Sept. 5, 2005 issue - Twenty-five years ago this week, state-run economies were dealt a mortal blow. A Polish electrician named Lech Walesa negotiated an agreement with a communist government establishing a free and independent labor union in the Soviet bloc. The world has never been the same since. Within a decade, Sovietism had been swept into the dustbin of history. Hundreds of millions found freedom and market economics. The other big communist center—China—decided that to survive it had to go capitalist, and in the past two decades more Chinese have been lifted out of poverty than ever before in the Middle Kingdom.
The impact in Western Europe was enormous. Whether in Thatcherite Britain or social-democratic Scandinavia, politicians got out of running business. The one shining exception, as always in European history: France. There, President Francois Mitterrand swept banks and a portfolio of companies into state ownership. In pre-globalization, pre-Internet days it was just possible to justify such economic nationalism. VCRs and Walkmans from Japan were made to transit through a provincial customs post in the hope that a French company would rise and do better than Sony or Toshiba.
Today France is the weak man of Europe. The nation that has done more than any other to define and shape Europe is still locked in denial on the reforms that need to be undertaken. France remains beautiful. Its pleasures continue to seduce; 70 million tourists will have had a great time this summer and go back to London or Frankfurt thinking that maybe France is not doing so badly after all, as will the country's own political and business leaders. They are wrong.
The French invented the trompe l'oeil painting, which tricks the viewer into thinking he sees something that isn't there. So with the French economy after more than a decade of low growth and high unemployment. The belle France that visitors experience is the fruit of the long years of tough leadership by the first presidents of the Fifth Republic, from Charles de Gaulle to Valery Giscard d'Estaing. They undertook unpopular decisions, such as making the currency strong and bringing in nuclear power to offset French dependency on oil. De Gaulle rigged European agricultural policies to ensure an ample trade surplus for French food exports: wine, cereals, butter and beef—what the French call their "green oil," all buoyed by generous price subsidies. That poorer countries suffered by exclusion from the European market mattered little as long as France was getting rich. But the world has moved on. Other countries learned the trick of making good wine, and French citizens themselves learned to like driving Nissans or buying goods, leisure and travel off the Web.
Today France runs a substantial trade deficit. Despite high income taxes, every cent paid by French citizens goes into debt repayments and not into renewing the country's infrastructure. Unemployment has been stuck at 10 percent or more for a DECADE. Only one in four workers under the age of 25 has a job. The biggest growth industry in France has been the Restaurants du Coeur—soup kitchens for the new poor who are growing in number in every French city.
The new French prime minister, Dominique de Villepin, has appealed to the "economic patriotism" of his countrymen. A former diplomat and chief of staff to President Jacques Chirac, he produces more books than France produces jobs. (One, on Napoleon's 100 days, questions whether Waterloo was indeed a defeat.) Named PM after the French crushingly voted no on a European constitution, drafted by former president Giscard d'Estaing, de Villepin promised a Napoleonic 100 days of action to get France back on its feet. But unlike Napoleon or even de Gaulle, France's leaders are not prepared to break out from the statist ideology that permeates all thinking.
Today's France appears to know only how to say no. Union bosses say no to labor-market reform even though high unemployment has reduced union membership to an historic low. Business leaders say no to tax reforms or breaking up corporate cartels that keep house sales expensive for citizens. The Paris media say no to any idea that comes from the dreaded Anglo-Saxons, even though Spain, Eastern Europe and the Nordic countries have shown how to cut unemployment.[b/] Chirac says no to allowing Polish plumbers or Czech nannies to come and work freely in France. The French socialists say no to Europe, leading to their party's marginalization and possible split. French professors say no to getting private money into universities. Chirac says no to any reform of the European Union or world trade rules that require reform of agricultural protectionism. De Villepin says no to Turkey's starting EU membership talks until the Turks accept conditions set by Greek politicians in Cyprus.
The France of nonistes—no-sayers—is now a major problem for Europe. There can be no European recovery or political moves forward until France learns to say oui to the new economy and to new ideas about how a modern society should be run.
msnbc.msn.com . . .
The impact in Western Europe was enormous. Whether in Thatcherite Britain or social-democratic Scandinavia, politicians got out of running business. The one shining exception, as always in European history: France. There, President Francois Mitterrand swept banks and a portfolio of companies into state ownership. In pre-globalization, pre-Internet days it was just possible to justify such economic nationalism. VCRs and Walkmans from Japan were made to transit through a provincial customs post in the hope that a French company would rise and do better than Sony or Toshiba.
Today France is the weak man of Europe. The nation that has done more than any other to define and shape Europe is still locked in denial on the reforms that need to be undertaken. France remains beautiful. Its pleasures continue to seduce; 70 million tourists will have had a great time this summer and go back to London or Frankfurt thinking that maybe France is not doing so badly after all, as will the country's own political and business leaders. They are wrong.
The French invented the trompe l'oeil painting, which tricks the viewer into thinking he sees something that isn't there. So with the French economy after more than a decade of low growth and high unemployment. The belle France that visitors experience is the fruit of the long years of tough leadership by the first presidents of the Fifth Republic, from Charles de Gaulle to Valery Giscard d'Estaing. They undertook unpopular decisions, such as making the currency strong and bringing in nuclear power to offset French dependency on oil. De Gaulle rigged European agricultural policies to ensure an ample trade surplus for French food exports: wine, cereals, butter and beef—what the French call their "green oil," all buoyed by generous price subsidies. That poorer countries suffered by exclusion from the European market mattered little as long as France was getting rich. But the world has moved on. Other countries learned the trick of making good wine, and French citizens themselves learned to like driving Nissans or buying goods, leisure and travel off the Web.
Today France runs a substantial trade deficit. Despite high income taxes, every cent paid by French citizens goes into debt repayments and not into renewing the country's infrastructure. Unemployment has been stuck at 10 percent or more for a DECADE. Only one in four workers under the age of 25 has a job. The biggest growth industry in France has been the Restaurants du Coeur—soup kitchens for the new poor who are growing in number in every French city.
The new French prime minister, Dominique de Villepin, has appealed to the "economic patriotism" of his countrymen. A former diplomat and chief of staff to President Jacques Chirac, he produces more books than France produces jobs. (One, on Napoleon's 100 days, questions whether Waterloo was indeed a defeat.) Named PM after the French crushingly voted no on a European constitution, drafted by former president Giscard d'Estaing, de Villepin promised a Napoleonic 100 days of action to get France back on its feet. But unlike Napoleon or even de Gaulle, France's leaders are not prepared to break out from the statist ideology that permeates all thinking.
Today's France appears to know only how to say no. Union bosses say no to labor-market reform even though high unemployment has reduced union membership to an historic low. Business leaders say no to tax reforms or breaking up corporate cartels that keep house sales expensive for citizens. The Paris media say no to any idea that comes from the dreaded Anglo-Saxons, even though Spain, Eastern Europe and the Nordic countries have shown how to cut unemployment.[b/] Chirac says no to allowing Polish plumbers or Czech nannies to come and work freely in France. The French socialists say no to Europe, leading to their party's marginalization and possible split. French professors say no to getting private money into universities. Chirac says no to any reform of the European Union or world trade rules that require reform of agricultural protectionism. De Villepin says no to Turkey's starting EU membership talks until the Turks accept conditions set by Greek politicians in Cyprus.
The France of nonistes—no-sayers—is now a major problem for Europe. There can be no European recovery or political moves forward until France learns to say oui to the new economy and to new ideas about how a modern society should be run.
msnbc.msn.com . . .