France in Free Fall
by Guy Millière
February 25, 2014 at 4:00 amThe European Commission asked France to avoid new tax hikes, and repeated that France had to bring its public deficit down. Soon France will have to do what needs to be done -- cut taxes and spending; reform the job market and the welfare system, and give entrepreneurs breathing space -- or the consequences could be worse than the strikes and scenes of insurrection.
French President François Hollande was all smiles during his three-day state visit in the United States. Now he is back home, and he does not smile anymore. He cannot escape the reality that France is in extremely bad shape.
On January 26, thousands of people marched through Paris, chanting "Jews, France does not belong to you." Some demonstrators were members of the extreme right. Most of them belonged to the so-called "black white Arab France": young Muslims coming from suburban slums, leftist students and urban professionals imbued with politically correct ideas. Anti-Semitism in France has become so commonplace that it is now a part of the cultural landscape. The event was called "Day of Wrath," a truism, considering that wrath now runs rampant through French society.
Police charge a crowd of rioters at the January 26 "Day of Wrath" protests. (Image source: YouTube "Jour de Colère" screenshot)
On February 2, another protest took place. It brought together a different group of people: Catholic conservatives wanting to defend the traditional family and reaffirm their opposition to gay marriage.
A few weeks earlier, a rebellion against taxes on trucks using French roads mobilized crowds in Brittany's main cities : the rebels wore red caps, the symbol of revolts in the region since an anti-tax uprising in 1675. Some of them were workers furious at factory closures, others were Breton separatists. Several toll booths and cameras designed to monitor the trucks were destroyed. Manure was dumped at official buildings.
Although no large-scale riot has occurred since last fall, every weekend, dozens of cars are burned throughout the country, and violent attacks take place daily.
In October, a report prepared by the Ministry of the Interior spoke of a "widespread and multidimensional frustration" that had not yet crystallized, but could "ignite" anytime soon and lead to "sudden eruptions of fury" or even to a "full scale uprising."
Surveys conducted by the government were recently published in the magazine Valeurs actuelles. They show that "frustration" is reaching an unprecedented level, and directed at a multitude of targets such as "European construction," "globalization," "capitalism," "finance," politics in general, and even democracy, which is rejected by more than 50% of the French. They report a sense of national decline (76% of the French think the country is "terminally ill"), and a growing xenophobic hatred against Muslims, as well as against Jews. They also report a strong desire to see a "strong person" emerge who would restore "order." Twelve percent of respondents explicitly say they want a military dictatorship.
Various economists describe France as the "new sick man of Europe," and they have good reasons to say so. In 2013, 62,000 businesses have closed their doors, and their employees have virtually no hope of finding a new job. Growth has been close to zero for almost a decade. The number of poor now exceeds 9,000,000, more than 15% of the population. The official unemployment rate is higher than 10%, and does not include 2,200,000 beneficiaries of the guaranteed minimum income (RSA) that any adult over twenty-five has the right to collect. Public spending accounts for 57% of GDP, an absolute record in the developed world. Compulsory levies are up to 46% of GDP and are the highest in Europe. Foreign investments fell 77% in 2013. The country's debt is growing at an ever faster pace, and nothing for the moment seems able to stop a movement resembling a free fall.
On January 14, François Hollande spoke of "supply-side reforms": while requesting that companies create jobs now, he promised to lower the costs that now preventing job creation -- but not sooner than 2017.
Economic difficulties are associated with social problems : there are now over 750 "no-go zones" that police dare not enter. Officially, they are called "sensitive urban zones" but the name is not fooling anyone. Crime rates are exploding: a book published last year, France: A Clockwork Orange, explained in detail how the statistical counting rules for recorded crimes were distorted and did not reflect reality.
Social problems go hand-in-hand with a lack of political perspectives. François Hollande was elected President because his predecessor, Nicolas Sarkozy, had reached an unprecedented level of unpopularity (in April 2012, Sarkozy's job approval rating had fallen at 36%), yet Mr. Hollande has now broken that record and is now the most unpopular president in French history. Before his sexual escapades were revealed, his approval rating stood a little over 20%; since then, it has sunk to 19%. During the past eighteen months, the government he formed has increased taxes, multiplied useless regulations, and enacted societal reforms widely rejected by the population, such as the introduction of gay marriage, and removal of mandatory minimum sentences for recidivist criminals. The moderate right stagnates and does not offer proposals that meet with popular approval, either.
