Wednesday, July 18, 2007

Bayrou Surfaces

By some estimates, François Bayrou could have won the election if he had made it into the second round. So it's all the more surprising that the man whom a majority of the French would have preferred to Sarkozy, according to several polls, has all but disappeared from the political stage. Now he has been resurrected, however, by Rue89. Resurrected just long enough to say that, Jack Lang notwithstanding, France will always have a prime minister in addition to a president. "It's a joke" to think otherwise, he says. I'm not sure how he can be so confident, especially since he also blasts what he calls the "Americanization" of power under Sarkozy. By this he appears to mean the ubiquity of the president.

Of course there is some justice to the charge that the United States now exemplifies the "imperial presidency," but, constitutionally speaking, there are more checks, balances, and veto points in the American conception of power than in the French. Bayrou's allegation is more guilt by association (with Bush, primarily) than constitutional scholarship. Bayrou might do well to reflect on the ways in which democratic politics under modern conditions (mass media, mass parties, mass advertising, and massive amounts of money) tend toward imperial presidencies no matter what constitutional niceties are intended to prevent such hypertrophy of the executive. James Madison already doubted the effectiveness of "parchment barriers" even as he attempted to create them. Bayrou's pious hope that the prime minister might be the "bearer of autonomy vis-à-vis the president of the Republic" ignores the reality mentioned yesterday by one of the appointees to the constitutional reform commission: the heavy turnout for the presidential election and the lively interest aroused by the campaign demonstrate continued popular support for a president who, like a monarch, is the incarnation of the nation.

Confidence Shock

In a moment of candor, Christine Lagarde asserts that the true purpose of the government's fiscal package is to create a "confidence shock." One has long suspected that the kinds of "shocks" of which economists speak in their technical lingo of models, time series, lagged variables, and vector regressions hold little interest for President Sarkozy. He may, however, hearken to a different economist's language, to John Maynard Keynes and his "animal spirits." What he aims to build is an urge to act akin to his own and a Micawberish confidence that "something will turn up." Investors should be lean, hungry, and cocky, not sated, lethargic, and pusillanimously risk-averse.

As for the aspects of the tax package likely to exacerbate inequalities, Lagarde is equally candid: "I accept responsibility for them." If the rich get richer, if tax exiles return home, so much the better, she hopes. She might have defended her position at greater length but appears to regard such a defense as unnecessary; the voters have expressed their indifference to the matter, she seems to be saying.

Nevertheless, the whole question of the widening gap between rich and poor deserves lengthier treatment, especially since a number of recent studies show that the phenomenon is nearly universal, occurring in countries with very different tax regimes, so that tax policy shouldn't be taken as causal (whether and how tax policy might be used as a remedy ex post are separate questions). The real causal elements are in a way more troubling than the simple greed implicated in tax-reform measures that favor haves over have-nots. Perhaps I'll find time to discuss those elements in subsequent posts, but I'm not sure that a blog is the best place for the extended discussion this would require. The point of immediate political interest is simply that Lagarde feels no need to defend the government's lack of interest in doing anything to diminish inequality by way of tax policy. Au contraire.

It will be interesting, therefore, to see if "equality" is invoked, as it most likely will be, when the agenda turns to reform of the special retirement regimes. At that point the government will almost surely attack the "privileges" of those now covered by such regimes. The sacrifices they will be asked to make will be justified in the name of equality, whereas for the present equality is to be sacrificed to the growth that Lagarde expects will follow the tax-cut stimulus and contends "will benefit everyone."

American Francophilia

So who reads this blog in the United States? If you were to map American francophilia, what do you think it would look like? A map of blue-state America?

A reasonable first guess, but wrong: actually it resembles a map of influence in antebellum America more than anything else. The dominant states are Massachusetts (but perhaps one needs to control for the fact that I'm a homeboy and that there's a link on the Web site of the Center for European Studies), followed by New York, Virginia, and Pennsylvania.

Then there's a sort of bloc in what used to be called the Northwest Territories and the Missouri Compromise area: Illinois, followed by Minnesota, Missouri, and Iowa.

Across the old Black Belt we have solid contributions from NC, Georgia, Florida, Louisiana, and on into Texas and New Mexico.

The west is led by California, of course, followed closely by--surprise--Nevada (but I believe the faithful Greg Brown may account for most of that traffic himself), and then Washington.

Montana, Wyoming, Nebraska, SD, Mississippi and West Virginia have generated no traffic whatsoever. Do we attribute this to francophobia, sparse population, the digital divide, or just having better things to do than read blogs about France?

Minimum Service

The minimum service debate is now the order of the day, the government having introduced its bill yesterday. Bernard Thibault has mounted the barricades, but Libération, which gave him ample space to air his views and might be expected to be his most likely supporter in the press, takes a decidedly tepid position in an editorial signed by Laurent Joffrin, calling upon both government and unions to tone down their rhetoric and negotiate.

Indeed, the rhetoric could stand a little chastening. Thibault speaks of an assault on "the constitutional right to strike." Presumably he has in mind Article 34 of the Constitution, which in fact stipulates only that "the law," which is fixed by acts of Parliament, "determines the fundamental principles of ... the statutory regulation of labor, unions, and social security." The burdens to be imposed on strikers (48-hour advance notice, requirement to vote on continuation by closed ballot after one week off the job) fall well short of, say, the powers of injunction granted to the US government by the Taft-Hartley Act. In pragmatic terms, use of the right to strike has declined sharply in the public sector in recent years: transport workers were out an average of 0.8 days last year, and in the RATP (Paris Metro), where a prior notice measure similar to that proposed by the government was negotiated between unions and management, the average number of days lost to strikes has declined from 0.8 to 0.4 per worker per year over the past ten years.

So what is really at stake? When asked if the minimum service law was not a way of heading off trouble over proposed reforms of the special retirement regimes, Thibault replied, "Sure, you can see it as a precautionary move, a way of anticipating discontent that the government's actions may stir up." And he promised that in September his union would launch a major "educational campaign" about retirement regimes.

In the back of everyone's mind, of course, are the events of 1995, when Alain Juppé's government attempted to reform the special regimes, provoking strikes by the transport unions that paralyzed the country and eventually brought down the government and brought the left to power. Transport strikes were a successful weapon then, but only because there was widespread opposition to the retirement reforms. As kirkmc pointed out in a comment to a previous message, there is not widespread support for unions to pursue a broader political agenda by using the right to strike in key sectors such as public transport to multiply their obstructive power. Nevertheless, the exact state of public opinion with respect to the larger issue of retirement reforms (and, beyond that, of the single labor contract) has yet to be tested. Thibault is maneuvering and skirmishing in advance of these anticipated major battles. A good deal has changed since 1995.

Opposition to DSK as IMF Chief

Opposition to Dominique Strauss-Kahn's candidacy to become head of the IMF is developing in the Third World. Finance ministers in Brazil, Colombia, and Argentina have challenged the "European lock" on the post as "archaic," and South Africa has joined the protest, which is not likely to succeed, although Brazil is seeking to involve India and China, a move that would add financial clout to the protesters' camp if successful.

Hugo Chavez has challenged the IMF more directly in recent years by using his petrodollars to help Argentina pay off its debt to the organization. DSK has sought to head off the revolt by promising to redefine the role of developing countries within the IMF.