Judy Asks: Does France Need to Change?

It has become popular to argue that France needs to change, not only for the country’s own sake, but also for the sake of the EU’s future. France’s inability to get its public finances in shape, the argument goes, has led to a dangerous power imbalance with Germany: France needs to change to reignite the Franco-German motor of EU integration. But Germany is now simply much bigger than France, and the economic relationship between the two is inevitably unequal.

It is true that the lead-up to the 2017 French presidential election has revealed a need for change. That so many young people intend to vote for the far-right National Front is particularly worrying, and moderate French politicians must find ways to address the widespread sense of resignation at the country’s economic future. France needs to push through ambitious reforms, especially of its labor market.

Change in France, however, is no silver bullet for the EU’s many woes. To restore the EU’s credibility, eurozone policies need to change. But it is naive to hope for a Franco-German quid pro quo under which Berlin would accept, say, the mutualization of eurozone debt. German opposition to such a step has little to with France’s failings, real or imagined. France needs to change, but it is not alone.

Sans doute. With the two main political parties fractured, France is already experiencing change, founded on disgust. But there are also serious, long-standing structural problems that need to be addressed, if any political leader can find the courage and the legislative support to do so and challenge the grip of the small but powerful unions.

Structural unemployment is far too high, built on a system that rewards those with permanent jobs and demands perpetual adolescence and insecurity for those young people who can only move from one temporary contract to another. The system is an insult to the young.

With low growth, early retirement, demographic change, and generous welfare and pension benefits, France is simply not creating enough wealth to pay for its magnificent social system. The French have high productivity but work short hours, take long vacations, and live off the state in their fifties. That’s wonderful if tax receipts cover all that, but they don’t.

State spending represents considerably more than 50 percent of GDP, and the fiscal and cumulative deficits are too high. There are far too many protected bureaucrats and layers of officialdom per capita. Too many young French aspire to become civil servants, perpetuating the anomie that feeds political disgust and emigration of the brightest.

Change all that, but never, please, the French baguette.

Take a stroll in fancy central Paris, have a glass of chilled Pouilly-Fumé in a country bistro, listen to the Foreign Legion sing its storied anthem, or attend the latest party for the controversial writer Michel Houellebecq, and you wonder: Why are the French so angry and depressed, held hostage to a national epidemic of cafard, that gloomy, existential lack of joie de vivre familiar to the most dyspeptic Sartre characters?

The French economy is not that bad; it could be better, but productivity is OK. France’s demographics are better than Germany’s, and its public debt of 96 percent of GDP is much lower than Italy’s. But no French president has had the guts to tackle reforms in the face of the unfurled red flags of striking trade unions.

So where does the French malaise originate? It is nostalgia for empire, for a real say in the world, not the present, weak harrumphing. Will the crass globalized world swallow what the French call their cultural exceptionalism and spit on McDonald’s? Will the banlieues eventually assimilate? The world loves France, but France has a hard time being just a great nation in a chorus.

Suggesting a change of policies for a foreign country is always difficult—even more so when it comes to a nation that always sought, in the words of former president Charles de Gaulle, “une certaine idée de la France.” Europe needs a strong France to maintain its internal equilibrium. Yet it seems that Paris had difficulties readjusting to the post–Cold War reality.

On a global scale, France chose to resist rather than adapt to market transformation. Free movement of capital, goods, and labor, as well as flexibility, were contested and made it difficult for France to be governed and to perform economically.

Regionally, Paris remained attached to the idea of a small Europe for far too long. France was skeptical of EU enlargement and, when it happened, pretended it could focus only on the union’s founding states. By ignoring concerns of the new member states about the looming threat to the East or pushing for separate economic governance for the eurozone, France limited its influence in the union—contrary to British or German engagement in the region.

Were France to regain its economic mojo and push for stronger relationships in the whole of the EU, it would create a win-win situation. Such a shift would result in a more balanced Europe and heal existing divisions. The ball is in the French court.

France needs to change to make its economy more dynamic and release the pent-up energy of young people who can’t find a steady job or get started in life. The country needs reforms to make hiring and firing easier, reduce business taxes and red tape on small firms, and give the middle classes incentives to invest their savings in stocks and start-ups rather than property. Welfare needs to be more selective and better-off pensioners taxed more.

Once France shows it is biting the bullet of fiscal and economic reform, it will be well placed to leverage its strength in defense and foreign policy to strike a grand bargain with Germany on a new start for the EU, to strengthen the eurozone and increase common defense efforts.

To overcome inevitable resistance, the new French president must deliver a strong political message of making France great again—not by closing borders, scrapping the euro, and being nasty to immigrants but by making the most of its assets, first and foremost its young talents. That means embracing diversity and creating more educational and economic opportunities for young people in the banlieues to combat delinquency and radicalization. Oui, France can!

France needs to change if only to address the overwhelming discontent in the French population. With figures indicating a steady loss during the last twenty years in the average real incomes of French households and a parallel drop in France’s competitiveness in world markets, indispensable reforms in areas like education, the labor market, and pension regimes cannot be pushed back for much longer.

Successive governments over these years have never lived up to the challenge. Today, unsurprisingly, the presidential candidates who represent the highly unpopular political parties in office over the last decade have a combined vote share of less than 30 percent in current polls.

This is where the quest for economic reform meets political change. The four main candidates, who are currently struggling to come out on top in the first round of the presidential election on April 23, amount to an unprecedented political combination of traditionalists, extremists, and newcomers. This could be the first sign of a transformation in French politics.

Perhaps none of this potential change will prevail at the end of this election. Yet the message will remain: the strong resentment perceived across France during this campaign calls for a profound change. If not this time, it will come sooner or later.

Whatever the result on May 7, one thing is certain: the French presidential election will be a game changer for Europe. Far-left candidate Jean-Luc Mélenchon and extreme-right contender Marine Le Pen have in common (aside from their pro-Russian stance) that they want to reform current French policies outside the EU treaties. Center-right hopeful François Fillon wants a renewed Europe of nations. Those approaches augur a dangerous protectionist and nationalist change.

Given Britain’s vote to leave the EU and the current political crisis in Europe, this is not the type of change France needs. Instead, the country should reform inside and together with the EU, by committing strongly to the Franco-German relationship and investing in new initiatives that will secure a renewed political consensus in the union.

Societal change is also deeply needed regarding laïcité, one of the key pillars of the French republic. French secularism will remain sustainable as long as it sticks to its tolerance principle and avoids entrenchment. It should not become a nationalist principle that polarizes society and excludes others, but instead should adapt dynamically and enter the era of postsecularism heralded by German sociologist Jürgen Habermas. That is a change being called for by the Socialist candidate Benoît Hamon and, with some nuances, by the front-runner, centrist Emmanuel Macron.