French Socialists, Under Fire, Display a Lack of Fraternité

The symbol of the victorious French Socialist Party is the rose, but the bloom is off five months after François Hollande won the presidency, petals are blowing around. Buffeted by a bad economy and rising unemployment, a decent but uninspiring prime minister, Ayrault, has been left by Mr. Hollande to ride the waves as best he can. But bosses are angry, workers are angry and mistakes are mounting, leaving the always disputatious Socialists sniping at their own leaders. At Socialist Party’s recent annual congress in Toulouse, there were complaints that  economic rigor had gone too far, and that the government should renege on its promises to European allies and markets to get the budget deficit this year to 3% of gross domestic product. Others complained that Mr. Hollande’s decision to meet the target by raising taxes and freezing spending, rather than cutting it, would throw France into recession, even as growth, so far elusive, would by itself provide more tax receipts and jobs. The main business lobby, Medef, has warned of more bankruptcies and layoffs, while association of top French companies, Association Française des Entreprises Privées, called for a 30 billion euro, $38.8 billion, cut in public welfare fees paid by employers over the next two years to try to reduce the weight of taxes and promote competitiveness. The group also called on government to cut spending by $77.7 billion over 5 years, warning that France could no longer afford to have the state producing 56% of G.D.P. The complaints come as a much-heralded report due next week on how to improve the French competitiveness, commissioned by Mr. Hollande in July from Louis Gallois, former head of the European Aeronautic Defense and Space Company, is being played down by the government. Mr. Gallois and Medef want “a competitiveness shock,” in which some social welfare fees now paid by companies would be transferred to general budget or covered by other taxes. But Mr. Hollande, who was criticized during the campaign as being indecisive and vague, said that a shock was a bad idea, he preferred a gradual “competitiveness trajectory.” “France is now facing triple challenges”, speaking of steep debt, poor growth, high manufacturing costs. Politically, it would be a difficult time to ease taxes on companies by raising them for retirees, but softening of his promise to provide strong measures to improve competitiveness, hence employment, disappointed many. Even Le Monde, on center-left, asked in a front-page headline on Wednesday evening, “Has Hollande underestimated the crisis?” (…..)

Link: http://www.nytimes.com/2012/11/01/world/europe/for-frances-socialists-a-breakdown-in-fraternite.html

Acerca de ignaciocovelo
Consultor Internacional

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