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| Europe |
| Regarding The Day that France went Bankrupt |
| 2006-11-05 |
| Imagine the scene: two billionaires are bidding at an auction in Paris for the world’s most famous painting. The Russian oil tycoon loses his nerve at £189m and the auctioneer bangs his gavel. The Mona Lisa has been sold to a grinning Chinese textile baron. France’s humiliation is complete. We are in 2013. The state’s coffers are empty and the French have been reduced to selling off their family treasures to make ends meet. The Day that France went Bankrupt, a novel by Philippe Jaffré, a former Treasury director, could serve as a warning about the dangers of big government to Ségolène Royal, the darling of the opinion polls concerning next year’s presidential election. In Jaffré’s book, Royal’s victory sets in motion a chain of events that leads to France going broke and suffering the indignity of having to beg for help from the International Monetary Fund (IMF), which imposes draconian economic conditions. The culprit in all this is France’s public debt. It has grown to 66% of GDP, compared with 43% in Britain, as a result of the cost of maintaining the country’s bloated bureaucracy and lavish social welfare system. It will impose a heavy burden on the next generation. No wonder the other recent addition to the doom-laden library of French “declinism” — as the “dark days to come” doctrine is known — was called Our Children will Hate Us. So attached are the French to the fat of their state, however, that few politicians would dare to suggest trimming it, particularly with the elections approaching. On the contrary, Dominique Strauss-Kahn and Laurent Fabius, two Socialist rivals of Royal, have been promising to increase spending on welfare as the battle for the Socialist party nomination, to be decided in a vote next week, reaches its climax. Royal has also vowed to defend the welfare system. Although the public adores her, she is under a cloud of suspicion in the Socialist camp for voicing admiration for Tony Blair, whose relatively moderate policies are anathema to most French Socialists. Even Nicolas Sarkozy, the most likely candidate from the centre-right, has gone quiet on reform. He likes presenting himself as the candidate of “rupture” with the past, but the painful spectacle of Dominique de Villepin, the prime minister, failing to get even a modest employment reform past the barricades of angry student protesters may have put him off. All of which fuels the “declinologist” gloom: beyond a parable about the perils of public spending, some see in Jaffré’s book an illustration of the growing belief that France can advance only through serious upheavals. In the novel, Royal is thrust into an uncomfortable coalition with the Greens after they end up scoring well in parliamentary elections. She makes a bold stab at reform after appointing Strauss-Kahn as prime minister but is forced to retreat after protests and strikes, a familiar pattern in French politics. She resorts to the standard French political reflex of spending her way out of trouble; by the time Sarkozy wins power in 2012, half of the state’s revenues go on servicing the debt, which has risen to 180% of GDP. The crisis is triggered when Standard & Poor’s, the debt rating agency, relegates French debt to the status of “junk bonds”. The banks are no longer prepared to lend France any more money. In short, France is broke. The stock market closes and so do the banks. In the resulting chaos, thousands of French tourists are left stranded around the world when their credit cards stop working. Once the boss on the European block, France goes cap in hand to its European Union neighbours for help and the Germans are not alone in experiencing intense feelings of schadenfreude at the spectacle of French officials grovelling. Some countries, including Britain, decline to contribute to the bail-out, arguing that France has only itself to blame. Others will come to the rescue only if an austerity package is implemented under the supervision of the IMF. The IMF seems to take perverse pleasure in making the terms particularly harsh. In the first year of the adjustment, production plummets and unemployment rises. The growing poverty fortifies the far right and gives rise to a radical new Socialist party. It does not stop the relocation of the Mona Lisa to Shanghai. Sarkozy, in particular, has every reason to hope that fiction remains fiction. The last straw for his character in the book is when, at the end of a state visit to America, he is prevented from taking off in his plane back to Paris. A judge acting on behalf of a creditor has ordered the seizure of French assets, including the presidential Airbus. |
| Posted by:ryuge |
| #11 Maybe they ought to pay some attention to the 7 million loafers they've got in banilues who do nothing but torch cars as a hobby. Deporting these leaches may do wonders for the treasury. That would require logique, something that may well have perished in France along with René Descartes. France's stubborn efforts to triangulate against America with its EAD (European Arab Dialogue) will likely be the death of it. Idiots. |
| Posted by: Zenster 2006-11-05 20:28 |
| #10 I think the correct estimate is 8-9 million Moslems of North African origin in France. Plus at least 400,000 converts. If you look at stats for first names of babies in France over the last few years the Moslems are nowhere near 30% of the population -- 15% and rowing fast seems a good guess though. This is all assuming that there is accurate information about what's happening in the lawless |
| Posted by: Kalle (kafir forever) 2006-11-05 17:53 |
| #9 Maybe they ought to pay some attention to the 7 million loafers they've got in banilues who do nothing but torch cars as a hobby You might like to know that a conservative forum member said a RG (police intelligence) friend told him there was actually 18 millions muslims in France, not the official 6 millions (this was the official number back in the 80's, there's NO way this has not changed since, not with 300 000 to 500 000 immigrants coming in each year). LOTS of salt, of course. But even the conservative officious number of muslims in France (I won't say "french muslims", that's an oxymoron) is 8-10 millions. But the 18 millions might be true, who knows, and would explain MUCH (basically, France would had put herself in an impossible situation, thanks to her Enlightened Elites and the EUrabia). |
| Posted by: anonymous5089 2006-11-05 11:42 |
| #8 I thought the whole rationale for the Euro was so that the French could ride the coattails of the stronger German economy and delay collapse until the whole of the Euro economies could no longer sustain governmental financial commitments. Too bad German unification placed a huge burden on the German economy. |
| Posted by: ed 2006-11-05 11:38 |
| #7 If France goes under to debt, does that drag the entire EU system down with it ? Like the electrical grid ? Maybe they ought to pay some attention to the 7 million loafers they've got in banilues who do nothing but torch cars as a hobby. Deporting these leaches may do wonders for the treasury. |
| Posted by: SpecOp35 2006-11-05 10:53 |
| #6 What's funny is that jaffré is a pure System man; for him to speak that way shows something is changing. And by the way, a less-publicized book written by an ex-fiancial inspector (high ranking civil servants for life) said that given current trends, and using Argentina as a benchmark, bankruptcy woudl be circa 2010, not 2012. There was also a recent fiction book, which had a modicum of success in libertarian-conservative ranks, about the crash of the french System... and Claude Reichman had a book about a metaphorical collapse of the bureaucracy/technocracy, in which the bloated french State collapses, and nobody notice, or cares, except the insiders and profiteers, as Reagan joked about. |
| Posted by: anonymous5089 2006-11-05 09:14 |
| #5 Oh! They're talking financially bankrupt. I wondered, because morally and culturally, the French went bankrupt decades ago. |
| Posted by: Rob Crawford 2006-11-05 08:57 |
| #4 We are in 2013. The stateÂ’s coffers are empty and the French have been reduced to selling off their family treasures to make ends meet. But they'll still be giving money to Paleos. |
| Posted by: gromgoru 2006-11-05 05:06 |
| #3 Belgium and Italy are in far worse shape than France. All that French nuclear power does wonders for keeping down France's external debt. |
| Posted by: phil_b 2006-11-05 04:28 |
| #2 All I can say is... ouch! French Rantburgers, have I mentioned how nice Nevada is? Not only do we have extremely limited taxes, but hookers, assault weapons, and slot machines too. |
| Posted by: Secret Master 2006-11-05 01:56 |
| #1 And in possibly related news, see the article immediately following this one... |
| Posted by: Seafarious 2006-11-05 01:27 |