Anne-Elisabeth Moutet on France’s Sclerosis

French “refugee” Anne-Elisabeth Moutet – one of the many French citizens who have fled the economic paralysis of France for the welcoming shores of Albion and made London the sixth-largest French city in the process – has written another very interesting article on the situation in France. She compares the current environment in France to that in Britain in the late 1970s. The main difference is of course that no equivalent to Margaret Thatcher who could pull the cart out of the mud is in sight anywhere. Instead, France has Marine Le Pen waiting in the wings, whose mercantilist, statist economic philosophy is mainly characterized by being just as bad as the socialism of Francois “Welfare State Incarnate” Hollande.

Hollande, who as we previously noted, has nothing to lose anymore given his record low 13% approval rating, has recently replaced the catastrophic crypto-Marxist “economy minister” Arnaud Montebourg with his polar opposite Emmanuel Macron (for details on this, see: “Reform in France – Mission Impossible?”). The latter apparently at least appears to know a thing or two about the laws of economics. He is also not afraid to voice uncomfortable truths in this context, to the chagrin of France’s left, which is howling with righteous indignation. As Ms. Moutet writes:

“France’s new economy minister, 36-year-old Emmanuel Macron, who has been tasked with tackling long-delayed reforms to reverse the country’s decline, is having a hard time. Every statement of his, it seems, provokes a storm of abuse from the politicians to the public.

Mr Macron, a former investment banker who was given his cabinet job less than two months ago, almost immediately suggested that the 35-hour working week – introduced by the Socialist government in 2000 with the aim of reducing unemployment by “sharing” the available work – could be done away with. He was roundly insulted.

Shortly afterward, he mentioned that 20 per cent of a Breton pork abattoir workforce, laid off because of a plant closure, would find it difficult to get new jobs because they were illiterate and couldn’t, for instance, pass a driver’s license exam, barring them from a number of available jobs. The reactions were so venomous that he was nearly punched in the face on the floor of the House by an MP from his own party, Olivier Dussopt. “You’ve grievously insulted my mother! She’s a laborer, she’s got no degree, she’s been laid off twice already!” Mr Macron had to issue a lengthy public apology.

Mr Macron favors workfare over the current long-term benefits handed out to France’s 3.5 million unemployed and suggested in a recent interview that recipients had “duties” as well as “rights”. Cue more outrage, with L’Humanité, the Communist daily, howling that he was hand in hand with the employers’ federation to “guilt” the jobless.

Mr Macron seems to specialize in straight-talking: in identifying core problems of the French economy and naming them. This is making him one of the most unpopular people in France, because saying blunt truths is seen here as an unforgivable act of aggression.

“The banker Macron? We don’t know him, he’s never said or done anything that was remotely of the Left,” the maverick Socialist defector, Jean-Luc Mélenchon, said in a radio interview. “He’s not one of us,” a columnist in the left-leaning Le Nouvel Observateur thundered. “He’s not just from any bank: he’s from Rothschild’s.”

Truth telling certainly seems impolitic in France, but the indignant political left has of course absolutely nothing to offer by way of viable alternatives. After all, its policies have been tried over and over again in France, to disastrous results every time.

New French economy minister Emmanuel Macron: France’s political left is up in arms over the minister’s so far timid attempts to reform the economy that has been run into the ground by socialist policies.

(Photo via gala.fr)

France’s Brezhnevnian Political Elite

As Ms. Moutet notes, French workers are riven by deep anxieties. The surprisingly small number of people actually working in the private sector are scared of losing their jobs, because they know they won’t get anything better. Meanwhile, government State employees, who are essentially are in no danger whatsoever of getting fired, are striking at every opportunity. It seems increasingly likely that even the most basic infrastructure will eventually cease to work. Writes Ms. Moutet:

“The vast majority of the French not directly employed by the state (about one quarter of the workforce) live in a state of pervasive fear of unemployment that is probably impossible to overstate.

One quarter of the under-25s are unemployed; while employers also actively discriminate against over-50s. France is depressed and gloomy. More and more, my native country reminds me of the Britain I knew from my days at school during the Winter of Discontent, those grey and pessimistic times when the joke was that the last person leaving England should remember to turn out the lights. We don’t have power cuts yet, but we have more and more power outages. The French, especially in the public sector, go on strike on the flimsiest of pretexts. Moreover, the country is riven by class envy and doubts most of its public figures.”

France’s youth unemployment rate is testament to the enormous institutional unemployment so-called “pro-labor” regulation has produced in Europe’s welfare states. Among the major economies, France and Italy are the worst offenders in this respect. It is no wonder France’s youth is disillusioned, apathetic and increasingly prone to radicalization, as the surprisingly large number of French youth joining the jihad of ISIS attests to – click to enlarge..

