[P2P-F] Fwd: [CommonGood] Fw: [New post] France: the choice

Michel Bauwens michel at p2pfoundation.net
Mon Apr 17 13:37:16 CEST 2017

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From: Birgit Daiber <bir.dai at hotmail.com>
Date: Mon, Apr 17, 2017 at 2:01 PM
Subject: [CommonGood] Fw: [New post] France: the choice
To: "commongood at listi.jpberlin.de" <commongood at listi.jpberlin.de>

Dear Friends and Colleagues,  French citizens will decide in next
Sunday's elections and the following 2nd round not only on their new
president but the existence of the European Union. I would like to share
with you the description on the candidates and their positions given by
Michael Roberts - see below. Yours, Birgit

*bir.dai at hotmail.com <bir.dai at hotmail.com>*
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*From:* Michael Roberts Blog <comment-reply at wordpress.com>
*Sent:* Sunday, April 16, 2017 8:37 AM
*To:* bir.dai at hotmail.com
*Subject:* [New post] France: the choice

michael roberts posted: "It’s only a week to go before the first round of
the French presidential election and it seems that the race is wide open.
Only two candidates can take part in the second round in May.  But who will
those two be?  Extreme right-wing Front National candid"
Respond to this post by replying above this line
New post on *Michael Roberts Blog*
<https://thenextrecession.wordpress.com/author/bobmckee/> France: the choice
by michael
roberts <https://thenextrecession.wordpress.com/author/bobmckee/>

It’s only a week to go before the first round of the French presidential
election and it seems that the race is wide open.  Only two candidates can
take part in the second round in May.  But who will those two be?  Extreme
right-wing Front National candidate Marine Le Pen has been the front runner
in the polls over the last year, but her support has been slipping.
Ex-socialist minister and centrist darling of the bourgeois media, Emmanuel
Macron is neck and neck with Le Pen, both at around 22-23%.  The official
conservative (Republican) candidate Francois Fillon should be ahead, but he
has been damaged by the expenses scandal of his wife and children getting
huge government-funded salaries for parliamentary work which they did not
do.  Even so, Fillon is getting about 18-19% share of those saying they
will vote.  The big surprise in the last few weeks had been the rise of
Leftist candidate Jean-Luc Melenchon, whose polling has leapt from 10-11%
to around 19% now.  In so doing, the official Socialist party candidate,
Benoit Hamon, has seen his vote slump to 6-7%.


It is still most likely that it will be Le Pen and Macron in the second
round, with Macron more than likely to win the presidency by some distance
over Le Pen.  But all combinations are possible, with the worst for French
capital being a battle between leftist Eurosceptic, anti-NATO Melenchon and
racist Eurosceptic Le Pen.

Back in February I analysed the state of the French economy
<https://thenextrecession.wordpress.com/2017/02/01/france-penned-in/>, the
second-largest in mainland Europe and one of top ten capitalist economies
globally.  The profitability of French capital is at a post-war low
(profitability is still down a staggering 22% since the peak just before
the global financial crash in 2007), real GDP growth is only just over 1% a
year, well below that of Germany.  The unemployment rate remains stuck
close to 10% compared to just 3.9% in Germany.  Youth unemployment is 24%.
Business investment has stagnated in the ‘recovery’ since 2009.

Because of the actions of the French labour movement, inequalities of
income and wealth have not risen as much as in other G7 countries like the
US and the UK in the last 30 years.

[image: zucman]

Neoliberal policies have been less effective in getting profitability up
and workers down under the thumb of capital.  French capital needs a
president that can and will do this now.  Can it find one?

If we look at the programs of each candidate, we can see it is Francois
Fillon who offers the best programme for the interests of French capital.
Fillon aims to end the key gain of the French labour movement, the official
35-week, often firmly enforced.  Under Fillon, workers would have to put in
39 hours before overtime or time-off in lieu is paid.  Fillon would slash
the public sector workforce by 500,000 (or 10%), while increasing the
working week for those who keep their jobs.  The retirement age would be
raised to 65 from 62 now and everybody would have to work to that age or
face pension loss.  Unemployment benefits would be cut.

Severe fiscal austerity would be imposed with a cut in public sector
spending from the (astronomically high for capitalism) 57% of GDP to 50%,
with a ‘balanced budget’. The cuts would be necessary because Fillon wants
to cut corporate tax rates to 25% and other ‘burdens’ on the business
sector, while raising VAT for purchases by French households by 2% pts.  He
would scrap the current wealth tax on the rich. One area of extra spending
would be more police and more prisons, while reducing gay rights.

This is an outright neo-liberal program that no French president has been
able to impose successfully in the last 30 years.  But French capital
demands it.  Unfortunately, for big business, Fillon is unlikely to make
the presidency.

But what of Macron, the ex-banker and socialist minister, the man most
likely to get into the Elysee Palace (the French White House)?  Macron’s
program is a mix that attempts to appeal to labour and capital, as though
they could be reconciled.  He wants to merge public and private pension and
benefit schemes.  He claims that he will get the unemployment rate down to
7% through an investment plan.  And yet he plans to cut public sector
spending and run a tight budget.