One political movement, and only one, seems to escape the general disenchantment: the National Front. When Marine Le Pen, its president, took over the party, she claimed she wanted to conduct an operation of "de-demonization" and she was successful. Municipal elections in March and European elections in May will probably show that the National Front is now the first party of France. Unlike her father, Jean Marie Le Pen, Marine Le Pen does not publicly utter anti-Semitic remarks, but neither does she ever condemn anti-Semitism. She has criticized Islam in the past, but does not do it anymore. She intends to build on the "widespread and multidimensional frustration," and not alienate anyone.
She says she is resolutely hostile to the "European construction," "globalization," "capitalism," "finance" and politics as practiced by all other parties: she calls them "members of the system." She does not say she is hostile to democracy, but uses words used decades ago by the rightist anti-parliamentarist Charles Maurras, such as describing herself as embodying the "real country" [pays réel].
She recognizes that the present mindset of the population is socialist, and she has an economic program that could be accepted by the far-left if it did not include nationalist and xenophobic dimensions. She is an ardent defender of the French welfare system, but wants to reserve welfare benefits for French citizens. She also wants to shut the borders and stop non-white immigration. Her chief economic advisor, Florian Philippot, now number two in the party, comes from the "souverainist" anti-capitalist wing of the Socialist Party.
Her foreign policy orientations show an inclination for authoritarian governments and she seems to favor closer ties with Putin's Russia and Iran's mullahs: Aymeric Chauprade, her foreign policy mentor, was a professor at the French Military College in Paris until he was let go in 2009 after publishing a book "explaining" how the 9/11 attacks were an "orchestrated American-Israeli conspiracy."
She knows that France is ailing. She waits. She thinks her time will come, perhaps in the next presidential elections, which will be held in France three years from now. The rejection of François Hollande is currently such that his chances of being reelected seem nil. The right wing candidate will most likely be Nicolas Sarkozy, the man François Hollande defeated in 2012.
Widespread frustration does not appear to be subsiding -- and changing that would require a dramatic turnaround which will almost certainly not happen.
The most widely read economic books in France are the works of unrepentant Marxists.
The main nonfiction best seller of the last ten years is called Indignez-vous [Time for Outrage]. It is short -- a dozen pages. It is a "call to the spirit of resistance" and a denunciation of the power of "money," "free markets," America and Israel. Its author, Stéphane Hessel, who died in February 2013 at the age of ninety-five, had become a media star. He never was a soldier, but he was buried with military honors. Another book that became a best seller a few months ago, L'identité Malheureuse [The Unhappy Identity] by Alain Finkielkraut, describes a "France that is crumbling before our very eyes." The book offers no solution; Finkielkraut was harshly criticized by those who still admire Stéphane Hessel.
In 2013, 285,000 people left France -- twice as many as the previous year. They include many Jews who discern that the social climate is unhealthy; entrepreneurs who consider the situation hopeless, and young graduates who think they have no future in France.
The largest number of European jihadists in Syria -- more than 380, according to police documents -- come from France. Most of them are recent converts to Islam. Some will die, some will return home.
In November of 2013, Standard & Poor's cut France's sovereign debt rating from AA+ to AA. A few days later, Moody's also also stripped France of its AAA, cutting it to AA1. And the next day, the OECD weighed in, saying that France was falling behind southern European countries.
At the same time, the European Commission asked France to avoid new tax hikes, and repeated that France had to bring its public deficit down to the EU threshold of 3% of GDP before January 1, 2015.
Soon, therefore, the French government will have no choice, and will have to do what needs to be done -- cut taxes and spending; reform the job market and the welfare system, and give entrepreneurs breathing space -- even if it means strikes and scenes of insurrection -- or face the consequences, which could be even worse than strikes and insurrection.