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Merkozy Out, HoMer In

MacroAndCheese's picture




 

Breaking up is hard to do, and now Angela Merkel will have to toe with a new dance partner.  In Francois Hollande she will find a different kind of dancer, but not an unfamiliar one.  Francois Hollande trained under that other Francois, France's former socialist president Mitterrand.  To say that Hollande took a page from the playbook of his his mentor would be an understatement, in the classic French tradition.

By way of review, here is the campaign platform of France's newly elected Monsieur Hollande:

  • Hire 60,000 new teachers
  • Balance budget by 2017
  • Tax income above EUR 1 million at 75%
  • Reduce usage of nuclear power
  • Reduce consumer utility bills
  • Lower retirement to 60 for those who have worked 41 years
  • Reduce payroll tax
  • Renegotiate European treaty
  • Separate commercial and investment banking
  • Encourage ECB to lend money directly to governments

These are the main points of a 60-point program that Hollande referred to as "les 60 Engagements"--sixty promises.  In a similar vein, Mitterrand campaigned on the "110 Propositions for France" in the election against incumbent conservative Valerie Giscard d'Estaing, defeating the standing president with 51.7% of the vote, virtually identical to Hollande's 51.2%.  Mitterrand's program included measures familiar to yesterday's French voters, including an increase in the minimum wage, a reduction in the workweek to 39 hours, 5 weeks of vacation per year, a "solidarity tax" on wealth, and an increase in social benefits.

After less than two years in office, Mitterrand tacked sharply towards austerity to bring his ballooning budget in line.  This u-turn was known as the "tournant de la rigueur" (turn towards austerity).  Mitterrand was keen on increasing France's competitiveness with his European neighbors.  Here too, Hollande seems to be baking this fiscal responsibility into the cake in advance, since based on his own platform he intends to balance the budget within just 5 years.

It should come as no surprise that Hollande has learned from his socialist predecessor.  After all, he worked for him, from the very beginning.  As a student, Hollande volunteered in Mitterrand's unsuccessful 1974 campaign, and in 1981 became a "Special Advisor" to the newly elected president, and went on to become a staffer for the Mitterrand government's spokesman.  It seems very likely that Hollande followed Mitterrand's election recipe, to great effect.

How Hollande will fare is anyone's guess.  Mitterrand was helped in his quest for competitiveness by a weak French franc, which lost half its value against the dollar halfway through Mitterrand's first term in office.  Since France is tied to the euro, this beggar thy neighbor currency lever is no longer available, and Hollande may find a move toward austerity to be more painful this time around.  Hollande also has to share the dance floor with his German partner, a form of cohabitation that Mitterrand did not have to do.

This is not a pairing made in heaven.  In the months leading up to the election, Merkel very openly endorsed and supported outgoing president Sarkozy, seemingly linking the fate of a number of her initiatives to his ability to retain office.  As of last night the fiscal pact and general shift towards austerity of the entire Eurozone is in doubt, and the stewardship of the recovery will have to be a product of compromise.  However difficult Merkel found it to enact her reforms early on, it's going to be a lot tougher now.

Merkozy is out, HoMer is in.  As the Chinese say, may we live in interesting times.

macroandcheese.org

 

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Tue, 05/08/2012 - 16:11 | 2407999 drunkenlout
drunkenlout's picture

I had the wrong Homer in mind:  Sing Goddess, the wrath of Achilles, son of Peleus, that brought countless ills upon the Achaeans.  Doh!

Tue, 05/08/2012 - 21:08 | 2408698 AldousHuxley
AldousHuxley's picture

Merkollande

Tue, 05/08/2012 - 14:25 | 2407531 sgt_doom
sgt_doom's picture

The problem with Europe?

The very same problem with America!

The ultra-rich believe debt financing is only for them, and their debts are for the rest of us.....

Tue, 05/08/2012 - 21:01 | 2408682 AldousHuxley
AldousHuxley's picture

"ultra-rich" in Europe are in a class by themselves....they are called royalty.

