La Prochaine Résistance Française – Tales Of Existentionalism And Interconnectivity
January 16, 2012 § Leave a Comment
It has been 38 years since France last imposed a balanced budget. Interestingly, 11 months have passed since President Sarkozy first suggested including a balanced budget amendment into the country’s constitution. As some readers may remember, Martine Aubry, the Socialist Party’s leader, deemed the potential measure “grotesque” and a “propagandistic smoke grenade.” Le sigh!
Well then, how did the country fare with Friday’s announcement that its credit rating would be downgraded by S&P to AA+ status? Sarkozy, forever poetic, took a page from Charles de Gaulle’s rallying book when stating, “This is a test and one we have to confront. We have to resist, to fight, we have to demonstrate our courage, to keep a cool head. We do not respond to a crisis of this magnitude with agitation, fits of anger and controversy[.]” Yes – he really did say that.
So, resistance from what? We do not know. S&P? Fiscal austerity? Responsible borrowing? Portugal? Spain? Ireland? Greece? The European Financial Stability Facility? France’s Socialist Party? Ah, yes. The latter, perhaps.
See, similar to the United States, France is stuck within an election year that has just become increasingly more ruthless given news of the downgrade. In recent history, Sarkozy has repeatedly referenced the country’s AAA status as a testament to his ability to lead. Unfortunately, he overlooked the fact that France recorded a deficit at 7.1% of GDP last year. Additionally, France owes quite a bit of its prosperity to neighboring countries that purchased its goods, services, and…gulp…debt throughout this past decade. Along with France’s downgrade came a similar blow to Austria’s rating, sapping the EU rescue fund’s guarantees from €451 billion to €271 billion. This decrease in funding will immediately put a strain on Ireland, Portugal, and most importantly Greece. Thus begins the downward spiral and impending collateral damage that will course its way through the EU. Well, that is of course unless the U.S. steps in to increase the rescue fund’s capabilities.
With that being said, I want you to close your eyes and imagine Romney and Obama standing at adjacent podiums in September, squaring off in true debate fashion. Let us pretend that both gentlemen are discussing the States’ inability to create austerity measures. Add bailout funding to France, Greece, and…well, the entire EU. Surely, you can now imagine a concoction not unlike molotov cocktails being thrown through the televisions/collective minds of middle-America. This ought to be fun.
The point being, of course, is that it’ll be a hard sell on both sides of the aisle. Mix that in with a strong Socialist Party showing in French polls, and you truly have a popcorn-worthy year filled with misinformation, anger, resentment, and unabashed nationalism. In short, American politics.
Well, at least we’ll finally figure out the resistance that Sarkozy so passionately referenced.
Europe Hit By Downgrades [WSJ]
The Great Debt-Break Swindle [Der Spiegel]
Election Season Is Heating Up In France [Jerusalem Post]