Like Fillon, he would cut corporate tax for businesses to 25% of declared
profits.  He keeps the 35-hour week, but companies would be allowed to
‘negotiate’ a longer week.  Low-wage earners would be exempted from certain
social welfare levies, a measure that would put an extra month's wage per
year in the employee's pocket (but no clarity on how this would be paid
for, except through ‘higher growth’).  He too would boost police and
prisons but also provide a ‘payment for culture’ to students and reduce
school class sizes.  He would cut the number of MPs and reduce time for
re-election of officials, while banning Fillon-type payments to family
members. This programme is thus a mix of help to business and wishful
thinking for labour.  But it seems to appeal to just enough voters over the
neoliberal alternative of Fillon.

Both Fillon and Macron are pro-EU and pro-euro.  This is the one big policy
difference with Le Pen and Melenchon.  Le Pen’s program is a mixture of
racist, anti-immigrant, anti-EU policies alongside pro-labour measures for
the public sector and wages.  Le Pen would ‘re-negotiate’ the EU treaty
with the rest of the EU and if that failed, call a referendum on leaving
the EU within six months.  If French voters decided to stay in the EU, she
would resign the presidency.  If they voted to leave, France would end the
euro as its currency and re-introduce the franc.  Such a policy would be
shattering for the French economy and probably sound the death-knell of the
EU and the euro as we know it.

Le Pen would get on with ending immigration, strip many French muslims of
citizenship, revoke international trade treaties and NATO operations and
confine free education to French citizens only.  Companies employing
foreigners would pay an extra 10% tax and foreign imports would be subject
to a 3% tax.  And, of course, the police forces would be expanded.

Like the Brexiters in the UK referendum, she claims that she can cut taxes
on average households and raise welfare benefits by saving money on EU
membership and regulations (that has turned out to be a myth in the UK,
where austerity has increased).  The number of MPS would be halved.

But Le Pen also aims to help (small) business with lower taxes.  And
instead of raising the retirement age, as Fillon proposes, she would cut it
to 60 years, increase benefits to the old and to children, while keeping
the working week at 35 hours and overtime tax-free!

Le Pen’s economic policy is thus anathema to French capital and attractive
to French labour, but combined with racist and nationalist measures.  But,
of course, there is no real attack on the hegemony of French big business.
So this policy of raising wages and benefits while leaving the euro and
introducing protectionism, in an economic world of low growth and a
possible new economic slump, is utopian. Neither the needs of labour nor
capital will be met.

When we turn to Melenchon, we see a similar utopianism, if from the
perspective of defending the interests of labour over capital.  His
economic program is similar to that of Corbyn’s Labour
the UK, if going further.  He proposes a 100-billion-euro economic stimulus
plan funded by government borrowing and some nationalisation in sectors
such as the motorway network.  He says he would raise public spending by
275 billion euros to fund the plan, to raise minimum and public sector
wages, create jobs to reduce the unemployment rate to 6% and also, like Le
Pen, cut the retirement age to 60.

This extra spending would, Keynesian-like, fund itself from higher economic
growth and employment.  But with big business needing profits to invest,
calling for more taxes on business (as well as the rich), may deliver the
opposite of faster growth.  At the same time, he too would cut corporate
tax rates to 25%!

Melenchon would also renegotiate the EU treaties, ignore the EU fiscal
austerity pact, call for a devaluation of the euro, take national control
of the Banque de France from the ECB and leave NATO and the IMF.  And
following Le Pen, if these measures are blocked, he would have a referendum
on EU membership.

Melenchon’s program is similar to that of socialist Francois Mitterand
(although somewhat less radical than Mitterand’s) when the latter won the
presidency in 1981.  He too wanted to take France on an independent line
from the rest of Europe in expanding the economy through public spending,
nationalisation and more taxes on business and the rich.  That program fell
down in face of the deep global slump in 1980-2, when financial investors
fled France and the franc.  The choice then was for Mitterand to go the
whole hog and take control from French capital or capitulate to neoliberal
policies.  He chose the latter with his so-called "tournant de la rigueur"
(austerity turn) in 1983.  That choice would soon face Melenchon, in the
unlikely event that he won the presidency.

Apart from the economic utopianism of Le Pen and Melenchon under
capitalism, they both face an immediate political problem.  In June, the
French vote for a new National Assembly, which, at least right now, would
probably elect a majority of conservative pro-capital, pro-EU MPs who would
be backed by a media campaign from big business, the EU Commission and
other EU governments aiming to shackle the new president.  The battle would
be on from day one, while the euro and French financial assets reel from
the shock.

But it probably won’t happen.
*michael roberts <https://thenextrecession.wordpress.com/author/bobmckee/>*
| April 16, 2017 at 6:37 am | Categories: capitalism
<https://thenextrecession.wordpress.com/category/capitalism/>, economics
<https://thenextrecession.wordpress.com/category/economics/>, Profitability
<https://thenextrecession.wordpress.com/category/profitability/> | URL:

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