France unites against François Hollande

Even the Left is turning hostile to the president, says Anne-Elisabeth Moutet

Francois Hollande has built his career on being a canny political manoeuvrer Photo: Reuters

By Anne-Elisabeth Moutet

7:00AM GMT 03 Nov 2013

As he stood at a military airport last Wednesday to greet four French hostages released by al-Qaeda militants in Niger, François Hollande could have been forgiven for thinking his disastrous run of bad news in the past months might finally be coming to an end. 

Having announced an assortment of taxes the previous week, Mr Hollande suspended most of them over the weekend after widespread popular protests. He had managed to unite unlikely bedfellows, more often at loggerheads against one another, in the fiercest demonstrations seen in Brittany in a decade.

A proposed green tax on lorry fuel that would raise transport costs by 4 per cent had brought out farmers and supermarket owners as well as labourers and trade unionists, brandishing the black and white Breton flag as a symbol of their outrage against the cluelessness of Parisian technocrats, of whom Mr Hollande is a central member. This was the face of a future French Tea Party, a political development that seems increasingly likely.

Mr Hollande also had to “suspend” — a word that fills the French with unease, as it promises a stealthy return of the same measures whenever the fracas dies down — a 15.5 per cent retroactive tax on savings schemes that seemed tailor-made to infuriated his most natural voters.

A Parisian barrister, himself not a Hollande voter, told me that his Portuguese-born cleaning lady, a single mother of five children, had sworn never again to cast her ballot for the president, as she did last year. “You work hard all your life, you do what’s right, and then they come after the little bit you’ve managed to put aside for your retirement age?” she said. “What kind of a Left-wing government is that?”

Once again, the government’s “method”, if it can be called that, seemed to be to first float the idea of a new tax for a few days, then back down if the outcry became too loud. “It’s probably the worst way you can run a fiscal policy,” says Erwan Le Noan, a competition lawyer and international consultant. “The amateurism and uncertainty alone mean businesses have no visibility, and will defer investment — and hires — as long as they possibly can.”
 

An insider suggests that the ministry of finance mandarins at the Treasury and budget departments, held in check by their previous bosses, have been trying out all their pet tax plans, even the most outlandish, on Pierre Moscovici, the finance minister, and Bernard Cazeneuve, the budget minister. “Moscovici believes the tax burden is as high as it can go, but he has little authority,” says the insider. “Cazeneuve, his junior, is a hard-working realist, but he suffers from having been an exemplary European affairs minister. He is convinced that France must abide by her European Treaty obligations, which means reducing the deficit. Since the spending ministries do not really want to make hard cuts, the only way — or so he thinks — is through more taxes.” The Laffer curve theory (too much tax kills tax revenue) does not seem to have made it to Bercy, the massive brutalist fortress built 20 years go to accommodate the finance ministry’s plethoric troops.

An unchecked French civil servant can think up some pretty outlandish tax ideas. The French property market is under threat of a new rent control law. This is the pet project of Cécile Duflot, the housing minister and a canny Green ideologue who believes, against all concrete evidence to the contrary, that it will make rents more affordable. Paris estate agents reply that this, alongside the heap of protective regulations skewed towards renters, has already convinced many landlords to just sell and get out, even though the law has not yet been passed.

This is, however, small beer next to an earlier proposal, last June, by the Conseil d’Analyse Économique, the prime minister’s office’s forward planning think tank, advising the creation of a “virtual rent” that all property owners would pay, in order to restore more equality between households burdened with rent and the other, rent-free ones. After the CAE report came out, the subsequent fury caused the virtual rent proposal to be shelved, “but that shows you how they think”, says Mr Le Noan. “People remember this. They have no trust at all in this government.”

The beginning of the week saw Mr Hollande’s ratings plunge even lower than before, breaking records of unpopularity. Two separate polls have given him the worst ratings of any French president. Their breakdown shows, perhaps predictably, implacable, near-total hostility (93 per cent for one, 97 per cent for the other) on the Right; but opinions on the Left and within his own Socialist party are solidly negative too. He is perceived as “lacking courage”, “indecisive”, “incompetent”, “weak”, even “incoherent”.

To the French who elected him in May last year, Mr Hollande controls nothing and has no authority anywhere. Not in his own home, not in his party, not in his Cabinet, not in the country, and not — after Barack Obama eventually spurned his offer of military help in Syria — in the world.

The one bright spot in which he received across-the-board support was the French intervention in Mali, back in January. In two weeks, French troops, called by the Malian president Dioncounda Traoré to help the country fight an Islamist invasion in the north, pushed back the rebels, liberated Timbuktu and stabilised a country whose fall to al-Qaeda affiliates would have been a disaster for several French allies, from Algeria to Sudan. This was perhaps the model of a foreign expedition done well: experienced troops knowing the region, limited and clear aims, regional and local support. Mr Hollande, quite rightly, saw his popularity edge back up. Visiting Bamako, the Malian capital, in early February, basking in popular adulation, he told an enthusiastic rally that this was “the most beautiful day of his political career”.

And one he’s seemingly tried to replicate ever since — it’s probably the reason why he was so gung-ho on a Syrian intervention, even though French intelligence is perfectly aware of the complexity in which the Syrian rebellion is mired. It was therefore difficult not to wonder at the timeliness, in political terms, of the four hostages’ liberation. Questions about a ransom were raised immediately. Mr Hollande denied any payment had been made.

For one moment, it seemed as if Mr Hollande’s luck might turn: Marine Le Pen commented on television on the look of the head-covered and bearded hostages, implying they might have been “Islamicised” in captivity. It was tactless and crass — a boon, you might think, to the mainstream political class, who duly grabbed the ball and ran with it in their hurry to re-demonise the Front National leader.

Their moment of good, clean fun lasted only for a couple of hours. That very afternoon, Le Monde came out with an authoritative piece of reporting laying out the different stages of the negotiations that succeeded in getting the hostages back, complete with payment of €20 million (£16.9 million) to the kidnappers and Malian intermediaries. Intelligence experts in Paris agree that the article was completely accurate, “with great chunks taken under dictation, I should say”, one jokes.

They explain that Mr Hollande took the negotiations off the hands of the French intelligence service, DGSE, to give them to a series of local intermediaries and presidency advisers, exactly the same type of associates that Mr Hollande, in opposition, criticised Nicolas Sarkozy for using. The implication is that DGSE leaked the entire story to Le Monde, furious both at this and because the ransom, of which they disapprove, seems to have been paid out of their own budget.

You can get away, in French politics, with lying, or looking extremely likely to have lied, to the nation. Mr Hollande’s job is as safe as the Fifth Republic constitution makes it, which is very safe indeed. But as for the hoped-for reprieve in the polls? That is not happening.

How long can this last? Normally, until the next presidential and general elections, which are in 2017. There are no provisions for getting rid of the president, unless he resigns or calls for an early general election, which will not happen. Nationwide municipal elections will take place in March, and European Parliament elections are scheduled for May. The municipal elections, and local deals for the second round, explain why Mr Hollande has been pandering so much to the Greens and the Left of his party. Voting in the European elections, on the other hand, is full proportional representation, which makes them, in effect, a life-size poll.

Ms Le Pen’s party is expected to poll somewhere between 25 per cent and 30 per cent, and, as an MEP herself, she has already been busy making European alliances for the day after. Her platform, in many ways, is indistinguishable from that of the hard-Left: protectionist, anti-euro, anti-capitalist, pro-national regulations, supportive of Bashar al-Assad’s Syria. She is hoping to steal from Mr Hollande many of the disenchanted voters on his Left.

Mr Hollande may not be a very successful president, but he has built his career on being a canny political manoeuvrer and, like a rabbit in a Citroën’s headlights, he understands this, without being able to change his essential nature. He is currently pondering a Cabinet reshuffle — from all accounts unenthusiastically, as it means a complete rebalancing of his majority such as it is, for less than game-changing results. He is therefore likely to keep trudging on, earning himself a place in the Guinness Book of Records in the chapter on unloved political leaders.

