The Straw, the Beam, Montebourg and Titan

There isn’t any relation between the DSK affair at the New York Sofitel and the likely closing of the Goodyear plant in Amiens for lack of buyers. But allow me to nevertheless make a connection.

Today, we’re dragging an American CEO through the mud, exactly as we previously dragged the New York police and the prosecutor, Vance, through the mud. The police and prosecutor acted too quickly. They disregarded the presumption of innocence. They dared to interfere in French political affairs. By condemning DSK in advance, they condemned France.

But now, these lively discussions have been silenced. The French have opened their eyes. The Parisian press finally did their job. We understand that DSK wasn’t as innocent as all that. He himself admitted it to Clair Chazal when speaking about “moral fault.”

Maurice Taylor dared to say that he didn’t want to make a fool of himself, spending millions to take over a factory that Goodyear no longer wants, if the CGT (General Confederation of Labor) continues with their law.

Without mincing words, he accused the CGT of being stupid, and he reproached factory workers in Amiens with not working enough. When he said this aloud to the unionized workers, they said, “In France, that’s how it is.” Maurice Taylor concluded, probably too quickly, that France is in the hands of lazy unions who are destroying the country’s industry.

This is an exaggeration. But like any exaggeration, there is some truth here. Instead of making Maurice Taylor the prototype of the rich American idiot who dreams of investing in France, we would do better to reflect on the exact elements behind his provocative accusations — especially given that France and the 1,173 employees in the Amiens factory had more need of him and his millions than he had need of them.

All the same, we should recall that this letter from Maurice Taylor was confidential. This Midwestern CEO never thought that it would be made public; his intention was not to set off a debate in France. Whoever at Bercy decided that it would be good to publish the letter had a very clear motivation: to discredit Maurice Taylor and take the focus away from their failure to find a buyer for Amiens Nord.

Naturally, it would have been better for him to have written in less aggressive terms. But Maurice Taylor has a style — the grizzly growler. The echoes of his growl were louder than he could have imagined.

The response written by the minister of industry renewal is correct on many points. It points out that France attracts many foreign companies, in particular American companies. It stresses that France isn’t a lazy country. The exaggeration had to be corrected.

But naturally, Arnaud Montebourg also skipped over some fundamental points.

1) Amiens North doesn’t have a buyer.

The CGT hardliners have lost. That’s very sad. The plant closure is a terrible thing. Hundreds of families will probably be plunged into an upsetting social drama. Many will probably feel used by the union and political forces beyond their control.

This isn’t the moment to get on your high horse and lecture foreigners who may invest in France.

2) If France is so competitive and attractive, why does it need the talents of Arnaud Montebourg to promote its industry?

The economist Patrick Artus, of Natexis bank, explains today in Le Figaro, that the labor cost per unit is 10 percent higher in France than in Germany, and 20 percent higher than in Spain and the UK.

Industry represents just over 11 percent of the French economy, compared with 21 percent of the German economy, 15 percent in Italy and 30 percent in Finland.

I have lived in the U.S. for close to 30 years; I hear it said all the time by intelligent French citizens that France has an industrial policy and America does not.

There isn’t actually an industry minister in the U.S. But despite this horrible lack, the American manufacturing sector contributes as much to the economy as it does in France: 11.5 percent. Good thing that the brilliant minds in France have an industrial policy. The results are striking. They are worthless, these simple Americans, rough, uneducated and disrespectful of the French spirit and its elites.

3) Maurice Taylor never pretended to be bigger, stronger or smarter than Michelin.

The French company is an example of success in the United States: Its high-quality products, made in the U.S. by Americans for the American market, are well known.

Titan International is effectively a second-rate actor compared to Michelin. The company specializes in agricultural tires and tire construction equipment.

But its ambition is not to flood wealthy countries with cheap tires made in India. It wants to make tires for local markets. If the tire industry disappears in France, it must, however, import tires from somewhere…

The head of Titan International never claimed to be an expert on France. He visited the Amiens North factory a few times and concluded that it could not survive if reforms and downsizing were implemented. Goodyear concluded the same thing. If Michelin, cited by the French minister in his letter, doesn’t take over the factory either, it may just be that there is a problem…

Maurice Taylor extrapolated other conclusions about the slowdown and decline in France. He reported his findings in a confidential letter to the minister. Instead of thinking about these conclusions and ignoring the provocative and excessive elements, the minister preferred to escalate the situation.

In my conversation with him, Maurice Taylor did not emphasize the “laziness” of the unions, but rather their high costs. He should have emphasized this point earlier.

The result is that the American media has widely reported on this. France is on the defensive. In the end, the minister’s good arguments were diluted by Maurice Taylor’s accusations which, here, ring true for many.

One does not point out the straw in someone else’s eye when one has a beam in one’s own eye.