The diagnosis is known. In 2000, France and Germany were almost equal. Twenty years later, the GDP per capita of France is 15% lower than that of Germany, the debt twice as high. While our neighbors maintain their industry’s share of GDP at 22%, ours is collapsing to 12%. Former boss of Amundi – the leading European asset manager – and president of the Edmond de Rothschild bank, Yves Perrier returns with the intellectual François Ewald to the causes of this great dropout.
Rather than blaming the euro, their essay has a strong thesis: unlike Germany, which has retained its Rhineland capitalism, France has abandoned the Pomido-Gaullian pact, namely an organization of the national economy both liberal and Colbertist. While leaving the players free, the Gaullist State ensured that the economy was at the service of national power, supporting major projects in energy, transport or defence. But if our nation has missed the turn of globalization, it is because it would have, from the 1980s, let this model of political economy come undone in favor of financial capitalism, with objectives of immediate profitability. Investment bankers, traders or managers of hedge funds supplanted the engineers. The strategist state has been replaced by a therapeutic state which tries to compensate socially for the effects of economic decline. Results: loss of competitiveness, accelerated deindustrialization, increase in public spending or the number of civil servants, all of this reinforced by the disastrous decision of the 35 hours.
For Yves Perrier and François Ewald, however, nothing is lost. In an increasingly multipolar world, and faced with the challenge of global warming, the State must, according to them, regain its function as a strategist, through planning and industrial voluntarism. We must also reconnect with a policy of supply rather than consumption. But our country retains assets, with large groups in luxury, energy, pharmaceuticals and aviation, excellent infrastructure, consistently high-performance research, a resilient financial system and abundant savings.
If one may find this essay too severe on “financial capitalism” – the authors nevertheless have the honesty to point out that the rise in the world standard of living for thirty years is unprecedented in history -, the critical analysis of this French downgrading is as argued as it is implacable, joining those of Nicolas Dufourcq (The Deindustrialization of France, 1995-2015) or Jacques de Larosière (40 years of economic wanderings).
What political economy for France? by Yves Perrier and Francois Ewald. Editions de l’Observatoire, 350 p., €23.
Rating: 4/5