Abstract: Dissecting an editorial misrepresenting the social, economic and political situation in France. However, the heavy misrepresentation is preceded by many things I said for years. It’s a sort of bait and switch with truth itself.
What’s the interest could big bankers find in this maneuver? Simply that the socialists governing France are represented as having given up on socialism. The truth is anything but.
Those who prefer to read me rather than Krugman can jump to the second part, “THE TRUTH”.
Pseudo panicky New York Times editorial by Paul Krugman “Scandal In France”. Yet it starts well:
I haven’t paid much attention to François Hollande, the president of France, since it became clear that he wasn’t going to break with Europe’s destructive, austerity-minded policy orthodoxy. But now he has done something truly scandalous.
I am not, of course, talking about his alleged affair with an actress, which, even if true, is neither surprising (hey, it’s France) nor disturbing.”
(In truth Hollande’s First Girlfriend, an arrogant woman. from a banking family, had her trouble coming: she, a star political journalist who made a career on her looks, pursued Segolene Royal, with whom Hollande had four children, with great vengeance and treachery, sabotaging even her political carreer, for all to see; Hollande’s family came to detest her; unsurprisingly, and hopefully, Hollande will send her packing.)
Krugman: ”No, what’s shocking is his embrace of discredited right-wing economic doctrines. It’s a reminder that Europe’s ongoing economic woes can’t be attributed solely to the bad ideas of the right. Yes, callous, wrongheaded conservatives have been driving policy, but they have been abetted and enabled by spineless, muddleheaded politicians on the moderate left.”
This is what I have been saying about Pelosi and Obama, for years. In Germany, Schroeder, a Socialist, carefully made the bed in which Merkel has been contently sleeping since. Yet, one can argue the tough reforms of Schroeder enabled Merkel herself to take a hard left turn in 2008. which boosted the German export machine.
Here is more Krugman repeating, almost verbatim, what I have been saying for years:
“Right now, Europe seems to be emerging from its double-dip recession and growing a bit. But this slight uptick follows years of disastrous performance. How disastrous? Consider: By 1936, seven years into the Great Depression, much of Europe was growing rapidly, with real G.D.P. per capita steadily reaching new highs. By contrast, European real G.D.P. per capita today is still well below its 2007 peak – and rising slowly at best.
Doing worse than you did in the Great Depression is, one might say, a remarkable achievement. How did the Europeans pull it off? Well, in the 1930s most European countries eventually abandoned economic orthodoxy: They went off the gold standard; they stopped trying to balance their budgets; and some of them began large military buildups that had the side effect of providing economic stimulus. The result was a strong recovery from 1933 onward.”
In this depressed and depressing landscape, France isn’t an especially bad performer. Obviously it has lagged behind Germany, which has been buoyed by its formidable export sector. But French performance has been better than that of most other European nations. And I’m not just talking about the debt-crisis countries. French growth has outpaced that of such pillars of orthodoxy as Finland and the Netherlands.
Mr. Hollande has spoken up about his plans to change France’s course – and it’s hard not to feel a sense of despair.
For Mr. Hollande, in announcing his intention to reduce taxes on businesses while cutting (unspecified) spending to offset the cost, declared, “It is upon supply that we need to act,” and he further declared that “supply actually creates demand.
Oh, boy. That echoes, almost verbatim, the long-debunked fallacy known as Say’s Lawthe claim that overall shortfalls in demand can’t happen, because people have to spend their income on something. ”
All the evidence says that France is awash in productive resources, both labor and capital, that are sitting idle because demand is inadequate. For proof, one need only look at inflation, which is sliding fast. Indeed, both France and Europe as a whole are getting dangerously close to Japan-style deflation.
So what’s the significance of the fact that, at this of all times, Mr. Hollande has adopted this discredited doctrine?”
All right. End of the Krugman circus. I understand that he may mean well. But he so enormously misrepresents the situation in France, that he is not doing a service to progressivism in the USA. Now for a bit of real data.
THE TRUTH: FRANCE IS SOCIALIST, BUT IS NOT GOING TO ATTACK THE USA:
General government spending in France is 57% of GDP. Only Denmark exceeds 55% in Europe. (The USA is at 39% of GDP, Federal government spending plus States plus Local Governments; it’s 37% in Japan.)
France has both a very centralized state and a government made of 15 “regions”. In consequence, France has several times the number of civil servants of some other European countries (relatively speaking). The USA has less than 20 million civil servants, France nearly seven millions.
French workers are paid nearly 50 dollars an hour (more than Germany). French minimum wage is more than 13 dollars per hour. Schooling, all the way to universities is free. Health care is free and universal.
So Mr. Hollande can go as much right as he wants, the French Republic is going to stay socialist by inertia, for a very long time to come.
Some of the measures proposed by Hollande are just about doing away with some department, to create more. local government. For example the city of Lyon will grow, at the expense of the department it lays in. There is talk to remove the 4 departments that dissect the city of Paris.
True, Hollande is not rabidly anti-plutocratic. But he is not going to declare war to Washington and Wall Street. All Americans are behind those, or nearly so.
Thus Hollande will stick to the 75% tax on income above one million euros that was introduced a few weeks ago.
France is, by USA standards, the very definition of a socialist country. But, without fighting the American Circus, little can be done against global plutocracy. The USA pretty much behaves like a Den of Thieves. Look at the F35 program, the most expensive military program in the history of the world, by far. It has dragged many countries into a most dangerous corruption.
Similarly, what can France and Germany do against the increasingly crazed surveillance state of the USA? Attack? Or talk slowly, and try to walk the patient through his derangement? It starts with getting to know reality. And reality is that Europe is physically small and civilizationally socialist, whereas the USA is physically huge, and thus relentlessly exploitative.
Last, but not least, the honorable professor Krugman does not explain how the mad spending of the 1930s ended. First France did not join it. Second Germany got broke down economically very quickly (by 1938), albeit “solved” the problem. with the “final solution” (stealing Jews and other Europeans).
Great Britain made the economy of an army, thus losing in 1940, but in the end did not escape expensive debts to the USA, that ruined the UK thereafter. The USA won, because all the spending, and a timely late, cheap intervention in the war, allowed it to win, and grab the world.
The only lesson? Keep cool, and try to understand what is really going on.
Patrice Ayme
