Wednesday, August 31, 2011

DSK and "the Jews"

The CSA has sanctioned a radio station, Sud Radio, for repeatedly asking listeners the question, "Is DSK supported by the Jews?" (More details here.) A more pertinent question today might be, "Is DSK supported by the Socialists?" With party leader Martine Aubry in the lead, most party stalwarts seem to be backing away from their initial "relief" and "joy" at DSK's liberation, as they begin to take stock of the ways in which his return to France, now scheduled for Sunday morning, complicates the Socialist primary.

NPA: The End Is Nigh?

Mediapart looks at the NPA, which is now apparently split between two factions, one of which believes that the Final Crisis of Capitalism is upon us, that a revolutionary situation is at hand, and that therefore ... the workers of the world must unite in opposition to the Front de Gauche led by Jean-Luc Mélenchon, whereas the other half thinks that its bit of the extreme left ought to be represented in the presidential voting and therefore wants to support Mélenchon.
Parmi eux, Ingrid Hayes, membre du comité exécutif, et «entre rage et inquiétude». D'ordinaire mesurée devant la presse, elle fait cette fois claquer les mots. «Il y a un aspect de gâchis dont j'ai du mal à me remettre. Et une inquiétude parce que ce qui est engagé, c'est la possibilité de survie du courant dans lequel je me suis engagée il y a dix ans», dit-elle d'emblée.
Elle enchaîne: «La seule fonction de la candidature de Philippe Poutou est d'installer une majorité sectaire à la tête du NPA, avec des courants révolutionnaristes hostiles au projet initial du NPA. Ils veulent faire autre chose: un énième groupuscule d'extrême gauche qui essaie de rassembler les courants trotskistes. Cette candidature est aux antipodes de ce qu'on avait tenté de faire et je ne vois pas sa fonctionnalité politique: elle ne sert à rien; il y a déjà Lutte ouvrière.»

Courants révolutionnaristes! First time I've encountered that adjective, and I'm not sure how I'd translate it into English: "revolutionarist" would be a mouthful to pronounce, let alone unpack ideologically. But just as there is a pejorative nuance between "Trotskyist" and "Trotskyite," I guess there is now a derogatory distinction between "revolutionary" and "revolutionarist." Or perhaps, from the revolutionarist perspective, one should call the other faction the "revolutionarites." Or revolutionaries lite.

So You Want to Marry a French Peasant

There's a Web site for you.

Tuesday, August 30, 2011

Aubry Calibrates Her Response to DSK Question

Martine Aubry's advisors must have sweated over this one: with polls showing that Dominique Strauss-Kahn is decidedly unpopular among the people--more unpopular even than Sarkozy--but Socialist elephants falling all over themselves to express their "joy" at his liberation, what is a candidate to do? For Aubry, the answer is to walk a fine line between "no proof of guilt" and "but he's still a macho creep," though the second part has to be put a little less bluntly for the sake of party unity:

Priée sur Canal+ de dire sI elle était au courant du retour prochain de DSK, la candidate à la primaire socialiste a répondu: «Il rentre dans les jours qui viennent.» «J'ai toujours dit la même chose: premièrement, la présomption d'innocence, deuxièmement, je pense la même chose que beaucoup de femmes sur l'attitude de Dominique Strauss-Kahn vis-à-vis des femmes», a-t-elle ajouté.

And of course this has the added advantage of digging at rival François Hollande, who can't get himself off the hook by saying he thinks what other women think.

DSK SVU

I predicted this back in May: the TV series "Special Victims Unit" will air an episode based on the DSK affair in September--in the U.S.

As for France:

En France, New York Unité spéciale est diffusée par TF1. La chaîne osera-t-elle programmer l'épisode inspiré du scandale du Sofitel: «Nous ne l'avons pas encore visionné, affirme-t-on à TF1. On n'en est qu'à la diffusion de la douzième saison. Le temps de réaliser les doublages, la treizième ne devrait pas arriver à l'antenne avant 2012.» La télé française est plus timide avec l'histoire contemporaine que les réseaux d'Outre-Atlantique. Josée Dayan a expliqué récemment qu'il était «inenvisageable de traiter d'un sujet si personnel et si douloureux». En revanche, Bruno Gaccio, ex-auteur desGuignols ne cache pas son intérêt pour l'affaire DSK.

The Socialist Primary: A Fictional Take

François Marty imagines a Socialist primary in which Hollande wins the first round handily but is, improbably, defeated in the second round. Despite strong suspicions of foul play, Hollande is forced to concede for the sake of the party, in order to avoid certain defeat in the presidential election. He does so with a certain grace, like Al Gore conceding to George W. Bush in 2000. And we know where grace got us that time.

Fiction?

Poverty Increasing in France

Details here. The full INSEE report can be read here.




Monday, August 29, 2011

Rocard: DSK Is "Obviously Mentally Ill"

Lors de l'émission Le Grand Journal de Canal+, M. Rocard a déclaré : "Cet homme a visiblement une maladie mentale", éprouvant des "difficultés à maîtriser ses pulsions. C'est dommage, il avait un vrai talent, c'est vrai".





See at 10:55 in the clip below:

Veuillez installer Flash Player pour lire la vidéo

Greenpeace Rates the Candidates

Greenpeace rates the candidates on a variety of green-related issues. The overall rating is worthless, because a number of the candidates did not respond on specific issues or have not taken public positions. But the answers to questions in specific categories will give you a sense of each candidate's overall orientation. I am not in sympathy with Greenpeace's overall orientation, so these aren't the questions I would have asked, however. In particular, I disagree with the intransigent anti-nuclear line. A more finally nuanced policy on nuclear power is essential, given France's current heavy reliance on nuclear for electricity, and this is one thing I will be looking for as the campaign proceeds. The nuclear industry is also one in which France holds a significant comparative advantage.

Be patient. The Greenpeace Web app is rather slow in moving from question to question.

Obama Coordinating with Europe, IMF, Fed?

It seems that Barack Obama has been working behind the scenes to persuade Angela Merkel to emphasize austerity a little less and stimulus a little more. He's also been talking to Ben Bernanke and Christine Lagarde, both of whom have recently said that the global economy is slowing and more stimulus action by governments is needed. Now, if only he could bring the ECB on board (see previous post), and if only these commitments were more substantial than they are likely to be, we might be getting somewhere.

Surowiecki Slams the ECB

Criticizing the European Central Bank is easy sport, and James Surowiecki doesn't break a sweat doing it.

Critique of Mélenchon Economic Policies

My friends at The Current Moment analyze Jean-Luc Mélenchon's approach to the European debt crisis and find it wanting.

Will Ségo Be the Spoiler?

The media love a duel, so the Hollande-Aubry contest, with the former ahead by a nose--no a head, no a neck, no a length and a half--has filled the papers, but some rumblings out of La Rochelle suggest that Ségolène Royal may be making a run from behind:

On peut entendre cette phrase aussi bien dans la bouche de proches de Benoît Hamon que dans celle du strausskahnien Jean-Marie Le Guen:«Ségolène sera au deuxième tour, contre Aubry ou Hollande.» D'autres, comme le proche d'Aubry, François Lamy, qui voit «évidemment un score à deux chiffres», ne croient pas à l'aura retrouvée de la candidate à la présidentielle de 2007, jugeant son isolement depuis comme trop handicapant.
An SR victory would upset many applecarts. It would be interesting, if only to see whether the PS éléphants could this time overcome their collective revulsion to, you know, actually support their candidate. But who counts the primary votes? Because I recall that in the party leadership contest, the vote-counting was not quite kosher--and I'm not talking about hanging-chad problems. More like Richard J. Daley-style box-stuffing and ballot-stealing.

