Friday, June 29, 2012

DSK & Wife Split

Didn't I read just this morning that DSK and Anne Sinclair were suing Closer for reporting that they had split? Why yes, I did. But now ... I guess private is private, until it isn't.


The Way Out?

European leaders have agreed on a new plan, which will allow the bailout funds (ESM and EFSF) to inject capital directly into troubled banks, conditional upon the establishment of a new EU banking supervision authority. The markets are pleased, for the moment. Of course the markets have been pleased before, and the euphoria has been short-lived. There are some reasons for optimism this time, however. Since Merkel has ruled out mutualization of debt for the time being (actually, in her words, for as long as she lives), this was the only option available that would not lead to imminent meltdown. Furthermore, there seems to be a consensus that the ECB can support banks via the ESM, an indirect route, but not directly. The ECB seemed to have recognized the need but worried about the legality, which has now been clarified. So this could hold things together for awhile.

Of course, this solution does not remedy the structural imbalances, that is, the fact that the southern tier countries, and even France, import more from the stronger economies than they export. With no devaluation option available in the short term to remedy this, and no willingness of private lenders to finance the resulting current account deficits, the only option is for the deficitary economies to contract sufficiently to reduce their demand for imports. (Increased productivity in the south is another remedy, but increasing productivity takes time, so is not a short-term solution.) The results of this contraction in Greece and Spain have been devastating, with very high unemployment, reduced social spending, etc. How much more of this can be tolerated is of course anyone's guess.

But saving the banks--distasteful as it is to many people to have to save banks whose irresponsible lending during the boom years is at the heart of the crisis--was the first necessity, and this has now been taken care of. I think the European banking system was fairly close to seizing up, so this was really an emergency measure. Let's hope the implementation proceeds smoothly and quickly.

As I discussed earlier, the banks, in protecting themselves against the risks of sudden stops in short-term financing, have largely stopped borrowing across borders. This means that the European financial system is no longer delivering one of the chief benefits that the euro had promised: the ability to move capital from countries where there is too much of it to countries that could make productive use of more. This is unfortunate. But after a period of healing, normal capital flows could resume, but with the tighter controls on bank lending promised by the new supervisory mechanism. There will still be booms and busts, of course, as long as there are human beings, but perhaps--perhaps--the damage can be limited next time. In any case, I'm feeling slightly more optimistic today than I did yesterday. The European agreement, plus the major, major Supreme Court decision in the US, are signs that the tsunami have bad news may have begun to recede.

Thursday, June 28, 2012

Death of the Minitel

Few will mourn, but some old-timers will remember when the Minitel was le dernier cri and the Métro was festooned with signs decorated with the mysterious numbers 36 15.

Wednesday, June 27, 2012

Rosanvallon Analyzes the Elections

Here:

Mais derrière ces effets de permanence, il y a un séisme, l’installation du Front national comme un parti structurant, et plus seulement comme parti de réaction. Il constitue désormais un élément nouveau, peut-être directeur, de la culture politique de droite en France. Avec tous les problèmes que cela peut poser dans son analyse : le Front national n’est pas simplement le reflet d’une géographie des problèmes sociaux ou de l’immigration. Il est le produit d’un imaginaire de l’identité sociale.

Tuesday, June 26, 2012

Sideshow

Ah, what bliss it has been these past weeks with nary a mention of the name "Sarkozy" in public hearing. The old president seemed to have just faded away, along with many of his works (Hollande is said to be considering a discontinuation of the tax exemption on overtime and restoring the ISF to its former levels). But now a struggle has erupted in Hauts-de-Seine which bears on the future of young Jean Sarkozy and therefore, inevitably, on the role his father played in advancing his career. The Sarkozys, père et fils, do not get on with Patrick Devedjian, who heads the conseil général and stands in young Jean's way. It would take Shakespeare to do justice to this battle among monstrous villains, but unfortunately we have only Marie-Célie Guillaume.

Monday, June 25, 2012

Image of Public Services Improves

In France, at any rate, but not in the rest of Europe.

Real Wages Decline in France and Germany

Reported here.

European Banking Union

A paper from Bruegel on what a European banking union should look like. Since it appears that we're going to have one, it's good to have a blueprint.

Saturday, June 23, 2012

Average Debt Maturity and the Euro Crisis

Layna Mosley on average debt maturity across the continent (h/t Henry Farrell):

The United Kingdom's Debt Management Office recently reported that the average maturity of its debt was a high 14.5 years as of March 2012, up from 13.5 years in March 2011 and 13.1 years in 2010. That same year, Portugal's average was 5.8 years, Germany's was 5.9, Belgium's was 6.5, the Netherlands' was 7, France's was 7.1, and Italy's was 7.2. And many of the peripheral European countries had increased their average maturity significantly during the 2000s, issuing longer-term bonds to replace maturing shorter-term debt. This strategy was facilitated by investors' confidence that, as members of the eurozone, these countries' assets were relatively safe. In 2000, Portugal's average maturity was 4.6 years and Italy's was 5.7 years. (Most peripheral countries' average maturities reached their highs in 2008, before falling again.) Indeed, recent calls for eurobonds are an attempt to recapture some of the EMU bonus that accrued to peripheral nations in the 2000s; eurobonds would pool risk across participating nations, resulting in lower rates for peripheral nations but higher ones for core EU members, such as Germany.

Growth Pact but No Stability

As I predicted, Frau Merkel has given France and the south a bone to chew on--€130 billion in stimulus money--while remaining firm on her refusal to shore up Spanish banks without some oversight mechanism. It's a tough position, but I can'say it's an unreasonable one, given the irresponsible lending by Spanish banks in the past (abetted, of course, by northern banks). Potential lenders are unlikely to be impressed, so Spanish and Italian borrowing costs will continue to rise, and the euro will move closer to the brink, until a new deal can be struck.

