President Francois Hollande to pass a law by decree. I wrote about that on May 10 in Hollande to Force New Rules by Decree, Risking Vote of No Confidence.

Parliamentary rules in France are a bit bizarre. Rules allow the president to pass legislation directly, over the wishes of parliament, without a vote.

The legislation stands unless the president fails a confidence vote.

Expect a vote shortly as Hollande whipped up legislation that neither the left nor the right can stand.

I commented at the time “More than likely, Hollande will survive. The socialists are going to get clobbered in the next election and to vote against Hollande now will put them out of a job now rather than next year. Surprises are possible if disgust gets low enough, but in general, politicians would rather have a paycheck than do the right thing.”

The result was a surprise strike.

Violence Flares Up

24hGold - France Running Out o...

Good News! Some Stations Still Have Gas!

@zerohedge Good News! In Wake of Strike, Some French Gas Stations, Still Have Gas! pic.twitter.com/4OXq02cts6

— Mike Shedlock (@MishGEA) May 25, 2016

Bad News! Cancelled Flights as Chaos Spreads to Air Traffic

The Independent reports Chaos Looms as French Workers Step Up Strikes.

Hundreds of thousands of British holidaymakers face disruption and frustration over the half-term holiday, as striking air-traffic controllers and refinery workers bring chaos to the transport network for people travelling to, through and over France.

Members of air-traffic control unions are unhappy about proposed changes to working arrangements and retirement conditions, and what they call “The inability of our government to develop a human resources management policy”. They also claim their salaries are “significantly lower than those of their counterparts in other major providers”.

The largest union, the SNCTA, will strike on five further days: tomorrow, from 3 to 5 June and on 14 June. Previous stoppages have caused hundreds of cancellations, with flights between the UK and Spain particularly badly affected.

Tomorrow will be the seventh day of industrial action by French air-traffic controllers in the past two months. Ahead of the strike, Ryanair has cancelled 70 flights , including some services from Birmingham, East Midlands, Manchester and Stansted to France, Portugal, Spain and Switzerland.

The airline warned: “Unfortunately, further flight delays and cancellations are likely.

British Airways has cancelled at least 20 flights, including six between Heathrow and Madrid, and four each to and from Barcelona, Nice and Paris. Passengers to Geneva, Marseille and Toulouse are also affected.

Riot Police Called Out

24hGold - France Running Out o...

Riot police stand guard behind a fire as refinery workers hold a blockade of the oil depot of Douchy-Les-Mines to protest against the government’s proposed labour reforms. Getty

Question of the day: When do the police strike?

While pondering that question, the latest news is grim.

Unions Vote to Strike at 19 Nuclear Power Plants

France24 reports After Fuel Blockade, French Nuclear Plant Workers to Strike Over Labour Reform.

In the past week French workers led by the CGT have blocked oil refineries around the country in protest at the planned reforms aimed at making it easier for firms to hire and fire, which has led to fuel shortages in large parts of the country and long queues of cars at near-empty petrol stations.

CGT energy and mining federation spokeswoman Marie-Claire Cailletaud said the strike action at nuclear plants, set to start Wednesday evening at 20.00 Paris time (1800 GMT), will reduce power output, but the reactors will not stop running.

“One cannot just turn off a nuclear plant, it is not like a thermal or hydro plant,” she said.

Staff in at least four fossil fuel-fired plants have also voted to strike, she added.

Ministers went on radio morning shows to say the government would stand firm, while CGT chief Philippe Martinez told RTL radio that his union, one of the most powerful in France, would press on with its strikes.

Taken hostage

The government has accused the CGT of taking the country hostage.

“A small minority is trying to radicalise things,” Junior minister Jean-Marie Le Guen told RTL radio. “We will unblock the situation,” he said, adding that a union “cannot govern the country”.

Undeterred, CGT chief Philippe Martinez told France Inter: “We will carry on.”

So far the strikes have affected oil depots and refineries, triggering shortages, and train and Metro strikes have been announced too.

The nuclear plant strike is a further escalation of a conflict that also threatens to affect the Euro 2016 football championship, which starts on June 10 in France.

Carry on Dudes

24hGold - France Running Out o...

By all means, carry on dudes. The massive “Code du Travail” (Labor Code) says you have rights.

“The Code du Travail is regarded by many in France as untouchable. Successive governments have chiselled away at its 10,000 articles – notably easing restrictions on layoffs and working hours – but without ever daring a comprehensive overhaul.”

PATCO Moment Needed

Ronald Reagan provided the precisely need solution for union insanity. Reagan fired them every PATCO (air traffic control union employee) who would not return to work when ordered.

I wrote about this once before, also in regards to France. Flashback October 12, 2010: French Unions On Strike Against Pension Reform, Disrupt Rail, Air Traffic.

The correct government response to this mess is to do what Reagan did to the PATCO workers, fire all the public union employees on strike and terminate their benefits.

Moreover, the French government should take this opportunity handed to them on a silver platter and go one step further to make a much needed change and dissolve all public unions. The same should happen in the US.

This would end the nonsense quickly and effectively. As in the US, there would be lines miles long to take those jobs at much lower wage and benefit levels.

Message From FDR

Inquiring minds are reading snips from a Letter from FDR Regarding Collective Bargaining of Public Unions written August 16, 1937.

All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management.

The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations.

Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees.

A strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable.

FDR was correct.

Reagan was correct, but he did not go far enough.Reagan should have dissolved every public union.

Had he done so. We would not have the pension/state budget crisis we have today.

Mike “Mish” Shedlock

Source : mishtalk.com
Data and Statistics for these countries : France | Georgia | Portugal | Spain | Switzerland | All
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Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management. He writes a global economics blog which has commentary 5-7 times a week. He also writes for the Daily Reckoning, Whiskey & Gunpowder, and has over 80 magazine and book cover credits. Visit http://www.sitkapacific.com
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