 

  • The Kingdom Belgium,
  • The Kingdom Denmark,
  • The United Kingdom of Great Britain and Northern Ireland,
  • The Principality Liechtenstein,
  • The Grand Duchy Luxembourg,
  • The Principality Monaco,
  • The Kingdom of the Netherlands,
  • The Kingdom Norway,
  • The Kingdom Spain,
  • The Kingdom Sweden.
Tue, 05/08/2012 - 13:12 | 2407176 Mountainview
Mountainview's picture

Horkel describes the charecter of the new couple much better!

Tue, 05/08/2012 - 11:21 | 2406715 barkingbill
barkingbill's picture

pepe escober recommended merlande i think thats better

Mon, 05/07/2012 - 20:12 | 2405154 lakecity55
lakecity55's picture

Haha. French "Hope and Change."

Tue, 05/08/2012 - 09:31 | 2406154 masterinchancery
masterinchancery's picture

"May find a move to austerity more difficult this time?" Try impossible.  Hence the plan for the ECB to buy unlimited govt bonds and hyperinflate.

Mon, 05/07/2012 - 18:50 | 2405003 Psyman
Psyman's picture

Are there even enough French people left in France for that word to have any meaning?  What is France without French people?

 

Let's call it The Islamic Caliphate of Neo-Algeria.

Tue, 05/08/2012 - 16:50 | 2407998 Bossuet
Bossuet's picture

Très franchement, je me pose la question, savez-vous exactement où se trouve la France ? 

Commençons par quelque chose de facile : hémisphère nord ou hémisphère sud ?

Tue, 05/08/2012 - 21:05 | 2408688 AldousHuxley
AldousHuxley's picture

France without French?

 

Lost Tourists.

 

 

Mon, 05/07/2012 - 20:37 | 2405217 Anton LaVey
Anton LaVey's picture

Whatever you are smoking, you probably should stop - it's not good for your brain.

FYI, the muslim population in France is estimated anywhere from 3% to around 10% - a sizable part of the population, certainly, but still a minority.

Most of these people, by the way, are not very religious, and recent studies have shown they are mostly rather well-integrated in French society.

But, hey, don't let cold, hard facts ruin your little fantasy, OK?

Tue, 05/08/2012 - 09:33 | 2406161 masterinchancery
masterinchancery's picture

Don't let the cold hard facts of french muslim murderous attacks on jews bother you, and I'm sure they don't.

 

Tue, 05/08/2012 - 16:10 | 2407989 Bossuet
Bossuet's picture

Quand on méconnaît à ce point un pays, on s'abstient.

Tue, 05/08/2012 - 10:39 | 2406526 DaveyJones
DaveyJones's picture

"chancery"... makes sense given your approach to this subject is fairly medieval  

Mon, 05/07/2012 - 18:29 | 2404942 sockratte
sockratte's picture

why not MerDe in analogy to MerKozy?

Mon, 05/07/2012 - 17:45 | 2404818 YesWeKahn
YesWeKahn's picture

Don't worry, Merdollande will work out like a marvel.

Mon, 05/07/2012 - 16:28 | 2404595 Dr. Crime
Dr. Crime's picture

C'est la vie. So say the French.

And if you think the wealthy French will leave...phft. The Swiss will not allow a French migration en masse not matter the wealth. Monaco has built vertically almost to the limits possible and Corsica lacks wifi. There are only a limited number of civilized places in the world where one can dine and drink with comfort. What are the wealthy to do?

Mon, 05/07/2012 - 18:31 | 2404952 Anton LaVey
Anton LaVey's picture

Corsica is part of France - moving there if you are French, does not make any sense, in a tax-optimization sense.

And Corsica has wifi and Internet access by the way.

Monaco has never been opened to French citizens anyway - that's part of the compact between France and that tiny country.

Mon, 05/07/2012 - 15:54 | 2404500 lolmao500
lolmao500's picture

Merkel needs to get her commie ass kicked out.

Mon, 05/07/2012 - 15:42 | 2404449 lolmao500
lolmao500's picture
  • Tax income above EUR 1 million at 75%

A lot of people will move to Switzerland...

  • Reduce usage of nuclear power
  • Reduce consumer utility bills

Good luck doing that...

  • Separate commercial and investment banking

Who wants to bet that won't be done?

And most of these are contradictory indeed... reduce payroll taxes and increase spending while saying that there will be no deficit?? Funny that.

