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Is the economy alive?

Mark Mardell | 10:30 UK time, Monday, 30 March 2009

marseillestrikesafp226b.jpgThe French economy appears to be in an even worse state than experts predicted, although it is hardly alone in being in that grim condition.

The total number of unemployed has reached 3.6 million, including a rise of 80,800 last month - a 10.4% increase on that month last year.

The government is being asked by the left and the unions to spend more and do more. But are they being asked to poke their fingers into a living organism? More on this near the end of this posting.

The French are again under attack for protectionism, this time from the head of Italy's biggest private employer, Fiat. Sergio Marchionne also attacked the financial help given to car makers in Sweden and Britain.

"These are very dangerous unilateral decisions," Mr Marchionne said at Fiat's annual general meeting in the northern Italian city of Turin, which was targeted by workers protesting redundancy conditions.

sergiomarchionneafp.jpgState funds "put certain players in a privileged position and force the others to fight with their hands tied," he added. "The aid should either go to everyone or to no-one."

His company saw profits plunge by 20% in the last quarter of 2008 and they've been force to lay off workers.

In France, the public mood seems to be swinging behind the call for more aid. I am heading to the country's second largest city, Marseilles, as part of the BBC's coverage of the run-up to this week's G20 summit, where we will see whether the world's leaders will discuss new rules and regulations for the world economy.

But are they interfering with a system so complex, so intertwined that it amounts to a living organism which humans tamper with at their peril? That seems to be the argument in this odd but intriguing blog from the free market Adam Smith institute, which compares the world economy to the natural environment and argues for an economic version of the Gaia theory. We'll see how that goes down with the French unions.


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