Sunday, August 28, 2011

Jean-Michel Baylet

The sixth man in the Socialist primary, profiled here. He belongs not to the PS but to the PRG and is credited with only 1% in the polls.

Paul Yonnet Has Died

The sociologist Paul Yonnet has died.

Macé Scarron, Recidivist in Plagiarism

Joseph Macé Scarron's adventures in plagiarism--or "intertextuality," as he prefers to call it (hey, "French theory" is useful after all!--apparently didn't begin with his last novel. At least four previous instances have been identified, going back to his first novel in 1998.

Saturday, August 27, 2011

Lagarde Takes Note of Danger of Second Recession

I am pleased to note that Christine Lagarde seems to be placing greater emphasis on the risk of a double-dip recession and is stressing the idea that, while debt reduction is a proper long-term goal, the immediate need is for rapid action to support growth as well as for accomodative monetary policy given currently low inflation risks:

"La politique macroéconomique doit soutenir la croissance", a souligné l'ancienne ministre française des Finances dans son premier grand discours depuis sa prise de fonction à la tête du FMI en juillet.
"La politique monétaire doit aussi rester extrêmement souple parce que le risque d'une récession est plus élevé que celui de l'inflation."
This is a clearer statement of priorities than I, at least, read in her recent FT article and a different picture from the one painted in the Forbes profile of the new IMF head.

Hoist by Their Own Petard

It's rather amusing, really: the Bush administration closely followed the genetically modified organism debate in France and worried that French anxieties would harm US interests. So here was a case where the French refused to believe the assurances of scientists that the GMO in question, manufactured by Monsanto, were harmless. But of course the Bush administration at home did everything it could to undermine the authority of scientists in a number of areas (global warming, stem cell research, etc.).

Now, I happen to think that far too many people in France are far too exercised about a small number of potential harms: GMOs, cell-phone towers, etc. To be sure, caution is always wise, but I also believe that it is possible to be too cautious. Yet if there is to be any fair and reasonable assessment of risks and benefits, some forms of authority must be accredited. And with the American right-wing assiduously undermining scientific authority for ideological reasons and the French eco-fringe just as assiduously attacking scientific authority for different ideological reasons, there are certain to be any number of issues in which the two converge to produce undesirable outcomes. And so we are treated to the comedy revealed by Wikileaks.

Mélenchon Addresses les Cocos

Jean-Luc Mélenchon rolled out the rhetorical heavy artillery for the Communist Party's Summer School:

Le "camarade Jean-Luc" en fait des tonnes pour montrer qu'il est presque un communiste comme les autres : référence à la doxa marxiste, évocation de la révolution de 1917, au "coeur battant de la Résistance" ; il parle même de "dictature de l'intérêt général contre la dictature de l'argent"... tout y est. Un rien cabotin, il lance : "Nous sommes des êtres conscients réunis par un pacte politique et pas par le charisme d'un leader." Ajoutant : "Je vais regretter les moments où je pouvais dire "je" et où je pouvais n'être démenti que par moi. A partir du moment où je vais dire "nous", je vais devoir vous demander à chacun si vous êtes d'accord."
I still remember the first time I was exposed to an evocation of the PCF's great lieux de mémoire. It was in a most unlikely setting--a seminar room at Harvard--and the speaker was Henri Krasucki. By the end of it, I was nearly in tears: le parti des 75 000 fusillés, les déportations (Krasucki's father died at Birkenau), les journées nationales de grève, la lutte des classes. Such emotional fellows, les cocos. And such a long way from the young American's image of "Marxist intellectuals" and "Soviet marshals and commissars." This was politics as soap opera. Most entertaining, and in the right setting I imagine rather effective. But that was 30 years ago. I wonder if this imagery still works on the young.

Polls and Feedback

Rue89 has a good piece on the effect of polling on primary voters. The argument is simple: had it not been for polls showing that Ségolène Royal was the best-placed Socialist candidate to beat Sarkozy in 2007, she wouldn't have won the primary, and look how that worked out.

Indeed, as the article points out, when ideological differences between candidates are small, primary voters tend to be unduly influenced by horse-race polling, which is notoriously inaccurate. After all, none of the contenders has really been tested against the true opposition, voters are notoriously fickle, and much can happen in the many months between now and the presidential election.

At the moment, François Hollande appears to enjoy a not insignificant lead both in polling against Sarkozy and in comparison with other Socialist candidates. This probably reflects his assiduous efforts: by campaigning constantly, he has kept his name in the news and not just at the national level. One can't accuse him of not working hard for the nomination. Are there other factors? Does he seem a more likely "incarnation" of the presidency than his rivals? Are primary voters, disappointed with their choice of a woman last time around, looking for a man this time? Has Aubry failed to convince or connect?

I really don't know. The polling methodologies in France are too various and haphazard to have much confidence in their ability to pick winners or even to identify likely primary voters (France needs a poll critic like Nate Silver in the U.S., who can separate the wheat from the chaff). I frankly don't sense much enthusiasm among my Socialist friends for either Aubry or Hollande. Faute de mieux, either one will do. The primary campaign hasn't stirred much of a debate yet about anything important, and both leading candidates are cautious in the extreme, as well as seasoned enough to avoid major gaffes. So we just have to wait to see who staggers across the finish line first. As for Montebourg, Valls, Royal, and the other guy (Baylet, qui ça?), yeah, sure, anything could happen, but ...

"Society of Equals" by Pierre Rosanvallon

Sylvain Bourmeau interviews Pierre Rosanvallon about his new book, La Sociéte des égaux, which happens to be what I'm translating at the moment. Unfortunately, you have to be a Libé subscriber to read this, and I'm not. If you're in France, do buy the book (just out, I believe): it's Rosanvallon at his best.

Hurricane Warning

As you probably know, Hurricane Irene is headed for the Boston area, so I may find myself without power or Internet or both for an indeterminate period. If the blog suddenly disappears, blame the hurricane. But I'll be back whenever life returns to normal.

Friday, August 26, 2011

Not Your Grandfather's Primary

Variae has a little fun with the latest dérapage of Cambadélis.

Les beaufs parlent

It's one thing for sober scholars like me to ponder the mysteries of sex and power, but we should really listen to the experts like Patrick Sébastien, le beauf par excellence et échangiste par-dessus le marché:
En ce moment, je suis en train de répéter avec des comédiens. J’avais dix jours off, j’en ai profité pour écrire une pièce. C’est l’histoire d’une femme de chambre dans un hôtel de luxe qui sort à poil de sa salle de bain et viole un mec. Ma petite troupe va jouer dans des cafés-théâtres.

F.-S. Vous faites donc référence à Dominique Strauss-Kahn ?P. S. C’est le juste retour des choses. Quand je vois les mecs qui parlent d’innocence vis-à-vis de DSK, ça me fait gerber. On ne sait pas ce qui s’est passé. La seule chose qui est sûre, c’est qu’il l’a sautée. Les socialistes n’ont pas intérêt à s’emballer là-dessus. Les gens que je croise dans la vraie vie savent que blanchiment et innocence, ce n’est pas la même chose. D’ailleurs, DSQ sera l’un des personnages de mon spectacle.
F.-S. Qui allez-vous soutenir politiquement en 2012 ?P. S. J’ai une tendresse particulière pour François Hollande. Je ne dirai pas aux gens de voter pour lui parce que ce n’est pas mon rôle. Mais le travail de Sarko, tel qu’il le fait aujourd’hui, me plaît. Je ne fais pas de politique, je fais de l’humanisme. J’ai la chance d’avoir de bons rapports avec les politiques, je les rencontre en tête à tête.

