Sunday, January 19, 2014

France under the Socialists

The idea that Francois Hollande is anything but a neoliberal hack was dispelled at his most recent press conference.  But in fact anyone could have seen this coming even before Hollande's election as French President.  During the election campaign, Dominique de Villepin, the French politician best known for his impassioned plea at the UN to avoid the USA invasion of Iraq, haughtily told Hollande that his Socialist promises were worthless because they would soon encounter market realities.  And they have.

The Socialists are in a box.  The EU is sort of a left-wing wet dream, after all, and it is EU neoliberalism that is being enforced in France.  Not that Socialist economics were all that exciting to begin with but they are utterly meaningless so long as all the important economic decisions have been given over to the European Central Bank.

Hollande chooses 'third way' on economy

Carolin Lohrenz / bk  15.01.2014

After a year and a half in office, French President Francois Hollande has turned away from his Socialist economic policies. But the country doesn't seem to care and is more interested in his personal affairs anyway.

"I am a Social Democrat!" Francois Hollande stands before 600 journalists in the main hall of the Elysée Palace and persists with the point. Framed by heavy curtains and the French national flag, he addresses the New Year's press conference, always a major media event in France.

And it is also the president's chance to set the course. Hollande wants to talk about politics. And about the economic recovery. "I have a conviction. It is strong," he says. "If France wants to maintain her influence in the world, if she wants to continue to help make decisions in Europe, and if she wants to remain in charge of her own fate, then she urgently needs to find new economic strength."

'Elected with the help of the left'

These 40-minute presidential monologues always serve the same purpose - to give the French renewed faith in their country's strength. But the way there requires nothing less than a radical change of course - less welfare, more market, more individual responsibility.

Hollande spoke of measures to stoke the economy, of cuts to the national budget and social services, and of a "responsibility pact," meant to lower wage costs for firms by some 35 billion euros ($48 billion). The pay-off which he promises is new jobs.

His positioning is clear, but the man with the Socialist credentials has no intention of losing his Social Democrat status. "I was elected with the support of the Socialist party and the left," he says. "Of course, I have always remained true to my convictions. Am I a Social Democrat? Yes! And this responsibility pact is no more than a social compromise. I haven't suddenly fallen into economic liberalism."

Saving till 2017

The president has been practicing this routine for more than two weeks now. In his televised New Year's address he made clear that 15 billion euros needed to be saved in 2014, and 50 billion by 2017. A new authority will be established to check every expense, called the "strategic expenses council."

"A lot of people will ask, 'why aren't you encouraging demand?' I will tell you: if all a left-wing politician did was to enlarge the deficit, then you'd have to describe my predecessor [conservative President Nicolas Sarkozy] as a left-wing extremist."

Hollande affair rumors overshadow speech

This press conference, a state-underpinning event, is certainly not intimate, but it offers Hollande a suitable platform for another issue that Hollande wants to promote in the coming year: Europe and its Franco-German engine.

"The initiatives for Europe must come from Germany and France," he said. "We have to cooperate economically and socially. Germany's grand coalition has just decided to introduce a minimum wage. That is a first step. We for our part have to balance our tax policy."

Energy transition

His next vision is a joint German-French energy transition. "Germany has a head-start in renewables, but we have our vanguard in energy storage and power grids," he said. "We have to work together to expand new industrial branches. We are very proud of Airbus, now we want joint action for the energy transition."

He also goes on to address common defense policies. "Close agreements between the chancellor, me, and our ministers" in all important issues are to create a French-German dynamic for Europe. "If we are capable of it," he adds, once again revealing the procrastinating Hollande.

And how is your girlfriend?

But then the announcements of this year's new political paths are over, and the cold shower everyone had been expecting arrives. As soon as the floor is opened to journalists' questions, the first one comes: Will Valérie Trierweiler be accompanying the president on his trip to Washington at the start of February?

This is what is currently preoccupying France. Hollande's partner has been in the hospital for several days with "exhaustion," after a Paris gossip magazine reported an alleged affair between the president and an actress. "I understand you asking the question, and I am sure you will understand when I answer that everyone goes through trials in their private life. It hurts. But I have a principle: private business is dealt with privately."

In the footsteps of Gerhard Schröder

Then, the president returns to the more pressing issues of education, youth, and health. The conference lasts around two and a half hours altogether and Hollande steadfastly refuses to answer any personal questions.

That evening, media commentators will compare Hollande to Gerhard Schröder, and remind the French people that Hollande won power by promising a 75-percent tax on the rich and a southern European alliance against Angela Merkel's European austerity program.

Now, trade unionists have accused the president of declaring his own philosophy bankrupt. "This is his market-liberal coming-out," said Jean-Claude Mailly, head of the Force Ouvrière union. "Labor policy is now no longer his problem but that of employers. So we give them 35 billion euros and see what happens. This is a hasty lurch to economic liberalism. It is dangerous. He is the president of France! Not the business chiefs." more
One of the things that usually happens when economic austerity is enforced through tight monetary policies, is the communities often come up with schemes to come up alternative forms of currencies.  Not surprising since the French economy is suffering due to austerity measures associated with the Euro, we are already seeing experiments with coupons.

