France

Is There Any Hope for France?

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Credit: Matthieu Riegler/wikimedia

In an article for Reason's April 2014 issue Veronique de Rugy outlined the awful situation France finds itself in, highlighting the country's 11 percent unemployment rate and its annual growth rate of 0 percent. The article also mentions the fondness for tax increases displayed not only by the current Socialist President Francois Hollande but also his predecessor, Nicolas Sarkozy.

The article hit newsstands about a week before the second round of French local elections, which resulted in losses for the Socialists and gains for the right-leaning Union for a Popular movement and the nationalistic and xenophobic National Front.

In a blog post written after the elections, British libertarian-leaning Conservative Member of the European Parliament Daniel Hannan highlighted the shocking level of industrial action in France:

Only 40 percent of French people are in work of any kind, as against 60 percent of Swiss. More days are 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. The French state last ran a surplus in 1974. The money has run out.

Hannan went on to write that Marine Le Pen, the leader of the National Front, pushed for economic policies "arguably to the Left of the Socialists":

It is important to understand that Marine Le Pen positioned herself to the Left of the UMP and, at least on economics, arguably to the Left of the Socialists. She railed against capitalism and globalisation, called for higher expenditure, and supported state-run energy, healthcare, education, transport and financial services.

The French National Front is not the only nationalist European political party pushing for more government involvement in the economy. In the U.K, the xenophobic British National Party advocates for the abolition of university tuition fees, protecting "British companies from unfair foreign imports," and other big government policies.

Despite the dismal state France finds itself in de Rugy believes that "For cockeyed optimists, there are still slivers of hope":

During his New Year address, Hollande turned into a rhetorical supply-sider, making the case for cutting taxes and public spending, improving competitiveness, and creating a more investor-friendly climate. He also promised French businesses a "responsibility pact" to cut labor-force restrictions and thus promote increased hiring.

While free market economists don't believe a word of this, it is worth noting that France has reformed successfully before. Both the 1980s and the '90s saw large waves of privatization, marginal tax cuts, and slighter spending increases. To secure robust prosperity for new French generations, leaders should extend the lessons of these brief shining moments by seriously tackling government spending and reining in destructive tax rates.

I hope the French Socialist president will learn from the past, but I'm not getting my hopes up. 

More from Reason on France here.