After a Year of Socialism, France's Meltdown is a Stark Warning to Anyone Who Wants Red Ed as PM

7/27/2019 After a Year of Socialism, France's Meltdown is a Stark Warning to Anyone Who Wants Red Ed as PM

1/10

Le catastrophe! A hated leader. Violent protests.

Wealth creators Fleeing abroad. After a year ofsocialism, France's meltdown is a stark warningto anyone who wants Red Ed as PM

By Daniel Hannan

PUBLISHED: 23:21 GMT, 23 April 2013 | UPDATED: 23:21 GMT, 23 April 2013

Never in modern times has a French government been so unpopular.

Even in May 1968, when strikes and student protests paralysed the country and forced President de Gaulle to

flee to a military base in Germany, the regime enjoyed higher approval ratings than does beleaguered

President Francois Hollande today.

According to the latest poll, no fewer than 74 per cent of French voters disapprove of the leader whom they

elected less than a year ago. Never mind de Gaulle; these are figures that would have alarmed Louis XVI.

Mr Hollande inherited an over-taxed, over-regulated, sclerotic France, and systematically


2/10

set out to make all its problems worse

Now, as during the run-up to the French Revolution, angry observers contrast a dramatically declining

economy with the wealth of some high officials. Now, as then, there have been angry clashes between rioters

and security forces.

President Hollande stood for office on a populist Left-wing platform, but his administration turns out to have

more than its share of millionaires, and stories persist about ministers having foreign slush funds.

Sleaze

Just as French people were scandalised by the supposed affairs of Louiss queen, Marie Antoinette, so they

now pore over magazine reports about Hollandes mistress, Valerie Trierweiler, who is involved in a lawsuit

over claims in a book that she had an adulterous affair with Hollande and another married man while she

herself was married.

How did it all go so wrong so quickly? How, having won office promising an end to the sleaze of the Sarkozy

era, has Mr Hollande contrived to make his countrymen nostalgic for his little predecessor and even his

supermodel wife Carla Bruni?

The short answer, as usual, is the economy. Mr Hollande inherited an over-taxed, over-regulated, sclerotic

France, and systematically set out to make all its problems worse.

Riot police are pictured near Paris last month as a last ditch protest by workers to save a

Goodyear plant that employs 1,200 staff descended into violence

Nicolas Sarkozy had bequeathed a country where the State already accounted for more than half the

economy; where legislation provided for a maximum working week of 35 hours; and where social and

employment costs were among the highest in Europe.

Only 40 per cent of French people were in employment of any kind, as against 60 per cent of Swiss. More

days were being lost through industrial action than in any other EU state: 27 days per thousand people per

year, as opposed to 3.4 days in Germany.


3/10

Hollande's mistress, Valerie Trierweiler, who is involved in a lawsuit over claims in a book

that she had an adulterous affair with Hollande and another married man while she

herself was married

Virtually anywhere else in the world, the solution would have been obvious. People would have voted for tax

cuts, deregulation of business and industry, privatisation and all the other things that Britain experienced in the

Eighties, and the rest of Europe in the Nineties.

But France is different. There is something known as lexception francaise which, broadly speaking, hascome to mean a combination of cultural chauvinism, economic protectionism, generous social entitlements

and big government.

In the short term, social entitlements are pleasant enough. Frenchmen prided themselves on having proper

two-hour lunch breaks instead of gobbling sandwiches at their desks like British drones. The trouble is you

cant carry on indefinitely squeezing the productive part of the economy in order to expand the unproductive

part the bloated State.

The last time that France ran a budget surplus was in 1974. There was bound to come a moment when the

money ran out and that moment arrived with the credit crunch.

Instead of drawing back from the cliff-edge, the French electorate the larger part of it, at any rate floored

the accelerator. Before he was led to the guillotine, Nicolas Sarkozy hadnt actually delivered any economic

cuts, but he had talked of the need for them, which alienated his compatriots.

France turned to uncharismatic Mr Hollande largely because he promised growth not austerity. Dont worry,

he assured voters, I can close the deficit without cuts; Ill do it by taxing millionaires. With a sort of grumpy

suspension of disbelief, people gave him their votes.

