The Left of the Left Demonstrates

The Front de Gauche and allied groups will demonstrate today against the austerity policy that the government of François Hollande has embraced. Their anger is comprehensible. Hollande artfully campaigned on the notion that there was an alternative to austerity. He promised to renegotiate the Merkozy agreement, now respectfully rebaptized the TSCG and erected as a sine qua non of sound government. The gauchistes are also perfectly correct in their analysis of the consequences of austerity: there will be plant closings, business failures, layoffs, and suffering. To all of this Hollande now argues--or, rather, implies--that There Is No Alternative. This is the famous Thatcherite justification for retrenchment. So the only question is whether Hollande's implicit analysis is correct.

So what is the alternative? If France were to try deficit spending, would investors park their money elsewhere and send French borrowing costs higher? This is not absolutely certain. Germany cannot absorb capital indefinitely, and interest rates are already negative. To the extent that investors wish to remain in the euro, France would still be attractive even if it were to diminish the budgetary shock. Hollande seems to be gambling on "shock therapy": if he concentrates all the pain--a shock to GDP of -3%--in his first year, then things will improve over the remainder of his quinquennat. This would be a better bet if Germany were stimulating its economy, but it isn't, nor is anyone else in Europe. Hence the risk is a mutually reinforcing contraction that will steepen the slide and leave everyone in a deeper hole.

Politically, Hollande seems to be tacitly assuming that he can brave the anger from his left, because the left of the Left has no place to go. The Right can cavil, but he is essentially continuing the economic policy of Sarkozy-Fillon and in fact pushing ahead where they were too timid to go. His cuts are deeper, his tax hikes are sharper than the Right dared while it was in power. This is a big bet for an essentially cautious politician like Hollande, and it's not clear where he retreats to if things go wrong. Nor does he have any carrots to offset the lash of his many sticks. The likely outcome is a sharp rise in anti-EU, anti-German, anticapitalist sentiment.

Ayrault Defends the TSCG

Mediapart once again leaps to the head of the pack in French journalism. The online "paper" has published a long interview with Jean-Marc Ayrault, the first in-depth defense of the TSCG by the Socialist government, which is now pushing for ratification by the parliament of an agreement negotiated by Sarkozy, which Hollande had promised to "renegotiate" but which is being presented to Parliament word-for-word as it was drafted by Merkel and Sarkozy. Ayrault, who is not unafflicted with la langue de bois, argues essentially that this agreement is but a step toward needed changes in European institutions. He presents the recent initiatives of the ECB as an example of such a change:

L’Europe est un combat, mais les peuples ont le sentiment que ce combat leur échappe. Il est illisible, mené d’en haut, technique… Or l’espoir suscité par la campagne électorale était aussi celui d’une repolitisation de ce débat européen. C’est une habileté tactique d’avoir promis une renégociation, qui est devenue une réorientation, et un pacte de croissance en complément, qui reprend des projets déjà engagés, sans objectifs précis d’emplois et de croissance ? Pourquoi avoir cédé au bout d’un seul sommet ?Ne faites pas l’impasse sur l’évolution du rôle de la BCE. Jusqu’à l’élection de François Hollande, c’était un sujet tabou. Là, elle s’installe progressivement dans un rôle qu’on souhaitait lui voir jouer. Ensuite, je vous ai dit qu’il fallait aller plus loin et porter d’autres investissements…

Now, this is more than a little disingenuous. It's true that the ECB's decision to support southern-tier sovereign debt is a positive step, which has averted imminent disaster. But it's also true that the conditionality of that support--contingent on austerity imposed on the recipient countries and enforced by threats of a cut-off of aid--sets an institutional precedent that social democrats may not wish to support. It's also true that the ECB's change of direction had little to do with Hollande's election and everything to do with the fact that the markets had lost confidence in the ability of the southern-tier countries to survive. Investors have now changed their views but only because the ECB is implicitly guaranteeing a floor price on the bonds they are acquiring.

Mediapart is correct to point out, in the very next question, that promises of future changes in European institutions are cheap talk of a kind that has long plagued European institution-building. If the process is to move forward democratically, the French government needs to lay some concrete proposals on the table and make room for public debate. Ayrault is essentially asking for a blank check: to reject the TSCG, he rightly says, would precipitate an immediate European crisis. True enough, but it's past the time when this sort of blackmail should be allowed to underwrite Socialist policy. What is needed is at least an outline of an institutional reform that makes sense in terms of allowing a unified currency zone to continue. Does Hollande have a plan? Are there discussions with the Germans? Have the Germans put forward a plan of their own? What are the ECB and IMF suggesting? Ayrault addresses none of these issues, but even this feeble effort is more than we have seen to date, and it does signal that the necessity of a reform process has been recognized at the highest level. How that process is managed will reveal a great deal about the Hollande administration. Decisions cannot be put off indefinitely, and the public deserves to hear about what is being considered in private.

