Letter From Paris

A Nation on the Edge

Is there a "French Spring" coming?

By From the May 2013 issue

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ONLY ONE YEAR INTO his presidency, François Hollande, France’s bland, indecisive, but stubbornly doctrinaire socialist leader, is already setting records. Admittedly they are not the sort of milestones that the French were hoping for when they voted him into office last May, preferring an insipid Monsieur Normal, as he marketed himself, to the aggressive, hyperactive Nicolas Sarkozy. Based on his campaign pledges, they were hoping Hollande, a career political hack, could rein in the country’s metastasizing unemployment, kickstart growth and consumption with redistributive, soak-the-rich tax policies, and deal with the divisive debate over homosexual marriage in an equitable way. “Change now” was his slogan.

What they have gotten is change for the worse: unprecedented unemployment, crushing taxes, a runaway budget deficit, zero growth, and a society rent by the unresolved issue of same-sex marriage. It makes for an explosive mix in a land known for the unpredictable volatility of its citizens. With a poisonous pall of disappointment and rising anger hanging over the land, the dark national mood resembles a collective nervous breakdown; significantly, France is now the world’s largest user of anti-depressants and ranks number two in alcohol consumption. Some political analysts are beginning to worry that the center cannot hold. They sense a whiff of bloody-minded insurrection in the air.

They point to things like Hollande’s record-breaking plunge in popularity. Two out of three citizens—68 percent—are disappointed in him, making him the most disliked president after a year in office in modern French history. (Buyer’s remorse: Polls show a comfortable majority would vote for Sarkozy if an election were held today.) They see public enthusiasm for the months-old military operation in Mali weakening after an initial bump of support, as the number of French soldiers killed in action climbs, their mission in the rocky fastness of the Sahel lengthens, and Hollande articulates no credible exit strategy. Perhaps most seriously, they see Hollande’s credibility irretrievably crippled by the resignation last month of his budget minister, Jérôme Cahuzac—responsible for French belt-tightening and cracking down on tax evasion—who confessed that for years he’d had well-filled illegal bank accounts in Switzerland and Singapore.

Hollande is losing support even among socialist voters and politicians, including the far left that initially backed him. Like the conservative opposition, they see him as mou, weak and soft, vacillating on issues that demand strong leadership. Marine Le Pen’s far-right National Front party recently came within a few points of winning a special election, as disgusted socialist voters turned away from the party. One socialist mayor, exasperated by the five disastrous special elections since Hollande came to power, publicly attacked the president’s limp-wristed style. “He has to stop making these technocratic speeches that nobody understands,” he said. “When you’re president, you size up the country’s problems and you take action.”

Hollande’s recent timid attempts to win over public opinion have flopped. After he did an hour-long Q&A on television this spring to explain his policies, 68 percent of viewers judged him “unconvincing.” Hand-shaking tours of the provinces similarly have come to naught, eliciting more jeers than cheers as harried security agents grappled with hecklers to get them out of camera range. One woman in a Dijon crowd even embarrassingly lectured him on his love life, advising him not to marry his live-in mistress, Valéry Trierweiler, “because we don’t like her.”

What they really don’t like is the economic pain as France slips into full-fledged recession. Unemployment, now near an all-time record of some 3.2 million, or almost 11 percent, has risen every month for the last two years. In response, Hollande doggedly keeps repeating the delusive mantra that he will, somehow, given enough time, reverse the unemployment curve by the end of this year. “We are living through a veritable economic and social catastrophe,” editorializes Le Figaro. Some recall President Georges Pompidou’s ominous prediction in the early 1970s: “If we ever reach 500,000 jobless in France, there will be a revolution.”

With the budget deficit running a catastrophic 4.8 percent of GDP—Hollande had promised to bring that down to the EU-mandated 3 percent—government coffers are empty. This despite nearly $40 billion in new taxes. With today’s total tax take of over 44 percent of GDP, France is the most heavily taxed country in Euroland, maybe in the industrialized world. The tax burden hits everyone one way or another, but especially businesses and the middle class. One result is that cash-strapped companies have to put investment on hold. As the Organization for Economic Cooperation and Development (OECD) has put it diplomatically in a report on France, “high levels of taxation are gradually eroding its competitiveness.”

