As the world’s eyes are fixed on Greece, France is striving to get its own fiscal house in order. The Financial Times reports:
France’s economy minister has vowed to ram further economic reforms through parliament if needed to bypass mounting resistance in the governing Socialist party.
Emmanuel Macron said the French government would be ready to override parliament again after pushing through a package of business-friendly laws without a vote last week. The pledge comes as the European Commission on Wednesday demanded greater financial efforts and more reforms in exchange for leniency on repeatedly missed public deficit targets.
Like other French socialist leaders before him, President Hollande has undergone an education in economics while in office. And as was also the case for previous French administrations, he and his cabinet now have to fight members of his own party, who are not as exposed to some external realities.
What’s new is the urgency—and the dangers—that the multi-layered euro crisis creates. The measures being contemplated are not exactly revolutionary, but they are nonetheless significant in scope. That they are being contemplated at all is illustrative of how, for the leaders of France, the fear of contagion and the feeling that the euro rules can no longer be flouted quite so openly has started to sink in.
Paris’s position on the euro crisis is unique and precarious. On the one hand, as one of the eurozone’s biggest economies and a traditional leader of the EU, not to mention the home of a lot of big banks holding big loans in the south, it’s expected to enforce the rules. On the other hand, its own fiscal order is more Mediterranean than Teutonic, if truth be told. It looks like the Hollande Administration is moving to comply with Brussels’s orders—and perhaps shore up its own financial position in the process. But will it be able to do enough, without running into even more serious domestic opposition than this?