Austerity: France

Outgoing President Nicolas Sarkozy Dept: While Hollande grandly vows to have done with austerity, his program doesn t differ hugely from that of outgoing president Nicolas Sarkozy, whose volatile flamboyance cost him the election. Nor should it. Both leaders agree that France s record $2 trillion-plus debt, at 86 per cent of output, needs to be pared back over time. And both regard 10 per cent unemployment as untenable, according to The Star. Domestically, Hollande proposes to tax the richest a bit more, to spend a bit more to create jobs and to preserve the social-safety net even if that mix means paying down the debt a little more slowly and does the election of a Socialist, Fran ois Hollande, to the French presidency signal an abrupt end to European austerity and a threat to the eurozone? Don t bank on it. His supporters don t call him M. Flanby , after the nondescript caramel pudding, for nothing. What he promises France, Europe s second biggest economy, is a prudent course correction after two years of destructive belt-tightening, not a ride on the wild side. What Hollande brings to the fractious budget/debt conversation with German Chancellor Angela Merkel is a sensible bias for stimulus and growth, and less fixation on austerity. Not unreasonably, he wants Merkel to either nudge cash-flush Germans to buy more from struggling European partners including Italy, Spain and crisis-dogged Greece, or to agree to bankroll some government stimulus to spur demand and jobs. Notably, European Central Bank President Mario Draghi is suddenly talking up a growth compact. (www.immigrantscanada.com). As reported in the news.