Hollande’s dangerous liaisons

By Pieter Cranenbroek – International Politics Blogger

Socialism and Politics in France

On New Year’s Eve, French President François Hollande announced a series of liberal reforms that meant a move away from socialist thinking.

Although the socialist president’s alleged liaison with an actress may have overshadowed his astonishing flirt with liberalism, he would do well to quickly re-join his ideological family. It is Hollande’s profound conviction that France needs to strengthen its economy to keep its influence, but switching to a liberal economic policy will help neither France nor his own position.

The president’s traditional yearend message addressing the nation turned out to be more than mere chit chat. Economic recovery has proved to be slow and fragile and Hollande has seen himself forced to take a number of rather liberal government measures. The first measure that should give the economy a new pulse is the so-called ‘responsibility pact’, which entails lower taxes and fewer constraints for companies in exchange for more jobs. Secondly, Hollande expressed the government’s aim to cut public spending since state expenses have become “too heavy”.

The president of the French central bank publicly backed the proposals by saying they were “precisely what the country needs right now to stimulate economic growth”. The French left, however, reacted furiously with former socialist minister Batho speaking of an “ideological turning-point”, communist party leader Laurent calling it a “betrayal” and the left-leaning media mourning the death of  socialist Hollande.

Social liberal

Hollande has essentially transformed into a social liberal, which is bad news for France. The French economy has proved difficult to reignite and it seems that Hollande has been willing to trade his soul to the devil for an economic miracle. Unfortunately, this has driven Hollande into the arms of right-wing economic policies.

The newly announced plans are classic ways of stimulating supply when the reality is that it is demand that needs to be boosted. Moreover, the responsibility pact is likely to lead to a large low-wage sector with no job security while it is still rather unclear how many jobs the pact will yield. In addition, Hollande’s intention to cut public spending will be another misstep. Contrary to what conservatives want us to believe, the crisis would have been far behind us if it hadn’t been for their austerity. Now is not the time for balancing your budget, there will be plenty of time for that once the economy is out of its slump. Monsieur Hollande, it seems, has decided to back the wrong horse.

More criticism of Hollande arrived from across the Atlantic when American magazine Newsweek published a poorly substantiated critique of the Hollande administration and France in general. Ironically, this helped the president a great deal; partly because it distracted attention away from his persona but mostly because of the lies the article produced.

The article blamed Hollande for France’s sky-high taxes, prices and benefit scheme and argued that they are forcing out the country’s beautiful minds. Author Janine di Giovanni provided no evidence for this except conversations with a few ‘friends’ at the top of the food chain. She then made the wrong assertion that “a great many pay in excess of seventy per cent taxes”, which only applies to companies and salaries over one million euros.

Di Giovanni went on to claim that the French government hands out free nappies and that the price of a litre of milk was six euros, both, of course, absurd. When this led to a national outrage in France, Newsweek responded with a second article accusing France of being an ostrich nation unwilling to face the truth. How about that for some decent journalism?

Ostrich nation

France is, however, not an ostrich nation. The country and its people are well aware of its problems. In fact, if any country can be deemed the ostrich nation par excellence, it would be the United States as, for some reason, Americans continue to believe they are in a position to lecture the world despite their record debt and abysmal welfare state.

France, on the other hand, is simply burdened with a president that has lost his way and has, in an act of desperation, even adopted traditional right-wing rhetoric by saying he will ‘curb welfare abuse’. It is true that France has a projected GDP growth of only 0.9 per cent compared to 1.7 per cent and 2.2 per cent in Germany and Britain respectively, but this is no reason to jump ship. Forget austerity, supply-side reforms, cuts on public spending and welfare ‘abuse’. Leave these ideas to the right. With France’s high unemployment rate and sliding inflation, Hollande’s focus should be on boosting macro-economic demand.

Meanwhile Hollande’s popularity has plummeted to a record low. The president has effectively manoeuvred himself between the devil and the deep blue sea and now faces two choices: he can either stick with his newly adopted family of social liberalism, a path that is unlikely to bring him any fortune, or he could return grovelling to his old family of socialism at the risk of being politically incredible (again).

Whatever he chooses, it is highly improbable that Hollande will come out of this without a scratch and Nicolas Sarkozy is reportedly laughing up his sleeve patiently waiting for the next general election. You could say that Hollande has lately cheated on two women: Valérie, his girlfriend, and Marianne, the feminine personification of the French Republic. For the sake of France, one can only hope that Hollande will at least be able to make things right with the latter.

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