Fed up with euro, France flirts with coupon money

Published time: January 10, 2014 14:10

Whether buying bread, filling a pharmacy prescription, getting a haircut or going to the doctor, some residents of Montreuil, France, are rejecting the euro in favor of ‘La Peche’, a local community currency.

In France, local currencies are growing in popularity as trust in state institutions erodes. An elaborate coupon system lets locals pay for services and goods with special local banknotes, which are recycled and kept within the community.

France, Europe’s second largest economy, has at least 20 different types of complementary currencies. Worldwide there are over 4,000 community-centered money schemes.

“First it’s practical. Local currencies stay and develop in the region. Second ideological. A lack of confidence in official currencies makes people want to have something they understand, that they can control, and that they can trust, not just something that is printed, you don’t know how, with no control and leads to speculation,” Herve Pillard, a French finance lawyer told RT.

Both electronic or paper, the currency is spent and then directly fed back into the community from where they come from, which cuts down on the number of monetary circuits through which it passes, which in theory strengthens the community, reduces the ecological footprint, and is a hedge against speculative markets and tax havens, according to the organization’s website.

Traditional money like the euro lost its appeal as Greece’s credit crisis dragged the currency to record lows in September 2011.

The value of one ‘peche’ is directly tied to the euro at a 1:1 exchange rate.

“The problem with the Euro is that it’s not just a mode of exchange, but it also became a mode of speculation to feed banks. While local currencies support local projects on the ground, which means it works for us, the people,” Ghislaine Scheffer of ‘La Peche, Monnaie Locale’ association told RT.

Economies around the world have tried to use monetary and fiscal policies as a tool to strengthen economic growth. The US opted to pump billions of stimulus into their economy, and Japan used monetary easing to boost exports on a weak yen.

“Banks play enough with money but at the end of the day ordinary people have to pay for mistakes and losses. This is why people want to have a currency they will be sure will serve them and not disappear in a fiscal paradise, global finance systems, or banks,” Etienne Hayem, entrepreneur and local currency expert told RT.

The intentional ‘currency wars’, at first criticized were later deemed acceptable by G20 nations as a way to guide their economies back on track.

Put into circulation in January 2002, the euro is currently administered by the European Central Bank (ECB) and the eurozone central banks. In 2014, the Frankfurt-based ECB will officially take oversupervision of more than 6,000 eurozone banks.

Startup currencies, both hard and digital, have been making headlines in 2013, with Bitcoin the clear winner. Following the spectacular rise from just pennies to over $1000, the cryptocurrency has won fans from the US to China to Cyprus, and amongst consumers looking for an alternative approach to state-backed financial systems.

Though alternative money has been making waves, most experts agree it won’t replace the central bank-backed conventional ones. more
One of the last stands against the ultimate Predations of neoliberalism is to take physical control of a factory and it senior management.  This is also happening in France.

Workers At Closing Goodyear Tire Plant Take Their Bosses Hostage

By Diane Sweet January 7, 2014

'Boss-napping' returns in France as unionists lock up Goodyear executives.

French workers at a Goodyear factory in Amiens have been holding two company executives hostage since Monday in the once-common French practice of boss-napping. Goodyear has been trying to shut down the plant for five years, a decision that has prompted huge protests and tire bonfires. “It’s a reaction of despair,” said Sylvain Niel, a labor lawyer who has worked on similar issues. “They have no room to maneuver with the closing of the factory.”

A boss-napping that lasts less than a week is punishable in France with five years in prison and a 75,000 euro fine, although workers are rarely prosecuted. At the Goodyear factory, union leader Michael Wamen said the captive managers had refused offers of mattresses and blankets.

"The boss-napping may be the final chapter in a dispute which started in 2009 when Goodyear management said the plant in France was not competitive enough to keep running and needed modernization to produce the sort of tyres now required on the market.

Goodyear workers rejected plans to tighten costs and labor conditions while across the street workers at the Dunlop tyre plant owned by the same Dunlop-Goodyear parent accepted new conditions. That plant is still producing after receiving hefty investments.

The unions at Goodyear are now no longer fighting to keep the plant open, but want severance packages of between 80,000 euros ($109,100) and 180,000 euros depending on seniority. Management's proposals have not been made public.

The unions also want access to job re-training benefits for 24 months rather than 15, as currently proposed, [CGT union delegate] Frank Jurek said."
Goodyear said in a statement it had filed a complaint against the workers on a lesser charge of "impeding personal mobility."

Maurice Taylor, chief executive of Titan International, said the boss-napping had killed any chance of a takeover for the plant.

Workers at the idled factory, located in the northern city of Amiens had been trying to negotiate redundancy terms with management for nearly a year, after the Texan tycoon Taylor withdrew a potential rescue bid on the grounds that French workers were "lazy" -- triggering a political storm. more

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