Tue, 05/08/2012 - 16:15 | 2408012 Bossuet
Bossuet's picture

A 75 % les riches partiront ? vendredi 16 mars 2012, par Frédéric Lordon

 

Mais qu’ils partent donc, ils ne nous manqueront pas. Ils sont très remplaçables, leur fortune est inutile à l’économie, et elle est un trouble à l’ordre public. Ah oui : en partant, qu’ils n’oublient pas de déposer leur passeport à la porte. Avant de la prendre.

Les faux-semblants de la gauche serpillière

Il y a suffisamment de raisons d’être affligé de la campagne du candidat « socialiste » — qui ne trouve mot à redire au traité MES [1] institutionnalisant les principes de l’« ajustement structurel », promet de renégocier le TSCG [2] avec la franchise d’un trafiquant de voitures d’occasion, fait des moulinets contre la finance avant de se rendre à Londres jurer l’innocuité de ses intentions réelles — il y a, donc, suffisamment de raisons d’affliction pour ne pas noter le moindre tressaillement du gauchomètre, dont tous les tracés étaient restés jusqu’ici absolument plats. Sans doute l’oscilloscope n’est-il pas menacé d’exploser : le maniement de la fiscalité individuelle n’est le plus souvent qu’un instrument de correction d’effets dont on préfère ne pas attaquer les vraies causes.

Le candidat socialiste aurait-il vraiment le projet de s’en prendre aux inégalités, aux chutes dans la précarité des uns et à l’indécente explosion des fortunes des autres, il s’attaquerait à leur principe générateur même, à savoir : la libéralisation financière, l’ouverture du commerce international à toutes les concurrences distordues — bien faites pour déstabiliser les classes ouvrières des pays développés et attaquer les Etats-providences —, l’orthodoxie de politique économique qui commande de satisfaire les investisseurs d’abord et les corps sociaux s’il en reste, soit synthétiquement les structures de la mondialisation néolibérale, spécialement mises en valeur par la construction européenne — dont les prétentions de « bouclier » (« L’Europe est un bouclier contre la mondialisation ») inspirent au choix le rire ou le dégoût. C’est à cela que s’en prendrait donc un candidat de gauche, conscient que la gauche se définit plus par le projet de transformer radicalement le cadre des structures du néolibéralisme que par celui d’y passer la serpillière [3]...

Précisément, on reconnaît la gauche serpillière, la gauche pleurnicheuse, la gauche qui ne veut pas être de gauche, aux chaudes larmes qu’elle verse sur la souffrance sociale sans jamais vouloir interroger, et encore moins modifier, les structures qui ne cessent de la recréer. On la reconnaît par conséquent aussi à ses instruments : emplois-jeunes, éducation-formation — avec le double aveu implicite que l’éducation est surtout une formation professionnelle et que, si bien sûr on les y aidera, il appartient tout de même aux individus de se rendre « employables » —, fiscalité enfin, soit tout ce qu’il reste de leviers secondaires pour atténuer les effets à l’intérieur du cadre mais sans jamais y toucher.

De tous ces palliatifs, cependant, la fiscalité est le plus significatif — quand il n’est pas manié à la baisse à la façon du socialisme Jospin-Strauss Kahn-Fabius... Mais voilà que François Hollande, décidé cette fois à le pousser dans le bon sens, semble avoir empoigné le levier, et la chose est suffisamment étonnante pour être notée (sous les habituelles réserves de la jonction incertaine du geste à la parole...). Que le gauchomètre s’en ressente et donne une mesure fiable, est confirmé par le capteur complémentaire de l’éditorialomètre, machine corrélée mais réglée selon un principe de variation inverse : sans surprise Jean-Francis Pécresse (Les Echos), Dominique Seux (Les Echos, again), Alexandre Phalippou (Huffington Post tendance Anne Sinclair) prophétisent le désastre, ainsi que Yves Calvi (C dans l’air) en charge de brancher l’expertomètre sur l’éditorialomètre (corrélation positive) et qui réunit un superbe plateau [4] à trois (plus lui) contre un pour bramer et faire bramer au désastre économique, avec parmi les bêtes à cornes l’inénarrable Philippe Dessertine, Christian de Saint-Etienne et surtout Elie Cohen, jusqu’à il y a peu conseiller économique de François Hollande mais horrifié des nouvelles velléités de gauche du candidat qu’il croyait sincèrement de droite.