Friday, June 22, 2012

Euro by the Numbers

Don't listen to the politicians; read the numbers as added up by a hedge fund operator. They don't look good.

Ayrault II: More than Meets the Eye?

The slight post-electiion remaniement of the Ayrault government, which saw the addition of four minor ministers, all unknowns, may be of greater significance than is first apparent, at least according to Médiapart. One story is that Nicole Bricq was removed from the ecology portfolio because she got in the way of offshore drilling and offended the MEDEF and Total. Bricq has been shifted to foreign trade, ostensibly a less important post (although reducing France's current account deficit is a major priority). And Delphine Batho, who takes over as ecology minister, is said not to have gotten on with Christiane Taubira, with whom she previously had to work at the justice ministry. Frictions and rivalries are of course part of any government, but these bear watching.

Thursday, June 21, 2012

Bartolone Gets the Perchoir


Bartolone élu candidat PS à la présidence de l'Assemblée

Le député PS de Seine-Saint-Denis, Claude Bartolone, a été élu par ses pairs candidat socialiste à la présidence de l'Assemblée nationale, et donc plus que probable président à l'issue du vote solennel qui aura lieu mardi 26 juin. Il a recueilli 127 voix sur 258 au premier tour, devançant largement ses trois concurrents, qui se sont retirés, annulant le second tour.

Bruno Le Roux

Bruno Le Roux has been elected chair of the Socialist group in the National Assembly. No surprise. He is described as follows:
Homme de confiance de François Hollande, M. Le Roux a notamment négocié les accords électoraux avec EELV, avant de devenir l'un de ses porte-paroles de campagne.
Very interesting, because we have also been told that M. Hollande did not consider himself bound by the agreement between the EELV and the Socialists, because it was an accord between parties, not a pledge by the presidential candidate of one of those parties. But the chief negotiator was a man who has had his confidence since 2002 and who has just been elected "by acclamation" to head the party group, which suggests a nihil obstat from Hollande.

I suppose that la présidence vaut bien une promesse en ce qui concerne le nucléaire, a promise that the president apparently has no intention of keeping (rightly so, in my view). But one can imagine a certain rancor on the side of the Greens, unless they, too, were party to the deception and perfectly willing to trade a meaningless promise for a substantial number of parliamentary seats. If so, chapeau! Everybody played his part extremely well, and it's no wonder that Le Roux is being rewarded for being point man in this commando raid.

Dark Horse

Bruno Le Maire says he might become a candidate for the leadership of the UMP if his ideas are "not taken up by the other candidates." I like Le Maire, probably more than I should, because I enjoyed the book in which he described his états d'âme as a cat's-paw in the war to the death between his mentor Villepin and Villepin's nemesis Sarkozy.


Wednesday, June 20, 2012

Ayrault: Eurobonds Must Wait

Jean-Marc Ayrault has indicated that France now accepts the German view that there can be no eurobonds without tighter political integration, and that this will take years--if it can be achieved at all. Instead, the main subject of discussion at the next Euro summit will be tighter bank regulation. The quid pro quo for this French concession seems to be that Frau Merkel has agreed to allow the European stability mechanism to fund troubled banks directly rather than lend to the governments that oversee them. This indirect procedure failed dismally in Spain, where the additional debt burden imposed on the Spanish government led to a sharp spike in borrowing costs, making the situation worse.

So, now we have the banks being propped up by the ESM and perhaps the EFSF, neither of which is yet properly funded. Unless there is some surge of market appetite for European risk, what this means is that these entities are being used as camouflage for ECB recapitalization of shaky banks. That's a good and necessary development, and it shows that the Germans aren't quite as adamant or unrealistic as they are made out to be. But there will be no--or very little--stimulus for the southern tier, because major stimulus would have to be financed somehow, and without eurobonds, that isn't going to happen.

In short, we will--or, more accurately, we may--see some calming of the banking panic but no relief for the struggling economies of Spain, Italy, Portugal, and Greece, where unemployment is rampant, political unrest rising, and extremist politics percolating.

Diversity Comes to the National Assembly

Arun Kapil explains why this development is so important.

Jacob Beats Bertrand

In the first test of strength between Copé and Fillon, Christian Jacob, l'âme damnée of the former, won handily in his bid to become head of the UMP group in the AN, defeating Xavier Bertrand 117 to 63. Dommage.

INSEE Report on the French Economy

Here.

Tuesday, June 19, 2012

Le Style Hollandais

I like Hollande's understated style on the international scene. When David Cameron went out of his way to insult France by inviting tax scofflaws to flee to England, Hollande, rather than put up his fists and lead with his mouth, as Sarkozy would have done, simply said that he wouldn't be dragged into any exchange of low blows because he had too much noblesse d'âme. I'm sure Cameron felt the blow more than he would have felt a less subtle verbal blast.

Hollande's proposals on propping up Spanish banks also seem to have made some headway with Mrs. Merkel. I remain pessimistic, but perhaps le style hollandais will have what it takes to cut through the Gordian knot.

The UMP Contest

Xavier Bertrand wants to replace Christian Jacob, Copé's right-hand man, as head of the UMP group in the AN. This will be the first skirmish in the war between Copé and Fillon. A quick glance at the line-up of forces on either side is revealing: Fillon's lot is the more savory of the two by a long shot. It will be interesting to see how the folks listed by Le Monde as "aribters" play their hands. Juppé, Baroin, Lemaire, Alliot-Marie, Accoyer, Hortefeux: some nursing ambitions, others grudges, still others both. One could write a novel.