© Telegraph Media Group & Anne-Elisabeth Moutet, 2013

Why the hostile reactions to my Telegraph article highlight France's deep divisions

Left-wing commentators are wrong to criticise my article in the Telegraph about the exodus of French entrepreneurial talent, says Anne-Elisabeth Moutet

Criticised: Anne-Elisabeth Moutet was told: 'Stories like yours are nothing but a massive swindle’ Photo: Lucas Schifres

By Anne-Elisabeth Moutet

7:00AM GMT 27 Oct 2013

Since last week, when my Sunday Telegraph report outraged France (“British propaganda!” was a recurring theme) by suggesting that my demoralised compatriots were leaving in droves, fleeing an economy overburdened by regulations and levies, François Hollande’s government has added three new taxes to the 84 that had been created in the past two years.

Not only will capital gains on a series of popular savings plans be now subject to a 15.5 per cent flat tax, but also the measure is retroactive all the way to 1997 – coincidentally (perhaps) the last time France elected a Socialist government before this one.

It would be unfair to say that the irony went unremarked. The dozens of reactions I heard – as well as the thousands of internet comments and Twitter and Facebook shares of my story – mirrored the state of deep division in which France finds itself.

Entrepreneurs are “really hunted away from the country”, wrote one correspondent, and specifically targeted by “many stupid decisions. One example: I created a business seven years ago; if I sell it now, I will have to pay 60 per cent of the value I’ve created. Unfair and discouraging.”

Another correspondent wrote: “Would not change a word: we are now in decline, and may never be able to regain the place of fourth-largest economy in the world.”

“The people who really drive the French economy and keep the country afloat are those in managerial roles or the professions, who know little or no job security or social protection, working in those highly competitive parts of the economy comparable to Britain or the United States,” said another commenter. “But they are tiring of supporting the unproductive masses.”

Last week, the ministry of finance, prompted by opposition MPs, released official emigration figures for 2011 (they assure you nothing more recent is available) showing that departures had doubled from the previous year to nearly 40,000. Professor Jacques Régniez of the Sorbonne, himself a statistician, predicts that these should have climbed to 60,000 by the time we get this year’s figures.

In the November-December issue of the foreign-policy journal The National Interest, the US economist Milton Ezrati published a damning, comprehensive study of the downfall of the French economy. “Whereas 10 years ago it rivalled Germany’s,” he wrote, “today, France produces only half the value added. France’s share of global exports has fallen from 7 per cent in 1999 to only 3 per cent today. During this time, its share of the eurozone’s exports has fallen from 17 per cent to merely 12 per cent.” France, Ezrati explains, is now outperformed even by Italy.

Like others, Ezrati blamed over-regulation: there are now so many complex and protective labour laws, the Code du travail (labour code) exceeds 3,200 pages. He also quoted a recent authoritative OECD study that identified “French failings in almost every major category: economic regulation, product regulation, impositions by local policies, state control of the details of business operations and barriers to entrepreneurship”.

The only area in which France didn’t blatantly underperform was, unsurprisingly, red tape: French bureaucracy barely reaches the OECD efficiency median.

You would think something of this would filter up to Hollande in his Elysée bunker – he might disagree on the diagnosis, yet worry on the souring of the public mood. You would be wrong: “Perception is reality”, the mantra of spin doctors around the Western world, leaves the President cold. Increasingly, his entourage reports that Hollande, despite hiring a communications team headed by a popular former France 2 prime-time news presenter, Claude Sérillon, believes he knows best how to speak to the French. “This may have worked for de Gaulle,” says Philippe Moreau-Chevrolet, a political communications expert. “Not for Hollande.”

The beleaguered president, whose unpopularity figures scale new heights seemingly every week, still enjoys a vocal, if ever-diminishing, constituency, who, when they do oppose Hollande, reproach him for not being tougher on “the rich”.

Many of these work in the media, and as I defended my story on various radio and TV panels all week, I encountered an interesting assortment of them. (I have become something of a rent-a-reactionary in the French media, where a “balanced” panel means three Left-wingers et moi.)

There was the France Inter (think Radio 4) hour-long programme in which Sibylle Vincendon, a senior editor of the newspaper Libération, called all critics of the economic and political situation “grumpies”. (She has a book out on this theme, Pour en finir avec les grincheux. By the third page of the introduction, the despicable “Anglo-Saxons” and their “free-trade” model have been introduced. Vincendon believes that anyone, especially an economist forecasting France’s decline, is evidencing a deep schadenfreude and dark motives. The French, she says, need to “share more, not less”.)

Anne-Elisabeth Moutet's reply to her critics in Sunday's Telegraph

There was the debate on Arte, the French-German cultural public channel, in which the right (by which I mean Left) kind of economist, Prof Benjamin Coriat, explained that instead of the 75 per cent supertax hitting “only” a few privileged citizens, national income tax should be raised well above the current 45 per cent marginal rate, so that “everyone will pay”. Prof Coriat is shocked that some people dare to oppose new taxes. “They’ll justify anything not to cough up!” he thundered. He deplores the kind of movements now emerging, such as Les Pigeons (a group of young entrepreneurs who oppose over-taxation of start-ups), and the fact that some politicians listen to these “bad citizens”.

Elsewhere, I was told that French emigration to Britain was “a myth”, the figures “too low to even consider”. In an online chat, I was asked why I wrote in English, implying that I was some sort of traitor. (“Because it’s more fun?” didn’t seem to cut it as an answer.)
Many went on the attack: “Stories like yours are nothing but a massive swindle,” a Le Monde Diplomatique editor told me. “For people leaving France, how many come back after experiencing the lack of public services in Britain, the inefficient Tube, the expensive, slow and badly maintained trains, the threadbare NHS? It’s France that is bearing up best in the crisis, not Britain: why do you think the richer of the English come to French doctors and hospitals for proper treatment when they’re ill? Britain has no industrial base to speak of: it only exists because of tax-rate dumping, the City of London, and those nice, honest financiers operating there. Britain is a terrible place to live except for the super-rich.”

France has remained in a thrall to Marxism to a degree that is rarely matched elsewhere in Europe. While Germany, Italy and, in Britain, New Labour, swore off it, Hollande’s Socialist Party never officially renounced it, in good part not to offend its Leftist frenemies, of which there are many, who still Believe.

In addition to the rump of its once-powerful Communist Party, France has three Trotskyite mini-parties, a Green nebula, and one upstart radicalised splinter from the Socialists, led by a charismatic philosophy teacher, Jean-Luc Mélenchon, who ran for president against Hollande in the first 2012 round, and scored a very respectable 11 per cent, coming fourth behind Hollande, Sarkozy and Marine Le Pen.

Because, for years, any Socialist candidate has needed all of the extreme Left votes to win, the language of economic realism has never gained traction on the Left in France. In private, the prime minister, Jean-Marc Ayrault, will describe himself as a social democrat. Ask him to repeat it on the record and you are faced with a stony glare, lest you create a political crisis for him and his boss. As a result, the political tone on the Left has remained frozen in a kind of Seventies radical aspic, a hoary kind of time travel in which every capitalist, every entrepreneur, every high-net-worth individual is guilty of starving the downtrodden masses.

“I left because I was tired of being considered little better than a criminal,” says a French banker who is now happily ensconced in a Soho loft with his family. “At a pinch, I could have paid the silly taxes; but it was the constant sniping, the feeling that I had to apologise for everything I achieved, the jealousy, the unremitting gloom, the guilt heaped upon you at every turn; and the idea that my children would have to grow up in a country where, at best, they could hope to become top civil servants, and duplicate the system with no deviation from the norm.

“This president has no idea that there is a wide world outside France; he has hardly travelled abroad; he speaks no other language; and he has no curiosity. Eventually, you get tired of waiting for our rulers to wake up.”