The trouble is that millionaires dont hang around waiting to be taxed. Friendlier jurisdictions are just a

Gulfstream jet flight away, and financiers can open their businesses abroad simply by opening their laptops.


4/10

Mr Hollande has contrived to make his countrymen nostalgic for his little predecessor

Sarkozy - and even his supermodel wife Carla Bruni

The result of a hike in tax rates is thus often a fall in tax revenue which means, of course, everyone elsefurther down the financial food chain ends up paying more to cover the share of the departed plutocrats.

Thus, President Hollandes announcement of a whopping 75 per cent top rate has, entirely predictably,

prompted many entrepreneurs to flee abroad.

Frances richest man, the business magnate Bernard Arnault, is shifting his fortune to Belgium. Gerard

Depardieu, the countrys greatest actor (figuratively and literally) is emigrating to Russia. There are even

rumours that Sarko plans a new career in finance in quelle horreur! London.

Thats the thing about high tax rates: they dont redistribute wealth, they redistribute people.

These days, you dont need to move physically to a different tax jurisdiction. Many Frenchmen have simply

shifted their assets across the border, snapping up houses in smart West London districts and opening bankaccounts in Switzerland.

Rather embarrassingly for President Hollande, these Frenchmen include the man in charge of setting the

budgets for everyone else his junior finance minister, Jerome Cahuzac, who two weeks ago admitted to

stashing money in a secret Swiss account.

Hapless


5/10

David Cameron couldn't resist inviting refugees from the 75 per cent tax to establish

themselves in London

The departure of the fat cats has left an even larger hole in the French national budget, which is why the

hapless Mr Hollande has just announced that he must somehow raise an additional 5 billion in 2014.

The economy, which had been forecast to grow by 0.8 per cent this year, is instead growing just at 0.1

per cent. Unemployment has surged to 3.2 million.

France ought, on most measures, to be treated as an economic basket case in the same category as Spain or

Greece. It cannot match the competitiveness of Germany, and so has difficulty sustaining membership of the

single currency. And the gap is widening.

As a consequence, despite the decline in the euro exchange rate, French exports keep falling. In 2005, France

had a trade surplus of 0.5 per cent of GDP; today, it has a deficit of 2.7 per cent.

Indeed, it is the only eurozone member with a consistently widening trade gap.

Habit prevents analysts from placing France in the same mental category as the stricken Mediterranean

states. But for how much longer?

Having been or at least appeared to be the driving power in Europe along with Germany in recent years,France is suddenly teetering dangerously.

Even the French political and financial leaders best known in international circles are in trouble.

Impropriety

First, Dominique Strauss-Kahn was forced to step down as head of the International Monetary Fund after a raft

of allegations over sexual impropriety. Now his replacement, Christine Lagarde, has had her Paris flat raided

by police in connection with an investigation into a large payment granted to a Sarkozy supporter when she

was French finance minister. For her part, Lagarde denies any wrongdoing.


6/10

It is tempting, from a British perspective, to take a certain wry pleasure in the problems of our old rivals. And,

indeed, David Cameron couldnt resist inviting refugees from the 75 per cent tax to establish themselves in

London an invitation many are taking up.

Miliband, who like Hollande has opposed every single spending reduction, has openly

praised the French president

But, before you sneer, consider that our deficit is 6.3 per cent to Frances 4.8 per cent.

Consider, too, that Labour is promising precisely the same policies as Mr Hollandes socialists. Ed Miliband

could hardly be more gushing in his praise for the French leader, claiming that his new leadership is sorely

needed as Europe seeks to escape from austerity, and it matters to Britain.

Labour, as with the French socialists when they were in opposition, has opposed every single spending

reduction, yet remains ahead in the opinion polls.

I hope that in Britain we will hold ourselves to a higher standard than French voters. If nothing else, we have

their example to serve as a warning.

La vie en rose has become life in the red. France has run out of credit and out of options.

You can evade reality, but you cant evade the consequences of evading reality.

Daniel Hannan is a Conservative MEP.