I mean, what else is there to say?

Tax Gadgets

Historian Nicolas Delalande looks at Fillon's austerity package in the light of a long French history of camouflage of the state's budgetary needs.


Dans l'histoire, les taxes gadgets et les impôts incongrus ne manquent pas. Avez-vous des exemples en tête ?

Après la guerre de 1870, la France a connu un grand moment d'inventivité fiscale dans un contexte où la bourgeoisie refusait l'adoption d'un impôt sur le revenu. C'est l'époque de la taxe sur les billards et sur les cercles de jeux. On imagine aussi une taxe sur les célibataires qui ne verra finalement pas le jour ainsi qu'une taxe sur les domestiques, considérés comme un signe extérieur de richesse. On a également évoqué une taxe sur les pianos et sur les vélos, qui étaient à l'époque des biens de luxe.
Après la Première Guerre mondiale et au début des années 1920, de nouveaux projets de taxes plus ou moins loufoques sont annoncés tous les mois : taxer les biens oisifs, les œuvres d'art, etc. C'est souvent le signe d'une absence de clarté et d'un manque de courage politique car on contourne ainsi les vrais enjeux du débat démocratique sur la fiscalité. C'est également un moyen d'augmenter discrètement la pression fiscale sur les consommateurs, sans avancer à visage découvert.

New Republic Article

I have an article in The New Republic on the political aftermath of the DSK affair. The lurid title is not mine, however. (Scratch that: at my request, they've changed the title.)

Villepin Mediated for Libyans

Dominique de Villepin revealed today that he had acted as a mediator between the Libyan rebels and representatives of Qaddafi. Nothing came of the talks, he said. Sarkozy was kept informed.

Thursday, August 25, 2011

Bayrou Draws Blood

François Bayrou has a bright future ahead of him as a polemicist. This rejoinder to Alain Minc is brilliant:
Je ne me plains pas d’Alain Minc. Au contraire. Il est bon d’avoir des ennemis déclarés, car vos ennemis en disent autant sur vous que vos amis.
D’habitude, on a les ennemis qu’on peut. Moi j’ai la chance d’avoir en Alain Minc l’ennemi dont on rêve, celui qu’on choisirait si on avait à choisir.
Tous les explorateurs vous le diront : il y a deux sortes de boussoles rassurantes. Celles, rares, qui ne trompent jamais et qui vous montrent fidèlement le nord même dans la pire des tempêtes magnétiques. Et, tout aussi précieuses, les boussoles qui se trompent absolument toujours et qui, quelles que soient les évidences, vous désignent, obstinément et avec assurance, le sud. Ce sont les boussoles méridianopètes. C’est Minc. C’est lui qui nous berçait avec « la mondialisation heureuse » ; c’est lui qui nous fit choisir le Minitel au lieu d’Internet ; c’est lui qui dans le mois qui suivit la crise des subprimes diagnostiqua avec sagacité que cette crise était « grotesquement psychologique. C’est de lui que Carlo de Benedetti, qu’il ruina en moins de temps qu’il n’en faut à un curé de campagne pour lire son bréviaire, dit : « Faire de lui un chef d’entreprise, c’est comme confier à un sociologue la gestion d’une charcuterie. » C’est pourquoi quand Minc est en désaccord avec moi, j’en éprouve une sorte d’aise, je me dis que je dois voir plutôt juste.

Unemployment Up Again


Troisième mois consécutif de hausse du chômage en France

Le nombre de demandeurs d'emploi atteint en France son plus haut niveau depuis février 2000, après une nouvelle hausse du chômage, de 1,3 %, au mois de juillet. 2 756 500 demandeurs d'emploi de catégorie A ont été recensés, selon les chiffres publiés jeudi par le ministère du travail. (avec AFP)

Eric Fassin on the DSK Affair

He and I plainly disagree. Here is Eric:

L’abandon des charges contre Dominique Strauss-Kahn confirme une vérité indéniable : aux Etats-Unis, la logique d’un procureur est d’abord politique. Dans cette affaire, il poursuivait sans pitié tant qu’il comptait gagner gros ; dès lors qu’il estime n’avoir qu’à y perdre, il renonce sans états d’âme.


The concept of "beyond a reasonable doubt" seems not to make an impression even on the most brilliant and best-informed French observers of the United States, of whom Eric is surely one. In my view, Vance dropped the case not because he feared losing it but because he believed that going to court with a witness about whose testimony he had developed "reasonable doubts" would have been an abuse of prosecutorial power. However unlikely, he might have won such a case by carefully selecting a jury and playing to its prejudices (against a Frenchman, a wealthy banker, etc.). But such a victory would have been unconscionable.


UPDATE: Meanwhile, even noted feminist columnist Katha Pollitt reluctantly concedes she would have been forced to vote for acquittal had she been a juror.

Nobel Critique of European Governments

From Edmund Phelps:

In corporatist Europe, a new sort of alliance has emerged. The politicians want sovereign bonds rated risk-free in order to be able to borrow at very low interest rates and the banks want sovereign debt to be rated so risk-free that no capital is required against bank holdings of these assets. This was accomplished through an implicit commitment to bail out a government in the event that it has serious difficulty servicing its sovereign debt. This alliance may seem to benefit the insiders, both the politicians and the banks. But the implicit bond guarantees impose costs on the public. The economic system would work better if creditors bore the risk of the state’s default and set interest rates correspondingly high. That way, the state would no longer have an artificial advantage in debt markets over the private enterprises that borrow – an advantage on top of the advantage the state derives from its size and whatever reputation it can establish. And the governments will no longer be subsidized to take the risks caused by heavy debt levels.

Nobel Support for Sarkozy

From Robert Mundell:

The Sarkozy Proposals for reform of the international monetary system have addressed three problems: the instability of raw material prices, the instability of major exchange rates and the need for improved governance of the system. This critique is correct in my view and could be addressed if the dollar-euro rate were stabilized within limits with monetary coordination between the Fed and the ECB. The stabilization could be achieved with each country supporting the other countries currency at its lower bound. China could join the group to make it a triad, the DEY, which could be designated for a renewable period of ten years as the anchor for a global currency in which all IMF members are included.
Hmm. Sarkozy Proposals, in capital letters, no less. I guess I'll have to read the paper, still under embargo.

Austerity Comes to France

The man formerly known as "le hyperprésident," who liked to keep his "collaborateur" the prime minister discreetly in the background, yesterday allowed M. Fillon, whom he had once rebuked for saying that "France is bankrupt," to step forward and take full credit for bringing austerity to France. A good summary of the new taxes and other austerity measures can be found in English here. Two of Sarkozy's signature measures have now been fully undone. The detaxation of overtime is finished, at least on the employer's side, which means that there is no further incentive for employers to increase overtime hours (if there ever was one. So much for travailler plus pour gagner plus. And the tax shield reform, already rolled back, has now been replaced by a supplemental tax on high incomes. So much for incentives to the alleged "job creators."

In short, Sarkozy's version of neoliberalism is now finished, and France has entered the era of fiscal austerity. That this move comes at precisely the wrong moment, as growth has slowed to a standstill, doesn't seem to bother anyone in the government, so tight is the grip of conventional wisdom and so vivid the delusion of virtuous suffering that no one can quite believe that anything but good can come of the turn to rigor.