Harlem Désir Named to Head PS

Martine Aubry, with the support of Prime Minister Ayrault, has proposed Harlem Désir to succeed her as head of the Socialist Party. The other leading candidate was J.-C. Cambadélis.

No Longer Passing Between Raindrops

On his inauguration day, François Hollande was drenched by heavy rains, but in the ensuing months he seemed to passer entre les gouttes, as they say. No longer. His approval rating has been falling sharply:

Un effritement à l'ifop (moins 2 points), un fléchissement chez CSA et TNS Sofres (moins 5 points), un affaissement pour Ipsos (moins 11 points).

The reasons will be clear to anyone who has been reading this blog over the past few weeks. Hollande's program has been looking increasingly incoherent. Any pretense to combat Europe-wide austerity seems to have been shelved. He has meekly accepted the fiscal pact, which he had promised to renegotiate. While that promise has been forgotten, other promises--to subsidize youth employment, roll back gasoline prices, hire new policemen and teachers--have been kept, but so has the insistence that the budget will somehow be balanced to respect the fiscal pact. Some tax increases have been announced, but not enough to compensate for the new spending.

The next few weeks may well prove decisive. Either he has a real plan in mind, or he intends to hold these contradictory good intentions together with chewing gum and baling wire, in which case the whole contraption may well fall apart, triggering protests from both his left and his right. I wish him well, but at this point it is hard to see where he is headed. If, in fact, his goal is the "balance-budget stimulus" recommended by Joseph Stiglitz, then he really owes it to the country to lay out in detail how he will shift government spending priorities to bring about growth while at the same time raising revenues to meet the requirements of the fiscal pact, which he now apparently supports.

Regulating Gasoline Prices

Pierre Moscovici looked very proud of himself while making the announcement: gas prices would be cut by 6 centimes per liter, "a very substantial amount." Even Total tried to put a good face on things: This will be part of our commercial strategy to show our clients that we are participants in the national effort, said, in essence, the firm's chief. The national effort to do what? To subsidize the burning of fossil fuel despite an ostensible commitment to reducing carbon emissions? To reduce the share of gasoline in the average family budget still further (it has in fact been declining steadily for decades)? To prove that, even if "l'État ne peut pas tout," il peut parfois quand même faire quelque-chose.

But who is the dupe here? If the state picks up 3 of those 6 centimes but Hollande sticks to his goal of reducing the budget deficit, taxpayers--including those who don't drive--will be taking change out of one pocket to put it in the other. What the companies contribute or don't contribute will soon be camouflaged by normal fluctuations in the market price of crude and the regular ups and downs of the euro.

In short, Opération Prix de l'Essence is nothing but de la frime, de l'esbroufe, even if it does make good on a Hollande campaign promise. It's no mystery why politicians everywhere--the US is no different from France in this respect--like this particular swindle. Nobody likes oil companies. They make too much money. They corrupt the state (notoriously so in France). They operate as virtual global powers and make their own foreign policy. And the market for oil, both crude and refined, is subject to various sorts of manipulation. Consumers are sensitive to the price at the pump. It's well-known to be a prime irritant simply because it's such a visible manifestation of the capriciousness of the market.

But really. Isn't there some more grown-up way to respond? Under Sarkozy one became inured to what Hollande himself memorably called le coup d'éclat permanent. It would have been nice if the new president, having named the vice, had refrained from perpetuating it. But a promise is a promise, alas.

Reality Bites

Austerity, unsurprisingly, has produced economic contraction across Europe. French unemployment is up sharply and, worse, long-term unemployment--the kind that permanently damages future employment and earning prospects--is up 22% in one year.

What does the Hollande government propose to do about this? It's very hard to say. Hollande, who many had hoped would lead anti-austerity forces, has rather meekly accepted continuation of the fiscal pact ("golden rule") concocted by Merkely and Sarkozy and has thus far seemed intent on realizing his (hopeless!) goal of reducing the budget deficit to under 3% by 2013. But these latest figures bring renewed pressure on the government to act decisively.

