Thursday, February 26, 2009

The Guillotine Falls

Christine Lagarde was on France2 last night to respond to the news that France had added 90,200 to its unemployment rolls last month. She looked decidedly less confident than she did last December, when she also went on television to say that France was standing up to the economic storm better than its neighbors (the fall in French GDP was somewhat less than Germany's, for instance). The confidence seemed misplaced at the time, and now there can be no doubt that it was, for this is not a crisis that can be avoided by massaging the data, putting a bright face on things, or simply ignoring bad news.

The social tension is palpable. Although there has been no major explosion yet, no one will be surprised if the French descendent dans la rue before the year is out. It's in their moeurs, after all. The recent "general strike" will have been a mere dress rehearsal for a major showdown. Why do I think this may be coming? Because President Sarkozy has thus far shown no disposition to change course. He persists in thinking that the reform program he advocated during his campaign remains appropriate as a response to the crisis.

To be sure, politicians everywhere see crises not only as challenges but also as opportunities. As Rahm Emanuel put it, "a crisis is too important to waste." But in order to seize the opportunity, to advance an underlying political agenda, one has to appear to be responding to the immediate challenge. This is Sarkozy's error. He seems to be saying, "I have the solution, and it is the same solution I have had all along"--as if the detaxation of overtime, which may have made some sense in 2007, still makes sense in 2009, with offers of employment plummeting. To be sure, there are aspects of the original reforms that could easily be accommodated in a revamped crisis policy, but for some reason the president seems to be resisting all pressure to reformulate his goals. Instead, he is seeking international escape. He will press the G20 for "greater coordination" and "more stringent financial controls." These items do not constitute a political program; they're points 1 and 2 in every post-crisis leader's Boy Scout Oath.

Is the problem that there's nothing to be done, that France is in reality at the mercy of forces beyond its control? To some extent, yes, but there are always things to be done in the realm of framing the challenge. Communication had been Sarkozy's forte, but his skills as communicator seem to have abandoned him.