© Telegraph Media Group & Anne-Elisabeth Moutet, 2013

Down and out: the French flee a nation in despair

The failing economy and harsh taxes of François Hollande's beleaguered nation are sending thousands packing - to Britain's friendlier shores, says Anne-Elisabeth Moutet

 

By 2014, France's public expenditure will become the world's highest, at 57 per cent of GDP Photo: Howard McWilliam

By Anne-Elisabeth Moutet

7:00AM BST 20 Oct 2013

A poll on the front page of last Tuesday’s Le Monde, that bible of the French Left-leaning Establishment (think a simultaneously boring and hectoring Guardian), translated into stark figures the winter of François Hollande’s discontent.

More than 70 per cent of the French feel taxes are “excessive”, and 80 per cent believe the president’s economic policy is “misguided” and “inefficient”. This goes far beyond the tax exiles such as Gérard Depardieu, members of the Peugeot family or Chanel’s owners. 

Worse, after decades of living in one of the most redistributive systems in western Europe, 54 per cent of the French believe that taxes – of which there have been 84 new ones in the past two years, rising from 42 per cent of GDP in 2009 to 46.3 per cent this year – now widen social inequalities instead of reducing them.

This is a noteworthy departure, in a country where the much-vaunted value of “equality” has historically been tinged with envy and resentment of the more fortunate. Less than two years ago, the most toxic accusation levied at Nicolas Sarkozy was of being “le président des riches”, favouring his yacht-sailing CEO buddies with tax breaks and sweet deals. By contrast, Hollande, the bling-free candidate, was elected on a platform of increasing state spending by promising to create 60,000 teachers’ jobs, as well as 150,000 subsidised entry-level public-service jobs for the long-time unemployed and the young – without providing for significant savings elsewhere.

By 2014, France’s public expenditure will overtake Denmark’s to become the world’s highest: 57 per cent of GDP. In effect, just to keep in the same place, like a hamster on a wheel, and ensure that the European Central Bank in Frankfurt isn’t too unhappy with us, Hollande now needs cash. Technocrats, MPs and ministers have been instructed to find every euro they can rake in – in deferred benefits, cancelled tax credits, extra levies. As they ignore the notion of making some serious cuts (mooted at regular intervals by the IMF, the OECD and even France’s own Cour des Comptes), the result can be messy.

On the one hand, the lacklustre economy and finance minister Pierre Moscovici recently admitted that he “understood” the French’s “exasperation” with their heavy tax burden. This earned him a sharp rap on the fingers from the president and his beleaguered PM, Jean-Marc Ayrault. On the other, new taxes keep being announced, in chaotic fashion, nearly every week. “Announced” doesn’t mean “implemented”: the Hollande crowd have developed a unique Wile E Coyote-style of leaks, technical glitches, last-minute tweaks and horse-market bargaining whereby almost nobody knows, at any given time, who will be targeted by the taxman, and how. Unsurprisingly, this is liked by no one except us reptiles of the press, eager to report on the longest series of own goals in the history of government communications.

Take last year’s famous 75 per cent supertax, on individuals earning over one million euros a month. This has still not been implemented. First, it got struck down by France’s Constitutional Council on a technicality. Leaks suggested the rate would fall to 66 per cent. They were confirmed, then denied. Hollande eventually vowed that the tax would be paid by the targeted individuals’ employers, for daring to offer such “obscenely” high salaries. This has just been approved by the National Assembly, and must still pass the Senate. So far, it is only supposed to apply to 2013 and 2014 income, but no one knows if the bill will be prolonged, killed or transformed.

What we do know is that this non-existent (so far) tax has been the clincher that sent hundreds, possibly thousands of French citizens abroad: not just “the rich”, whom Hollande, during his victorious campaign, said he personally “disliked”, and who now are pushing up house prices in South Kensington and fighting bitterly over the Lycée Charles de Gaulle’s 1,200 new places; but also the ambitious young, who feel that their own country will turn on them the minute they achieve any measure of personal success.

In the heart of Paris’s Right Bank, where I live, only foreigners seem to buy flats, at prices entirely disconnected from reality. In my street, I have spotted three new Maseratis. Even before seeing their Qatari plates, I knew they couldn’t belong to local owners: they’re an ostentatious admission of wealth no one wants to make in Hollande’s France. (A luxury car is one of the “outward signs of wealth” your tax inspector has been specifically trained to query. The lesson has been learnt: last year, Rolls-Royce sold no cars in France.) On the Left Bank, elegant Americans buy bijoux apartments on place de Furstenberg, at 30,000 euros per square metre, and venture into the fine Café de Flore for elevenses.

“It’s not only that people don’t like to be treated like criminals just because they’re successful,” says a French banker friend who has recently moved to London. “But this uncertainty in every aspect of the tax system means it is impossible to do business: you don’t know what your future costs are, or your customer’s. You can’t buy, you can’t sell, you can’t hire, you can’t fire.”

While I’m still happy in Paris, I envy him his surroundings, the vibrancy of London, the feeling that anything is possible, the sense of fun I remember from the years I lived there in the Eighties and Nineties, and that I gladly find again every time I zoom in on the Eurostar. Paris, my city of birth, is an elegant museum – where any new idea, in any context, seems to be fated to be shot down by a combination of old, structural conformism and blasé disenchantment.

Today, one out of four French university graduates wants to emigrate, “and this rises to 80 per cent or 90 per cent in the case of marketable degrees”, says economics professor Jacques Régniez, who teaches at both the Sorbonne and the University of New York in Prague. “In one of my finance seminars, every single French student intends to go abroad.”

“The French workforce is now two-speed,” explains a headhunter who shuttles between Paris and London. “Among the young, perhaps a third speak English, are willing to relocate, and want to work. For one thing, their dream employers are the more prosperous of the large French multinationals, almost all those in the CAC40 index, who make over half of their profits abroad, sometimes over 90 per cent – companies like, say, L’Oréal, Schneider or Danone. This is why French universities have shocked the Académie française and now teach many courses in English.

“But I’ve also seen determined young people take jobs in places like Vietnam, with local contracts and nothing like the level of protection afforded by French labour law, in order to gain a proper first experience of business in a competitive environment. And then you have a large group whose ambition is simply to stay outside the economy.”

This means a trade-off with which anyone in France is familiar: young people, and many of their parents, dream of getting any kind of state or local administration post, usually badly paid, very often frustrating, but which ensures complete job security, unrelated to the economic situation, the market, or their own performance.

More than a quarter of the French workforce is employed by some public body or other: schools, hospitals, local and regional councils, the police, the civil service proper – or those new subsidised public-service jobs the Hollande government is so keen on.

While the young French generations were aspiring to cocoon themselves away from the realities of the world, our nearest neighbours were following the opposite trend. In 2000, under a socialist chancellor, Gerhard Schroeder, German businesses paid an astonishing 51.6 per cent company tax – largely to pay for the previous decade’s reunification. Today, this is down to 29.8 per cent, when the French equivalent, the highest in Europe, is 38 per cent. By 2003, Schroeder had embarked on a widespread reform programme, lowering taxes and drastically slashing benefits, curtailing the influence of the unions, and eventually reducing German unemployment from 10 per cent to 7 per cent (it’s 11 per cent in France).

There are many reasons why this wouldn’t work in France, not least because the French Socialists happen to have noticed that Schroeder and his party reformed themselves out of a job. Another is that French unions represent very little: less than 8 per cent of the French workforce overall is unionised, a figure that falls to between 3 per cent and 5 per cent in the private sector. Unions do, however, play a mandated part in a number of negotiation and welfare net structures, the unemployment benefits system, retraining schemes and the national health and pensions co-administration. This, not members’ contributions, keeps them afloat. The law also provides for legal labour dispute fines to be paid to the unions.

French unions see as their main goal the preservation of the status quo: from overprotective labour laws that make it so hard to fire employees that French bosses will do almost anything to avoid hiring new staff (who cost them a whopping 70 per cent in payroll taxes), to perpetuating antiquated regulations dating back to Vichy France, banning Sunday trading and evening shifts.

Recent union legal actions have forced businesses to close on evenings and Sundays, from the cosmetics chain Sephora – where employees protested that they wanted to keep working their late hours – to the British-owned DIY chain Castorama, which belongs to Kingfisher: no wonder Ian Cheshire, Kingfisher’s chief executive, complained last Friday that this harmed the French economy as well as his stores. “The president has said that recovery is in sight: I’m not sure where he’s looking at the moment. The mood is improving in the UK, not in France.”

