Showing posts with label Arnaud Montebourg. Show all posts
Showing posts with label Arnaud Montebourg. Show all posts

Thursday, May 2, 2013

Mr Normal has become the Pitiful President

One year in, François Hollande has alienated most voters, antagonised Angela Merkel, driven droves of French into exile and presided over a worsening economy. Anne-Elisabeth Moutet reports.
 
Anne-Elisabeth Moutet debates the Cahuzac scandal rocking the Hollande presidency.

With hindsight, it seems as if François Hollande’s troubles started the day he was inaugurated, on May 15 2012. First he was drenched by a surprise storm as his open Citroën drove up the Champs-Elysées. Then, the very same day, his Falcon plane was hit by lightning on the way to Berlin, where he was scheduled to meet Angela Merkel – making it possibly the first and last time the German Chancellor has felt unreserved sympathy for him.

The new president had to turn back before travelling to Berlin in another aircraft. When he got there – in more pouring rain – he missed a turn on the airfield red carpet while reviewing German troops, and had to be steered back in the right direction by Mrs Merkel’s firm grip on his elbow, a moment that presciently symbolised their future relationship.

And everything went downhill from there.

One year later, the man who had billed himself as the “normal president” during his victorious campaign against Nicolas Sarkozy is breaking records for unpopularity. With 75 per cent against him, Hollande is scoring the lowest approval ratings of any president of the Fifth Republic since the country started conducting polls. Unemployment has risen by 11.5 per cent since his election, reaching an all-time high of 3.2 million. An estimated 150,000 young people have left the country in search of better prospects abroad: the only jobs created in France have been in the public sector, usually in fields such as teaching that are solidly controlled by Socialist voters.

Despite a widely touted “austerity” drive, public spending stands at 57 per cent of GDP – the figure in Britain is 45 per cent – and the country’s public debt is about to reach 94 per cent of GDP. The largest street demonstrations since 1984 – when the country also had a Socialist president, François Mitterrand – have brought more than a million people on to the streets of Paris on two occasions (and more are planned), to protest against justice minister Christiane Taubira’s new law on gay marriage and adoption: given that France is a fairly tolerant society, these were effectively a street referendum against Hollande.

France’s very visible spat with Germany is a good example of how Hollande manages to make a bad situation worse. It is hardly new for French and German governments to disagree on economic issues; nor is it unusual that its leaders belong to different political parties. Yet, mindful of the European leverage afforded by the French-German axis, Valéry Giscard d’Estaing, a conservative, was excellent friends with the Social Democrat Helmut Schmidt, while the Socialist Mitterrand spoke in almost Gaullian terms of his German counterpart, the Christian Democrat Helmut Kohl. Even Jacques Chirac never clashed with Chancellor Gerhard Schröder in the way he did (as PM) with Margaret Thatcher.

Hollande, however, still seems to manage France the way he managed rival “currents” during his long tenure as Socialist Party leader, trying to play one against the other while trying to keep everyone happy by granting them some sort of concession. This was in evidence at last year’s European summit, where instead of sitting down with Mrs Merkel to hammer out a viable compromise, he tried to rustle up an alliance with Spain and Italy behind her back, thinking this would be enough to counter the German position.

“This may work in Corrèze [Hollande’s constituency in central France]; it doesn’t in the real world,” a French diplomat commented at the time. “At the end of the day, the Germans were annoyed, the French line was all but absent from the final communiqué – and Mrs Merkel and David Cameron found themselves in closer alliance than they’d ever been.”

Recently, a trio of ministers including the flamboyant Arnaud Montebourg, minister for industrial recovery, started making increasingly belligerent statements about “German-imposed austerity”, accusing Mrs Merkel of “egotistical intransigence” and calling for “a democratic confrontation with Germany”, without being taken to task by the president.
It didn’t take long for Mrs Merkel’s entourage, who are much savvier in the ways of French politics than the French are about Berlin affairs, to counterleak a memo – plausibly produced by the Chancellor’s coalition partners, the Free Democrats – on France being “Europe’s biggest problem child”, with a stalled economy and a “meandering” reform programme. Mrs Merkel then gave a perfunctory denial that she thought anything of the kind.

