|Courtesy of AFP/Archives|
Yet, incredibly, Valls and Hollande are today facing the biggest revolt by backbench Socialists since Hollande became elected, and the cacophony of dissent is deafening. Added to this is the fact that the ecologists have decided not to participate in the new government, thus weakening it from day one.
It began on the very evening that the election results were announced, but it went relatively unnoticed at first. Consisting of a document called The Conditions for Confidence - For a Contract of the Majority, it demands that the government and Hollande change their policies and insists that Hollande must implement his election promises. It goes on to outline a series of measures its authors say should be taken immediately in order to change course.
The reason for the dissent is that Hollande and Valls have made it clear that the government's policy package is to remain more or less intact. This means we shall see more cuts and more money - €50bn - dedicated to helping businesses to create new jobs. It's a brave - some would say foolhardy - move designed to get France's economy back on track and reduce deficits.
Who is behind it? The main instigator seems to be no less that party First Secretary Martine Aubry, a woman who has never hidden her disdain for Manuel Valls and who is still licking her wounds after being defeated in her efforts to become Prime minister after Hollande's victory. This led her to refuse a cabinet post and keep her distance from Matignon. So far the document has been signed on to by 86 députés and senior left-wing figures, including the First Vice-president of the National Assembly and the presidents of several parliamentary commissions. At least a couple of dozen more are expected to sign it before Valls presents his new policies to parliament for a vote of confidence next Tuesday.
It begins by declaring that "dialogue with the new government begins now" and goes on to list its demands. Here are those that are directly related to the economy;
[We must] obtain a reorientation of Europe that puts an end to the policies of austerity that have pushed Europe into recession [by establishing] sustainable budgetary trajectories....To put that into plain English;
[We must] concentrate public means on the real creation of jobs and intensify industrial renewal. For that, we must substitute a national investment pact, negotiated with companies, for the more costly conditions that are without conditions [for business] that are being considered right now in the Pact of Responsibility.
[We demand] measures in favour of low salary earners, fiscal reform and a progressive CSG [a tax that helps finance the Social Security system] and an effort in favour of those on modest retirement benefits.
[We need to] Reaffirm and amplify the choices and engagements undertaken in 2012: beef up efforts to regulate financial and banking activities.
- France should confront the EU (and Germany) and demand that the very budgetary constraints that France helped to create to save the euro should be scrapped in favour of a more laxist approach that would increase national debt, thus risking the ire of the markets, the IMF and the moneylenders.
- France should create tax-funded jobs, thus increasing the tax burden on households in order to create artificial jobs that don't create wealth. Also, business should be forced to contribute to the effort, thus lessening the possibility of them creating real jobs and frightening investors away.
- More public money should be found to help the less well off.
- Hollande should put his "I am the enemy of finance" promise into effect, with stricter demands being placed upon the markets and banks, despite the fact that doing so unilaterally would ensure that France became the international paria of the world of business, lending and investment.
In other words, this document demands that France revert to the very policies that got it into this mess in the first place. Hollande tried them for almost a year until it became clear that doing so risked driving the economy straight over a cliff and pushing the country into a deep recession.
French socialists still seem to be stuck in a timewarp in which believe that business, bosses and the rich are their enemies and that France can tax its way out of debt using their money. Adopting these policies would be akin to committing economic suicide and Hollande and Valls should reject these demands out of hands.
I am reminded of these wise words;
"I contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket trying to lift himself up by the handle."- Winston Churchill