On doit toutefois à l’honnêteté de reconnaître que l’éditorialo-expertomètre, machine pourtant ultra-sensible en tout cas dans cette partie là du cadran (depuis vingt ans, très peu de réaction sur bonus, fortunes et inégalités, non plus sur chômage, fin de droits et seuils de pauvreté), n’a pas fait exploser le scope comme elle l’aurait fait il y a cinq ans à peine. Jean-Michel Aphatie, par exemple, a même éprouvé le besoin de démentir avoir pris parti pour les riches et n’avoir fait que de l’ironie à propos des 75% de Hollande. Il est vrai que l’époque commence à sentir fort le goudron et les plumes et pour la classe possédante et pour la valetaille médiatique qui jusqu’ici n’avait de cesse de lui servir la soupe avec force justifications économiques et admonestations à l’endroit du peuple envieux. Les temps ont changé et, jusque chez les riches, commence à se former la conscience « d’avoir un peu exagéré »... Pas suffisamment cependant pour désarmer complètement les réflexes incorporés qui font objecter instantanément à la fuite des talents et au bris de l’élan créateur de richesses — et l’on pense irrésistiblement à ce moment là au parti qu’on pourrait tirer de la trouvaille des graphistes du film Les nouveaux chiens de garde [5] où l’on voit chaque éditocrate multicarte accompagné d’un phylactère faisant la liste de ses innombrables employeurs, combinée à la proposition de Régis Jauffret [6] demandant que chaque expert prônant le sacrifice salarial à l’usage des autres soit sommé de déclarer ses propres revenus...

 

La suite à cette adresse : http://blog.mondediplo.net/2012-03-16-A-75-les-riches-partiront

Tue, 05/08/2012 - 12:07 | 2406921 FlyoverCountryS...
FlyoverCountrySchmuck's picture

"Encourage ECB to lend money directly to governments"

 

How do you think he intends to pay for all of these promises?

As a black man once told me, loans are just FREE MONEY if you never intend to pay it back.

Mon, 05/07/2012 - 19:29 | 2405077 Bunga Bunga
Bunga Bunga's picture

The socialists did even nationalize Rothschild in 1981, so what's the problem?

Mon, 05/07/2012 - 15:19 | 2404371 lamont cranston
lamont cranston's picture

That list reads more like the "60 Contradictions". Just like the snake oil the US swallowed in 2008. 

Mon, 05/07/2012 - 16:37 | 2404633 James
James's picture

Hi lamont cranston,

I used to go hear your band all the time 20 - 30 yrs. ago when I lived in MPLS., MN.

Remember the Caboose?

 

Mon, 05/07/2012 - 16:25 | 2404591 MacroAndCheese
MacroAndCheese's picture

Yep.  The budget is bad enough, good luck on lowering utility costs while eliminating nuclear power.

Mon, 05/07/2012 - 18:46 | 2404992 The Disappointed
The Disappointed's picture

Maybe they could 'allow' the static electricity autos that Galt invented to become reality.
Got Palladium?

/sarc off

Mon, 05/07/2012 - 15:14 | 2404350 Hobbleknee
Hobbleknee's picture

I have no mouth and I must scream.

 

_______________________________

compare gold, sliver dealer prices

Mon, 05/07/2012 - 17:50 | 2404837 Bollixed
Bollixed's picture

Spam, it's everywhere...

Wed, 05/09/2012 - 08:21 | 2409493 Hobbleknee
Hobbleknee's picture

I don't spam that much.  didn't you get my reference?

 

Mon, 05/07/2012 - 18:53 | 2405006 The Disappointed
The Disappointed's picture

Imagine that the Chairsatan was the waiter in Monty's Python's "Spam" sketch. He would have to say the dreaded word how many quadrillion times for QE3? Spam to Infinity!

Mon, 05/07/2012 - 15:10 | 2404320 besnook
besnook's picture

the real choices are blow up the people with austerity which won't save the banks because the debt load is too big for an austeritized tax payer to handle in the end or blow up the banks which will force austerity upon the people.the latter program would probably work better simply because people will suffer austerity much more stoically if  nobody is benefitting from their suffering. in the end, no matter the tack taken now, this will be the final solution so the former strategy will be the one taken because the world is run by really stupid people(except in iceland) who think this time is different.