Decisiveness is not Jean-Marc Ayrault's long suit, however. He appeared tonight on France2 and offered a brief paean to "concertation," "deliberation," "discussion," and "dialog," as important, he said, to the whole of France as he had learned it was to collectivités locales--reminding viewers rather lamely of his long tenure as mayor of Nantes, as though to prove he was no amateur at this business by vaunting his long career in the bush leagues. It was a lamentable performance, not because there's anything wrong with concertation or deliberation but because Ayrault seems incapable of departing from the langue de bois he mastered in long years as the head of the Socialist group in an inhospitable National Assembly. To make matters worse, he was forced to put out a small brush fire started by Arnaud Montebourg, who announced that nuclear power was une filière d'avenir, when Hollande during the campaign had promised the Greens that he would begin to phase it out. It was a very poor beginning to la rentrée, which promises to be chaude, as workers, unions, left-wing voters, and some left-wing politicians lose patience with la force excessivement tranquille. Hollande's next move had better be carefully calculated.

The Socialists at La Rochelle

Is there any spectacle sadder than a French political party meeting when it is already in power? Since the parties these days are mere vehicles for selecting a presidential candidate, there's not much to hold the interest of outsiders when a party whose candidate has already been elected meets. This is not the moment for the ambitious to reveal themselves nor for rebels to propose bold departures from the status quo. So there will be no Sixth Republics this summer, no nights of the long knives (remember when Moscovici was left sitting alone in a café while other former DSKers went over to Aubry?), no Mélenchonesque reminders that the left in power hasn't really accomplished much or even set a clear course.

All the drama will be over at the UMP, where each of two former second bananas will attempt to emerge as the Contender.

But at least the Socialists aren't being threatened with annihilation by hurricane, which could be the fate of the American Republicans if Isaac stays on course.

Cumul des mandats

For a party that officially opposes le cumul des mandats, Socialist deputies are awfully fond of the practice. 19 of them hold three additional mandates, 80 hold 2, and 202 hold 1.

I know, I know: babbling about le cumul des mandats is what one does when there's no real political news to discuss. But whaddayagonnado? It's the middle of August.

Le Cacheux on Competitiveness

Jacques Le Cacheux has an excellent analysis of France's competitive position and of proposals to improve it. Among other things, Le Cacheux notes (as I have repeatedly emphasized here) that France has a serious problem in manufacturing due in part to high unit labor costs in that sector:

Pourtant, l’indicateur se référant à la seule industrie manufacturière délivre un message bien différent (graphique 2) : en moyenne depuis le lancement de l’euro, la compétitivité-coût de l’industrie française par rapport à ses partenaires de la zone s’est sensiblement maintenue, se dégradant très légèrement sur la période ; mais dans le même temps, l’industrie allemande a, quant à elle, très substantiellement amélioré la sienne – de près de 20%.

This is not the whole story of France's deteriorating current account balance, to be sure, but it is part of the story, and Hollande's determination to attack this problem is praiseworthy. In the remainder of his piece, Le Cacheux carefully analyzes the positive and negative aspects of both the social VAT and the CSG. Here is his bottom line--cautious approval of the Socialist strategy.:

Alléger le coût du travail en transférant la charge d’une partie du financement de la protection sociale vers des prélèvements autres que les cotisations sociales apparaît souhaitable et possible, tout en rendant le système fiscal français plus juste. Pour ce faire, il convient de compenser la baisse des cotisations sociales, patronales, mais aussi éventuellement salariés, par un alourdissement des prélèvements pesant sur la consommation et sur les activités polluantes, afin de modifier résolument les prix relatifs, donc les incitations qui pèsent sur les entreprises et les ménages dans leurs choix de techniques de production et d’emploi et dans leurs choix de consommation ; et de conduire en même temps une réforme de la fiscalité directe qui permette de compenser les effets négatifs de ces modifications sur le pouvoir d’achat des détenteurs de revenus modestes et de rendre l’ensemble des prélèvements directs plus progressifs. Alourdir la CSG sans conduire cette grande réforme[2] serait léser ces catégories.

Ayrault II: More than Meets the Eye?

The slight post-electiion remaniement of the Ayrault government, which saw the addition of four minor ministers, all unknowns, may be of greater significance than is first apparent, at least according to Médiapart. One story is that Nicole Bricq was removed from the ecology portfolio because she got in the way of offshore drilling and offended the MEDEF and Total. Bricq has been shifted to foreign trade, ostensibly a less important post (although reducing France's current account deficit is a major priority). And Delphine Batho, who takes over as ecology minister, is said not to have gotten on with Christiane Taubira, with whom she previously had to work at the justice ministry. Frictions and rivalries are of course part of any government, but these bear watching.