The truth is that she is incensed with Hollande, not least because of her growing conviction that the French president and his spin doctors allowed the German-bashing because they felt that it would displace domestic dissatisfaction with Hollande on to Germany.

Even the notoriously complacent French press is now giving the president a hard time. “Is 'GrandPa’ [one of Hollande’s mildest nicknames] really up to it?” asked the news magazine L’Express on a recent cover. Le Point called him “Monsieur Faible” – Mr Weak – after Hollande confessed that he hadn’t believed the economic crisis would “last so long”.

No relief was to be expected after the announcement yesterday that Arnaud Montebourg had scuppered a deal by which Yahoo had agreed to acquire 75 per cent of Dailymotion, a successful French internet video site, valuing it at $300 million. “Yahoo wants to devour Dailymotion, but we told them no and that it had to be a 50:50 split,” the avowedly anti-American Montebourg boasted to Europe 1 radio. Whereupon Yahoo called the whole thing off.

Similar grandstanding by Montebourg had already driven the Indian tycoon Lakshmi Mittal from the Florange steelworks in Lorraine, and the American company Titan International from a floundering Goodyear tyre plant in northern France.

“The country is drowning in an ocean of discouragement,” said Christophe Barbier, the influential editor of L’Express. “It’s not just the tax-avoiding rich, artists like Gérard Depardieu, businessmen – everyone is now tempted to leave for a better life elsewhere. Young people feel they will never get a break, a job, a sign of trust. Entrepreneurs have to fend off red tape, rising costs and levies.”

In April, to add to this toxic climate, came the Cahuzac scandal: France’s budget minister, the man in charge of fighting tax fraud, was revealed to have a secret bank account in Switzerland – and in all likelihood another in Singapore – and to have lied to the president and parliament about it.

In the past week, polls have given Marine Le Pen, the far-Right National Front leader, record numbers in a hypothetical presidential election – 23 per cent, well above Hollande at 19 per cent, while Sarkozy scored 34 per cent. Were Sarkozy to stand, he would beat Le Pen easily in the second round but the talk in France has been of the dangers of Fascism, beginning with the very real distrust of all politicians and of the ruling class.

It says a lot about Hollande’s tin ear that he chose that very moment to compel ministers to disclose their personal assets, arguing for the virtues of “transparency” against corruption. This may work in the United States, where personal success is admired: but in France, a country where unregenerated Marxist thought still largely holds sway, overlaying a centuries-old Catholic mistrust of money, it prompted Claude Bartolone, the Socialist Speaker of the National Assembly, who is fighting suggestions of a similar obligation for MPs, to talk of “voyeurism and envy”.

Embattled in the Élysée Palace, where at times it seems his only remaining supporter is his partner Valérie Trierweiler – a woman so unpopular that Hollande has to fend off unpleasant remarks about her during his rare walkabouts – the president is now mulling a cabinet reshuffle as a way of signalling to the French that he has taken their displeasure on board.

But whom to choose to replace his weak prime minister, Jean-Marc Ayrault, a former German language teacher? The 2007 Socialist presidential candidate, Ségolène Royal, is unacceptable to Mme Trierweiler. The former Socialist leader Martine Aubry, Jacques Delors’s daughter and the artisan of the rigid 35-hour working week, may be unacceptable to Mrs Merkel. François Mitterrand’s former PM, Laurent Fabius, now the foreign minister, is hampered by having just been revealed to be the richest man in the Cabinet.
Hollande’s instinct is probably to try to trundle along with the same tired team. His latest attempt to show that the presidency is doing its part to relieve the public debt has been to announce that he will sell part of its cellar of fine wines, lovingly accrued since the Vincent Auriol presidency in 1947.

On May 30 and 31, 2,200-euro bottles of 1990 Pétrus and Château d’Yquem will be auctioned off, “to be replaced by more modest vintages”, according to the president. So speaks a self-proclaimed modest man, who may be feeling that he has a lot to be modest about.