It wasn’t fated to happen. “By 2000,” says Jacques Régniez, “French multinationals had achieved a very high level of competitiveness. Having committed to the strong franc, in the run-up to the euro they were forced to become lean and efficient. They rationalised production, and French workers became some of the most productive in the world.” French utilities, insurers, aerospace makers and luxury-goods conglomerates were up there with the best. If you wanted the best nuclear plant, crocodile handbag, commercial aircraft, high-speed train, you bought French.

What went wrong, says Régniez, was a bill passed by the then socialist Lionel Jospin government reducing the working week to 35 hours. “Where our competitors, especially the Germans, saw the need to keep prices and costs down, France spent money she couldn’t afford.” The entire system, he explains, tilted fatally to the side of salary hikes, perks and a lowering of retirement age, in the face of every observable demographic trend. Investment slowed down in the private sector, and almost stopped in the public one. “Each year, France has missed out on four GDP points of capital investment. By now, after a decade-and-a-half, we are not only lagging behind, it’s not certain we can make up for it. It would cost a 4.5 per cent hike in VAT, and other significant hikes in payroll taxes. That, quite simply, is not realistic.”

Even France’s vaunted infrastructures – those trains, roads, telecoms cables, the once ultra-performing electrical grid, the nuclear plants, the delayed 4G network – have taken a severe hit.

A French businessman who moved to London last year and asked not to be quoted by name, “because my tax audit would be even more retaliatory than what I’m currently being subjected to”, compares July’s Brétigny train crash, France’s worst rail disaster in a quarter of a century that killed six and injured 100, to the Paddington and Potters Bar derailments. “The rolling stock is ageing, the tracks are in a constant state of disrepair, even the TGVs now have regular delays because of catenary failure.”

Despite disputing allegations of negligence, SNCF have said they will reinforce maintenance “without waiting for the conclusions of the inquiry”. Criticisms have also been made that vast sums went on salaries, benefits and pensions.

But most analysts share the blame between Left- and Right-wing French governments in the past two decades. An investment banker, who has also moved to London recently, dates the wrong choices from the first Jacques Chirac presidency, in 1995. Chirac and his PM Alain Juppé, both Gaullists, decided to reform the huge French public sector’s pension system, to align civil servants’ pay-as-you-go pensions, which were (and still are) much more favourable, with those of the private sector.

There followed three weeks of hard strikes, shutting down the entire country, from schools to public transport to utilities and the post office. Juppé was ready to stick it out, but Chirac blinked. The reform was shelved, and for the next 12 years he stayed in office, Chirac never, ever tried to clash with vested interests again.

Sarkozy had great plans after his 2007 election. He believed in business, and good pay for hard work, and was devastatingly frank about it. It might – perhaps – have passed in prosperous times: one year on, the financial crisis hit, and his brusque style and love of bling clashed with both the times and age-old French preferences. (France is an old Catholic country that, for over a century, was influenced by unapologetic Marxism. It is atavistically hostile to money.) The reforms Sarko managed to pass, much milder than necessary, still ensured his unpopularity. He bet on French realism, and lost.

Realism – actual, real-life realism – is not an accusation you can levy at Hollande. Like Chirac – who supported him both because of a deep personal dislike for Sarkozy, and because they are in many ways very similar – France’s unlikely seventh president of the Fifth Republic is a professional politician, a graduate of the top government school ENA, and has never held a job in the private sector. Both Chirac and Hollande come from Corrèze, in central France, a region that has regularly provided French politics with a certain type of wily opportunist. Both appear easy-going and friendly, and both are complete cynics, with very little in the way of ideals, and an infinite capacity to scheme in order to stay in power.

Chirac, like Hollande, knew how to cultivate an array of political allies: in the case of Hollande, this means keeping the Left of his party as well as his Green allies happy with a number of symbolic measures, from the supertax to the recent anti-fracking bill.

Uninterested in the impact of morale and image on politics and the economy, Hollande believes that the economic cycle is bound to turn (he has said several times already that the recession is behind us), and that all he’s got to do is stay in power until things get better – thanks to the Chinese, the Americans, it hardly matters which. He doesn’t even worry about Marine Le Pen’s inroads in local elections: a junior aide in the Mitterrand Élysée 25 years ago, he believes the National Front, conjured up by his old boss, is a convenient accessory designed to split the Right and help him win a second term in 2017.

Professor Régniez believes this is very dangerous. “Sarkozy narrowly lost in 2012 for personal reasons – his style annoyed voters who could have agreed on his policies, but who wanted to punish him: 18 per cent of them voted for Marine Le Pen, against only 5 per cent for her father in 2007.

“This should be a warning to other countries, like Britain – it’s all very well punishing a conservative politician you’re dissatisfied with by voting for a maverick, Le Pen here, Farage there. But it gets the likes of Hollande elected. Think well: is ours the kind of future you want for your country?”

© Telegraph Media Group & Anne-Elisabeth Moutet, 2013

France prefers subsidy to égalité

Competition is a dirty word in France. It threatens the privileges of state employees, says Anne-Elisabeth Moutet

Do French unions have too much power? Anne-Elisabeth Moutet debates on F24.

By Anne-Elisabeth Moutet

1:40PM BST 15 Jun 2013

217 Comments

As the French rail strike followed the French air traffic controllers’ work stoppages last week, and tens of thousands of passengers and commuters saw their plans disrupted, it became a point of perverse pride for French commentators to deny that anything was very much amiss. The government, we were told, wasn’t really unhappy with the popular message being sent to Brussels, whether on the Single Sky Initiative, or the (very slow) opening of the French railways to free competition. In fact, it was felt at the Élysée that François Hollande, a man who doesn’t come equipped with a handbag, would only find his negotiating stance against too-fast reforms strengthened by this visible expression of national hostility.

British public opinion sees the EU as a source of Byzantine regulations hampering free trade. A large cross-section of the French are incensed by what they see as the European Commission’s Anglo-Saxon-tainted liberal economists and free-marketeers attacking the myriad privileges and protections that make the life of those happy enough to benefit from them so comfortable.

Competition is often a dirty word in France: never more than when it threatens to disrupt “avantages acquis” (acquired advantages), the gold-plated benefits a group of (usually) public employees has managed to have enshrined in contractual agreements. For years, among the various bonuses that can double an SNCF railwayman’s salary, was a “prime de charbon” (coal allowance), finally cancelled long after the last steam engine was retired. Pension age starts at 50 (soon 52) for train drivers and 55 for most other personnel.

Similarly, the 300,000 employees of EDF, the nominally privatised national electricity utility (the French State still owns 85 per cent of its equity) enjoy subsidised meals, holidays, cultural events, housing, as well as huge discounts on their power bills, lifetime employment, and early retirement provided for by a pension fund separate from the cash-strapped national system. Most of these perks are managed in-house by a committee dominated by CGT, the Communist union, on a €500 million budget funded by a statutory 1 per cent contribution of the company’s turnover. As a result, EDF, a multinational corporation of recognised excellence, turns only nominal profits compared with its competitors.

It hurts to lose these benefits, which explains why the French public sector strikes so often and so fiercely. The paradox is that apart from the quarter of the French workforce employed by the bloated French state, almost no one else in France belongs to a union – only 7 per cent of the 22.3 million-strong workforce do. Yet because the role of the unions is enshrined in French labour laws, the country’s main union representatives are party to all government negotiations on social reform – with predictably intransigent results.

Since 1979, when Giscard d’Estaing’s then PM, Raymond Barre, a no-nonsense professor of economics, tried to go blood, sweat and tears on the French after the second oil crunch, and lost, the mantra in Paris has been negotiation, negotiation, negotiation. Less than two years later, Ronald Reagan broke a lockdown with striking American air-traffic controllers by firing every one of them, and replacing them by requisitioning their military counterparts. The French still haven’t recovered from such a terrifying spectacle. The only prime minister to try to hold firm against a public service general strike, Alain Juppé, had to cave in ignominiously after two months in 1995, and his boss Jacques Chirac lost a general election just 18 months later. In short, courage doesn’t pay in France.

