François Fillon has been a little more present in the media since the
rentrée. Perhaps he feels that he had been rather more self-effacing than necessary: he seemed to bristle when the president referred to him as
un collaborateur, and he told the press that he was more than a mere underling, that he enjoyed a "legitimacy" of his own by virtue of his election by universal suffrage. Or perhaps Sarkozy has taken to heart all the editorials urging him to protect himself by using the prime minister as
un fusible. Of course Sarko, not having been born yesterday, knows that when the "fuse" blows, those same editorialists will be the first to say that the fault wasn't really the prime minister's but rests squarely with the president. Nevertheless, he did make a point of several times invoking the prime minister's name at a number of recent press opportunities. Still, whenever Sarko says "
moi et le premier ministre," the implied pat on the back has a way of seeming rather forced.
In any case,
Fillon has just appeared before the press on his own. His performance was somewhat mixed. On the one hand he seemed to issue yet another mild rebuke to finance minister Christine Lagarde, whose adaptation from high-flying legal counsel to politician and minister has not been as smooth as it might have been. When the OECD revised its growth estimate for France downward the other day, Lagarde said that the indicators on her control panel were still all green and therefore policy would proceed at full throttle. Fillon managed to say exactly the same thing without seeming quite so dismissive of the OECD and the fact that a global liquidity crisis that hadn't been foreseen when the policy was designed now looms large on the horizons of investors. And, as everyone has known since James Carville's famous quip--"When I die, I want to come back as the bond market, because that's where the power is"--governments taking steps to increase their deficit cannot afford to ignore investor sentiment. So Fillon said, as Lagarde had, that it would be full speed ahead with policy, because "a commitment had been made," but that the government was aware of the reduced growth estimates and would be keeping an eye on things.
All well and good, except that the interpretation he went on to give probably raised more investor hackles than Lagarde's cavalier attitude. The intent of detaxing overtime was precisely to stimulate growth, Fillon observed, but if that didn't take care of things, the government stood ready to "go further." Two things can be said about this. If GDP growth really has dropped 0.7 points on an annualized basis, tinkering with overtime isn't going to fix it. And whatever effect the tinkering has will reveal itself only after some lag, so Fillon's notion of chasing the needle on the GDP speedometer isn't going to yield very smart adaptations. Lagarde was actually closer to the truth when she suggested that the OECD's numbers might be less real than apparent, a reflection of the usual noise in the economic data. A single quarter's drop is not sufficient basis for a policy overhaul.
Of course it's unfair to scrutinize political communications like Fillon's and Lagarde's as though they were meant seriously as economic analysis. Still, there does seem to be a difference of appreciation here, and there is certainly a lack of transparency. It would be useful to the public, and useful to the government itself, if it were clearer about what it thinks its tax package will achieve, and when. The campaign is over; the policy has been sold. Now it has to be managed, and that will take some clarity.