 

of course, a synchronized debt foregiveness could work, too, but that falls into the "what are you, crazy?" category for the players involved until they begin falling over the brink.

Mon, 05/07/2012 - 14:55 | 2404297 bonin006
bonin006's picture

I thought the Chinese saying (curse) was   may YOU live in interesting times

Tue, 05/08/2012 - 14:22 | 2407517 sgt_doom
sgt_doom's picture

Naaaah...I think their saying was:

Ship all your jobs, technology, R&D and investment over to us, you stupid frigging round-eyes.

Yeah....I think that was it.

Mon, 05/07/2012 - 14:44 | 2404257 Mountainview
Mountainview's picture

Sarko was just tired! Wait for the parliament elections...Hollande will be transfered in a (very) lame duck !!!!

Mon, 05/07/2012 - 18:29 | 2404946 Anton LaVey
Anton LaVey's picture

Probably not - French people tend to be logical and they will probably vote to give a comfortable parliamentary majority to Hollande.

Mon, 05/07/2012 - 14:31 | 2404219 Disenchanted
Disenchanted's picture

 

 

Things could be worse for the frogs...

 

http://l1.yimg.com/bt/api/res/1.2/UTaS_lwTww7IAfmllKcYVA--/YXBwaWQ9eW5ld...

Mon, 05/07/2012 - 17:47 | 2404829 RichardENixon
RichardENixon's picture

Next time you're going to post something like that could you warn those of us with pacemakers?

Mon, 05/07/2012 - 14:05 | 2404117 Joe The Plumber
Joe The Plumber's picture

Merde. Please use the correct combination. The word is recognized as shit in all latin based languages

Mon, 05/07/2012 - 19:24 | 2405066 Bunga Bunga
Bunga Bunga's picture

Right, that is coming into everyone's mind there.

Mon, 05/07/2012 - 13:51 | 2404064 DOT
DOT's picture

I would like to see France try to reduce Nuclear Energy. What would they do? Stop selling electricity to the germans?

Mon, 05/07/2012 - 18:27 | 2404935 Anton LaVey
Anton LaVey's picture

If Hollande has his way, nuclear energy will be progressively phased-out during his mandate. At least, that's the idea I got based on his program.

Mon, 05/07/2012 - 14:49 | 2404271 GreetingsFromGermany
GreetingsFromGermany's picture

Just a small correction: 
This year we had a supply shortfall in Europe (due to low temperatures in February). It was not France selling Energy to Germany but all the German wind turbines and other renewable energies which preserved French from power-breakdown. We exported huge amounts of renewable energie while French tried to reactivate even the oldest nuclear power plants !

Tue, 05/08/2012 - 17:53 | 2408313 11b40
11b40's picture

How can that be?!  I read all the time that renewables won't work in any meaningful way.  We know here in the USA that subsidizing shit like that is dumb - just throwing away money.  Renewables. Wind, Solar, GEothermal.  Ha!  How silly can you get?  Next thing you know, you dumb Gremans will be re-cycling stuff.

sarc/off (you know, just in case)

Mon, 05/07/2012 - 13:46 | 2404035 disabledvet
disabledvet's picture

A strong French State is what's in. That goes a long way towards explaining a Hollande bounce. You all are about to find out "Germany" is much more like "Greece" than France is.

Tue, 05/08/2012 - 14:24 | 2407521 sgt_doom
sgt_doom's picture

Actually, you make a great deal of sense.....

Mon, 05/07/2012 - 15:44 | 2404466 lolmao500
lolmao500's picture

Yep. The German banks are a joke. Way too overleveraged.

Mon, 05/07/2012 - 18:26 | 2404930 Anton LaVey
Anton LaVey's picture

Errr... Looked at any French bank recently? You'll find them just leveraged (if not more) than the German banks.

Tue, 05/08/2012 - 14:25 | 2407528 sgt_doom
sgt_doom's picture

Yo, Soc Gen's made a fortune off of money laundering all that stolen loot from Iraq.

Do NOT follow this link or you will be banned from the site!