Needless to say, François Hollande doesn’t want to consider such extremes. For one thing, all this week’s strikers are his natural constituents: the last group of socialist voters in France are government employees. Teachers will, in all likelihood, stay with him, but train or air-traffic workers could succumb to Marine Le Pen and her populist, anti-Brussels, anti-“international finance” stance –or the increasingly similar-sounding Jean-Luc Mélenchon, the extreme-Left leader.

France’s socialists have had no New Labour conversion in which they officially renounced Marxist ideology. Hollande declares himself to be a social democrat in private, or abroad; but denies it frantically in public. As a result, a strange parody of class war will continue here for the foreseeable future, defending privileges instead of fighting them, led by unions representing little more than their own apparatchiks.

© Telegraph Media Group & Anne-Elisabeth Moutet, 2013

France's battle royal between Ségolène Royal and Valérie Trierweiler has the nation gripped

The warring women on the frontline are giving politics a sharply feminine edge.

Valérie Trierweiler: giving France a delightful taste of personal strife Photo: AFP/Getty Images

By Anne-Elisabeth Moutet

9:28PM BST 13 Jun 2012

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The French, like most of us, love a catfight. When First Girlfriend Valérie Trierweiler tweeted her support for the opponent of Ségolène Royal, the rival she supplanted in the affections of President François Hollande, in Sunday’s parliamentary elections, the entire nation sank with delight into the bliss of watching the political become personal.

Barely a month ago, the day after her partner was elected President of the French Republic, Trierweiler confidently told Agence France Presse how much better suited to the job she was than her predecessor, Carla Bruni, Nicolas Sarkozy’s third wife. “Carla Bruni comes from a world entirely alien to politics: fashion, showbusiness. She doesn’t know its codes.” She, on the other hand, Trierweiler explained somewhat smugly, had been a political journalist for 20 years. “I know politics, I know the media.”

The woman many of the French are calling “Rottweiler” then illustrated the shortest way to link the words “pride”, “goeth”, “before” and “fall”. Nicolas Sarkozy had been kicked out of office chiefly for having paraded his private life with ostentation. Demurring that she would play “no political part whatsoever”, Trierweiler made it difficult to forget her existence for one minute. Whether she was bemoaning that she didn’t like the title “First Lady” and inviting the public to think up a new one, or insisting that she could remain a working Paris Match reporter “in all independence” while maintaining a staff and office at the Élysée Palace, she was hardly ever out of the news.

Scenting a rich vein, the political puppet show Les Guignols de l’info hastily recycled the puppet they’d used for Jacques Chirac’s spin-doctor daughter Claude, slapping on a new wig and redoing its make-up to rush their Valérie on air. They now portray Hollande as a bumbling, henpecked husband. Deferring to She-Who-Must-Be-Obeyed, the President is depicted fleeing to the comforting arms of a softer, sweeter, more understanding female – Angela Merkel.

But in real life, the woman Trierweiler has been obsessing about for nearly a decade is Ségolène Royal, Hollande’s former partner of 23 years and the mother of his four children. Trierweiler admits to having started her affair with Hollande in 2005. He was then Socialist Party leader; she had been covering the Left as a Paris Match political correspondent for years. But they’d met years before: it was a young Trierweiler who reported from Royal’s maternity ward after she gave birth to her and Hollande’s last child, Flora, in 1992. She’d remained friendly with Flora’s father ever since.

Royal, who had gradually become aware of her partner’s betrayal, kept silent until the night of her 2007 defeat against Nicolas Sarkozy. Then, minutes after the result, she announced that the doors of her house were “now closed to Hollande” – who, while still officially living with her, had in fact moved into Trierweiler’s flat. It transpired that Trierweiler had egged him on to sabotage Royal’s presidential bid during the campaign.

Having lost her bid for a second presidential try in last year’s Socialist primaries, Royal immediately gave her support to her children’s father. Meanwhile, Trierweiler went to absurd lengths to sideline her. In rallies, Royal found herself seated away from other party bigwigs, and excluded from pictures. The children, who also were involved with the campaign, tried to intervene with Hollande, but to no effect; instead he often remonstrated with his advisers that they should “support Valérie: she’s so insecure”. Royal was excluded from Hollande’s Élysée swearing-in, but he did give her his official support in her bid for the La Rochelle seat, in the region where she has been council president for eight years.

This infuriated Trierweiler and led to this week’s tweeting extremes, igniting the kind of nationwide ruckus which is still in full swing. She has dug her heels in, refusing to recant her tweet. Meanwhile, several former Royal adversaries, all women, including Socialist leader Martine Aubry and Green leader Cécile Duflot, have very loudly sided with her. “I hope this tweet gets [Royal] elected,” Aubry said yesterday.

Feminine solidarity is relatively new in France, in politics and elsewhere: it was really only seen last year, at the height of the Strauss-Kahn affair, when women politicians from Marine le Pen to a Trotskyite, including two then Cabinet ministers, denounced casual sexism and double standards. Earlier, Rachida Dati, Sarkozy’s glamorous justice minister, found relatively little support when she chose to become a single mother in office, then got sidelined partly because she’d been a friend of her boss’s second wife. But all signs are that Trierweiler’s latest outburst may have triggered unintended consequences. “You started missing Sarkozy, now you will miss Carla,” Nadine Morano, a former Sarkozy minister, tweeted yesterday.

© Telegraph Media Group & Anne-Elisabeth Moutet, 2012

Dominique Strauss-Kahn: A Frenchman sunk by a sex scandal?

If the allegations against Dominique Strauss-Kahn end the popular IMF chief's presidential candidacy, it would be a first for France, writes Anne-Elisabeth Moutet in Paris.

Dominique Strauss-Kahn to appear in New York court over alleged sex attack on hotel maid Photo: AFP/GETTY

By Anne-Elisabeth Moutet 7:04AM BST 16 May 2011

IMF chief Dominique Strauss-Kahn’s likely candidacy – and probable victory – next year against Nicolas Sarkozy in the French presidential elections (he had been leading by double digits in every poll in recent months, even without declaring himself officially) should have ushered in a series of firsts for France’s political life. First French Socialist leader to have officially discounted Marxism; first Jew directly elected to the presidency; and first seriously rich president in a country where money, not sex, is a dirty word.

Instead, DSK, as he is known here, will go down in history as the first French politician whose career imploded because of a sex scandal, not a financial one. When the news broke in Paris early yesterday that France’s former finance minister had been arrested by the New York police for alleged sexual assault on a hotel housekeeper, reactions here were split between sheer disbelief, suspicions of entrapment and all-too-many knowing shrugs.

“Dominique Strauss-Kahn is well-known as a seducer,” his official biographer, Michel Taubmann, said. “I can’t believe he would force himself on an unwilling woman. That doesn’t make sense.”

Such a statement would come across as damning in most Western countries. In France, it is seen as a spirited defence. Until today, complicated sexual lives, multiple divorces and serial adultery never hampered political careers. François Mitterrand famously ran three parallel families while president. He appointed a former girlfriend of his, Edith Cresson (a married woman) as prime minister in 1991. His predecessor, Valéry Giscard d’Estaing, used to borrow a Ferrari from his friend Roger Vadim, the film director and Brigitte Bardot’s first husband, when he went on the pull. (He once crashed it into a milk float early one morning on his way back to the Elysée.) Jacques Chirac and Nicolas Sarkozy were known for eyeing up comely reporters and female junior ministers.

In that context, DSK’s notorious penchant (and more) for a legion of pretty women did him no harm at all. “If anything,” Taubmann recalls, “he was the one harassed, not the reverse — I’ve seen time and again women MPs, party workers, etc brazenly passing on notes, hoping he would notice them.”

Alleged assault, however, is another matter entirely. “If the whole situation isn’t exposed for being a political set-up in the next 24 to 48 hours,” French leading polling expert Stéphane Rozès warns, “Monsieur Strauss-Kahn’s political career is finished. He is, of course, presumed innocent until proven guilty, but even suspicion of attempted rape will make it impossible for him to stand.”

