Vive la France?

Reuters reported last week that more than 3.2 million French are jobless, an 11.5%  y/y increase and that President Hollande's "nagging headache have now turned into a migrane"  .  Monsieur le President, “pays la meme c’est comment comment?”

Leading to his election, President Hollande got a lot of help from the French media, who perpetuated so much hate on the persona of Mr. Sarkozy that he (Sarkozy) literally had no hope of winning the vote of independents; the large constituent of voters that were crucial to Hollande’s victory last year.  

Hollande, like many socialists in Europe ran on a populist platform similar to the one Obama ran in the U.S last year.  His election cycle rhetoric was:  tax the rich, let them pay their fair share, while we look after the poor.  Of course, this sounds good to the ears of most of us waking up too early in the morning and coming home late at night just to put food on the table, but the reality is – how effective has Mr. Hollande’s populist rhetoric been when put in practice?

For the average man in France, it is beginning to look like Mr. Hollande’s socialist ideas are no better than Mr. Sarkozy’s economic plan which the French detested so much that they voted him out of office. The unemployment rate and the country’s economy stubbornly remain stagnant. And to compound the malaise further, France at the moment is unable to take bold economic steps to address their problems.  They cannot do the American Fed-style of quantitative easing without the consent of the European Central Bank since France no longer control their own currency. And also, officially in the Euro- Zone, increasing liquidity or the purchase of toxic assets like the U.S. did during the great recession will be too much to ask of the French government at the moment.  So what to do?  What to do Monsieur le president? Parce-ce que vraiment, les temps sont durs.

The reality remains that Hollande came at a time when Europe is broker than Zimbabwe and the French youth are even more hopeless than they’ve ever been.  And it is now high time that Hollande realizes that France needs major structural reforms.  Hollande must do everything in his power to curb public spending, which is now almost 60% of GDP. He must roll back the socialist policies that nationalized a lot of industries in France, increase the work hours, and raise the retirement age.  By doing so, Hollande will allow the government to generate more tax revenue from workers instead of sending them retirement cheques they currently can't afford.

I hate to say this because I consider myself pro-poor, but France is at a point where it must adopt serious and tough austerity measures.  The governement of Francois Hollande must put entitlement programs on the budget cut table. With France now having the lowest profit margin in the Euro-Zone, investors are not going to come in, especially not when Hollande is promising to make good on his word to tax them at a rate of 75%.

Donc monsieur le presido, la France dites quoi meme?