Sunday, January 6, 2013

Times Expresses Impatience With Hollande

The New York Times thinks that François Hollande is moving too slowly on economic reforms. After all, the piece suggests, Hollande could simply overhaul French labor laws, end "corporate welfare," increase carbon taxes (as Ireland has done), and subsidize shorter working hours without reduction in pay (as Germany does with its Kurzarbeit program). The life of the editorial writer is so easy: he or she needn't recall that a higher carbon tax ran into a buzzsaw of opposition under Sarkozy; that "corporate welfare"--not only in France but also in the United States--is entrenched by powerful networks of interests, and that subsidizing shorter working hours may conflict with the imperative--which the Times writer fully acknowledges--of reducing French borrowing from financial markets. In sum, the Times editorial is little more than an exercise in nostalgia for the decisiveness of the Sarkozy years, when the president was so full of certitudes that the country lurched from one set of goals to another without so much as a moment's pause to catch one's breath in between.

Yes, Hollande is rapidly losing the support of many of the people who elected him. Yes, the prospect of a collapsing center is alarming to many intermittent observers of the French scene. And yet to propose that it's high time that the French simply "get on with" reforms that everyone knows must come is disingenuous in its utter neglect of the reasons why "stalemate" has been so characteristic a feature of French politics for so long and abject in its implicit comparison with the United States, which is silently portrayed as a place where people know how to get things done. And yet this same editorial writer may well have been working a day or two ago on a piece about the fiscal cliff deal as a classic exercise in kicking-can-down-road politics. Rather than blame "Flanby" for his mushiness, it might be better to recognize that mushiness is inherent in the structure of the crisis itself (and in welfare state retrenchment more generally).Is there a new world waiting to be born, or a field strewn with wounded lions awaiting opportunities to pounce as soon as they've regained the last necessary increment of strength? Multiple equilibria no doubt exist, with the conditions permitting transition from one to another murky at best.