A selection of experts answer a new question from Judy Dempsey on the foreign and security policy challenges shaping Europe’s role in the world.

 

Kris BledowskiDirector of economic studies at the Manufacturers Alliance for Productivity and Innovation

Of course it is. Reforms form part of political change and shifts in social preferences in every country. France is no different.

It took all sorts of malaise in the Labour-led UK in the 1970s, the collapse of Communism in Poland at the end of the 1980s, and a series of major economic and financial crises in social-democratic Sweden in the 1990s to usher in these countries’ reforms. Apparently, France is not there yet. It doesn’t appear to be in the interest of either of the two traditional political formations in France to seek radical change. These parties enjoy the support of the middle class, which is wary of rocking the status quo.

The one French party leader who does appeal to a broad cross-section of the electorate (such as former British prime minister Margaret Thatcher, for example) is Marine Le Pen of the far-right National Front. Perhaps the road to economic change in France runs first through a victory for the National Front. Based on the party’s platform, the country is certain to plunge into a major economic and financial crisis. Out of the ruins of this depression would emerge political leadership that espouses the needed reforms. France would then finally have its catharsis of radical change.

 

Fredrik ErixonDirector of the European Centre for International Political Economy

Of course France can be reformed. Its economic policies are more archaic than those of other states in the West, but no country is predestined for perdition. France’s economy has become more open and competitive over past decades, and that should spur some optimism about the chances of reforming it.

However, like other Western countries in need of economic reforms, France has formidable challenges. While there is a fairly strong and growing opinion in favor of reforms, France’s political parties cannot channel it. They are rather like loose federations of warring tribes. A parliamentary majority supports deregulation and pro-competition reforms, but French Prime Minister Manuel Valls cannot get his modest and watered-down economic reforms approved by the country’s deputies—including those of his own party—and has to deny the parliament a right to vote on the reforms.

French society is increasingly divided. Far too many people feel their economic expectations have been demoted to permanently low levels. As they can’t imagine themselves in better economic conditions, they have lost their aspirations for societal change. That’s the story not just of France but of Western economies generally. Economic opportunity has to be restored, but that won’t happen unless saturated and overbureaucratized economies change.

 

Ulrike GuérotFounder and director of the European Democracy Lab at the European School of Governance in Berlin

This question sounds a little misleading. Who would be the one to reform France? It can only be France itself, and it has done so. Despite the lasting idea that France was lagging behind on the path to reform, the country has achieved astonishing things in recent years: it has enacted a retirement reform and a tough labor market reform, ending many of the privileges in the French labor law, especially the protection against job losses. So if labor market reform is what people generally assume a reform is, then France has done its job quite well.

On the political side, France acted too. Realizing that decentralization is key to a successful economy and that a country in which only the capital is integrated into the global value chain, Paris passed a law on regional reform, boosting the role of the French regions and merging them into thirteen new entities. The problem was that the shift from industry to services benefited only the metropolitan areas around Paris, Lyon, and Lille. The rural regions lost out. The winner was Marine Le Pen and her far-right National Front, which gained some 15 percentage points in the polls between 2012 and 2015.

The question, therefore, is not who will reform France: it has done so it itself. The question is at what political cost. The price tag of reforms will become clear in France’s May 2017 presidential election.

 

François HeisbourgSpecial adviser at the Foundation for Strategic Research

Ever since nineteenth-century French thinker Alexis de Tocqueville, the assumption has been that France cannot reform except through revolution. In the twentieth century, it took war to transform the social contract (in 1945), regime change to modernize the economy (in 1958), and riots to move society out of the Victorian age (in 1968).

Yet, has it been any easier for France’s partners? Britain’s welfare state was born of war, as was Germany’s social market economy. The Thatcher revolution followed the 1978–1979 Winter of Discontent, and anybody who thinks the Hartz reforms to the German labor market came easily should ask former chancellor Gerhard Schröder about them.

