Saturday, January 10, 2009

Sarkozy's Impatience

An interesting comment from Bernard Girard this morning on Sarkozy's recently renewed zest for reform. Unlike many commentators, including myself, Bernard thinks that Sarko's motive is not to enhance presidential power (he's no different in that respect from his predecessors) but rather "to eliminate anything that might stand in the way of rapid execution of his instructions." His impatience is structural as well as characterological: the short duration of the quinquennat makes it essential for a president who intends to run for reelection on a platform of "reform" to get rid of procedural obstacles to getting things done. When it was possible to donner du temps au temps, one could temporize, dicker, negotiate, or simply outwait one's opponents. Now one has to steamroller them.

Procedural bottlenecks are not merely impediments to impetuosity, however. They are also checks on autocratic temperaments. An obstacle removed today in the name of efficiency is a potential point of resistance absent tomorrow when it may be needed. This is not an argument for government by quagmire, in which the headlong rush to disaster is prevented by ensuring that every attempt to move forward ends up to its axles in the muck of soggy opposition. It is, however, a brief on behalf of dialogue. When obstacles are eliminated and carefully prepared reforms rush ahead to conclusion, there is little opportunity to take account of the voices of those affected, whose resistance to change, while sometimes narrowly self-interested, may at other times afford an opportunity to impart useful information to would-be reformers, without which their project, however efficiently executed, is doomed.

Stimulus to Date

Libé attempts an accurate accounting of French bailout and stimulus measures to date and reduces Patrick Devedjian's incredible figure of 428 billion euros to a more plausible 50-60 billion, including both loans to banks and new investment.

Which is still a lot of money--3 percent of GDP--but it's not all "stimulus," a point that Libé fails to make clearly. Sarkozy himself seems intent on obfuscating this point. He has been extolling the state for making "a good investment" by lending to banks at 9 pct. "Is there anyone here whose savings are invested today at 9%?" he taunted his audience.* Well, on the one hand, he's counting his chickens a bit soon: the loans haven't been repaid, and in the nature of things the risk of default is not insignificant. On the other hand, banks borrowing from the state at 9 pct must need the money pretty badly, and they're not likely to be lending it on at a higher rate. This is a backstop in the form of emergency bridge loans, not a stimulus.

*Mais surtout, c’est 10,5 milliards placés à 9%. Je demande : y-a-t’il un seul d’entre vous qui aujourd’hui a placé ses économies à 9%?