Of course there may be political method to economic madness. Conventional wisdom also says that to introduce rigor eight months before an election is to ensure defeat. But what Sarkozy has done is to deprive the left of its most potent campaign themes: that he is the president of la bande de Fouquet's, that he has piled up huge debts, etc. He also forces the left to fight on his terrain, and the Socialists seem eager to fall into the trap, since they, too, are speaking of nothing but sober budget management. Each candidate is vying to be "more responsible" than the next. One can only imagine the tediousness of debates between the slashers and the cutters. It's almost enough to make one long for les années folles of presidential junkets to Luxor. But those days are gone forever.

My Le Monde op-ed on American Justice

Le Monde invited me to do an op-ed on the DSK fair. I compare French and American justice here.

Wednesday, August 24, 2011

Collateral Damage of DSK Affair: Socialist Enthusiasm

Take a look at the CSA poll result below. Notice that the proportion of respondents who say that they will "probably or certainly" vote in the PS primary has dropped steadily since DSK's arrest in may.


Profile of Christine Lagarde

Here:

Not a moment too soon, given a world in financial turmoil and an IMF shaken to its core by the scandal of her predecessor, Dominique Strauss-Kahn, who resigned over allegations of sexual assault in May. A moderate Socialist, DSK pushed for lenient fiscal policies and stringent financial regulations and opposed austerity programs in beleaguered euro zone economies like Ireland, Portugal and Greece. Lagarde, an unabashed free marketer, takes a much flintier approach to the crisis. It’s time, she says, to return the IMF to its roots, “that fiscal consolidation line, which I think is right.”

Uh-oh.

"The French FDR"

DSK's team apparently had it all figured out. He was to resign from the IMF in late June, announce his candidacy on June 28, preceded by a "blitzkrieg" in the last two weeks of June, positioning himself as "the French FDR," savior in a time of crisis. With Laurent Fabius as his campaign manager!

The best laid plans ... I especially like the idea of taking it easy through the summer. I've always thought that DSK was a lazy politician with little taste for the thousand indignities of campaigning (who can blame him for that?). A blitzkrieg campaign followed by a sequence of stealthy appearances would have been just his style.

Gros: Eurobonds are not the answer

Daniel Gros argues that eurobonds are not the answer to the crisis of the euro. He makes several points, the last and most important of which is "quality of governance":

These differences in the quality of governance, more than any technical problems, are probably the reason why the electorate in Northern Europe is sceptical about Eurobonds. With these fundamental differences in the way different member countries work it would in practice be impossible to conduct a unified fiscal policy even if the post of a Eurozone finance minister were created.
UPDATE: another, similar critique of the eurobond idea here,  from Yannis Palaiologos.

False Hopes

European stock markets are rising again on hopes that the US Federal Reserve will soon initiative a third round of "quantitative easing." This is foolish. QE1 and 2 were hardly models of effectiveness, and the Japanese central bank has amply proven that expanding the money supply, though undoubtedly the right thing to do in a slump, cannot by itself turn things around: the famous "pushing on a string" analogy is, alas, more than just a metaphor. But Europeans seem to like grasping at American straws, while Americans persist in their Lafferish delusion that tax-cutters walk on water. It would be more useful, perhaps, if Europeans could prevail upon their own central bankers to ease up on their side of the Atlantic. The euro is too high against the dollar, and European inflation is too low. The IMF has recommended higher inflation targeting as one way to reduce the danger of overhanging debt, but the cry has gone unheard in the European wilderness. Indeed, continental inflation rates have begun to diverge from US and UK inflation rates:

(Source: FRED CPI data)

Europe needs to raise its inflation rate and depreciate its currency. It can't count on the Federal Reserve.

Pascal Bruckner Délire

Pascal Bruckner is a writer who often has interesting and provocative things to say, but something about the United States seems to have unhinged him. He thinks he sees an "alliance du féminisme et de la droite républicaine, ultra conservatrice. Ces deux forces se sont unies, au nom d'intérêts différents, pour refermer le couvercle ouvert par les années 60-70." The old saw of America's "puritanism" is revisited, but only to assert that its existence is proved by its antithesis: "La qualifier de puritaine ne suffit pas car c'est un puritanisme retors, d'après la révolution des mœurs, qui parle le langage de la liberté amoureuse et coexiste avec une industrie pornographique florissante." It was absurd to have charged DSK with rape because America is guilty of so many crimes of its own:

Il semble que l'establishment médiatique d'outre-Atlantique, si prompt àcondamner la France à travers l'un de ses représentants, ait déjà oublié les tortures d'Abou Grahib : des grappes d'hommes nus entassés les uns sur les autres ou forcés de se masturber, sous les ordres, notamment, de la sergente Lynndie England qui en tenait certains en laisse (les femmes, en position de pouvoir ne sont pas meilleures que les hommes, on le sait depuis le nazisme). La torture existe partout, même dans les nations démocratiques, mais seul un pays malade de sa sexualité peut imaginer de tels sévices. On s'étonnera par ailleurs que Dick Cheney et Donald Rumsfeld, soupçonnés de corruption et d'incitation aux interrogatoires violents, n'aient pas été poursuivis, après 2008, par la justice de leur pays toujours encline à sanctionner la moindre peccadille amoureuse.
And so we are back where we began in the DSK affair, with a member of the French elite excusing a sordid hotel-room encounter as une peccadille amoureuse. Amoureuse! Even the defense admits that whatever transpired between the naked Strauss-Kahn and the chambermaid wearing two pairs of tattered pantyhose was confined to an interval of nine minutes maximum. It is hard to imagine the part played by amour in such an encounter.

Bruckner tries to redeem himself in the end by allowing that, despite its depravity, America knows the difference between rape and la moindre peccadille amoureuse, as does France:

Entendons-nous : de part et d'autre de l'Atlantique le viol est un crime, le harcèlement un délit et c'est un progrès objectif. De part et d'autre, les tensions entre hommes et femmes, consécutives à l'émancipation, demeurent et s'exacerbent parfois. Mais tandis qu'aux Etats-Unis, cette coexistence semble toujours au bord de la guerre, sous l'œil vigilant des avocats prêts à faire les poches des époux désunis, l'Europe latine semble mieux protégée de ce fléau par une culture ancienne de la conversation et une tolérance aux faiblesses humaines.
On croit rêver. Some in France seem to have learned nothing from this whole sordid affair. Fortunately, it seems clear that most of M. Bruckner's countrymen are not quite so broad-minded in their "tolerance of human weakness." France2 reported last night that DSK's approval rating has plummeted from 52% before his arrest to 28% today. And The Times reports that

Gérard Grunberg, a political scientist who studies the left in France, said that Mr. Strauss-Kahn’s “image in public opinion is very damaged” and the Socialist Party itself, already annoyed with him for ruining an important political opportunity to challenge Mr. Sarkozy and with its primary soon, “does not want to have this collective occasion spoiled.”
Let's hope that Pascal Bruckner represents the embittered few rather than the sober majority.

Tuesday, August 23, 2011

Habermas Blasts the European Elite

Jürgen Habermas believes that there will be no solution to the debt crisis without a prior solution of the deficit crisis--the "democratic deficit," that is:

“The process of European integration, which has always taken place over the heads of the population, has now reached a dead end,” Mr. Habermas said at a forum hosted by the European Council on Foreign Relations. “It cannot go any further without switching from its usual administrative mode to one of greater public involvement.”
The political elites “are burying their heads in the sand,” he said, adding, “They are doggedly persisting with their elitist project and the disenfranchisement of the European population.”