This reminder doesn’t exonerate France—on the contrary. Schröder and former French president Jacques Chirac together exploded the EU’s Stability and Growth Pact in 2003. The chancellor used the stimulus of deficit spending to dull the recessive impact and social pain of Hartz IV, the fourth stage of Germany’s reforms. The French president did nothing, and his successor, Sarkozy, did little more.

Current French President François Hollande, who was elected on a platform of soaking the rich, is now trying to bring French labor laws and regulatory regimes into the modern age. However, he will fail, and not merely because it’s too late in the electoral calendar. To succeed in selling a French version of the Hartz reforms politically, socially, and economically, Paris needs to include a stimulus component as secured by Schröder to enable those reforms. This is what France should do, and this is what Berlin should encourage Paris to do.

 

Thomas KlauDirector of K-Feld & Co

Charles Alexandre de Calonne, a former French finance minister, famously told Queen Marie Antoinette: “If it is possible, madam, the affair is done; if it is impossible, it shall be done.” As a predictor of France’s future, Calonne’s quip seems encouraging—but only at first sight. Marie Antoinette’s husband, King Louis XVI, sacked Calonne after he had agitated for a fiscal reform that, had it been implemented, might have averted the French Revolution.

Calonne’s success as a courtier and failure as a reformer reveals a dark truth. France has a track record of delaying change until its existing order is destroyed by stasis. The United States is still operating under its first republic established in 1789. France is onto its fifth.

The question, then, is not whether reform is doable, but whether the French Fifth Republic has strength left to deliver it. Given the declining quality of presidential politics over the last twenty years, there is room to doubt that electing a successor to President François Hollande will give the current system enough oomph to drag France into the age of digital globalization. One must hope it will, for the alternative may be unbearable decline or unpredictable revolt. Perhaps the first rumblings of France’s next upheaval can already be heard in the streets of Paris.

 

Gianni RiottaMember of the Council on Foreign Relations

This is a très insolente question, surely concocted by an Anglo-Saxon mind. As former French president François Mitterrand said, “There exists in our country a solid continuity of Bonapartism, where the vocation for grandeur of France, the monarchist tradition, and the passion for national unity, the jacobin tradition get together.” You fix what is broken, but as former president Charles de Gaulle kept making clear during World War II, France cannot be destroyed, defeated, or fixed. It is France, period.

This is, of course, just a narrative, however noble and storied. France keeps performing a traditional play: the government proposes a new bill to spur the economy, the students occupy the streets as their parents and grandparents did in 1968, les flics patrol the boulevards, and nothing much changes. Economist Thomas Piketty slaved for fifteen years over his book on inequality, but since that solitary exploit he is everywhere, sharing his wisdom on the world and now vouching for the student movement.

France is the proud heir of revolutions and communes; who cares about reforms? It is inequality, the new king, the French are fighting. So the play will go on, at least until reality hits.

 

Pierre VimontSenior associate at Carnegie Europe

Of course it is possible to reform France, and it has been done in the past: in the early years of Charles de Gaulle’s return to power as French president in 1959 just as during the implementation of the EU’s single market legislation in the late 1980s. Furthermore, the last fifty years have seen a complete transformation of the country through decentralization, an overhaul of state-owned corporations and the public administration, and impressive transfers from agriculture to industry to services.

Yet France lives with repetitive examples of deep opposition to reform inspired by profound corporatism, strong conservatism, or just plain antiestablishment spirit. Such resistance to change cannot be explained only by economic recession, as popular revolts have erupted at all times. One could even argue that these confrontations stem mostly from political unrest against the ruling government and are more a way of showing outright opposition to political leadership than a well-argued case against a proposed reform.

Moreover, these so-called revolts have largely been the same response to a few sensitive issues that have challenged the government of the day for the last twenty years: pension regimes, healthcare provisions, reform of the labor code. From that point of view, these failures to convince the French population have more to do with the difficulty of installing a genuine dialogue between governments and citizens than with some sort of French inability to accept change.

In other words, France illustrates the complexity of promoting a modern social democracy. This is a lesson that has yet to be learned.