It is well worth noting that it took the long arm of New York’s finest to make the Strauss-Kahn scandal incontrovertible even to the very cagey French press. With the help of the internet — the great difference with the Mitterrand years, where the average French voter was left ignorant of the president’s natural children, for instance, and stringent privacy laws were supplemented by thousands of illegal phone taps directly commandeered by his private office — all the stories about his womanising have filtered down for years.

What is more surprising is that DSK has also been accused in the past of assault along eerily similar lines, if not as brutal as what the NYPD spokesman has alleged. Journalist and novelist Tristane Banon, a god-daughter of DSK’s second wife Brigitte Guillemette, recalled in a 2007 book, then in a TV chat show that same year, going to interview Strauss-Kahn to an address “he gave me, neither his office nor his flat; an elegantly appointed studio, with a bed in an alcove”, in which, she said, he grabbed her, tore off her bra, and she only managed to escape after a serious scuffle. “I kicked him, I called him a rapist, he didn’t seem to care,” she said. (DSK’s name was bleeped out in the chat show.)

Banon’s mother, Anne Mansouret, a Socialist local politician, confirmed the story yesterday to the respected website Le Post. Banon consulted a barrister, but finally decided not to sue, a decision her mother now regrets having encouraged her to do so. “She was just starting out in journalism,” says Mansouret. “I was afraid she’d be defined by this story.” She says her daughter will give a press conference “in the coming days”.

Other instances may well resurface. Aurélie Filipetti, a respected Socialist MP and Ségolène Royal supporter, said in 2008 that she had been groped by DSK and would “forever make sure” she was never “alone in a room with him”.

And yet nobody among DSK’s spin doctors and advisers seemed to think this would blow up in the face of their candidate. In recent weeks, as the probability of his candidacy looked certain, and politicians and the press made hay of his taking a ride in a Porsche owned by his main adviser, Strauss-Kahn and his wife Anne Sinclair sued France-Soir, a Paris newspaper, for disclosing the benign fact that he had bought three suits from a French bespoke tailor in Washington, who also dressed several US presidents, for a sum estimated “between $7,000 and $35,000 apiece”. Looking rich – he is in his own right and his wife, the granddaughter of one of France’s great art collectors, is even more wealthy – was seen as infinitely more toxic.

On the other side of the divide, Nicolas Sarkozy’s team were rubbing their hands at the prospect of their own man’s taste for bling, Rolex watches and expensive pens being negated by DSK’s own tastes for luxury.

“What are holidays in my wife’s family house on the Mediterranean next to a three million euro riyad in Marakesh?” Sarkozy himself was reported to have said to Cabinet members.

When he was appointed to the IMF in 2007 with the support of Nicolas Sarkozy — who saw a welcome opportunity of ridding himself of a dangerous opponent, at least for a time — most DSK-watchers warned that Dominique, for all his sophistication and razor-sharp intelligence, would do well as head of the world’s economic watchdog, but might not realise the cultural gap between life in Paris and Washington. Sure enough, barely a year later, DSK’s affair with an IMF economist, the Hungarian Piroska Nagy, made international headlines.

Amazingly, he survived that crisis. It probably helped that the disclosures occurred exactly three days after the beginning of the financial meltdown, on October 18, 2008. After an internal inquiry, the IMF published findings that Strauss-Kahn, universally seen as a safe pair of hands in difficult times, had neither favoured his mistress, nor harassed her. Bowing to American mores, DSK apologised publicly to his high-profile wife, something he had never bothered to do before in France, and Ms Nagy soon afterwards took the opportunity of a well-compensated redundancy when DSK decided to bring cost-cutting home to the IMF, and shed 600 top jobs.

In the following years, he burnished his credentials as a hard-working boss, criss-crossing the globe to help bail out failing financial institutions and defaulting countries, all the while avoiding criticism from the Right or the Left — he is one of the stars of the Oscar-winning documentary Inside Job, for instance, in which he details the work done to keep the economic sphere from exploding, and calls for more regulation of financial institutions in moderate, convincing tones.

Unlike most of France’s political elite, but like Nicolas Sarkozy — and Marine Le Pen — Strauss-Kahn is not a civil servant and a graduate of the top government school, ENA. He found himself, as finance minister, constantly sneered at by his supercilious mandarins for what was seen as his “inferior” education, even though he has taught at Stanford and Harvard, and co-authored major economics books. When, between political mandates, he turned to the private sector to make a living, instead of sliding back effortlessly into a well-paid, guaranteed-for-life civil service job, he was derided for a supposed crass love of money. Helping to save the world economy and being constantly voted France’s most popular politician, on track for the presidency no less, was essential recognition at last.

But all this came to a crashing halt on Saturday, as DSK was walked out of the first-class cabin of Air France flight 23 sitting on the tarmac of JFK airport, to be arraigned at the Harlem Special Victims Unit of the NYPD, and subsequently charged with “attempted rape, [a] criminal sexual act, and unlawful imprisonment”.

The French presidential race is wide open again, as DSK’s closest contender in the Socialist primaries, the lacklustre François Hollande, and Nicolas Sarkozy refrain from commenting for fear of appearing too eager to take advantage of their rival’s meltdown.

The only untroubled beneficiary is the Front National’s Marine Le Pen. “I am utterly unsurprised,” she said yesterday. “He must be presumed innocent - but everyone in the Paris political village knew of Dominique Strauss-Kahn’s pathological relations with women.”

© Copyright Telegraph Media Group & Anne-Elisabeth Moutet 2011

Marine Le Pen becomes Front National leader: A pivotal moment for French politics?

The election of Marine Le Pen as leader of the far-Right Front National could mark a watershed moment for French politics, writes Anne-Elisabeth Moutet.

Marine Le Pen with her father, Jean-Marie Photo: GETTY

By Anne-Elisabeth Moutet, Paris
7:30AM GMT 16 Jan 2011

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It's a measure of the inroads Marine Le Pen has already made in the French political debate that she now splits opinion among the rarefied world of Parisian intellectuals.

On the one hand, the philosopher Bernard-Henri Lévy still thinks she reeks of sulphur: according to him, the youngest daughter of Jean-Marie Le Pen, 82, the longstanding Front National leader, is "even more dangerous than her father".

Yet on the other Elisabeth Lévy, the shrewd editor of Causeur magazine, the French answer to The Spectator, considers not only that Marine Le Pen "says nothing scandalous or morally unacceptable", but also that she might well "be truly breaking away from the old French extreme-Right, to create something new."

Sunday marks an extraordinary moment for Marine Le Pen, and a potentially pivotal moment for the politics of France.

On Sunday afternoon at a party conference in Tours she will be formally declared the comfortable winner of a postal ballot to elect a new leader of the Front National, the party created by her father and reviled for decades even among some of the most conservative of the French.

He is bowing out and giving way to his daughter, a twice-divorced single mother with an infectious laugh and a no-nonsense manner mitigated by charm, who represents a younger, more open-minded and more politically fleet of foot generation - and thus a far greater challenge to France's two main and traditional parties.

"I've taken risks to draw the Front National out of its old rut," she says. "I could have tried to pander to all the small groups who wanted no change at all. Instead, I have made my case that I was a secular republican and a democrat. Over 90 per cent of our members are with me."

Even though she kept to a gruelling schedule, criss-crossing France 51 times in the past few months to campaign for the leadership, she is in fine shape and cracking good humour. She favours tailored jeans which she wears with high-heeled boots, silk shirts and strict blazers, and told Paris Match she follows the high-protein Dukan diet.

Now the FN's undisputed leader, she has her sights firmly on the 2012 presidential election, in which she could prove as dangerous for Nicolas Sarkozy as her father was for the Socialist candidate, Lionel Jospin, in 2002: she firmly believes she can come in second, and slug it out in the runoff with whoever gets finally picked by the Socialist Party.

"Nicolas Sarkozy took many right-wing voters for a ride," she says. "He stole our slogans on security and order, promised a lot and delivered little. We won't be taken in twice."

