Friday, September 5, 2014

Thirteen Percent

It didn't seem possible that things could get worse for François Hollande, but they have. A new poll has his approval rating at 13 percent. The new secretary for--get this for incoherence--foreign trade, tourism, and French living abroad apparently doesn't like to pay income tax and was forced to resign after 9 days on the job, when the ethics police caught up with him. Prime Minister Valls, whose popularity was supposed to boost the president's baleful numbers, lost 14 points in his own approval rating, which plunged to 30%. The most "approved" party in the country is the Greens (which doesn't mean that those who approve of it will vote for it, of course), after Hollande booted its leader, Cécile Duflot, and Valls trashed (not without reason) her signature act as minister of housing. The mood in Paris is grim.

And speaking of income tax, my fellow blogger Arun Kapil informs me that his income tax bill just doubled. The middle class was already groaning last year about tax increases under the Socialists, and now this, just as payroll taxes paid by firms are being reduced (again, not without reason).

On the vie privée front, as everyone surely knows by now, the ex-soi-disant Première Dame published her secrets d'alcôve yesterday, alleging that, yes, the president did drive her to a suicide attempt, and what's more, he was contemptuous toward the poor he is supposed to represent, allegedly referring to them as "toothless." In response, French journalism yesterday discovered the dental problems of the bottom decile of the French income distribution (apparently they have 15% fewer teeth on average than the rich--a distributional marker that Thomas Piketty somehow missed).

In foreign policy, Hollande yesterday was compelled to reverse his decision on the 2 Mistral amphibious assault vessels that France had been scheduled to deliver to Russia. With Russia on the march in Ukraine, the pressure from NATO to scotch the deal was too much. Again, it was the right decision, but it came only months after Hollande and his foreign minister Fabius had forthrightly stated that a deal was a deal, that international law forbade them to prevent delivery just because Russia was making menacing gestures, etc. So Hollande looks weak for standing strong.

To top it all off, the European Court of Justice ruled that a state subsidy to the semi-private ferry company SNCM was illegal, a decision that will likely drive the firm into bankruptcy. The illegal subsidy was paid by the previous government, but the current one will be left holding the bag when the firm collapses, throwing 2,000 people out of work. Hollande just can't catch a break.

This government is the Gang that Couldn't Shoot Straight, Les Pieds Nickelés, the Keystone Cops, and The Three Stooges all rolled into one. It would be amusing if it weren't so alarming. The loss of legitimacy has been precipitous. Disgust is mounting, as is unemployment, while deflation looms to the point where Mario Draghi was forced to take unprecedented action yesterday, dropping central bank rates to an historic low and commencing purchases of asset-backed securities, hitherto taboo in Europe. And meanwhile Europeans are worrying about whether they will be asked to "die for Donetsk," and a million Ukrainians have been displaced from their homes in a proxy war between Moscow and Kiev. And the specter of ISIS fighters returning from Iraq and Syria to wage jihad in infidel Europe is also weighing on people's minds. Dark times.