© Telegraph Media Group & Anne-Elisabeth Moutet, 2013

Thursday, February 21, 2013

Titan boss Maurice Taylor says it's a hard job getting the French to work

A row with Maurice Taylor, the US tycoon behind Titan tyres, shows how employment and tax laws in France keep the idle in business, says Anne-Elisabeth Moutet
 
Working lunch: the boss of the US tyre firm Titan has accused the French of taking long breaks and being unproductive
Working lunch: the boss of the US tyre firm Titan has accused the French of taking long breaks and being unproductive Photo: Getty Images
 

If Maurice “Morrie the Grizz” Taylor didn’t exist, François Hollande’s embattled socialist government would have tried to invent him. Just when the government’s bluff was being called over France’s unrealistic growth predictions by the EU (finance minister Pierre Moscovici kept promising 0.8 per cent for 2013 until Tuesday, when incontrovertible European figures forced Hollande to admit that it will be much closer to zero), here comes the textbook Ugly American from Illinois, boss of the Titan tyre firm, thwarted in his dastardly aim to lay off French workers from an ailing tyre factory he was hoping to acquire, now spitting venomous slurs at the entire French working population.

Cue, on all news channels, the perfect Two Minutes’ Hate (more like two days so far) in which everyone — union reps, party leaders, the commentariat — bemoans in touching unison the gall of this unreconstructed, boo-hiss Anglo-Saxon Reaganite, who, in a letter to Arnaud Montebourg, the minister for industrial renewal, asked: “Titan is the one with the money and the talent to produce tyres. What does the crazy union have? It has the French government.” Taylor added: “The French workforce gets paid high wages but only works three hours. They get one hour for breaks and lunch, talk for three and work for three. I told this to the French union workers to their faces. They told me that’s the French way!”

The letter was leaked within hours to a business daily. Montebourg, a former militant barrister whose grandstanding habit had been curtailed for a couple of months after he insulted Lakshmi Mittal for wanting to close loss-making steel furnaces in Lorraine, grabbed the opportunity to get back into the limelight. He claimed in an open response to Taylor that “the entire French population had been grievously insulted”, and listed the many American industrial investors who managed to make do with France’s 35-hour week and strict labour laws.

Morrie the Grizz has in fact given a free-spending, high-taxing government the perfect moment to bury more bad news. Intent on reversing Nicolas Sarkozy’s reforms, Hollande has already rescinded the very timid pensions change in which retirement age had been pushed, with exceptions, from 60 to 62. Ditto for a mild attempt to curtail the comforts of a Socialist-voting public sector that employs a quarter of the labour force: to fight chronic absenteeism, Sarkozy had instituted a day without pay before civil servants would be paid for sick days. Civil service minister Marylise Lebranchu announced yesterday that it was reversed, in an interview with the newspaper that had published Maurice Taylor’s letter.

Consider that two of the best-selling books in the past decade were Bonjour paresse (“Hello, Laziness”) by Corinne Maier, employed by the largely state-owned utility EDF, in which she rolled out a number of clever strategies to do the least work at the office, and Absolument dé-bor-dée! (“Li-ter-al-ly Snowed Under!”) by Zoé Shepard, a civil servant who vividly described her experiences in the Aquitaine administration of “how to work 35 hours in the month”, from sick day competitions to misappropriation of expenses.

These books sold well because they rang a familiar bell. The French are used to long queues at one counter at the Post Office while three more people behind closed desks carry on private conversations. And don’t try to call someone for business between 12.45 and 2.30pm in Paris. Every time the notion of opening up Sunday trading is mooted, an alliance of family associations and unions kills off the attempt with pieties about “the family day”, no matter that Sunday sales sometimes exceed half the week’s takings in stores (like Ikea) that, with staff support, brave the law and pay the fines. As for the 25 mandatory days of paid annual vacation, no one, Left or Right, has suggested that they should be reduced.

