It can’t get any worse than this!

Dialogue with the Alter Ego on Hollande’s leadership after the demise of Jérôme Cahuzac

Question by Alter Ego of Noah denkt™ (AE): The government of French President Hollande is in extreme disarray after the now disgraced former budget minister Jérôme Cahuzac who, by the way,  was responsible for the persecution of tax evasion was forced to admit that he himself had secret funds stacked away in some offshore accounts in Switzerland and Singapore. In a way the current situation validates a previous judgment of yours in which you characterized Mr. Hollande as being a ”disaster”? (see: Does Noah denkt™ now feel a sense of vindication for having anticipated his leadership adequately?Answer by Noah denkt ™ (Nd): No, we do not feel vindicated at all by this. In fact, we even have a glimmer of hope that the situation in France might shape up a little bit in the months to come. After all, the political mood in that country is so bad at this point that it is hard to presume that it could get even worse.

AE: But isn’t there still the possibility that the President himself or his Finance Minister might get caught up in the Cahuzac scandal. After all, there are allegations surfacing now that Mr. Moscovici may have tried to influence the independent judicial inquiry in to the Cahuzac case and that Mr. Hollande’s office itself may have been quite aware all along of the dishonesty that France’s former budget minister brought to the job.

Nd: Okay, granted, there may still be some ripple effects to the Cahuzac revelation. We continue to believe though that from now on things will work out a little better for Mr. Hollande and his team.

AE: Why is that?

Nd: Because he has tried to do a few things that aren’t altogether wrong.

AE: Like what?

Nd: Well, take for instance, the idea to develop a tutorial job entry system for the unemployed young. Or take his plan to finance high-speed fiber broadband networks all around the country. And last but not least look at his initiative to offer tax breaks for companies that employ low wage labor. This is going into the right direction, isn’t it?

AE: May be. But there is still the fact that his interpretation of economic reality and, hence, the conclusions which he draws from that aren’t state of the art?

Nd: Sure! But, we at this point prefer to view the glass as half-full rather than as half-empty. At least, Mr. Hollande isn’t the same socialist anymore that he was when he got into his office. In fact, it is probably fair to call him a social democratic now which deserves some praise not just from us but from the markets too.

AE: In our mind this is too little too late. Don’t forget that France still has a long way to go to face up to the harsh reality that global competition imposes: Just think about its overly protective labor law system, its success punishing tax law and the quite inadequate attitude which the country has towards financial speculation. Things like that cannot be remedied by cosmetic touches here and there.Nd: No doubt about that. But given the less than warm welcome that capitalistic thinking tends to receive in France you have to appreciate the small steps that are being taken into the right direction rather than to wait for the big breakthrough. Do not forget that the real issue over there is the continuing loss of credibility that both the UMP and the Socialist Party are suffering from. So, at this stage, it is more important to help stave off a slide into populist extremism in France than to beat up Mr. Hollande for not being a neo-liberal conservative.

AE: In other words, you are worried about the self-destruction of the republican center in France. But you don’t want to say it out loud.

Nd: Well, okay, we are worried but we do not view the situation as being hopeless.

AE: That is a very lukewarm statement coming from you. After all, you are notorious for not giving up hope, even in the most hopeless situations.

Nd: Perhaps: But we still mean it.

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