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The End Of Socialism In France

Alain Minc is a French businessman, author and respected intellectual. He is a close advisor of Nicolas Sarkozy. This article appears in L'Express this week.

PARIS -- For the first time, in his recent speech, French President Francois Hollande recognized the world as it is. In the past, his Socialist Party behaved in a way that showed they understood how the world works, but didn't want to embrace it ideologically.

It was a "digression" when Pierre Bérégovoy, prime minister in the early 1990s, rolled out an intelligent policy that was more market oriented. It was still a "digression" when Lionel Jospin, prime minister in the late 1990s, came up with his: "Yes to the market economy, no to the market society." The words have been said.

Recognizing reality, President Hollande is at last seeing off socialism just as, in his time, President Francois Mitterrand saw off communism in French politics by bringing the Communist Party into his cabinet only to expose their outdated and unrealistic doctrine.

By claiming he is a social democrat and befriending the market, Hollande has taken a huge step forward for France.

POLITICS IS ABOUT WORDS

Politics is about words. François Hollande is now prisoner of the words he has uttered. I have no idea whether he'll succeed in implementing the measures he has announced, but as far as the words -- the ideology -- are concerned, there's no going back. Or, if he does, it will be political suicide.

Another thing strikes me: Hollande has now truly become a President of the Republic, by which I mean the Fifth Republic which empowers the executive. Until now he governed as if he were chairman of the board like the head of a coalition in a Scandinavian parliamentary monarchy.

Now he has said that he will be using the formidable weapons the Fifth Republic gives the president to tame a parliamentary majority and put it back on the right track.

It's a question of confidence and of issuing orders -- two ways of acting he never wanted to use. Everyone knows that what he has announced isn't necessarily what his 300 Socialist members of parliament want to hear, but he has given himself the means to encourage a change of heart on their part.

WHY THIS U-TURN?

Why this U-turn? I see three reasons. The first, by far the most important, is economic. Hollande no doubt sincerely believed that when growth returned, all the European countries would benefit in the same way. He has now realized what we all knew: his initial policies would have made France the weakest link in Europe.

He has now realized what we all knew: his initial policies would have made France the weakest link in Europe.

There are three factors of production: capital, work and confidence. Hollande quite blithely destroyed the last. He has finally understood that when growth returns in Europe, you notch up 0.5% or 0.7% more or less than the average depending on whether you have succeeded in creating a climate of confidence.

The second reason is political: if he wants to have a chance of winning again in 2017, Hollande needs the votes of the moderates, and he won't pick them up in the last month of a five-year term. Pledges of support have to be made well in advance.

The third reason is human: Manuel Valls, Hollande's own Minister of the Interior and the so-called "Socialist Sarkozy," committed an act of political treason by saying that circumstances might arise where he could be a candidate in 2017. What was the only way for Hollande to avoid ever appointing Valls as Prime Minister? Apply his policy!

AN EMPHASIS ON GROWTH INSTEAD OF REDISTRIBUTION

Putting a new emphasis on business and investment driven growth instead of continuing to talk about redistribution; talking for the first time about the abuses and excesses of the social welfare system and taking the view that public services could operate with less money - these are ideological changes in direction.

HAS HOLLANDE'S PRESIDENCY SO FAR BEEN TIME WASTED?

For his term in office, yes, since he decided to run the first 100 meters after putting shackles on his feet. On the scale of the life of ideas, no, because we've been waiting for this important clarification for 55 years. It's the end of an ideological lie.

I am delighted that Hollande has entered into the "circle of reason" with which I am associated. But while he has done the country a great service with this change in direction, he will be judged on the results of his policy.

He has burdened himself with such a heavy weight that he'll struggle to compensate, in three years, for the cost of the mistakes made and the mistakes told at the beginning.

Yes, the President has extricated himself from the swamp; he managed to head off a crisis over France's debt -- that's very important. But there's a real possibility that he'll lose in 2017 because it will be extremely difficult to make up the ground lost due to the decisions of 2012. But France will not be in the disastrous state that it could have been in if he had continued to pursue the same policy as in his first few months.

