A few days ago, a German journalist asked me an interesting question. Why are French politicians apparently unable to clearly and unambiguously diagnose the European wage problem and to address it in European negotiations? Since it is clear that it is Germany that caused the wage problem in the European Monetary Union, it should be well possible to draw political conclusions and propose specific actions. Instead of stubbornly resisting the extremely popular resistance in French society against the new labour laws and trying to imitate German policy, French policy-makers should bring the issue to where it belongs and where a solution for it can be found, the European level. Why is this not happening?
It is far from easy to give a satisfactory answer to this question. It is indeed difficult to understand how it is possible that a president from the Socialist Party who got elected on a lofty program promising redistribution and a new socialist management culture transformed himself to such degree. In the last year of this presidential mandate, Hollande is trying to implement conservative, if not downright reactionary, labour market reforms, changes in social law, the organisation of work and the legal status of unions. These reforms go further than what the Right ever proposed before because they considered them politically and socially unachievable. It also far from easy to understand how it is possible that a great nation such as France cannot seem to organise a serious and rational discussion about the cause of the dysfunction in the euro zone. Since there is no discussion, there are also no conclusions. This is strange, especially since there are good economists available which could provide competent assistance (see here).
Let’s make no mistake about this and harbour no illusions. The French social-democrats (we really can no longer call them ‘socialists’) have been in violent crossfire from the media and all the organisations of the Right and the employers ever since they came to power (see here). The German social democrats find themselves in exactly the same situation. Then everything becomes incredibly difficult. To this has to be added that the French social democratic party has no clear conception about what should happen economically, there is a lot of confusion but little vision and no willingness or courage to seek independent advice. It also does not help that the vast majority of the so-called economic and social scientists firmly sit in the conservative camp. In short, there are constant attacks, the obstruction never stops and everything is always a fight. This does wear people out.
There is also the international dimension. Wherever the French head of state arrives, he will always immediately – with great diplomatic restraint of course – be reminded that he is expected to finally put the things in order that his predecessors mismanaged. The shining example of Germany will be used as the proper way to pull the cart out of the mud. When French politicians meet up with colleagues from their largest neighbour the power imbalances become very clear. They will be told that France must reform and that successful Germany must not. Schäuble is very good at this sort of structural dishonesty (see here).
What is François Hollande supposed to do in this situation? He might send out his Minister of economy to test the waters. How would the Germans react to proposals that envisage changing economic policy (see, for example, here)? But if he reaches the conclusion that the ‘friends’ across the Rhine let him massively down and that the whole media attacks him, he will choose to be a lot more careful when planning his next action. If Hollande is tactically astute, he will let the President of the European Commission, who has some understanding of his situation, explore whether a major public investment initiative at the European level could become more realistic. The problem is always the same. The doctrinarian wall in Berlin obstructs any progress. Hollande could try to find a kindred spirit in Matteo Renzi, who has similar concerns, and team up with him, but Renzi lacks determination and others are also too afraid to act. These people will rather swear that a circle is in fact a square than to mess with god and the world and to instigate an open European conflict.
A reconciliation between the Nuit Debout protesters and the unions on the one hand and the government on the other seems unlikely at this point. There are few or no channels left to reach common understanding, let alone to broker an agreement. Further escalation is therefore likely. The confrontation has – in good French tradition – already been harsh and could well become harsher. Does Hollande not understand what is at stake? Why is he not trying to mediate? The only ones who will ultimately benefit from this conflict are the nationalists, the Front National and Marine Le Pen. Furthermore, the conflict also strengthens the already widespread conviction within the population that it is Europe that is responsible for all evil. That is not constructive either.
What I cannot understand is the discouragement of those at the very top of the EU institutions, those who are officially responsible for EU policy, first and foremost Jean-Claude Juncker. What does Juncker has to lose? He knows where the root of the problem lies in Europe. You should expect that Juncker should stand up and speak out against the madness with all the weight, status and power of his office and person as conservative party leader. Perhaps even that would not lead to policy changes, but at least he, the president of the European Commission, would denounce the problem. But Juncker is nowhere to be seen. He half-heartedly protects France when it comes down to not creating even more dysfunction. Dear Jean-Claude, this is not enough. Sometimes circumstances – and they well be historical right now – are such that you need to do more than anyone else did before you. You need to speak up. Those who walk at night will not stop and those who remain silent during the day are personally responsible for the failure or Europe.