Bartolone Gets the Perchoir

Bartolone élu candidat PS à la présidence de l'Assemblée

Le député PS de Seine-Saint-Denis, Claude Bartolone, a été élu par ses pairs candidat socialiste à la présidence de l'Assemblée nationale, et donc plus que probable président à l'issue du vote solennel qui aura lieu mardi 26 juin. Il a recueilli 127 voix sur 258 au premier tour, devançant largement ses trois concurrents, qui se sont retirés, annulant le second tour.

Bruno Le Roux

Bruno Le Roux has been elected chair of the Socialist group in the National Assembly. No surprise. He is described as follows:

Homme de confiance de François Hollande, M. Le Roux a notamment négocié les accords électoraux avec EELV, avant de devenir l'un de ses porte-paroles de campagne.

Very interesting, because we have also been told that M. Hollande did not consider himself bound by the agreement between the EELV and the Socialists, because it was an accord between parties, not a pledge by the presidential candidate of one of those parties. But the chief negotiator was a man who has had his confidence since 2002 and who has just been elected "by acclamation" to head the party group, which suggests a nihil obstat from Hollande.

I suppose that la présidence vaut bien une promesse en ce qui concerne le nucléaire, a promise that the president apparently has no intention of keeping (rightly so, in my view). But one can imagine a certain rancor on the side of the Greens, unless they, too, were party to the deception and perfectly willing to trade a meaningless promise for a substantial number of parliamentary seats. If so, chapeau! Everybody played his part extremely well, and it's no wonder that Le Roux is being rewarded for being point man in this commando raid.

Le Perchoir

Suddenly, everybody wants to be president of the National Assembly. Ségolène Royal thought the position belonged to her, but voters got in the way. Now, Claude Bartolone, Jean Glavany, and Elisabeth Guigou are all after the spot. The Elysée and Matignon are said to want a woman, but there is "no consensus" around Guigou, whatever that means, so the name of Marylise Lebranchu has been floated, but she says she doesn't want it. It's a bit of a mystery why anybody wants the job. Does anyone remember who had it last? (Ans. Bernard Accoyer. Who's he? Right, that's the point.) Here's a radical idea: how about letting the deputies vote?

The Center Did Not Hold--or Did It?

Not only did François Bayrou lose his seat, but the center parties generally succumbed to the logic of a presidential system and its strong tendency to become biplar. But perhaps Hollande deserves more credit for this than he's generally given. His "centrist" approach to his candidacy, along with Socialist dominance of government at the local and regional levels, has weakened centrist fears of the Left. Just as the line between extreme-right and right has become increasingly blurred, so, too, has the line between center and center-left.

There may be a sociological basis to this result as well. The Socialist Party is no longer a workers' party. Most of the "workers" it retains are in fact public sector employees: schoolteachers, government workers, etc. Socially liberal professionals are plentiful in both Socialist and centrist ranks. Many of these people do not share the anti-EU, anti-globalization sentiments of either the extreme right or the extreme light, and they are put off not only by the droitisation of the center right but also by its crass pursuit of wealth (the bling-bling factor) to the exclusion of other cultural values.

Throughout the campaign, and indeed throughout the past five years, I argued that the 2012 election would be won in the center. My confidence in that interpretation wavered after the presidential, because 1) Sarkozy made a stronger showing than he should have if the center had really deserted him, and 2) I think Hollande won because the extreme right came to detest Sarkozysme as much as it has always detested the Left. But the legislative election makes me wonder if, indeed, France may have become a country where the majority is now in the broad center, which stretches from, roughly speaking, Hamon to Bayrou.

Interestingly, this very diverse "broad centrist" electorate may be easier to please when the issues are rather fragmented, as they are in a legislative election, than in a presidential election where a few high-cleavage issues tend to dominate the discussion, and where personal characteristics of the candidates ("the incarnation factor") loom large.

So perhaps I was right all along to think that France is now a country in which the center is trying hard to hold, and succeeding, even if the self-proclaimed "centrist" party(ies) fared quite poorly.

The La Rochelle Drama

The French press has been distracted by the Trierweiler-Royal saga from the real story in the 1st District of Charente-Maritime, which is why a second banana like Olivier Falorni is in a position to eliminate one of the Socialist Party's elephants next Sunday. Some polls have Falorni winning with 58% of the vote, which is extraordinary. Royal is not une parachutée in the region. She has been its governor for years. To be sure, her candidacy was imposed by the national party on the local federation, but it is a district that has been reserved for a woman, so Falorni's challenge was a break with party discipline. Why are the rank-and-file voters supporting him? Is it Royal they resent? Is it the presumptuousness of the national party? Are there local issues that are driving this contest? The press has been remarkably uninformative about all this, preferring to concentrate on what the media clearly hope will be a mud-wrestling, hair-pulling contest between the "president's two women," as Hollande puts it. All this is diverting enough on a human level, but it leaves out the politics of the situation.