Yet the latest polls show that her anti-globalisation, anti-Europe and anti-capitalist speeches make more inroads in the Left-wing electorate that on the Right.

It was in 1972 that her father created the Front National out of several even smaller right-wing factions, but the first-past-the-post system ensured that it remained outside parliamentary politics for its first 12 years.

Then came the first European elections of 1984, and a decision by the embattled Socialist president, François Mitterrand, to revert to the system of proportional representation that General de Gaulle had previously repudiated.

That year, when Ms Le Pen was just 15, the Front National celebrated the election of 10 MEPs - and two years later, with a similar electoral system introduced in national elections, 35 Front députés were elected. That split the Right enough to help keep the Socialists in power - and gave the party a new legitimacy.

It was a wily manoeuvre by Mitterrand: no alliances were possible on the Right with the toxic Front, seen, not entirely without reason, as a motley alliance of Vichy nostalgics, football hooligans, Algérie française colonial carryovers, and dyed-in-the-surplice Traditionalist Catholics. Yet without their number, the Right could not attain a majority.

Since then, PR has been again excised from the electoral system, but the Front National has never returned to complete obscurity.

It is difficult to overstate the weight of France's historical past in her present political life. The scars left by the French Revolution, the great original sin of the Occupation, and the bitter Algerian war of decolonisation still fester, just under the surface of almost any debate.

Le Pen, an orphaned Breton fisherman's son, tried to join the Résistance in 1944, and later fought in Algeria and in the Suez expedition.

But he made his indelible mark in French politics by obsessively picking at the scabs of the country's dark past. He boasted of using torture in Algeria to combat terrorism; called the gas chambers "a point of detail" of the Second World War; used time-and-motion calculations to dispute the number of Auschwitz victims; and described France's German occupiers as "very civilised".

He was several times condemned under French incitement laws - all of which he used to paint himself as a larger-than-life pariah in the too-tame, self-referential world of French politics.

This history, of which she is acutely aware, Marine Le Pen has actively tried to put behind her. She has disavowed her father on several points, not least in references to the Second World War. She goes further in private, say her friends, "but she doesn't want to attack her father in public."

At 42, a handsome, single working mother of three, she presents herself as the young, modern face of the Front National, in sharp contrast to her defeated opponent in the Party leadership contest, the 60-year-old academic Bruno Gollnisch, under whose banner the Party's residual hardliners had sought an increasingly exiguous shelter.

In the Gollnisch camp gather the "tradis", the traditionalist Catholics who are horrified by Marine's support of gay rights - short of gay marriage - and refusal to support abolition of the 1975 law permitting abortion. (She says she only wants all provisions of the law strictly applied, so that women are first offered "alternatives" such as pre-natal adoption.)

No-one in France will admit to anti-Semitism, which is actionable by law, but campaign rumours from the Gollnisch camp included descriptions of Marine's entourage as "full of Jews, queers and Arabs".

It's an exaggeration, but it's true that her inner circle includes types not hitherto much seen at Le Paquebot, the old FN headquarters in Saint Cloud, West Paris.

But mostly, her appeal is her undeniable charisma. Photographs don't entirely do her justice: she is tall, broad-shouldered but slender, with an easy self-deprecating manner that is especially unusual in France. A barrister, she is a good public speaker, capable like her father of delivering a structured speech for an hour without notes.

If she feels her instinctive pugnacious style, modelled on her father, is making the wrong impression on her audience, she is capable of stopping in mid-sentence to address a contradictor with a smile and a joke.

She was far mellower when I asked her last week if, being divorced and raising her three children alone, she had become a new, unlikely emblem of French feminism. She gave a spontaneous belly laugh.

"Well, I'm not especially proud of this failure, you know, but I've had to deal with it and it's taught me a lot," she replied.

She supports a parental salary for young mothers and a number of Scandinavian-type measures to help women work and raise children.

"I wouldn't call myself a feminist, because I don't think relations between men and women should necessarily be confrontational; and I don't want to be reduced to my gender; and yes, I think we should find other solutions than affirmative action to break the glass ceiling. You never know if you were hired because of your competence or because a woman had to take the job, do you?"

It is interesting that two personalities she quoted positively during a half-hour conversation were two Jews: Simone Veil, the former health minister and European Parliament president, who first introduced the abortion bill, and Elisabeth Badinter, the left-wing feminist author.

On television, she is a redoubtable debater, having honed her bruiser's skills in numerous panels in which most of the other participants seemed to gang up against her. This, of course, has helped her: the Front National always made a meal of representing the citizens left without a voice.

The thrust of her political discourse is a mix of protectionism, almost Leftist social welfare economics and French nationalism that seems tailored to the present post-crisis Zeitgeist in France.

Following her father, she has built a strong nationwide support by opposing unchecked immigration, but insists this has nothing to do with racism and is only about proper assimilation into the French culture.

Almost alone of the French political class, she has jumped on the European anti-Islamist bandwagon, and makes approving reference to Geert Wilders of the Netherlands and Oskar Freysiger of Switzerland.

The latest polls give her good reason to look forward to the coming year.

In recent weeks, Le Monde and Marianne, the news weekly, published figures showing that close to one quarter of the Gaullist electorate sympathises with her views; and that almost half of all French voters agree with her on insecurity and crime.

One third agree on immigration, one third on "secularism" - code in France for disagreeing with the encroachment of Islam on society - and one quarter on leaving the euro.

Fascinatingly, 74 per cent of the French would describe her as "courageous". (Meanwhile 59 per cent consider her "racist", 47 per cent "modern" and 42 per cent "close to people's concerns.")

Such figures would make her France's most electable politician if she weren't called Le Pen.

But if she weren't called Le Pen, would she be where she is now?

© Copyright Telegraph Media Group & Anne-Elisabeth Moutet 2011

Nicolas Sarkozy scandal goes back to Hungarian roots

The case of L'Oréal heiress, Liliane Bettencourt, has enraptured France and forced Nicolas Sarkozy into the spotlight. By Anne-Elisabeth Moutet in Paris.

Published: 8:00AM BST 11 Jul 2010

French photographer and author Francois-Marie Banier explaining his works to Liliane Bettencourt (L) at Hans Lange Museum in Krefeld, Germany Photo: EPA

Before becoming a scandal about money, politics, art, history, café society and power, the Affaire Bettencourt, now threatening the Sarkozy presidency, is the story of two ferociously ambitious young Hungarian outsiders and their success at storming the citadels of the French establishment.

One, Nicolas Sarkozy, the son of a womanising émigré aristocrat and a doctor's daughter, used to be told by his (twice) remarried father on visiting Sundays that he would never amount to anything much in France, because of his foreign name, small stature and below-average school grades.

The other, François-Marie Banier, né Banyiaï, was regularly beaten by his Renault migrant worker turned ad-man father for being a dilettante, an aesthete, and a high-school drop-out. (By coincidence Pál Sarkozy, Nicolas's father, also dabbled in advertising for a while).

Mr Sarkozy has mentioned the slights he suffered as the least well-off boy of his chic school in Neuilly, Paris's richest suburb. Mr Banier neglected even to complete his baccalauréat, haunting luxury hotel lobbies from his teens on, becoming in rapid succession the favourite of such luminaries as the painter Salvador Dali, the Nobel-prize playwright Samuel Beckett, and the couturiers Yves Saint Laurent and Pierre Cardin. The Communist poet Louis Aragon enthused about the first novel Mr Banier published, aged 22.

Mr Sarkozy came to the attention of Charles Pasqua, the Gaullist party stalwart and key power-breaker who was to help shape most of his career, with his first public speech at a national rally: he was just 20 at the time.

Today Nicolas Sarkozy is president of the French Republic, while François-Marie Banier, a polymath photographer, painter and novelist, has recently been ranked 917th richest individual in the world, having accepted fabulous gifts from a string of wealthy old ladies, ranging from the viscountess Marie-Laure de Noailles to the actress Silvana Mangano - and especially from his latest patron, Liliane Bettencourt, the 87-year-old L'Oréal heiress.