France’s political elite meanwhile has proved quite adept at tapping into this discontent on occasion of Mr. Hollande’s election, but seems otherwise tone-deaf. The attitude seems to be that it is not the political elites that might be at fault. Instead, the voting sheep just don’t know what’s good for them:

“Like Mr Macron, François Hollande is a graduate of the École Nationale d’Administration (ENA), the incestuous, elite civil service school that shapes most French political and economic leaders.Mr Hollande consciously decided to forget economic realism and pandered to the national psychosis to get elected in 2012. “My enemy is finance!” he thundered. He promised more civil service jobs, that he would reverse most of Nicolas Sarkozy’s timid reforms and cuts, and insisted that he “didn’t like the rich”. Embracing their inner sans-culotte (the Left-wing partisans of the French Revolution), French voters seized his cue enthusiastically.

But, soon enough, it became obvious that Mr Hollande was part and parcel of the same comfortable insider crowd that has been entrusted with power in France for decades. Not only was he an énarque – the name given to a graduate of the ENA – who only hired other énarques; he even narrowed it down to giving three dozen top jobs to the friends he had made in his very own ENA class, between 1978 and 1980.

The Brezhnevian intricacies of the tight circles of power in France are imperfectly understood by the population at large, but there’s a certain tone, a way of telling the public that you know what they want better than they do, to which the French have increasingly grown allergic.

The problem is that this attitude is driving French voters in droves into the arms of Ms. Le Pen’s Front National. Sociologist Christophe Guilluy has analyzed this phenomenon with the result that the elites are ignoring and ridiculing his findings, because they are not in line with their view of how society “should” behave. As Ms. Moutet notes in this context:

“Marine Le Pen has tapped into this seething discontent: she now draws as many votes from the disenfranchised Left as from the discontented Right.

This national dismay has been analysed for almost a decade by the young sociologist Christophe Guilluy, now 40, in a series of essays that it has been fashionable to decry in academic and political circles. Mirroring the popular refusal to acknowledge economic reality and accept reform, the elites have dismissed Guilluy’s findings because they don’t tally with their idealized view of how society should behave.”

Mr. Guilluy points out that a kind of modern-day feudalism has developed in France, with the average citizen no longer able to afford to live in the areas where the elites have their residences. As a result, many people have moved out of large cities to the countryside, where living costs are much lower, but job opportunities are even scarcer. These are the people who simply don’t want to live in the banlieus, the crime-infested ghettos of the poor in the big cities.

The political elite is providing a lot of funding to these ghettos to keep people’s discontent there under some degree of control, but it is ignoring the far less unrest-prone portion of the population that has been forced out of the cities. Instead of occasionally rioting, this part of the population is increasingly supporting Marine Le Pen. Her statism is deemed to be attractive, because it promises security. In their boundless arrogance, France’s socialists simply blow off the voters of Ms. Le Pen as “stupid” (i.e., if only they weren’t so uneducated, they would surely support the socialists):

“The Socialists think Le Pen voters are stupid. When they say ‘these are people with not a single diploma’, what they mean is that if they were better educated, they’d vote for them,” Guilluy told the French version of online magazine, Slate. Le Pen’s avowedly statist solutions reassure those voters who feel that France’s declining economic situation mirrors their own. French schools have slipped in the global ratings, and fail some 150,000 children annually; the country’s vaunted infrastructure – trains, even the electrical grid – has started falling apart, because maintenance is neglected in favour of paying a workforce with golden contracts.

[…]

Mr Macron probably knows that a single tweet from his boss isn’t going to resolve the French malaise. When we elected Mr Hollande two and a half years ago, little did we know how fast things could deteriorate. Even hard-won economic success – in our case, Nicolas Sarkozy managing at least to keep things together and running during the financial crisis – can be reversed in moments. All of this feeds even more into the kind of malaise that may eventually get Miss Le Pen elected.”

We think it is rather distressing that the French seem set to exchange one form of statism for another, and one that might easily prove even worse. France was once home to truly great libertarian thinkers and free market economists like Turgot, Bastiat and de Molinari, to name just three of the most prominent. It is a great pity that the French have apparently forgotten the teachings of these men.

Strident right-wing statist Marine le Pen. Her economic program is Mercantilism pure.

(Screenshot via Reuters)

Nevertheless, Mr. Macron is a clear improvement over his predecessor. Whether the new cabinet under prime minister Valls, now that it has been reinforced by Macron, will be able to enact sufficiently far-reaching reforms to pull France out of its economic paralysis remains to be seen. As we have previously noted, the problem is that powerful vested interests from all walks of life as well as a combative workforce are all arrayed against any serious attempts at economic reform. It is even uncertain that the government can count on the support of its own party in parliament. In short, there is an ever greater chance that Ms. Le Pen will indeed come to power in the not-too-distant future.

As an aside, France’s establishment parties are involved in yet another political scandal revolving around ex-president Sarkozy and his recent political comeback efforts.

Conclusion:

France continues to go downhill, and its political elites are seemingly too arrogant to recognize the dangers their policies have wrought. The population’s growing discontent could easily deliver a major wake-up call at the next general election, with a bang. However, no defender of the free market will replace the current crop of political leaders. Instead, yet more statism and economic regimentation await.

Addendum: Anne Robert Jacques Turgot

Readers interested in the writings and speeches of French statesman and economist Anne Robert Jacques Turgot can download a collection of his works for free here (pdf). Turgot is in many respects a “proto-Austrian” and we highly recommend this collection of his oeuvre.