As for some of the overheated reaction in the comments section of a previous post, I can only say I am flabbergasted by the blindness that partisanship can induce. Hollande's connubial arrangements may be unconventional, but his predecessor's marriage to a gauchiste songstress who warbled about her "trente amants," who had affairs with a father and son, who slept with rock stars and prime ministers, and whose nude pictures can be found all over the Internet hardly fit the traditional mold either and certainly alienated more right-wing voters than Trierweiler's tweet is likely to alienate left-wing voters. As one commenter said to another, "Get a grip!"

Normal Presidency Ends, Cat Fight Begins

Just when you thought things couldn't get any more normal, Valérie Trierweiler (allegedly) tweets support to Olivier Falorni, the dissident Socialist who may defeat Ségolène Royal in Poitou-Charente.

I think the press was getting a bit bored with normality and endless Socialist victories. So now we have something to replace Mélenchon vs. Le Pen.

Mais, mon dieu, ça manque de classe. Hitherto sans faute, the Hollande presidency is now in danger of becoming a laughingstock.

France Will Tighten Rules on Layoffs

The new government plans to make it more difficult and expensive for firms to lay off workers. "The main idea is to make redundancies so costly that it's not worth it," said Michel Sapin, the new labor minister. I'm no neoliberal apologist, but I think this is a terrible idea. France needs to improve its competitive position in the world. It has too many workers in declining industries and too many plants that are suboptimal in size and technology for today's markets. It's wishful thinking to believe that this can be combated by fiat, but the government is apparently sufficiently desperate about rising unemployment numbers to resort to a measure that is likely to worsen the situation in the medium term, even if it prevents further losses for a few months or years. Perhaps Hollande is less of a centrist than I thought he was, or perhaps the balance of forces within the party is not quite what I believed.

Rosanvallon-Hollande

I just came upon this interesting dialogue between Pierre Rosanvallon and François Hollande, which took place last year, at the beginning of the primary campaign season. In it, Rosanvallon chides "the Left" for its abstractness:

P.R. Si vous prenez des livres sur la société française qui ont rencontré le succès – Le Quai de Ouistreham de Florence Aubenas ou Les Tribulations d'une caissière d'Anna Sam –, vous voyez la différence. Ces livres sur la précarité résonnent avec le vécu de la société. Si on se contente de dire « il faut lutter contre la précarité et l'exploitation », « développer plus de solidarité », on dit des phrases justes, mais abstraites, à la surface des choses, coupées de l'expérience quotidienne. Il est à mes yeux urgent d'inventer en politique une conceptualisation « sensible » sur laquelle fonder un nouveau langage. D'autant qu'il y a de la concurrence : la phraséologie populiste qui repose sur une conceptualisation simplificatrice et une vision magique de la volonté politique. Elle ne donne consistance au « peuple » qu'en l'opposant par en haut aux élites et par en bas aux immigrés… Le défi pour la gauche dans cette campagne, c'est de trouver un langage où chacun sente que son histoire est prise en charge.

F. H. : Je m'amuse de l'inversion des rôles. Vous êtes le philosophe, je suis le politique, et vous me mettez, à juste titre, en garde contre la conceptualisation et le risque d'une trop grande abstraction des discours politiques. Le danger, en effet, est grand d'oublier de nommer les choses et les gens. Le langage politique cherche, et c'est son honneur, des solutions. Mais il fait comme si les problèmes étaient déconnectés des individus, comme si tout était global et rien n'était personnel, voire charnel, ce qui fait que l'écoute est perdue. La première condition de la crédibilité politique est de partir des situations vécues, de les reconnaître avant même de chercher une issue pour les régler. Il ne s'agit pas de se mettre à la place de chaque individu – la caissière ou l'ouvrier –, mais de parler en leur nom, d'arriver à une proposition politique donnant une perspective à toutes ces expériences singulières.

No PS-FG Accord for Legislatives

Negotiations between the PS and the Front de Gauche over the legislative elections have broken down. It seems that the Communists favored an agreement, but the Parti de Gauche balked.

Aubry Will Be Leaving the Leadership of the PS

It's inevitable, says her close collaborator François Lamy, who will be in the Ayrault government:

"La logique voudrait qu'elle parte après les législatives,dit M.Lamy. Mais elle sera attentive à ce que ce ne soit pas "après moi, le déluge"

Announced candidates for the leadership post are Harlem Désir and Jean-Christophe Cambadélis. If these are the two candidates, please let it be Désir.