The two men, no longer so young (Mr Banier is 63, Mr Sarkozy 55) nor as pretty as they both once were, stand at each end of a glittering chain of achievements, events, relationships, networks and rivalries now threatening to engulf France in the kind of political meltdown not seen here since the 1930s.

Mr Sarkozy's poll ratings, already dire, have plunged to ominous lows, with fewer than 32 per cent saying they still trust him. The latest projections are that the 2012 presidential race wil be won by the lacklustre Socialist leader, Martine Aubry, who in a second-round run-off against Mr Sarkozy would win 52 per cent of the vote.

But that's only if the second round is a traditional contest between Right and Left. Other, more worrisome, figures show that French public opinion holds politicians of both main parties in equal contempt, with only the Front National's Marine Le Pen showing a strong improvement in her rating, albeit still behind the others.

If that trend isn't reversed, France could see a repeat of 2002, when the Front National won second place in the first round of presidential voting, allowing its leader - Ms Le Pen's father, Jean-Marie - to challenge Jacques Chirac in the second round.

All French scandals are complicated (they're never about something so depressingly simple as sex), partly because they hide within layer upon layer of secrets in a country which has never believed in transparency.

"Pour vivre heureux, vivons cachés" (To be happy, live hidden), a maxim of the 18th-century poet Jean-Pierre Claris de Florian, remains a byword here.

The political revelations of L'Affaire Bettencourt came out almost by accident. Françoise Meyers-Bettencourt, Liliane's daughter, 57, brought to court a case against Mr Banier, whom she accuses of abusing her elderly mother's trust to gain favour - specifically, being showered with gifts of cash and artworks.

This was three years ago, soon after the death of her father, Mrs Bettencourt's husband, André. (She may have feared that her newly-widowed mother was dangerously unmoored; after Bettencourt's death there was talk of Mr Banier being adopted by Liliane.)

The case dragged on. The daughter tried to prove that her mother's mind was befuddled. The mother refused a psychiatric evaluation, countering that her daughter was jealous of Mr Banier, who was "more amusing, more interesting" while Françoise was "dull" and had "no conversation."

Mrs Bettencourt's worth is estimated between 17 and 20 billion euros. "If you can afford it, it's very nice to be able to be generous," she recently said in a television interview.

If it wasn't for the Monopoly money amounts (993 million euros given to Mr Banier over four years in the form of Matisses, Picassos, life insurance contracts and a Seychelles island), it would look like every mother-daughter bitter feud, writ large.

Still handsome and elegant today, Liliane Bettencourt was for decades one of France's great society beauties. (The stylised woman painted in the early 1960s by the celebrated illustrator René Gruau, to figure on the golden cans of L'Oréal's best-selling Elnett hairspray, was modelled after Liliane. The hairspray container is unchanged today, an example of timeless design.) Françoise Meyers-Bettencourt, not to put a fine point on things, is rather plain.

Liliane's adored father Eugène Schueller, the founder of the L'Oréal fortune, was a notorious Collaborationist, who financed a number of fascist parties in the Thirties, was a Vichy regime enthusiastic supporter, and paid for the exfiltration to South America of some French Nazis at the Liberation.

Françoise married the grandson of Neuilly's Résistant rabbi, who died in Auschwitz.

Liliane Bettencourt's help – her butler, her secretary, her accountant, her driver – started taking sides. Those who showed too much favour to Françoise (or didn't hide their distaste for Banier, an increasingly frequent, often rude visitor) were fired. With compensation, but fired.

As it turns out, this was a spectacularly bad decision. The family's butler had started taping the conversations taking place in the expansive neo-Art deco Neuilly house, where Mrs Bettencourt has lived since commissioning it in 1951. (This is very much a tale of Neuilly, a kind of French South Kensington where the residents voted against having a second Métro line extended from Central Paris, because it would bring petty crime to their doors. Not long after that vote, Nicolas Sarkozy was elected Mayor, aged 28.) This was, the butler said, because he felt his boss was being taken advantage of.

Upon getting the sack, the butler went to Françoise (a mere 50 yards away, in a house almost as grand) and gave her a computer memory card containing the recordings, made on a tiny machine hidden on the drinks trays. (The Liliane-Banier camp counter that Françoise paid him all along to make them).

Three weeks later, Françoise handed 28 CDs of the recordings to the police. For good measure, she also gave them to an investigative website and a news magazine, which published very long excerpts. One can't but assume she had listened to them. Did she realise the conflagration they would trigger?

The recordings were dynamite. Not so much because, at times, Mrs Bettencourt did sound forgetful and hazy about the whereabouts of her immense fortune (she had, for instance, completely forgotten about two Swiss bank accounts containing over 100 million euros) and how much of it she'd given Mr Banier - but more because of the personalities and doings of her chief financial adviser and her lawyers.

Patrice de Maistre, the head of her "family office," a Jockey Club member, is heard advising her on where to hide large amounts of money from the French taxman (Singapore is in, now that Switzerland has become leaky). He boasts of having hired the then-Budget Minister Eric Woerth's wife, herself a former Rothschild banker, "to oblige him" - although he also badmouths Mrs Woerth, "who really puts on airs, playing too much the minister's wife."

Mr de Maistre angles to be given (tax-free, in Switzerland) a 60-foot sailing boat. He drops a few unsavoury comments about John Elkann, Gianni Agnelli's grandson, who is Jewish ("isn't it typical how they always gravitate to money?" he laughs, which Liliane interrupts with "I'm absolutely not anti-Semitic").

And he explains how cheap it is to contribute officially to a French politician's campaign, since individual gifts are capped at 7,500 euros. ("They are so grateful, and it really isn't much at all.")

In other recordings, lawyer and money manager discuss on their own how best to prevent Banier from getting even more. It makes for a riveting read – and a rare bird's eye view of the vernacular of France's super-rich, where tax evasion and influence-currying come naturally.

Having the wife of then minister in charge of tax employed, at the very least, in a place where fraud took place, was bad enough. How much did she know? asked the predictable headlines.

Worse was to follow. The usually tame French press took the bit between their collective teeth, and in the intervals between clamouring for Mr Woerth's resignation from his current job as labour and social affairs minister (a key post since he's in charge of pushing through Mr Sarkozy's great pension reform), went digging.

Soon, Mediapart, the investigative website, found another fired employee, an accountant, who blithely told how for years she collected large wads of cash from Mr and Mrs Bettencourt's bank to give to politicians in brown envelopes – most recently 150,000 euros to Mr Sarkozy's presidential campaign in early 2007.

The accountant was subsequently harshly grilled by the police and seemed to withdraw some of her accusations (she had been told by Mr de Maistre who the money was for, but had never actually seen it given out), then recanted her recant. Meanwhile the bank balances did show withdrawals for the various amounts she'd mentioned at the given dates.

"This proves nothing!" Mr Sarkozy's supporters and assorted lawyers roared. But by then it was of course too late – the general impression of cronyism and corruption was disastrous, compounded by the stonewalling, in time-honoured fashion, from the Elysée. (Earlier in the month, two cabinet ministers who'd abused their expenses in an unrelated polemic had to step down, which was seen as too little, much too late.)

Mr Sarkozy won't go and can't be investigated, because of the same presidential immunity that so often shielded Jacques Chirac. I wouldn't put good money on Mr Woerth staying, even though the current wisdom at the Elysée is that he is necessary to the pensions law, and that if he steps down Mr Sarkozy's most emblematic reform, on which he was hoping to be reelected, is toast.

But it's increasingly obvious that we have reached a paradigm shift, where the old Chirac saw, "Never admit to anything, never answer on anything", finally no longer applies in France.

The French, from a unique, centuries-old mix of Catholic and Marxist distrust hardwired in their collective psyche, have always despised money and mistrusted the rich.

At the very time when he is asking for belt-tightening and rallying together, Mr Sarkozy, the bling-bling president of the early days, the outraged victim of the Clearstream smear campaign, appears himself finally to have stepped over the line.

© Copyright Telegraph Media Group & Anne-Elisabeth Moutet 2010