Political Novelist Admits Plagiarism

Joseph Macé-Scaron has admitted to plagiarizing parts of his much-praised novel, Ticket d'entrée, from an American work by Bill Bryson. Macé-Scaron's work is of political interest because it is un roman à clef that purports to reveal political pressures on the world of journalism, which the author knows from the inside as the former editor of Le Figaro magazine among other publications. He was forced out of his job at the magazine when a new owner took over. A similar story is recounted in the novel, which I had just begun to read when the plagiarism story broke. The book also offers a tour of the Parisian homosexual community. It's hard to see what an American writer would have had to offer to either of these themes, but the author has confessed.

Factoids

Two interesting observations from a generally interesting post by Bernard Girard:
Le médicament représente à peu près 20% du coût de la santé en France). Les marges de progrès sont considérables : si 90% des consultations de médecins se traduisent par une ordonnance chez nous, ce n’est le cas que de 43% de celles-ci aux Pays-Bas.

Le Monde Gets It Right

Some in France may be saying that DSK has been "blanchi," but Le Monde gets it exactly right:

En se prononçant pour le classement du dossier, lundi 22 août, faute de pouvoir établiravec certitude devant un jury la crédibilité du témoignage de la victime présumée, sur lequel repose exclusivement l'accusation d'agression sexuelle, le procureur de l'Etat de New York ne blanchit pas totalement M. Strauss-Kahn : il reconnaît simplement que les incohérences apparues, au cours de l'enquête, dans la version de la jeune femme, ne lui permettraient pas de convaincre douze jurés de la bonne foi de celle-ci, au-delà du doute raisonnable.

Monday, August 22, 2011

The Dismissal Request

Can be read here.

Vance Will Ask for Dismissal

Le procureur de New York a informé la défense de Nafissatou Diallo qu'il demandait l'abandon des poursuites contre Dominique Strauss-Kahn, lundi 22 août. Kenneth Thompson, l'avocat de Mme Diallo, a dénoncé un "déni de justice" au sortir de son entretien avec Cyrus Vance. Suivez les faits en direct sur Le Monde.fr. (AFP)
Prosecutors in the office of Cyrus R. Vance Jr., the Manhattan district attorney, have filed papers officially requesting that all charges against Dominique Strauss-Kahn, the former head of the International Monetary Fund, be dropped.
The papers, known as a dismissal on recommendation, were filed at 3:20 p.m. in Manhattan Supreme Court.
At about the same time, the lawyer for the hotel housekeeper who accused Mr. Strauss-Kahn of sexual assault emerged from a brief meeting with prosecutors Monday afternoon to offer harsh criticism of Mr. Vance. Read More:http://cityroom.blogs.nytimes.com/2011/08/22/strauss-kahn-accuser-and-lawyer-meet-with-prosecutors/?emc=na

Juan Cole on France and Libya

Here:

It is obvious that the French and the British led the charge on this intervention, likely because they believed that a protracted struggle over years between the opposition and Qaddafi in Libya would radicalize it and give an opening to al-Qaeda and so pose various threats to Europe. French President Nicolas Sarkozy had been politically mauled, as well, by the offer of his defense minister, Michèle Alliot-Marie, to send French troops to assist Ben Ali in Tunisia (Alliot-Marie had been Ben Ali’s guest on fancy vacations), and may have wanted to restore traditional French cachet in the Arab world as well as to look decisive to his electorate. Whatever Western Europe’s motivations, they were the decisive ones, and the Obama administration clearly came along as a junior partner (something Sen. John McCain is complaining bitterly about).

Sunday, August 21, 2011

Winning the Pot

It looks as though Pres. Sarkozy is about to win his Libyan gamble:

Les rebelles libyens occupent le quartier de Tajoura, à l'est de Tripoli, d'après un envoyé spécial de la chaîne Al Jazeera et un témoin, cité par l'AFP. Selon celui-ci, les pro-kadhafi pilonnent régulièrement le quartier, mais la situation est sous le contrôle des insurgés.
Ironic that one of his first successes as president was to strike a deal with Qaddafi about the Bulgarian nurses. Now he is about to oust the dictator he had initially tried to tame and bring inside the tent. Now, to profit from the victory with a nice, juicy oil and gas deal ...

Loose Ends in the DSK Case

Enumerated here. If, as expected, the DA asks for a dismissal on Tuesday, we may never know if these are actual discrepancies in this or that narrative or mere "noise."

Saturday, August 20, 2011

Robert Boyer on Socialist Candidates

Robert Boyer, the founder, with Michel Aglietta, of the French "regulation school" of economics, is quite pessimistic about the crisis. And while he is quite critical of Sarkozy and Merkel, he is not impressed by the answers provided by the Socialist candidates either:

Je suis aussi frappé, pour certains candidats à la candidature socialiste par exemple, par leur ignorance totale de l'économie mondiale. La Corrèze, c'est bien, mais il faut aller voir ailleurs. La détérioration de la qualité du personnel politique est impressionnante. Les intellectuels politiques, comme le furent Michel Rocard ou Jacques Delors, ont disparu. Du coup, les politiques sont prisonniers des conseillers économiques. Ils sont non seulement coupés de leur base, mais n'ont pas non plus la capacité d'analyser le monde. Vu la complexité de la crise, c'est inquiétant.

DSK: vers un dénouement?

On Tuesday, the prosecutor will announce whether he plans to proceed with the case or dismiss the charges. Meanwhile, Newsweek has reported that Diallo's attorney sought a monetary settlement in June, which Kenneth Thompson denies.

Friday, August 19, 2011

Philosopher of the Extreme Right

The Front National has come up with a telegenic philosopher, Julien Rochedy, to represent its point of view among la jeunesse.

Apple Is Worth More than ALL Eurozone Banks Combined

Here:

That's the stark result from a steep fall in the share price of banks including Spain's Santander,France's BNP ParibasGermany's Deutsche Bank and Italy's Unicredit, compared to a steady rise in Apple's valuation, according to Thomson Reuters data.

Guérini to Be Summoned Before a Judge

Report:

Selon ses proches, il s'en réjouirait presque : Jean-Noël Guérini, 60 ans, sénateur et président du conseil général (PS) des Bouches-du-Rhône, est convoqué le 8 septembre chez le juge d'instruction marseillais Charles Duchaine."Depuis le temps qu'il demandait à être entendu, il va enfin pouvoir se défendre", ont indiqué plusieurs de ses proches.

A l'issue de cette audition, l'élu socialiste, qui, en tant que sénateur, bénéficie de l'immunité parlementaire et ne peut donc être retenu en garde à vue ni être l'objet d'aucune contrainte, pourrait être mis en examen pour "association de malfaiteurs, trafic d'influence et prise illégale d'intérêt". Au stade actuel de l'enquête, il est soupçonné d'être impliqué dans une vaste affaire de malversations qui concerne les marchés publics des ordures ménagères, instruite depuis deux ans par la juridiction interrégionale spécialisée (JIRS) de Marseille.

Paris manif'

A new book recounts the history of Paris as a city of mass demonstrations. Not to be forgotten in this time of troubles: "Ce peuple est toujours dangereux."

Thursday, August 18, 2011

The Paradox of Largesse

Keynes spoke of the "paradox of thrift": if everyone saved more, supposedly behaving virtuously, aggregate consumption would fall, leaving everyone worse off. Maurice Lévy, the head of Publicis and of the Association française des entreprises privées, is a very wealthy man--"megarich," in the terminology of Warren Buffet, who is also a member of this club. And like Buffet, Lévy has proposed that he and his kind increase their contribution to the public treasury in this time of troubles: "Il me paraît indispensable que l’effort de solidarité passe d’abord par ceux que le sort a préservés. […] je considère avec la même force qu’il est normal que nous, qui avons eu la chance de pouvoir réussir, de gagner de l’argent, jouions pleinement notre rôle de citoyens en participant à l’effort national."

