Posted on 08/30/2003 9:16:19 AM PDT by knighthawk
Eleven years after France signed the Maastricht Treaty it has decided it has had enough of its obligations. The straitjacket of the stability pact, which paved the way for the euro, is bound too tight for an economic downturn, it has told Brussels.
So instead of suffering for the common European good, President Chirac has decided to bust out, to let his deficits soar and try to spend his way to an economic recovery.
It is hard to know what lesson Sweden is to draw from this as it prepares to vote on Sept 14 on whether to start using the euro. Is every country that uses the single currency allowed to behave like this?
Was not the very purpose of the stability pact to ensure a collective economic responsibility? What if every country decided to cheer up their depressed economies with a credit card binge?
In public at least, M Chirac is unlikely to go as far as Philippe Marini, the government's economic spokesman in the Senate, who called the stability pact "completely obsolete" this week. But he has concluded that his own political interests and those of France are not served by adhering to the pact.
Long before sending his prime minister, Jean-Pierre Raffarin, to Brussels this week to explain that France would not even try to bring its deficit to below the stability pact limit of three per cent until 2006,
M Chirac made an obvious calculation. As he considered reforming the French state and cutting taxes, he asked: "Who is more likely to cause me trouble? The French unions or Romano Prodi?"
Mr Prodi, for all his gifts, has no record of stopping trains, closing schools, smothering Paris in tear-gas and turfing out Right-wing governments.
M Chirac, who experienced all of this the last time he tried reforming France in 1997, does not want to give the unions another chance.
By telling the EU where to go on deficits, M Chirac is telling his citizens that France's problems and recovery are now their own to deal with. No foreign entity can be held responsible - unless you count America, whose economic recovery is being prayed for fervently by the French. M Chirac hopes the tax cuts he has started to implement take effect and generate spending.
A pick-up in the economy will help ease the pressure on the government. Structural reforms can then be made to the public sector, the cost of running the state reduced, businesses will thrive, tax receipts rise and by 2006 France will be ready to rejoin the stability pact's polite society.
M Chirac must set to work now if he wants his efforts to bear fruit before he stands for re-election in four years' time.
M Chirac has also told his government that nothing must affect promised increases to the defence budget. He believes the French military must at least be equal to the British if France is to be a credible global power.
To this end, he has suggested that defence and research spending be excluded from the stability pact rules.
Germany and Italy are having similar problems to France in meeting the stability pact criteria and are also applying unilateral remedies to the economic downturn.
Which leaves those countries still mulling over joining the euro with a new question. Which kind of flexibility is better? The flexibility of staying out or the flexibility of joining and then ignoring the rules?
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Cowboy Français
If this is the case, the French are dooomed.
There are not enough MEN in France to save them.
Semper Fi
Seconded. I've been saying on FR since the day I registered that the Euro is doomed to eventual collapse, precisely because it was inevitable that at least one country would end up ignoring the currency rules the moment it because economically convenient for them to do so. (No big surprise that country turned out to be France.)
And once the Euro collapses, the EU will eventually collapse along with it. There is simply a limit to how much autonomy an ever-growing agglomeration of countries with wildly different cultures - even naturally-submissive European cultures - will be willing to give up to a bunch of elitist jerkoffs from France, Germany and Belgium. And the Eurocrats are already trying to cross that line.
The euro's already been trending downward against the dollar for about four months now. Should be interesting to see what happens next week.
For France to catch up to the British military, it will take a triple tax hike and about 30 years to get there. The frogs built their latest aircraft carrier with a flight deck 30 metres too short to launch a jet. On its maiden voyage, it dropped a prop and had to be towed to port. They are supposed to be part of the civilized world and they can't even build a car that anyone would want. What a bunch of dolts those people are... I could go on, but...
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