Wednesday, July 19, 2017

Bill Mitchell — Austerity will not work for France right now

It didn’t take long from Emmanuel Macron to get started on his neo-liberal agenda. That should be no surprise, given he championed the insidious El Khomri Law when he was Minister of Economy and Finance in the second Manuel Valls Cabinet. In a major speech in Paris on Monday (July 17, 2017), Macron, demanded that local governments in France slash spending by 13 billion euros by 2022 as part of an effort to cut the French fiscal deficit. Why they would want to be cutting the fiscal deficit with growth creeping along and the unemployment rate stuck close to 10 per cent, among other problems facing the French nation is another matter. Clearly, they are under pressure from the Excessive Deficit Mechanism given that the overal fiscal deficit remains around 3.5 per cent (above the 3 per cent threshold) and doesn’t look like coming down any time soon. And it is clear that Brussels will not turn a blind eye to France, as it did for Spain when it allowed the deficit to rise to support growth as part of the strategy to get the conservatives re-elected. The elites in the Eurozone have their boy in power in France so no further political support is required. But austerity will not work for France right now.
Look for more political unrest in France.

Bill Mitchell – billy blog
Austerity will not work for France right now
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

See also
Backlash against painful budget cuts coming from both sides as military, teachers, local authorities push back..
A backlash against budget cuts was to be expected in France, but for the first shots to be fired from the military is unusual, and a sign that Macron should be prepared to be hit from both ends of the political spectrum.
Honeymoon over?

Asia Times
Revolt against Macron begins, chief of French armed forces resigns
Chris Scott


Matthew Franko said...

You have to watch what they actually end up doing... they might say one thing and do another thing...

hog said...

"You have to watch what they actually end up doing... they might say one thing and do another thing..."

must have blinked for one second. watch more carefully next time.

Matt Franko said...

Nobody is measuring how much they are actually spending in Europe... it is increasingly looking like they are spending more than articles like Bill's here would generally imply...