Opinions vary as to the import of Lévy's gesture. Romain Pigenel reviews them here. Unlike Buffet, as Pigenel points out, Lévy is proposing only an "exceptional" tax increase on the rich. Still, it's yet another breach in the "tax shield" and implicitly a critique of the ideology that the rich will go on strike and cease to "create jobs" or "invest in innovation" unless granted extraordinary incentives by governments. One might want to compare this with Jeff Sachs' sour view of one of the consequences of globalization:
The simple fact is that globalization has not only hit the unskilled hard but has also proved a bonanza for the global super-rich. They have been able to invest in new and highly profitable projects in emerging economies. Meanwhile..., they have been able to convince their home governments to cut tax rates ... in the name of global tax competition. ... In the end the poor are doubly hit, first by global market forces, then by the ability of the rich to park money at low taxes in hideaways around the world.
 Be that as it may, Lévy's largesse troubles me for a rather different reason. To my mind it is motivated by surrender to the overwhelming conventional wisdom of the moment, which is that all our problems will end if only we pay down our debt. So the paradox of largesse is that it is simply the paradox of thrift in disguise. The megarich in their generosity and far-seeing wisdom would set an example for the rest of us by submitting quietly to the supposedly self-evident need for austerity, more austerity, always austerity.

But what if the real problem isn't debt but the distribution of income in normal times? What if the decline in labor's share has put downward pressure on demand that asset bubbles at first disguised and now, having collapsed, exacerbate? Then M. Lévy's admirable generosity would be misplaced; rather than fill the state's coffers so that they can be emptied again to pay off bondholders, he would do better to add a swimming pool to his villa or a helipad to his yacht, putting idle workers to work and allowing them to purchase goods that will enrich others who will spend in turn, multiplying the effect of private self-indulgence (not to say private vice, which would be putting it pejoratively) and transforming it into public virtue.

The job of the rich is to consume. The proper role of the government is to craft tax laws that keep the engine of consumption running, which in fairness to the greater number may require higher rates of contribution by the better-off. But it should not be left to the better-off to decide when and how much they wish to contribute. The tax system should be made optimal for all, not flattering to any one class's concept of virtuous citizenship.

Delors Sounds Alarm on Euro

Joining the chorus.

ECB as Lender of Last Resort

Why it is needed discussed here.

European bank liabilities as percentage of GDP:


Wednesday, August 17, 2011

Sanctions for Nonconforming States

Sarkozy and Merkel are proposing sanctions against states that fail to discipline their budgets:

"A l'avenir, les paiements issus des fonds structurels et de cohésion devraient être suspendus dans les pays de la zone euro qui ne se conformeraient pas aux recommandations de la procédure sur les déficits excessifs", écrivent-ils.

Lagarde Hearings Begin

La Cour de justice de la République has begun hearings on the charges against Christine Lagarde. Médiapart has a summary of the charges here.

Never Mind the Markets (dixit de Gaulle)



"La politique de la France ne se fait pas à la corbeille" (i.e., on the trading floor of the stock exchange). The good old days. For comment, see here.

Tuesday, August 16, 2011

Sarkozy-Merkel Meeting

Sarkozy and Merkel have met. They propose a financial transactions tax (good). They also propose a new council to govern eurozone economics, possibly to be headed by von Rompuy. I won't say this is a bad idea, rather an indifferent one. Clearly it's a response to the obvious need for greater economic coordination if the euro is to survive, but everything will depend on the powers of the new council and the degree of sovereignty that member states are required to give up. This could be mere eyewash, or it could be the start of something big, and necessary.

Then they go on to recommend the "golden rule" (balanced budget constitutionally mandated, albeit with escape clauses), which to my mind stands La Rochefoucauld's maxim on its head: "L'hypocrisie est un hommage que le vice rend à la vertu," La Rochefoucauld said, whereas la règle d'or est un hommage que la vertu rend au vice: it makes lawmakers feel virtuous but compels them to vicious misbehavior (in the form of procyclical budget-cutting) in a crisis. If they're seeking an exit from overindebtedness, they would do better to follow the advice of Augustine in the fleshpots of Alexandria before his conversion: "Make me stop sinning, O Lord! but not just yet!"

They also--new proposal--will consider a common corporate tax for France and Germany, a good idea and a step toward better coordination. Finally, they rule out Eurobonds for now but not forever: this can come, they agree, but only after fuller integration has been achieved. In the meantime they promise to defend the euro to the hilt. Let's hope this will be enough.

On the whole, this appears to have been a constructive meeting and more substantive than I had feared. I am told on good authority that there was also more substance to Mme Lagarde's statement than I indicated yesterday. So let's say I'm feeling a wee bit more optimistic. But then of course there's the US to bring me down again. Here at home, our newest presidential candidate, Rick Perry, has said that Ben Bernanke's quantitative easing is "almost treasonous." Bismarck is supposed to have said (apocryphally, alas) that "there is a special providence for children, drunkards, and the United States of America." I certainly hope so.

UPDATE: The Times and the markets are more downbeat about the agreement.

Eurozone Growth Stalled

Paul Krugman:


First we worried about one-size-fits-all policy; then it seemed that the ECB was actually engaged in one-size-fits-one, oriented entirely toward Germany; now growth in Germany and the eurozone as a whole has stalled (pdf). So now it’s one-size-fits-none.
It really is a race between America and Europe: who can make the worst of a bad situation. And both competitors are giving it their all.

Spendthrift Government?

FrédéricLN analyzes the behavior of governments of the Right and the Left in managing the French budget over the years, with corrections for growth effects and attention to the primary budget surplus or deficit (i.e., excluding service on the accumulated debt). I haven't examined his analysis carefully, but you may find the data useful.

Monday, August 15, 2011

Lagarde Indulges in Newspeak

Christine Lagarde, at last liberated from Nicolas Sarkozy's tutelle, should be finding her own voice, but if today's pronouncement from the IMF director is any indication, she's singing falsetto, and the lyrics are in Newspeak:
There are no easy answers. ... slamming on the brakes too quickly will hurt the recovery ... what is needed is a dual focus ... that may sound contradictory ...
Will the markets buy such an approach? In some countries, they seem to be pushing for sharp fiscal adjustments. And some policymakers have decided that is the road to follow. But in many countries a short-term focus would be wrong. We should remember that markets can be of two minds: while they dislike high public debt – and may applaud sharp fiscal consolidation – as we saw last week they dislike low or negative growth even more.
Forgive me, but this sounds like the doctor in Molière prescribing la vertu dormitive, except in this case she's prescribing la vertu stimulative, mais pas trop. And how about naming names? "Some countries" indeed. Is Mme Lagarde out of her depth?

Libyan Rebels Are Talking to Qaddafi People

Reported here. And Libya's security chief has apparently defected to Egypt.

Two Eurozone Proposals for Sarkozy and Merkel to Consider

Here and here.

UPDATE: And, right on cue, we learn that Sarkozy and Merkel have taken off the table the core of both proposals, namely, the creation of a Eurobond. Hence anything they propose will be inadequate, and once again Europe will find itself behind the eight-ball in trying to resolve the lingering crisis.

Although the subject, Le Monde tells us, is "in the air" in Germany.

Sunday, August 14, 2011

Ozon Out

Laurent Ozon, who joined the bureau politique of the FN in January and was supposed to be contributing to the party's de-demonization, has resigned, possibly in the wake of tensions stemming from his having blamed the Norwegian massacre on "too much immigration." This is the same "deviation" from the party line of which Le Pen père is guilty--but he remains as honorary president of his daughter's inheritance.