Yet once you get them into the workplace, the French can be efficient, competent and hard-working: 2011 OECD productivity figures show them coming first in Europe at $57.70 per working hour, ahead of the Germans at $55.80, and of the British at $47.20. No wonder: labour is expensive (payroll levies amount to 65 per cent of total salary outlay) and stringent employment laws make it difficult and costly to fire anyone. A French boss will wait to breaking point before he will hire anyone – and in the meantime that production will have been automated to quasi-Japanese standards with the best robots extant: machines, unlike people, are not subject to employment taxes. The losers are the young, the over-50s, and anyone who’s had the mischance to fall off the protected ship of the full-time employed. Structural unemployment, even in boom years, has very rarely fallen below 8 per cent. It exceeds 11 per cent today, and almost all of those claiming the dole would have welcomed the opportunity to work for Morrie the Grizz.

© Telegraph Media Group & Anne-Elisabeth Moutet, 2013

Sunday, December 9, 2012

Arnaud Montebourg: France's love-hate relationship with 'the madman on the third floor'

He is the firebrand minister who told Indian industrialist Lakshmi Mittal that he was "not welcome in France". He is also the surprising new hero of the Left, as Anne-Elisabeth Moutet writes.
Arnaud Montebourg: France's love-hate relationship with 'the madman on the third floor'

In happier times: Audrey Pulvar announced her split with the minister via the media Photo: REX FEATURES

He is the grandly-named and grandstanding "minister for productive economic recovery" - an outcome which France, and Francois Hollande's struggling Socialist government, sorely needs.

But to say that all is not well with Arnaud Montebourg, a firebrand and populist left-winger who opposes most of the features of a modern economy, would be an understatement of equally grandiose proportions.

And the fact that this weekend he remains - just - in his post indicates the confusion at the heart of the French government.

Last weekend Montebourg, 50, had almost resigned; on Wednesday he was very nearly fired by Jean-Marc Ayrault, the prime minister, who gave him a sharp dressing down in front of group of goggle-eyed Socialist MPs.

Only the previous week, he'd been dumped by his high-profile girlfriend, Audrey Pulvar, a television personality who let him know by a text message she sent Agence France Presse.

Speculation on the beautiful Miss Pulvar's reasons for deciding to end their very public affair is rife, but everyone in France is well-aware of how Montebourg ended in the political doghouse.

A former crusading lawyer who built up popular support on the left of the Socialist party, and beyond, for his anti-corruption, anti-globalisation views, Montebourg drew international ire and national dismay for his response to industrial negotiations on the possible closure of the loss-making Lorraine steelworks at Florange.

He proclaimed that their owner, the Indian tycoon Lakshmi Mittal, was "not welcome in France" – where Mittal still employs some 20,000 people in many other locations.

 Coupled with a threat - now seemingly abandoned - of "temporary" nationalisation, in a style not unlike the General Motors bailout, of the Florange steelworks, this gave out a strong echo of the last time a Socialist government took over in France: more than 30 years ago, in 1981, when President François Mitterrand's Socialist-Communist cabinet decided to nationalise banks and large industrial corporations.

This is not the impression Hollande, and especially Ayrault (who happens to have a Mittal plant in his own Loire Atlantique constituency) want to make on the financial markets.

Until now they have kept lending to France at exceptionally reasonable rates - a smidgeon under 2 per cent for 10-year bonds, despite the recent downgrade from AAA-rating by Moody's that followed a similar move from Standard & Poors in January.

In the almost seven months since he took office, Hollande has acquired a reputation for economic shilly-shallying: hefty tax increases on business were almost immediately followed by tax breaks, for instance, while an announced 60 per cent capital gains tax for start-up entrepreneurs was rescinded after a few days of furious Tea-Party style Facebook campaigning by opponents. But so far this has not been punished internationally, even though it has translated domestically into the worst poll ratings of any president of the Fifth Republic since 1962.

Ayrault was of a mind to let Montebourg go, supported – even egged on – by Pierre Moscovici, the finance minister, who in theory is Montebourg's boss, but in practice has been frequently outshone by the figure referred to by many at the ministry's mammoth futuristic pile on rue de Bercy as "the madman on the third floor".

Their partnership is hardly a meeting of minds: Moscovici, a former European affairs minister under Lionel Jospin 10 years ago, is of a moderate Social-Democrat bent: pro-European integration, pro-business. Montebourg, by contrast, voted No in the 2005 referendum on the European constitution and would block the import of goods from countries without social welfare provision.