A symbol of the tax squeeze on individuals has been Hollande’s purely ideological, class-warfare proposal of a 75 percent tax on income over $1.3 million. The Constitutional Court ruled that was confiscatory and unlawful, but France’s affluent citizens got the point: The socialists were out to punish them and would find a way to do it. They were right. Hollande has now decreed that the 75 percent tax will be paid not by individuals, but by the companies that employ them. It’s a brilliantly perverse stroke that boosts his socialist street cred: He not only soaks the rich indirectly (French companies now will hesitate to pay their executives top dollar), but he also strikes at hated business profits and discourages entrepreneurship. If that has the unfortunate side effect of further weakening the economy, at least it’s textbook socialism.

THE EXODUS OF WEALTHY French citizens has become epidemic. No official statistics exist, but it’s estimated that about 10 “fiscal exiles” leave the country every month to escape rising income and wealth taxes. To make sure they take a last hit before they go, the government has instituted an exit tax levied on the “latent capital gains” of portfolios worth over $1.7 million. In only nine months last year, some 250 such tax declarations were made, but tax lawyers and other consultants say the real number of emigrés is much higher. One sign is the acceleration of high-end home sales in places like Paris and its prosperous suburb of Neuilly, where the number of sold properties worth more than $2 million is up by as much as 75 percent within the last year. A notary who advises these refugees from socialism told me their flight reminds him of the massive 17th-century emigration of persecuted Huguenot Protestants.

The tout Paris chatters about the latest big names to exit, like prominent sports figures (scarcely a professional football or tennis player maintains a residence in France), Bernard Arnault, France’s richest man, and the families of businessmen who created some of the country’s most successful retail outlets like Carrefour and Darty. Then there is the spectacular case of actor Gérard Depardieu.

Having amassed a fortune not only through roles in hit movies but also by canny investments in land and real estate, Depardieu has not been shy about why he left last year for Belgium, where he bought a home and set up a holding company, and Russia, where he was welcomed with a passport by Vladimir Putin. Having paid, by his own calculation, some $190 million in taxes over the last 45 years, he wrote a letter to Prime Minister Jean-Marc Ayrault, explaining that he was surrendering his French passport because “you think that success, creativity, talent…should be punished.” But he didn’t leave only for financial reasons. The man who embodied the country’s romantic hero Cyrano de Bergerac on the screen hated the absence of panache, the “lack of energy,” in today’s public. “France is sad, and I think the French are fed up…I have the impression that those people in government don’t know what they’re doing.”

Evidence of that are the unintended consequences of the increased taxes imposed by “those people in government.” One think tank calculates that the fiscal flight of French entrepreneurs to more business-friendly countries has cost France tens of thousands of new start-ups that could have created more than 1 million jobs. Or take the inevitable impact on standard of living. Due to the abrupt rise in taxes—up some 17 percent in 2012 alone—the average French citizen’s buying power actually has dropped by around 1 percent. It’s the first time that has happened since 1984. Naturally, that was when France had its only other postwar socialist government. A certain François Mitterrand also tried to govern by doctrine.

Mitterrand eventually changed course before he ran France into the ground. Hollande, his acolyte, apparently failed to learn that lesson. He is now attempting to ram a same-sex “marriage for all” law down the throats of a large, increasingly angry minority who reject it and demand a referendum. Nothing doing, replies the government—it is a non-negotiable question of equal rights. Liberté, Égalité, Fraternité, quoi! The socialists crowed that it was “a social evolution that benefits society as a whole.” In a fine example of Socialist Newspeak, they claimed that granting marriage and adoption to homosexuals would actually “strengthen the institution of marriage.”