Royal Plays the Experience Card

She has the "experience" to defeat Nicolas Sarkozy, she says, having lost to him before. It's a weak hand she's playing, and this is no doubt her best, perhaps only, card. But it doesn't seem to be working.

Friday, August 12, 2011

Cozy Sarko Support Group

Nicolas Sarkozy has agriculture minister Bruno LeMaire working on his official campaign platform, but it never hurts to have other minions at your beck and call. So a group of septuagenerians has been enlisted, led by Vivendi president J.-R. Fourtou and including Figaro editor Mougeotte and former Grenoble mayor and convicted felon Alain Carignon.

Sheesh. In what other country can a presidential campaign be advised by the editor of one of the country's major newspapers? Conflict of interest? Ni vu ni connu.

Aubry Responds to the Golden Rule

She makes some good points and offers some reasonable ideas--not new by any means, but reasonable.

Was SocGen the Victim of a Misread Fiction?

Truth is stranger than fiction, especially when a fictional account of the collapse of the euro published in Le Monde serves as the basis for a purported news article in The Daily Mail, which then becomes a rumor that takes down the bank's stock.

New Book

For a tour of the state of center-left parties in the US and Europe, have a look at the new book What's Left of the Left? Democrats and Social Democrats in Challenging Times, edited by Jim Cronin, George Ross, and Jim Schoch, just out from Duke. George Ross and I contributed the chapter on France. (Caveat: the papers are based on a conference held 2 years ago, so you won't get the most recent developments--such is academic publishing--but the arguments still hold up fairly well, I think.)

Baroin Joins the Tea Party, Economists Floored

Finance minister François Baroin knows who butters his bread. Nicolas Sarkozy has made "the golden rule" (not "Do unto others ..." but "Balance your budget at all cost") the watchword of his campaign, and Baroin has therefore become a spending slasher. But raising revenue is unthinkable:

«On ne touche pas à l'impôt sur les sociétés, on ne touche pas à l'impôt sur le revenu, on ne touche pas aux prélèvements sociaux et on ne touche pas à la TVA», a asséné le ministre. Il y a à cela «deux raisons», a-t-il ajouté : «c'est un choix politique assumé par le gouvernement de ne pas faire porter l'effort de réduction des déficits sur une augmentation d'impôts car c'est la solution de facilité».
You have to admire his faux forthrightness. The decision to cut expenditures without raising taxes is "a political choice for which the government assumes responsibility not to place the burden of reducing deficits on a tax increase, because that's the easy way out." So, instead, the burden will be placed on all those whose benefits will be cut and jobs eliminated as the government moves toward austerity without unduly burdening corporations or wealthy individuals. The distributional consequences of austerity are swept under the rug by casting the choice as one between "placing the burden on taxes" or resorting to the tough choice to cut expenditures. It's as if redistribution were between taxes and spending rather than between the better-off and the worse-off members of society. Baroin here seems to be borrowing his rhetoric from the Tea Party.

I suggest that he read the "Manifeste des Économistes Atterrés" (how to translate? Floored Economists? Dumbfounded Economists? Speechless Economists?), which was issued well before the current resurgence of crisis and which nevertheless raises questions that remain pertinent today.

Times Assesses Sarkozy's Challenges and Strategy

Here.

Thursday, August 11, 2011

Soros on the Euro Crisis

Here:
Germany and the other eurozone members with AAA ratings will have to decide whether they are willing to risk their own credit to permit Spain and Italy to refinance their bonds at reasonable interest rates. Alternatively, Spain and Italy will be driven inexorably into bailout programs. In short, Germany and the other countries with AAA bond ratings must agree to a eurobond regime of one kind or another. Otherwise, the euro will break down.

It should be recognized that a disorderly default or exit from the eurozone, even by a small country like Greece, would precipitate a banking crisis comparable to the one that caused the Great Depression. It is no longer a question whether it is worthwhile to have a common currency. The euro exists, and its collapse would cause incalculable losses to the banking system. So the choice that Germany faces is more apparent than real – and it is a choice whose cost will rise the longer Germany delays making it.

Krugman Stands Up for France

Here. No doubt Sarko will claim victory.

Juppé Speaks the Truth About the Golden Rule

When Alain Juppé was still on the outside of government looking in, he quite clearly expressed the reason why the "golden rule" that Sarkozy wants to make the centerpiece of French fiscal reform is nonsensical eyewash:



Interrogé, page 158, sur la manière de remettre de l'ordre dans les finances de la France « sans risquer de la plonger dans la déflation », voici ce que répondait Juppé :

« Ce sera extrêmement compliqué. L'une des réponses, dit-on, serait d'inscrire dans la Constitution, comme les Allemands l'ont fait, qu'on n'a pas le droit de dépasser un niveau d'endettement ou de déficit supérieur à un pourcentage donné du PIB. Je ne suis pas contre, mais je n'y crois pas trop.
Cela ne consisterait qu'à se faire plaisir et on expliquera, à la première crise grave, que des circonstances exceptionnelles font qu'il n'y a plus d'autre moyen que de violer la Constitution. La nécessité comme la facilité l'imposeront. Il n'y aura personne ou presque pour s'y opposer et il suffit, pour s'en convaincre, de voir ce qui s'est passé avec le Pacte de stabilité et de croissance au respect duquel tous les Etats qui ont adopté l'Euro s'étaient, pourtant, obligés par traité.
Là aussi, il y avait des pourcentages de déficit et d'endettement au-delà desquels on ne devait pas aller et qu'est-ce qui s'est passé ? Tout le monde s'est affranchi de cette règle sous le coup de la crise financière et même, en réalité, bien avant. On a maintenant beaucoup de mal à y revenir et cette idée d'obligation constitutionnelle n'est donc pas la panacée, même si ça peut faire du bien dans le paysage. »

One might say that this passage exemplifies the difference between the American right and the French right. The French right has many politicians who, when not in office, are quite capable of thinking intelligently and stating plain truths forthrightly. The American right is now so besotted with its antistate ideology that it has become what the French right used to be, "la droite la plus bête au monde." 

Poll: French Trust Merkel More than Sarkozy

When it comes to leading the way out of financial crisis, the French man in the street apparently trusts Angela Merkel (46%) and the IMF (41%) more than Nicolas Sarkozy (33%). Of course only 48% trust themselves, so we must take these figures with a grain of salt. In any case, the French surely know less about Merkel than they do about Sarkozy, and in this case ignorance breeds respect. And so does Merkel's niggardly attitude toward bailouts: the French are no more eager to help out their neighbors than the Germans, it seems, even if in the end they're undermining themselves.

French Lending to Asia

French banks, it turns out, are big lenders to Asia, so the troubles in French banking pose a potential threat to Asian economies.

European Sovereign Credit Default Swaps

Prices of credit default swaps on the sovereign debt of various countries can be found here. France (167.8) is judged by the market to be about twice as risky as Germany (83.8) and three times as risk as the US (54.4) but is not in the same league as Greece (1726) or Ireland (777).

If you believe the market ...

Wednesday, August 10, 2011

French Debt

Who accumulated it? Who holds it? The answers are here.

French Bank Stocks Hit by Market Anxiety

The government is trying to keep the ship from listing, but the seas are heavy. Kinda feels like 2008 again. Be still, my heart.

If DSK Were Tried in Paris ...

Now that Ms. Diallo's has filed her civil suit in the Bronx, Le Figaro has an interesting comparison of French and US justice. In France, the civil and criminal cases would be inseparable. Assuming conviction on the criminal charges by a majority of at least 8 votes among the 9 jurors and 3 judges hearing the case, civil damages would then be decided by the three judges alone. In France, damages in a rape case would be unlikely to exceed 15,000 euros, whereas in the US the plaintiff might expect $20 million or more.