I can't go so far as some captains of industry who are loudly applauding the President and predicting he will succeed. I believe that he has done something essential, but that he will not be able to improve the economic situation enough to change the overall political picture between now and 2017.

The bosses had such a fright that now they're happy! What's more, they now know that even if François Hollande doesn't manage to deliver what he's promised, there will be no more absurd measures. It's an anti-blunder insurance.

The bosses had such a fright that now they're happy! What's more, they now know that even if François Hollande doesn't manage to deliver what he's promised, there will be no more absurd measures. It's an anti-blunder insurance. After what we've seen on the tax level - for example his 75% tax on millionaires -- this is already a big step forward!

IS HOLLANDE FORCING THE SOCIALIST PARTY TO DO AN ABOUT TURN?

What can the Socialists do now? Vote against the President and find themselves in a group of 50 MPs? We now know that the far left/left equation can no longer claim a majority. The break with the far left is interesting. We have had a situation where two government parties are blocked by their extremist wings -- one far left, the other far right. Hopefully, France will look like a normal democratic country from now on whose future is decided by a battle at the center.

We have had a situation where two government parties are blocked by their extremist wings- one far left, the other far right. Hopefully, France will look like a normal democratic country from now on whose future is decided by a battle at the center.

NOT SO GOOD ON EUROPE

François Hollande has a real international policy. I supported him against going to war in Syria -- where his decisions were very solid -- and on his interventions in Mali and Central Africa. But he doesn't have a European policy.

An energy "Airbus" for Europe -- which he has proposed -- doesn't make sense; the only area where we can't cooperate with the Germans is energy, since our policies are incompatible.
What's more, the Germans are just as absurd in their energy policy, albeit now undergoing a shift, as we can be absurd in our macro-economic policy. And we are just as rational in our energy policy as they are in their macro-economic policy.

The only thing we can do here is to make proposals together to federate the Eurozone. We need to create a mechanism for the transfers of sovereignty, with voting at the European level based on a qualified majority.

On the ground, Hollande is still afraid of the "nay sayers" on a strong federal Europe. With the presence of the Social Democrats now in the grand German coalition -- who are much more pro-European than the German liberals -- a window is opening. We won't always have in Germany a government with so many pro-European militants. Let's take advantage of the situation.

France must be more proactive! It should propose a common working group with the Germans... with Jacques Delors, the respected French Socialist and former head of the European Commission, as France's representative! That would put Germany on the spot!

IS THE FRENCH RIGHT TOO FAR TO THE LEFT?

First of all, those of us on the right must speak with one voice to the President: Welcome to the real world! As citizens, we are happy to see this great change of stance; but if we're talking about managing the modern world, we're better able to do it because we're not hamstrung like Hollande by his own constituents combined with the enemies he has made in the business community.

Secondly, the French right has a problem. It is liberal in the economic sense, but not on societal questions, for the usual reasons: Le Pen's National Front (far-right party) is on the prowl in the aftermath of the anti-gay marriage demonstrations and on immigration issues.

In any case, it can no longer hesitate! Even before Hollande's U-turn, I thought that the right could not start preparing for the elections without having a truly socially liberal program. The Socialists have rendered France a very salutary service: they have turned the whole country against tax increases, forever -- even among their own voters.

WILL SARKOZY COME BACK?

I think Nicolas Sarkozy will decide whether to run for President again or not when the time is right. And now is not the right time. He has taken positions that will enable him to do this. That said, he's not going to decide three years in advance of the next election.

It's impossible to say today whether Sarkozy will come back. To my mind, the right has two candidates and only two: Nicolas Sarkozy and Alain Juppé, the former head of Sarkozy's party, the Union for a Popular Movement, and a former foreign minister.

HAS FRANCE'S IMAGE BEEN DAMAGED BY HOLLANDE'S PERSONAL LIFE?

No. In the eyes of the outside world, Presidents of the Republic are the successors of the kings of France. In the United Kingdom, what's forbidden to the Prime Minister is authorized for the heir apparent. And the French President is both the English monarch and the Prime Minister.