Le Perchoir

Suddenly, everybody wants to be president of the National Assembly. Ségolène Royal thought the position belonged to her, but voters got in the way. Now, Claude Bartolone, Jean Glavany, and Elisabeth Guigou are all after the spot. The Elysée and Matignon are said to want a woman, but there is "no consensus" around Guigou, whatever that means, so the name of Marylise Lebranchu has been floated, but she says she doesn't want it. It's a bit of a mystery why anybody wants the job. Does anyone remember who had it last? (Ans. Bernard Accoyer. Who's he? Right, that's the point.) Here's a radical idea: how about letting the deputies vote?

Monday, June 18, 2012

The Center Did Not Hold--or Did It?

Not only did François Bayrou lose his seat, but the center parties generally succumbed to the logic of a presidential system and its strong tendency to become biplar. But perhaps Hollande deserves more credit for this than he's generally given. His "centrist" approach to his candidacy, along with Socialist dominance of government at the local and regional levels, has weakened centrist fears of the Left. Just as the line between extreme-right and right has become increasingly blurred, so, too, has the line between center and center-left.

There may be a sociological basis to this result as well. The Socialist Party is no longer a workers' party. Most of the "workers" it retains are in fact public sector employees: schoolteachers, government workers, etc. Socially liberal professionals are plentiful in both Socialist and centrist ranks. Many of these people do not share the anti-EU, anti-globalization sentiments of either the extreme right or the extreme light, and they are put off not only by the droitisation of the center right but also by its crass pursuit of wealth (the bling-bling factor) to the exclusion of other cultural values.

Throughout the campaign, and indeed throughout the past five years, I argued that the 2012 election would be won in the center. My confidence in that interpretation wavered after the presidential, because 1) Sarkozy made a stronger showing than he should have if the center had really deserted him, and 2) I think Hollande won because the extreme right came to detest Sarkozysme as much as it has always detested the Left. But the legislative election makes me wonder if, indeed, France may have become a country where the majority is now in the broad center, which stretches from, roughly speaking, Hamon to Bayrou.

Interestingly, this very diverse "broad centrist" electorate may be easier to please when the issues are rather fragmented, as they are in a legislative election, than in a presidential election where a few high-cleavage issues tend to dominate the discussion, and where personal characteristics of the candidates ("the incarnation factor") loom large.

So perhaps I was right all along to think that France is now a country in which the center is trying hard to hold, and succeeding, even if the self-proclaimed "centrist" party(ies) fared quite poorly.


La Droite Populaire Decimated

Details here. Two interpretations: voters sanctioned the droitisation of the UMP (the defeat of Guéant might lead one to this conclusion), or, FN voters refused to turn out to support UMP candidates who had solicited their votes, just as many of them refused to support Sarkozy.

Party Realignment on the Right?

Slate.fr has a very interesting piece by Jean-Laurent Cassely, who examines with the help of a number of scholars the idea that the party of the center-right is in danger of fissure and absorption by the party of the extreme right. Alexandre Dézé: "These questions of rapprochement and explosion arise whenever the right is in a difficult position, except that the media dramatize the situation in different ways." Indeed, not the least interesting aspect of the article is the look back at history, in which we find Giscard, for example, speaking of the "invasion" of immigrants and the RPR-UDF expressing concern that Islam may not be compatible with French law.

Sunday, June 17, 2012

A Political Renewal

It was more than a victory that the Socialist Party scored today; it was a political cleansing. A whole new generation of Socialists has come to office, as Bernard Girard notes. Of the 291 Socialist deputies, moreover, 108 are women. Two elephants were eliminated: Jack Lang and Ségolène Royal. All the ministers were elected, however. On the right, the older generation suffered defeats as well: Bayrou and Alliot-Marie are gone. Arun Kapil has a full rundown.

Two things trouble me. First, I'm not sure what the Socialist Party did to deserve such a victory. Its program remains vague, its leadership untested, its commitments confused. Its victory might be seen as an expression of revulsion against the Sarkozy years--except Sarkozy himself did better than expected in the presidential. The new leadership of the UMP is hardly inspiring, and this crushing defeat opens the way for a challenge to Copé by Fillon and/or Juppé. With the Socialists now in control at every level of government, they would benefit from a renewal on the right; otherwise all the blame for failure is theirs.u

Second, the party system seems out of kilter. The FN enjoys strong support but has only 2 seats. Similarly, the extreme left is underrepresented in the Assembly. The Greens, by contrast, are overrepresented. And the center, alas, has all but disappeared. Ayrault has spoken of the need for a more balanced exercise of power between legislature and presidency. Such a change will require a lot of work on the Assembly internally. The imbalance is institutionalized and reflected in budgets, office space, and staffing. It won't be easy to change.

Finally, a word about Bayrou and Royal. Both deserved better than they got. To be sure, Royal's bitter speech was graceless, and she probably sealed her own fate by making a poor tactical choice, but I find it hard to believe that Falorni couldn't have been dissuaded from his challenge if the will had been there at the national level. And clearly Bayrou could have been saved as a gesture of gratitude and respect, which he deserves. But politics, as they say, is not beanbag.

Hollande's "Growth" Package

Hollande is proposing to France's European partners a growth package consisting of 3 parts: EU structural funds of 55 billion, European Investment Bank loans of 60 billion, and project bonds of 5 billion, for a total of 120 billion euros, or less than 1% of EU GDP. This is not likely to make much of an impression, even if it is approved, but with New Democracy's apparent victory in Greece and a reinforcement of Socialist power in France, Germany may be inclined to reward the Greeks for good behavior and the French for making such a modest proposal.

Le Pen Loses in Hénin-Beaumont

Hallelujah!

Absolute Majority for the Left, Royal, Bayrou Lose

The Socialists will have 291 seats. Ségolène Royal lost her seat, as did François Bayrou. François Hollande now has all the support he needs to enact a program of the left. It remains to be seen what that program is.