Austerity and Unrest

Timing is everything, and these two scholars are impeccable in their timing, producing a study of the relation between austerity and unrest just as London is consumed by riots.

We look at five different types of instability – anti-government demonstrations, riots, assassinations, general strikes, and attempted revolutions – in Europe over the period 1919-2009. The data comes from a large-scale international data collection (Banks 1994), and is based on an analysis of reporting in the New York Times. The individual indicators are then aggregated by summing them up for each country and year. This gives the variable called CHAOS. Figure 1 shows how it evolved over time since 1919, presenting the mean and the maximum. The interwar years show a high level of unrest, as does the immediate post-World War II era, and the period from 1970 to the early 1990s.

Krugman: Desperation Time

Paul Krugman:

I’m still trying to make sense of this global intellectual failure. But the results are not in question: we are making a total mess of a solvable problem, with consequences that will haunt us for decades to come.

Tuesday, August 9, 2011

Golden Rule

Sarkozy wants a balanced budget amendment to the Constitution, which he calls the "golden rule." The idea is daft, but nothing is too daft in politics these days, particularly when it comes to wrong-footing one's opponent. François Hollande has found a riposte, however: he wants to force the parties to indicate in next year's budget bill how they propose to return to a 3% of GDP deficit by 2013:

"La seule question qui vaille c'est qui va payer l'effort ? Est-ce que ce sont toujours les mêmes – c'est-à-dire une grande majorité de nos concitoyens – ou est-ce que ce sont ceux qui ont quand même beaucoup gagné grâce aux cadeaux accordés par Niocolas Sarkozy depuis 2007 ?" ajoute M. Hollande sur France Info.

Monday, August 8, 2011

Today in DSK

It hardly seems to matter any more, what with the world careering out of control and all, but the DSK affair has passed another milestone:


Nafissatou Diallo a déposé plainte au civil contre DSK

Nafissatou Diallo, la femme de chambre qui accuse Dominique Strauss-Kahn de viol, a déposé une plainte contre celui-ci devant une instance de la justice civile de New York, selon l'agence Reuters. Elle entend y obtenir des dommages et intérêts en raison de l'"agression sadique" dont elle affirme avoir été l'objet.

Jouyet Sees Federalism Ahead for Europe

Jean-Pierre Jouyet, former sec'y of state for European affairs:

"Le fédéralisme va se faire. C'est cela ou sinon le système saute", prédit Jean-Pierre Jouyet, président de l'Autorité des marchés financiers (AMF) et ancien ministre des affaires européennes (2007-2008). L'affaire rend de plus en plus urgente les propositions d'intégration économique que doivent faire Mme Merkel et M. Sarkozy à la fin de l'été. Mais il faut éviter que la crise ne "cristallise", selon M. Jouyet.

Google-Hachette Deal

Well, well:

Yet France is suddenly the only country in the world in which Google has managed to achieve a longstanding business goal. A few days ago Google signed an agreement with the publisher Hachette Livre under which tens of thousands of French-language books will be pulled out of ink-on-paper purgatory and provided with a digital afterlife.

Enemies Lists

The "enemies list" is the last refuge of a scoundrel. Richard Nixon had one. Thierry Mariani has two, and they are symmetrical: one for "the cheats at the bottom," the other for "the cheats at the top." The former, as befits a leader of the so-called "droite populaire," consists of people Mariani calls "welfare chiselers," people whom he claims are "illegally collecting the RSA in more than one département." Are there many such people? Is this a major problem in today's France? Well, of course, the answer is, "We don't know, because we don't have a list." But we will have one. Because Xavier Bertrand agrees with Mariani that such an instrument is needed. Why, it's almost as if "la droite populaire"--the UMP's own internal national front--and "la droite classique" (or perhaps we should call it "la droite impopulaire") were in cahoots to raise the specter of "the welfare cheat" as a presidential election approaches.

Of course it would be unkind to suggest any sort of desire on the part of the UMP to stigmatize welfare recipients by associating them with the idea of fraud. Mariani's initiative and Bertrand's positive response thus have nothing to do, of course, with Laurent Wauquiez's more abstract and philosophical attack on the very concept of what he so delicately called l'assistanat. And lest you suspect that there's any sort of racial bias underlying Mariani's crusade against the chiseling but resourceful poor--resourceful enough to collect the RSA in more than one département, which, given the hassles of dealing with the French bureaucracy, must require a fair amount of patience--he goes after the cheats at the top as well, those who are earning "very high financial incomes." Make no mistake, however: these greedy financiers are not to be confused with "entrepreneurs, who help the country to progress." The former must have the tax collector's screws applied, while the latter deserve every possible break to alleviate the burden of creating jobs.

Governing is so simple when you know how to choose your enemies with such unerring precision.

Friday, August 5, 2011

"Le coeur à gauche" but a Vote for the FN Is "Not Unthinkable"

Rue89 recounts the evolution of one voter on whom the left can no longer count.

Structural Unemployment in Southern Europe

Daniel Gros explains why the collapse of cheap credit in southern Europe has led to structural unemployment, as import intermediation service workers are left without imports to service.

Good Cheer from Barroso

Has a major international agreement ever come undone as quickly as Europe's last best effort to deal with its debt problem:
The European Commission president, José Manuel Barroso, has been pushing euro zone leaders to do more. In a letter released Thursday, he called for a “rapid reassessment of all elements” related to the stability fund, so that it was “equipped with the means for dealing with contagious risk.”

He also criticized European politicians for “the undisciplined communication and the complexity and incompleteness” of the package agreed to at the summit meeting on July 21.

“Markets remain to be convinced that we are taking the appropriate steps to resolve the crisis,” he wrote. “Whatever the factors behind the lack of success, it is clear that we are no longer managing a crisis just in the euro area periphery.”

Thursday, August 4, 2011

Case Against Lagarde Moves Forward

The Cour de Justice de la République has decided to open an investigation into the role of Christine Lagarde in awarding a large settlement to Bernard Tapie.

Yesterday, at the end of a post on another subject entirely, I offered an unjustified criticism of an article by Laurent Mauduit in Mediapart concerning the Tapie affair. M. Mauduit rightly questioned my comment, which I regret. I hereby apologize.

UPDATE: From the decision of the CJR (quoted by Mediapart):

« Il apparaît, comme en témoignent le nombre et les nuances des notes répétées faites à son attention, tant au moment de la décision de recourir à un tribunal arbitral qu'à celui où le Crédit lyonnais est écarté du débat sur le processus arbitral, qu'à celui où une récusation des arbitres proposés est envisagée, ou à celui où le CDR est appelé à connaître de la sentence arbitrale, et enfin à celui où un recours en annulation est envisagé, que madame la ministre de l'économie, des finances et de l'industrie a constamment exercé ses pouvoirs ministériels pour aboutir à la solution favorable à Bernard Tapie que l'assemblée plénière de la Cour de cassation paraissait pourtant avoir compromise.»

Wednesday, August 3, 2011

FN Discussed on C Dans l'Air

The program starts with a shocker: polls show Marine Le Pen capturing 40% of the working class vote, more than twice the score of the PS (15-18%) and three times that of Nicolas Sarkozy (~13%).

Stimulus in a Time of Austerity

Who says you can't have stimulus in a time of austerity? François Fillon has found a way to inject €36 million into the economy of his home region via an infrastructure project known as "the comma": a jog in a new TGV line that will serve his hometown fief, pop. 12,000.