Tuesday, October 28, 2008


Judah Grunstein accepts my description of Sarkozy's recent behavior but believes that his defects and qualities coexist in roughly the right combination to provide a specific for Europe's chronic ills. I don't disagree with Judah's rather optimistic corrective to my jaundiced pessimism, but I'm not sure that the cure, if it occurs, will redound to Sarkozy's benefit. His activism has pointed up the need for greater European-level coordination, particularly in economic and foreign policy. It has not demonstrated that the best way to achieve that coordination is to establish a cult of personality around a willful national dervish. Europe needs a leadership cadre whose interests somehow rise above their national and regional origins. As the history of the United States has demonstrated, it is a tricky thing to maintain a balance between the interests of the whole and those of the parts. Two things are essential: offices at the transnational level that fulfill the ambitions of the most ambitious men, and a professional civil service capable of providing continuity and support to those striving politicians. Europe's civil service is too small and EU offices, in their present form, are too unrewarding to create the nucleus of a superstate. The move from the Confederation of European States to the United States of Europe will not be easy, and Sarkozy's abrasiveness is not likely to make it easier.

Lone Ranger without Silver Bullets

Sarko has rediscovered the joys of constant media exposure and an announcement a day, but while the Lone Ranger role suits his personality, he seems to be without silver bullets when it comes to unemployment. Today's speech on employment could have been delivered before the crisis struck. There will be more of the same (the fusion of ANPE and Unedic will have been twice-blessed and again wished godspeed, though it is now nearly a year old) and more of the previously denounced (the "social treatment of unemployment," that supposedly failed remedy favored by the "Socialo-Communists" and emulated by Chirac before being dismissed by Sarkozy, who has now proposed a bolus of 300,000 subsidized jobs to revive the ailing market). Of course, unlike loan and deposit guarantees and capital infusions to banks, hiring the unemployed and transforming the bureaucracy require actual outlays of cash, which is in ever shorter supply. So we look forward to the details. And lest I forget, there will be a push to liberalize the rules governing work on Sundays. That should fully absorb the reserve army of the unemployed, who can be put to work selling appliances to those who haven't earned anything during the other six days of the week.

The Napoleon of Neuilly

Charles Bremner reports that the Germans have taken to referring to Sarkozy as the Napoleon of Neuilly. I take it that this is not a term of endearment.

Whither Securitization?

If "securitization" of mortgage debt had become such an indispensable instrument of construction finance, you may be wondering whether anything will be built in the future. Housing starts in France have plummeted 23 percent. But here is a discussion of further "innovations" in financial innovation. The watchwords seem to be "transparency" and "simplicity," to which we are to return from opacity and complexity.