"Où sont les intellectuels?" Bouvet vs. Fassin

After the victory of Mitterrand in 1981, as problems started to accumulate for the new socialist government, Le Monde published an article entitled "Où sont les intellectuels?" The import of this piece was that intellectuals of the left, who had been vociferous in their critiques of government when the right was in power, had fallen silent when the left arrived, as if it had nothing to say about governing.

What about now? Where are the intellectuals? Are they silent, or have they simply become "organic," to use Gramsci's term, parts of the apparatus of government itself, specialized in technical activities such as fiscal and monetary policy, environmental regulation, labor law, etc., and therefore not suitable for discussion in public forums? Marianne, for its part, believes that there is a vital intellectual debate raging on the left but that it hasn't attained the visibility it deserves, so it arranged a face-off between Laurent Bouvet, representing what it calls "une gauche d'inspriation conservatrice, parfois souverainiste, affichant un ton nouveau sur les questions de sécurité et d'immigration," and Éric Fassin, representing a left more open to the inclusion of minority communities but no longer calling itself "multiculturalist." And this Marianne sees fit to call "the war of the lefts."

Neither side in this war has many divisions, but the generals are intent on enlisting imaginary armies. For Bouvet, his troops consist of nothing less than les classes populaires, while Fassin counters that "visible minorities" such as female workers, shop clerks, and homosexuals are not all "bourgeois bohemians" and are in fact the heart of Bouvet's imaginary army. Has "la gauche populaire," the name sometimes applied to the vague school of thought associated with Bouvet and geographer Christophe Guilluy, really emulated la droite populaire of Thierry Mariani et cie. and the Dutch "new realists," as Fassin alleges? Or have the "neo-Tocquevilleans" and "anti-racists" of old morphed into the think tank Terra Nova, which according to Bouvet would transform the Socialist Party into a third-way mishmash designed to ensconce a well-to-do socially liberal elite in power at the head of a rainbow coalition of voiceless but symbolically visible minorities?

I'm afraid I fall into the squishy marais between these two would-be montagnes. There's too much rhetorical heightening of differences for my taste and too little in the way of strategic or policy implications. La gauche populaire is right to stress the importance of solidarity, while its opponents are right to insist that protection of minority rights is essential, and that differences can be discussed without being enshrined. Et après? Les chiens aboient, les caravanes passent. But others may find more to chew on in this debate, so I bring it your attention just in case.

Saturday, June 16, 2012

Musical Chairs in French TV News

Laurence Ferrari quit TF1. Rumor has it that Martin Bouygues wants to replace her with Laurent Delahousse, the France2 weekend anchor. Meanwhile, David Pujadas, the regular France2 anchor, has let it be known that he wouldn't necessarily refuse an offer from the commercial network if one were made. Who cares? you may well be asking yourself, and indeed the question of which pretty face reads the news isn't necessarily as important as the principals seem to think it is, especially in the era of the "normal presidency," which has the president traveling to the TV studio for an interview rather than summoning journalists to the Elysée for a carefully mise en scène representation of presidential power amid les fastes de la République.

Is it really "normality" that has guided Hollande's media decisions or rather a communications strategy as sophisticated as Sarkozy's but designed to take maximum advantage of the particular qualities of its "star," so different from Sarkozy's? And Sarkozy always seemed to be trying a bit too hard with his ever-shifting décor, carefully calculated camera angles, and studied displays of "attitude." As many commentators have remarked, that is why the now infamous Trierweiler tweet did so much damage. It undermined all of Hollande's effort to "dépipoliser" the presidency. Pour qui se prend-elle? was the reaction of many who had hitherto been pleased to find themselves with a president who didn't feel it necessary to use taxpayer money to erect a special mobile presidential shower stall in case the chief executive felt the need of une douche before a speech (as Sarkozy did).

France and Germany

Tensions are mounting between Paris and Berlin as Hollande and Ayrault meet with leaders of the German SPD in Paris. Meanwhile, linguistic boundaries are being crossed everywhere in Europe. The German edition of the Financial Times, concerned about the possible consequences of a Syriza victory in Greece, published an appeal in Greek asking voters in Greece to reject the party of the extreme left. Meanwhile, Jean-Marc Ayrault, an accomplished Germanist, was asked by an interviewer to address Frau Merkel in German, and he obliged, quite credibly to my ear (which is to say, his German accent is a good deal better than mine--not surprising since he taught the subject for many years):


Wednesday, June 13, 2012

France Will Propose New Stability Package

France is set to propose a new stability package for the Eurozone. It would have the ECB tighten bank supervision and the ESM (European Stability Mechanism) authorized to recapitalize banks directly rather than through governments (as in Spain). The French believe, rightly, that the negative market reaction to the Spanish bailout shows that a new formula is necessary.

The La Rochelle Drama

The French press has been distracted by the Trierweiler-Royal saga from the real story in the 1st District of Charente-Maritime, which is why a second banana like Olivier Falorni is in a position to eliminate one of the Socialist Party's elephants next Sunday. Some polls have Falorni winning with 58% of the vote, which is extraordinary. Royal is not une parachutée in the region. She has been its governor for years. To be sure, her candidacy was imposed by the national party on the local federation, but it is a district that has been reserved for a woman, so Falorni's challenge was a break with party discipline. Why are the rank-and-file voters supporting him? Is it Royal they resent? Is it the presumptuousness of the national party? Are there local issues that are driving this contest? The press has been remarkably uninformative about all this, preferring to concentrate on what the media clearly hope will be a mud-wrestling, hair-pulling contest between the "president's two women," as Hollande puts it. All this is diverting enough on a human level, but it leaves out the politics of the situation.

As for some of the overheated reaction in the comments section of a previous post, I can only say I am flabbergasted by the blindness that partisanship can induce. Hollande's connubial arrangements may be unconventional, but his predecessor's marriage to a gauchiste songstress who warbled about her "trente amants," who had affairs with a father and son, who slept with rock stars and prime ministers, and whose nude pictures can be found all over the Internet hardly fit the traditional mold either and certainly alienated more right-wing voters than Trierweiler's tweet is likely to alienate left-wing voters. As one commenter said to another, "Get a grip!"

