Liberté, égalité, austérité

It has long been apparent that France is something of an outlier when it comes to political debate.  The Italian Communist party understood that it had to change way back in the days of Berlinguer (how many western communist parties had a bona fide nobleman as their head?), and the MSI (the heirs of the fascio, whose historic leader Almirante conducted some memorable debates with Berlinguer) did the same under Gianfranco Fini.  Even the Greek Communist party adapted (though of course it split, as did the Italian party). 

Nothing doing for the French Communist party, which is now as dead (politically) as a dodo.  Remember, these are the people who even lagged behind the Soviets in terms of recognizing the nastiness that occurred in the Evil Empire under Uncle Joe.  A significant (and vocal) fraction of the current crop of Socialist party cadres in France are the worthy continuators of this suicidal left-wing French tradition.  Talk is of class warfare, of taxing the running dogs of capitalism (for example, penalizing companies that actually pay dividends to investors), and hiring tens of thousands of new civil servants.  If only they had confined their rhetoric to Johnny Halliday's fiscal migration (Halliday is a rock star and Jerry Lewis is a comedic genius --I know it's an easy cheap shot, but these two facts speak oodles...).

There are, thankfully, exceptions.  In a recent TV debate between the Right and the Left (on France 2, if memory serves me correctly), the Socialists were represented by Michel Sapin, their secrétaire national pour l'économie: at times, he sounded as if he were inhabiting a 1970s time warp.  And yet, he was actually minister of finance back in the early 90s, so he should have no excuse in terms of a quick reality check.  Of course the Right was represented, among other people, by the turncoat minister Eric Besson, so they did not have much mediatic sex-appeal either.  Thank God that the other left-winger on the program was François Chérèque, who has been leader of the CFDT trade union for almost ten years.  This man exudes raison, but he is woefully alone in the socialist camp.  When talking about pension reform, he actually knows the numbers and talks sense, without descending into the current socialist phraseology that would make Bukharin or Preobrazhensky feel at home.  If more Chérèques don't appear in the French Socialist camp, Sarkozy will in all likelihood squeeze by in the 2012 presidential election, and the French Left will have no one but itself to blame.  Again.

What does this all have to do with economic development?  Well, we know from a huge corpus of empirical work on developing countries that political institutions matter in terms of determining who grows and who does not.  If the French political system doesn't start to produce some sort of consensus as to how to reform the welfare and healthcare systems and improve incentives for job creation, France will become a "soon to be developing" country. In the meantime, at the very least, it's liberté, égalité, austérité.