"Mosco" had loathed Montebourg's ideas from the start, but things rapidly became personal as well.

After the election, but before the finance team had moved into Bercy - the name by which the ministry is known - back in May, Moscovici was forced to adjudicate on territorial disputes caused by Montebourg.

The office of the finance minister himself is traditionally on the sixth floor. Montebourg tried to dislodge the budget minister, Jérôme Cahuzac, from the floor below, at the same time as attempting to appropriate the parking space in the courtyard assigned to the foreign trade secretary, Nicole Bricq.

In both cases Montebourg's machinations failed and he ended up, fuming, on the third floor, even further down the building than the minister for tourism and trade secretary, Sylvia Pinel. Tempers have only deteriorated over the following seven months, while the country's economic and political governance has given an impression of endless flip-flopping.

This may sound more like Big Brother on steroids than proper political disputes, but it's emblematic of the confusion reigning under François Hollande.

France's president made a lifelong career, as regional politician and party boss, of being a master of compromise, conciliating the Socialist Party's various "currents" by granting favours and advantages according to precisely-calibrated assessment of weight within Hollande's view of the ideal political balance at any given time.

Hollande is very much aware that a majority of his Socialist base likes Montebourg's flamboyance, even his gaffes – which they see as speaking truth to powerful interests. In the Mittal crisis, some polls found up to 63 per cent of French opinion supporting Montebourg's stance.

Unlike the German SDP or Britain's New Labour, the French Socialists have never formally renounced Marxist theory, and even the name "social democrat" remains a political insult in many quarters.

And this is before taking into account the sensibilities of the myriad parties to the left of the Socialists – the Greens, three small Trostkyite parties, the rump of the once-mighty French Communist Party, and a couple more tiny splinters – whose votes, added up, ensured Hollande's victory over Nicolas Sarkozy last May.

Because of France's first-past-the-post system, the Socialists enjoy in fact a clear majority in both houses of the French parliament, but still Hollande calculates as if hamstrung by a coalition, perhaps aware that he has to keep several currents within his own party from defecting to the militants on the Left.

His resulting indecisiveness is worsened by his own nature, as well as by his single previous experience close the presidency. He was a junior aide to François Mitterrand in the 1980s, and learned much from the wily old politico - who always arrived late everywhere and famously believed that you should "give time to time". In other words, wait and see how a situation would decant.

It worked for an autocrat like Mitterrand, born in 1916, and who viewed the telephone as a cutting-edge technological device. It is far less effective in Twitter time, in a man whom neither best friend nor worst foe would ever think of calling an autocrat.

And so when Montebourg spoke of "nationalisation", Hollande crucially stayed silent for five days, even inviting the troublesome junior minister to the Elysée to assure him, Montebourg afterwards said, that "nationalising the Florange steelworks until a credible buyer [was] found" was "still a possibility".

Hollande staved off Montebourg's resignation, seemingly only to let his prime minister threaten him with the sack four days later.

Hollande had his reasons – Montebourg increasingly appears to Lakshmi Mittal as the pitbull the president releases when his concessions are seen as just not good enough – but such tactics carry their own risk.

Emboldened by Montebourg's stance, and a militant political vocabulary unheard from a cabinet minister for decades, enough Socialist defectors voted with the Communist group in the Senate to defeat the Budget and the bill funding France's state health and pensions systems last week.

This was only a warning shot: both bills will now be amended, and are likely to pass the next time they return to the upper house. But the impression of weakness remains - even as most of Hollande's campaign promises, including new civil service jobs, lowering the retirement age and more teachers, go unfulfilled.

Meanwhile Montebourg is fuming at his treatment by Hollande and Ayrault, but upbeat in one respect: amid all the publicity he has become a hero for the Left.

When he stood in the last Socialist Party primary elections for a presidential candidate, he received just 17 per cent of the vote. If Hollande's government goes on giving the impression that no-one is really at the helm, the inevitable clamour for change next time may mean there's a demand for even more grandiose promises.

In the strange world of the French Left, Montebourg may consider his own prospects of becoming president himself have just risen, from impossible to merely improbable.

© Telegraph Media Group & Anne-Elisabeth Moutet, 2012