Tuesday, June 12, 2012

Normal Presidency Ends, Cat Fight Begins

Just when you thought things couldn't get any more normal, Valérie Trierweiler (allegedly) tweets support to Olivier Falorni, the dissident Socialist who may defeat Ségolène Royal in Poitou-Charente.

I think the press was getting a bit bored with normality and endless Socialist victories. So now we have something to replace Mélenchon vs. Le Pen.

Mais, mon dieu, ça manque de classe. Hitherto sans faute, the Hollande presidency is now in danger of becoming a laughingstock.

The Green Economy and the Growth Agenda

A manifesto, here:

Une véritable transition social-écologique peut nous permettre de dépasser la mondialisation à somme nulle, de sortir de la torpeur européenne et d’atténuer le malaise national. La crise que nous traversons n’est qu’en apparence un obstacle à cette ambition : elle signale une transition structurelle qui périme les modèles du passéet donne ainsi l’audace de se poser les bonnes questions et d’avancer des propositions novatrices. Commençons par le niveau global. (h/t EL)

Monday, June 11, 2012

Report on Taxation and Redistribution in France

From the Institut des Politiques Publiques, here. I haven't had a chance to read this yet, but it looks quite interesting.

France Will Tighten Rules on Layoffs

The new government plans to make it more difficult and expensive for firms to lay off workers. "The main idea is to make redundancies so costly that it's not worth it," said Michel Sapin, the new labor minister. I'm no neoliberal apologist, but I think this is a terrible idea. France needs to improve its competitive position in the world. It has too many workers in declining industries and too many plants that are suboptimal in size and technology for today's markets. It's wishful thinking to believe that this can be combated by fiat, but the government is apparently sufficiently desperate about rising unemployment numbers to resort to a measure that is likely to worsen the situation in the medium term, even if it prevents further losses for a few months or years. Perhaps Hollande is less of a centrist than I thought he was, or perhaps the balance of forces within the party is not quite what I believed.

Joffrin Analyzes Mélenchon's Failure

For Laurent Joffrin, Jean-Luc Mélenchon failed in the presidential election and even more spectacularly in Hénin-Beaumont because he misdiagnosed the state of mind of the working class:

Autant Jean-Luc Mélenchon a fait preuve depuis un an d’un grand talent, d’un abattage exceptionnel et d’une réussite certaine en donnant à la gauche de la gauche une visibilité inédite, autant il paie le prix d’une grave confusion idéologique. Son aventure reposait sur un postulat : pour ramener à gauche les classes populaires détournées par le vote FN ou l’abstention, il fallait radicaliser le langage, la tactique et le programme. Un discours agressif et dénonciateur, le refus de toute perspective gouvernementale avec les socialistes honnis, des propositions de rupture en matière économique ou d’immigration : il fallait en tout point déclarer la guerre au réformisme. Pour séduire les ouvriers déçus par la gauche, il fallait être beaucoup plus à gauche. C’est ce raisonnement, plus que le candidat Mélenchon, qui a échoué à Hénin-Beaumont.
Les classes populaires, contrairement au postulat mélenchoniste, ont les pieds sur terre. Elles se méfient de la radicalité verbale qui recouvre avant tout l’irréalisme. Aussi bien, un candidat qui proclame à tous vents que l’immigration ne pose aucun problème ne saurait remporter un grand succès auprès des ouvriers et des employés, qui craignent la concurrence d’une main d’œuvre sous-payée et corvéable à merci.
I think we all tend to overinterpret the results of elections. One could equally well point to the fact that the Front de Gauche was not nearly as well organized in H-B as the Front National, that Mélenchon, even more than Le Pen, was un candidat parachuté, who chose the district only because he wanted a symbolic and ego-nourishing confrontation with the leader of the FN, and that Mélenchon's focal issues were particularly ill-adapted to the situation on the ground in the district. Still, I think that Joffrin's basic point--that gauchiste intransigence did not pay off--is correct. The left of the left will now have to rethink its position. It can still play a useful role as critic of the center-left government. What was not useful was the attempt to construct a duopolistic cult of personalities pitting a charismatic orator of the extreme left against the dynamic heiress of the FN dynasty. Mélenchon défrayait la chronique for a while, but his failure leaves the left of the left adrift, leaderless, and in search of a new message. The attempt to revive, if only rhetorically, the revolutionary militancy of a bygone era has been definitively rejected. It's time to move on.

Sunday, June 10, 2012

Le Pen Beats Mélenchon


Législatives : Jean-Luc Mélenchon reconnaît sa défaite à Hénin-Beaumont

Le leader du Front de gauche est arrivé en troisième position du premier tour des élections législatives dans la circonscription d'Hénin-Beaumont (Pas-de-Calais). Marine Le Pen est arrivée largement en tête du scrutin devant le candidat du PS, Philippe Kemel.

Left Wins Legislatives


Législatives : de 305 à 353 sièges pour la gauche parlementaire

La gauche emporterait de 305 à 353 sièges aux élections législatives d'après des projections réalisées par Ipsos pour "Le Monde", Radio France et France Télévisions. Le PS aurait de 270 à 300 députés, EELV de 8 à 14 et le Front de gauche de 14 à 20. La droite parlementaire aurait de 227 à 266 sièges dont 210 à 240 pour l'UMP. Le résultat du Front national oscille entre 0 et 2 députés. La majorité absolue est à 289 sièges.

Couple of things to note. The PS by itself does not have a majority. The Front de Gauche did better than EELV. And the turnout was extremely low.