CONSERVATIVE OPPONENTS BEG to differ. Encouraged by Catholic cardinals who denounce same-sex marriage as a “sham that will smash one of the foundations of society,” they organized a massive protest march in Paris last January that mobilized half a million. With Hollande continuing to ignore the heated national mood, opponents staged an even bigger demonstration March 24. Surprised by the nearly 1 million banner-waving marchers—Hollande’s advisers told him the movement was running out of steam—heading for the Arc de Triomphe, riot police panicked. Without warning they began swinging truncheons and spraying tear gas indiscriminately into the faces of couples with children and elderly people. As the crowd’s mood turned uglier, the chants changed to the more directly anti-government “Hollande Resign.”

It was a shocking reaction by a weak government unsure of itself and frightened of its citizenry. Officials compounded their error by flagrantly lying about the number of demonstrators: only 300,000, they claimed, whereas anyone watching the human flood on the broad Avenue de la Grande Armée and Avenue Foch, two of the largest streets in Paris, could see it was at least triple that. One commentator, comparing the authorities’ reaction to strong-arm tactics used by the former East Germany’s repressive Stasi police, called the demonstration “the real French people, men, women, children and elderly who never in their lives had attended a street demonstration.” Christine Boutin, a former cabinet minister under Sarkozy and now president of the Christian Democrat Party, passed out after being gassed as she marched peacefully. “Watch out, Mister President,” she warned afterward. “The people won’t take any more contempt and ridicule. This situation is going to blow up.”

Hollande’s response basically has been to hunker down in his Élysée Palace bunker and hope the mass discontent will blow over. But there is nowhere to hide. Traditionally, a French president reigned but did not rule, leaving the rough and tumble of day-to-day governing to the prime minister. When things got too hot the premier took the fall, as Alain Juppé did in the 1990s when President Jacques Chirac was accused of corruption. Nicolas Sarkozy changed that by putting himself in the front line, much like an American president. Still, Hollande has all the governing leverage any chief of state could ask for: His Socialist Party dominates both houses of parliament and most other levels of government down to town halls nationwide.

But he is mistaken if he believes that is enough to deal with the frustration and anger welling up throughout the country. Nor is it sufficient to use the old totalitarian argument that those opposing him are in the wrong because a majority voted him into power. As a former conservative prime minister under Jacques Chirac, Jean-Pierre Raffarin, said recently, “If the simmering discontent in today’s French society turns into outright anger against the government, we risk having a turbulent spring.”

That is putting it mildly. Analysts are outdoing themselves with dire predictions about just how bad it could get. The respected editor of an economic review notes that the most dangerous thing about the anti–homosexual marriage movement is precisely that it is not organized and has no recognized leader. Rather, it is a loose association of people all across France who share the same convictions and same outrage at being deliberately ignored. “This is a pre-revolutionary situation similar to that in 1789,” he writes, “when Louis XVI faced catastrophic economic circumstances and an army of men, women and children rose up against him.” A prominent columnist for Le Figaro sees “a wind of civil insurrection starting to blow. It hints of a probable French Spring carried out by a people determined to defend their culture, their values, and their way of life.”

I suspect that France is on the edge of something big and unpleasant. As the late philosopher and political scientist Raymond Aron put it after the historic riots of May 1968, “There is no evolution in France. Once in a while we have a revolution.” This May marks the 45th anniversary of the uprising that rocked the country for six weeks and brought Charles de Gaulle’s eventual downfall. It’s impossible to say what might ignite the next explosion, or when.

The spectacular affair of a corrupt budget minister who hid a fortune in offshore accounts—without the knowledge of Hollande, his prime minister, or anyone in his administration, it is claimed—thoroughly shocked and disgusted the French and could be one element. But most likely, the spark will come out of the blue from an unexpected quarter. In 1968 it was an insignificant college panty raid in a Paris suburb. Just before the first cobblestones and tear-gas canisters were thrown, the usually perceptive editors of Le Monde looked around, saw nothing interesting ahead except summer vacation, and ran a front-page editorial complaining about how dull things were.

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About the Author

Joseph A. Harriss is The American Spectator's Paris correspondent. His latest book, An American Spectator in Paris, was released this fall.