MOST READ NEWS

Previous

1


7/10

2

3

Next

Jailed in secret - for trying to rescue her father from care...

Paedophile with HIV jailed for having unprotected sex with...

The world's most conserved hamburger: Preservative-packed...

'You can rouse him now': Extraordinary scene of Boston...

One million people who are fit-to-work have been on benefits...

Wealthy City worker dies in 'suicide pact' with childhood...

The BBC's local news presenter on 225,000... and she's not...


8/10

Two IRA gangsters shot by a cage fighter were cremated in...

At last, it feels like summer! England celebrates the...

Worst date ever: Man who built a menu-fort to block out girl...

Mad scramble to buy 35 empty houses in Stoke-on-Trent after...

Toddler died of sudden childhood death syndrome after...

Comments (16)

Newest

Oldest

Best rated

Worst rated

View all

We don't need and don't want Red Edd as PM but we don't want Cameron the U-Turn kid as PM as he can't be trusted, we need

Ukip or at worse a coalition of Ukip and the Conservatives. The Tory Party don't want to see that they are losing a vast amount of

there voters because of Cameron and his Eton Toffs on the front bench. The only way that the Tory Party have a hope of getting any

where is to call that Referendum before 2015 GE .VOTE UKIP

- Robbie , Nottingham, 24/4/2013 07:21

Click to rate Rating (0)

Report abuse

Maybe Marine Le Pen will get her chance to fix France.

- Casey , Brunswick, 24/4/2013 07:12


9/10

Click to rate Rating 1

Report abuse

Proof of the adage - the trouble with socialism is that eventually you run out of other people's money.

- Scooby , Edinburgh, United Kingdom, 24/4/2013 06:58


Report abuse

You are are right, the French economic disaster is the Labour economic experiment in action and France were in a far better position

when the crash happened in 2008. Labor as usual left us all with a car crash of economy and it is the very same team of wealthy

"Nu-Labour" policy researchers who studied PPE at Oxford and Cambridge, an old brand of Socialism that failed so badly in 1960's

and 70's. Come on even, Tony Blair (not that I like him) has warned against Balls and Miliband. What is needed is a cuts in local and

national civil service positions, in overseas aid and a cut in the ridiculously generous benefits to below the minimum wage. The

government then needs to investment in transport (not necessarily more just get it working), power generation, securing our borders

both physically and from the very expensive losses incurred by cyber crimes.

- Jonthan Roberts , Munich, 24/4/2013 06:52


Report abuse

Looks Very similar to Thatchers Britain if you ask me.

- Mancunian Abroad , Down Under, 24/4/2013 06:49


Report abuse

It proves two things: 1. French voters are as stupid as ours. 2. The French are a lot bolshier than we are, because we will just lie

down and take it.

- Dutch Ovens , Still stuck here..., 24/4/2013 06:49


Report abuse

Blatant spiteful propaganda showing how desperate the Tories are becoming - is this really the type of headline for a supposedly

inofrmative national newspaper. Is ther any chance of just a little bit of balance?

- Eamonn , epsom, 24/4/2013 06:42


Report abuse

Anyone in public office with a slush fund should have it seized and investigated. Likewise all tax havens should be closed. They exist

only to allow the rich to shirk their tax paying responsibilities whilst the rest of us pick up the gap left.

- Les , Perth, Australia, 24/4/2013 05:21


Report abuse

france needs 5 billion? why don't they go ask gadaffi as they did last time they needed a bail out? of course they cannot now, they

didn't want to pay that debt so they disposed of gadaffi!!! sacre bleu


10/10

- True-Brit , Plymouth, United Kingdom, 24/4/2013 05:09


Report abuse

Hollande and Milliband, what a vile pair

- egg roll , London, United Kingdom, 24/4/2013 04:55


Report abuse

The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline.

Published by Associated Newspapers Ltd

Part of the Daily Mail, The Mail on Sunday & Metro Media Group

Associated Newspapers Ltd

Documents

After a Year of Socialism, France's Meltdown is a Stark Warning to Anyone Who Wants Red Ed as PM