Saturday, June 9, 2012

Six Ministers in Jeopardy

There are legislative elections in France tomorrow, in case you've forgotten. The campaign has gone all but unnoticed, and, even more than in the presidential election, the issues have been avoided, as Arun Kapil notes. Since ministers must win their seats in order to remain ministers, there are six who may be in trouble:

Pour d'autres sortants, la situation est plus incertaine. C'est le cas d'Aurélie Filippetti (culture et communication) dans la 1re circonscription de Moselle, où M. Hollande a obtenu 52,3 % le 6 mai ; de Jérôme Cahuzac (budget) dans la 3e de Lot-et-Garonne (51,8 % pour M. Hollande) ; de Marisol Touraine (affaires sociales et santé) dans la 1re d'Indre-et-Loire (51,8 %) ; de Pierre Moscovici (économie et finances) dans la 4e du Doubs (51,27 %) ; et de Sylvia Pinel (artisanat, commerce et tourisme), seule ministre membre du Parti radical de gauche, dans la 2e de Tarn-et-Garonne (50,9 %).
Of course they're in trouble only because Hollande and Ayrault decided to emulate Sarkozy's gambit of imposing this rule on their ministerial choices. It kept Juppé from becoming a super-minister in 2007, as originally intended (or perhaps it was Sarko's intention all along to neutralize Juppé by naming him to an important post but imposing a rule that was likely to prevent him from assuming it, as turned out to be the case). But what was the purpose of the rule? Later in his presidency, when he wanted Juppé for a different ministry (foreign affairs), "respect for democracy" apparently no longer required his surviving a baptism of fire.

The whole business is faintly demagogic. The French government, unlike the British, is not an emanation of the legislature. It is a distinct constitutional entity, and there is really no good reason why ministers should be required to win elections if they happen to run but, if they don't, to serve without impediment.

Socialist Could Win in North America Constituency

In something of a surprise, the Socialist candidate has a chance to win a seat in the National Assembly to represent the new North American district covering the US and Canada and comprising some 155,000 French nationals.

Closing Nuclear Plants

François Hollande has promised to close the Fessenheim nuclear power plant, which has reached the end of its lifetime. He may close others, depending on whether or not he reneges on his agreement with the Greens (at the moment, he seems to have cooled on the plan). But what will closing plants cost? A nice article by Brad Plumer is illuminating on this point.

Friday, June 8, 2012

The Right and the Poor

Andrew Gelman sets out to debunk a myth about the US electorate but in the process demonstrates that France is an anomaly. The myth is that blue-collar workers vote for the right in the US, and Gelman claims that this is false. Of course his evidence compares voters in the upper third of the income distribution with those in the lower third, which is not necessarily identical with blue-collar. But what interests me is not whether Gelman is right or wrong but rather the place of France in the middle graph below:


As you can see, France is an outlier, a country with high GDP per capita in which the poorest third of the population is more likely to vote for the Right than for the Left. I wish I knew the source of the data on which these graphs are based.

The Feminization of the FN

Like the party's base, the FN's candidates are younger and more of them are women than in the past. All the dynamism on the right is with the FN. With Copé as leader of the UMP and a series of scandals likely to plague the party in the press for years to come, the UMP risks being ringardisé as the FN gains strength. Could the next few years bring a party realignment in France? It's not out of the question.

Thursday, June 7, 2012

Wisconsin Conference

Back in April, between the 2 rounds of the presidential election, I took part in a conference at the U. of Wisconsin in which I spoke about French politics and its implications for the euro. Today, over at Econbrowser, Menzie Chinn, who also participated in the conference, refers to his lecture and also gives a link to video of the whole conference. By now, the first part of my lecture is outdated, of course, since we know how the election turned out, but if you're interested, it starts at about minute 23. Menzie precedes me, George Ross follows, and then there is a question session. You can learn about the economics of the euro zone from Menzie and about the politics of the European Union from George.

Greece, Cradle of Democracy

The political debate in Greece really is heating up. Be sure to watch all the way to the end, even if it's all Greek to you:




Story here.

Fess up, François!

Le Monde thinks François Hollande isn't coming clean with the voters:
En dépit de prévisions d'une croissance du PIB faible et d'une pluie d'avertissements de la Cour des comptes, de l'inspection générale des finances ou de la Commission européenne sur le dérapage des dépenses, le gouvernement s'abrite derrière un audit sur l'état des finances publiques opportunément attendu fin juin, après les élections. En attendant, il n'annonce que des nouvelles sympathiques : hausse du smic, majoration de l'allocation de rentrée scolaire, retraite à 60 ans pour ceux qui ont travaillé jeune...
La zone euro est en feu. Non seulement ce flou persistant n'aide pas à maîtriser l'incendie, mais les électeurs français seraient en droit de connaître, au moment de retourner aux urnes, les véritables intentions du gouvernement. Le devoir de vérité incombe à la gauche comme à la droite.
But why should Hollande change what has been a winning strategy until now? Vagueness served him well in the primaries; ambiguity won the presidential election; and polling shows that evasiveness, along with a policy of announcing only good news, is winning the legislatives. So we won't really know how Hollande plans to govern before the end of June and perhaps not until the rentrée. There's just no incentive to honesty. It's a pity that Hollande's models are François Mitterrand and Jacques Delors rather than Pierre Mendès France. But then again, PMF didn't last very long as président du Conseil, did he? Honor in politics rarely translates into effectiveness, and Hollande may well have a better idea of what it will take to govern effectively than I do.

Nein!

Angela Merkel has answered the call for "growth" from François Hollande, and her answer is "Nein!" Of course she also has to persuade her own opposition--SPD and Greens--that this is the correct answer, or Germany won't ratify its own fiscal pact. The SPD has decided to put the question to a party referendum. Unfortunately for Hollande, what this signifies is that there is considerable opposition within the SPD to accepting the French proposal, whose contours remain quite vague. Germany's policies have not worked out too badly for German workers--at least for the ones who are employed, as most SPD members are--so there is no groundswell of worker sentiment for greater European solidarity. The SPD leadership may be sympathetic to Hollande's position, but the leadership is not prepared to stick its neck out if the rank-and-file are prepared to lop off its head.

In short, Hollande had better have a plan B. Having said that he opposes the fiscal (Merkozy) pact as it stands, he may find himself boxed in when it is ultimately approved by Germany, as it likely will be.

Wednesday, June 6, 2012

Galbraith: Solidarity, not Growth

In a hard-hitting piece, James Galbraith argues that what Europe is needs is not more "growth"--a meaningless nostrum, he says--but more "solidarity."

If you still think DSK is news ...

.. you can read this extended ad (in the guise of a news article) for the new book on "Les Strauss-Kahn" by Le Monde journalists Raphaëlle Bacqué et Ariane Chemin. Personally, I've had it with DSK. Like BHL, he no longer interests me.

For a rather different take by a young African woman, try this.

Retirement Reform Redux

Retirement reform in France is a bit like the peace process in the Middle East. An endless saga, negotiations over the most minute details (will women who bear children get credit for one or two extra semesters of contributions? do "long careers" begin at 17 or 18?), and in the end, not much happens. So 110,000 additional people will be allowed to retire at age 60 if they choose, and it will cost the state an additional €3 billion to be covered by a hike in cotisations of "only" 0.5 points, according to Marisol Touraine.

This is the "managerial socialism" that Pierre Rosanvallon lamented in his conversation with François Hollande, to which I linked the other day. Little bits are changed around the edges to permit the left to differentiate itself from the right. The essential vision remains unchanged. The necessary overhaul of the whole retirement system is deferred if it is even so much as considered. The whole structure of remuneration and its effects on competitiveness are not discussed. Disillusionment with the mainstream parties increases. Friends to my left chide me: "But what did you expect?"

To be honest, this is what I did expect, but I reserve the right to be disappointed. Crises are supposed to concentrate the mind. Evidently things are not yet bad enough for any real thinking.

Tuesday, June 5, 2012

The Rent Control Decision

I commented earlier on Cécile Duflot's announcement of a new rent control measure as a political ploy. In that sense it may be successful as an appeal to the left of the Left. As economic policy, however, it is more questionable. France unquestionably suffers from a shortage of housing. It also has a very high unemployment rate. The obvious thing to do would seem to be to put unemployed workers to work building houses, no? So why not try that instead of controlling rents?

Well, one reason is that "the coffers are empty," as Sarkozy used to say. But this is not entirely persuasive, given Hollande's pledge to stimulate new investment via some kind of public investment bank. New housing would be an obvious choice, since the demand is known to exist. To be sure, there would be a lag before the pressure on rents was alleviated, but a lag is better than an imposed rent control that is likely to choke off any new supply of housing.

Another reason is the current credit squeeze, as investors fly to safety. But it would be better to put some of this capital to work building houses than parking it in sovereign debt yielding close to zero. A better use of the government's prerogatives would be to devise incentives to funnel this money where it's most needed.

Perhaps, after the legislative elections, France can debate this issue rather than rely on executive orders to impose rent control. One hopes that the turn to rent control as a sop to the left of the Left is not a sign of the direction that Hollande intends to go in economic policy. This is a bad decision, but it is not yet set in stone. There is still time to revise it after the elections. Matt Yglesias offers a similar analysis here.

Legislatives: Looking Good for the Left

Polling shows the Left doing well in the upcoming legislative elections. The French apparently don't like cohabitation and, despite J.-F. Copé's ominous warnings, seem prepared to let the Left has its chance to see what it can do. Surprisingly, the Left is also doing well in the overseas districts created by the UMP in the hope of adding to its majority during the fat years.

Rent Control, Nuclear Control

Cécile Duflot has announced a measure to limit permissible rent increases in case an apartment is rented to a new tenant. There is perhaps less than meets the eye in this measure, since the allowable increase is linked to an index of rents that is itself increasing. But the announcement is a useful crowd-pleaser in advance of the legislative elections and pending a promised new law on rents.

Meanwhile, there are rumors that Hollande might oust Henri Proglio from his post as head of the nuclear firm Areva. On the other hand, Hollande's promise to cut French dependence on nuclear-generated electricity from 75% to 50% by 2025 has now been downgraded, according to some advisors, to a mere "aspiration."

So it's interesting that Cécile Duflot, who comes to the Socialist government from the Greens, is the minister who is tasked with announcing the rent-control measure, which will please the left of the Left, while her own Greens, who didn't contribute much to the Hollande victory, are left to wonder what became of their dream of shutting down the French nuclear industry.

Euro Deal in the Offing?

Outlines of a euro deal have begun to leak. The plan would be to absorb all "non-Maastricht compliant debt," that is, national debt exceeding 60% of GDP, into a fund that would be paid off by all member states over 25 years. In exchange, members states would give up additional control over their national budgets to a central authority, although it remains sketchy what this would entail.

Clearly, the crisis has entered a new stage. Portugal announced an infusion of new capital into its banks, and Spanish banks have been in the news for weeks. So the Germans are ready to make their move, lest the whole system collapse, and now we will see what they want in return for their cooperation. The price is not likely to be small, and the political ramifications in the south will be interesting to watch.

Monday, June 4, 2012

Magic Mosco

Pierre Moscovici says that France will trim its budget deficit to 3% of GDP by 2013 without austerity. I breathlessly await further details. Perhaps the state has signed a contract with David Copperfield.

The Noose Tightens around Europe.

Stories here and here. Of course the latter story, which reports a massive sell-off of euros by central banks, could have an upside: the fall of the euro should at some point begin to stimulate exports. And then there's George Soros:

Financial panics subside and the authorities realize a profit on their intervention. But not this time because the financial problems were reinforced by a process of political disintegration. While the European Union was being created, the leadership was in the forefront of further integration; but after the outbreak of the financial crisis the authorities became wedded to preserving the status quo. This has forced all those who consider the status quo unsustainable or intolerable into an anti-European posture. That is the political dynamic that makes the disintegration of the European Union just as self-reinforcing as its creation has been. That is the political bubble I was talking about.

OMG! A Touted French University!

A new survey ranks relatively young universities (under 50 years old). Too bad it didn't happen before the election. Sarkozy could have claimed credit for a French success story (if there is any more reason to believe this ranking scheme than the others):

Also highly ranked were the École Polytechnique Fédérale de Lausanne in Switzerland; the Hong Kong University of Science and Technology (HKUST); the Korea Advanced Institute of Science and Technology (KAIST); Université Pierre et Marie Curie in France; and the Irvine and Santa Cruz campuses of the University of California. Three British institutions — the University of York, Lancaster University and the University of East Anglia — rounded out the top 10.

Sunday, June 3, 2012

More on Identity Checks

Yesterday, I linked to an important post by Arun Kapil on identity checks in France. This started a lively discussion in the comments section, which prompted Arun to add to his original post. I'd now like to add a few comments of my own. Constitutional rights do not enforce themselves. The state's attitude is crucial. What prompted Arun's post in the first place was an apparent change in the attitude of the French state: the new interior minister announced that police will henceforth required to justify identify checks and supply receipts to people who are stopped for controls. The old minister, Claude Guéant, immediately responded that he thought this was a bad idea, because one can trust the police to distinguish between someone who "looks like a dealer" and someone who doesn't (as if everyone stopped by the police had that "look," and as if such a bald assertion would be quietly accepted by the population at large). And a cop accuses the Socialists of "angélisme" and adds that "in the station houses, police are snickering."

Now, it's quite true that abusive identity checks are common in the United States as well as in France. Everyone knows about "stop and frisk" procedures in certain neighborhoods, "special regimes" in states that border on Mexico or have large immigrant populations, anti-gang laws in cities like Los Angeles that give police broad license to do as they please, and the use of minor infractions such as a broken taillight to stop suspects guilty of "driving while black" or "driving while young" (in years long past I myself was subjected to this kind of stop on the New Jersey Turnpike for driving with long hair). And if one's taillight doesn't happen to be broken, it can always be broken after the fact.

But there is a difference between the behavior of the police in the US and the police in France. The French police seem to make a point of conducting checks in very public places: in railroad and Metro stations, on busy streets, etc. And often they go out of their way to make it clear that there is no particular reason for the check. It has always seemed to me that there was a reason for this publicity: the police wanted their action to be visible, they intended to assert that, even if they might not have the right to do what they were doing, they had the authority, since no one would or could stop them. No court would hear any complaint against them. No public official would dare chastise them. And indeed, few citizens would dare to protest, because everyone recognized the futility of doing so. In the US, these practices continue in certain neighborhoods, whose residents know, similarly, that protest from them would be futile or impractical. But outside of those areas, there are people who could and would protest if the police made a spectacle of their high-handed behavior. In France, the police have the upper hand and do not shrink from showing it.

Will that now change? Who knows? A ministerial decree can be combated on the ground in many ways. A warning has been given, but the struggle for enforcement has only just begun.

How Do European Economists View the Euro Crisis?

Survey results here. Most expect a fiscal union to result, and most do not expect Greece to leave or be expelled from the Eurozone. Depending on whether or not you think that economists are any less clueless than the rest of us, this may or may not be taken as "information" about the state of play.

Saturday, June 2, 2012

And meanwhile, in Quebec ...

University reform is contentious in France (see earlier post). Apparently, it's also contentious in la Nouvelle France, Québec. Vive le Québec libre! (h/t GR)

Kapil on Identity Checks

An important note by Arun Kapil. Read it.

Reforming the University Reform

Was I wrong? I fairly confidently predicted that the Hollande administration would let stand the changes in French higher ed wrought by the LRU, better known as la Loi Pécresse, which shifted power from the Ministry of Ed to university presidents. Or so it was said. Pécresse's replacement, Geneviève Fioraso, about whom I know nothing, claims that in fact this ostensible transfer of power was "a fake," and that university presidents who tried to act on their own were soon shot down by the ministry.

This wouldn't entirely surprise me. Indeed, this is the historical pattern of decentralization reforms in France. In any case, Fioraso says that the new government will file a bill proposing a new reform. But--and the nuance is worth noting--the new reform will be based on the same principle as the old, that power should be shifted away from the center. But this time, she says, there will by no "hyperpresidentialization" and "more coordination" with faculty, staff, and other interested stakeholders. Could even be true. So was I wrong or right? The principle of the old reform will remain, but the implementation will be different, so I was right. On the other hand, the implementation may be so different that the principle itself is changed. That is the hope of opponents of the LRU. So I was wrong. Or, then again, the new implementation may be thwarted by ministerial reflex, as the old one allegedly was, in which case, plus ça change, plus c'est la même chose.

Mélenchon Gets His Wish, Sort Of

During the presidential campaign, Jean-Luc Mélenchon called for the US Sixth Fleet to be withdrawn from the Mediterranean. Now it has been announced that the bulk of the US Navy will be shifted to the Pacific. Probably not exactly what Mélenchon had in mind ... but still a rather ominous development, I think.

Friday, June 1, 2012

Irish Vote Yes

The Irish have approved the budgetary pact:


Les Irlandais ont voté "oui" au référendum sur le pacte budgétaire européen

D'après le résultat définitif du vote organisé jeudi 31 mai, 60,3 % des votants se sont prononcés en faveur du texte qui généralise le principe de "règle d'or" dans les 25 Etats de l'Union signataires.