Recall this AFOE post on the industrial politics of the abandoned BAE-EADS deal? Here’s an object lesson, from the Galileo navigation satellite system. The French were hugely keen on the project for political-military reasons and because they knew how to build it; the Germans wouldn’t pay into it unless they got to learn. Unfortunately they had a lot to learn and now the project is a mess and Thales is sending herds of engineers to Germany to fix the satellite. If we’re unlucky, the answer might be to smush the EADS Astrium and Thales-Alenia Space satellite operations together, which might leave us without the pretty impressive Italian and UK satellite industries but with the German company that just demonstrated it wasn’t much cop.
We’ve suspected for some time that the French and German governments’ refusal to take part in the Iraq war had something to do with their access to independent overhead imagery satellites. Briefly, France and Germany did (with the HELIOS and SAR Lupe programs respectively), and didn’t take part at all. Spain and Italy had some access to French imagery and had advanced plans to get their own. They made a limited commitment. The UK, Australia, Denmark, and the ROK relied on the United States and were, in a phrase that should be better known outside Australia, all the way with LBJ. Turkey didn’t have its own, although it has since acquired a satellite from Italy and it did have liaison staff at the little-known EU Satellite Centre, but it probably had ample intelligence from human sources.
“They say everyone else was wrong,” said this former official, “but we conditioned them to be wrong. We spend [tens of billions of dollars per year] on signals intelligence and when we reach a conclusion, the people who spend less than that tend to believe us. They weren’t wrong, they chose to believe us. The British, Germans, and Italians don’t have all those overhead assets, so they rely on us. Historically they have been well-served, so they believe us when we tell them the earth is round. The French have their own assets—and guess what? They didn’t go with us.”
Guilhem Penent, of France’s IFRI and IRSEM thinktanks, writes in the Space Review as follows:
Regarding outer space, France’s main objective is to perpetuate its autonomy and national sovereignty. As sovereignty is the state of determining itself based on its own will without depending on other nations, satellites are, first and foremost, the guarantee of France’s autonomy in assessment and thereby in decision-making.
The decision not to follow the US in 2003 was thus taken by then President Jacques Chirac in accordance with intelligence based for the most part on Earth-imaging satellite HELIOS 1, whose findings were in contradiction which was being said at the UN Security Council. When the war in South Ossetia broke out in 2008 between Russia and Georgia, then President Nicolas Sarkozy, as chair of the Presidency of the Council of the European Union (EU), used images provided by HELIOS 1 and HELIOS 2 to deny Russia’s allegations about the withdrawal of its troops when those troops were actually progressing southward.
This is the first public confirmation, I believe, that the French did in fact stand out of the Iraq war because HELIOS imagery showed that the WMD claims were nonsense. IFRI, and even more so IRSEM, are organisations with the status of something like CSBA in the States or RUSI in the UK, so this should be taken seriously.
Chris Williams, who pointed me to the TSR piece, contrasts the British concern about sovereignty with regard to things like bananas, beef, and birth certificates, with the French equation of it with independent verification technology. He has a point. (So does Dan Hardie in comments there, who points out that perhaps the French could have benefited by worrying more about their influence over monetary policy, something no British Eurosceptic has ever omitted to worry about.) I’ve repeatedly argued this elsewhere.
There are a couple of points here. I feel a degree of contradiction between my suspicion of mass telecoms surveillance and my enthusiasm for overhead imagery. Perhaps that’s just the conviction that however much fuss I kick up, it’s unlikely anyone will burn limited delta-vee to get pictures of me, but you can’t say that about X-KEYSCORE. With more consideration, I think it’s the terms-of-trade in the relationships I described in this post that worry me most of all.
From a British point of view, the deal was fairly simple. The UK would concentrate on signals intelligence and would share everything with the US, and would stay out of the satellite business. In exchange, the US would share back their satellite product. We know that on at least one occasion, during the Falklands War, this didn’t happen. Later, the UK started a major project, known as ZIRCON, to build a signals intelligence satellite. This went overbudget badly, but got a surprising degree of support from Margaret Thatcher for reasons of sovereignty vis-a-vis the US, before being abandoned when the Americans instead offered a share of the targeting slots for their equivalent system in exchange for cash.
But the ZIRCON strand of the story doesn’t cover imagery. It seems that the national interest was very poorly served by this part of the deal – the implicit sigint-for-imagery trade – to say the least, both in Iraq and possibly later in Afghanistan.
Since the 1980s, the cost of satellites has fallen sharply, notably due to the work at Surrey Satellite Technology Ltd. in Guildford. The UK had a very quiet test project between 2005 and 2009, and going ahead with an operational system on a similar basis to the Germans’ was being discussed openly by the Department for Business, Innovation, and Skills as late as early 2011. Since then, it’s all gone quiet over here…so what did happen to that project? And do we need more Europe here?
I think the answer to that is much more clearly Yes than it ever was with regard to the Euro. The main objection from the UK side (and from Atlanticist Europe more broadly) is that the Americans might not share as much stuff with us. But this makes less sense on close examination. In so far as it is a market-like, bargaining relationship, we would be in a stronger position. In so far as it is a relationship of integration among allies, the alliance would be better off as a whole and might be more allied. In so far as it is a feudal, tributary relationship, it would be less so. (You’ll notice that Penent alludes to this in the TSR article.)
And this doesn’t take any account of the quality of the information received. It seems that the information the US shared with its partners in the intelligence special relationship before Iraq was worse than useless – in fact, functionally defined, it was disinformation. Its recipients were less informed after receiving it than they were before. Even a small increase in independent capability might have the useful effect of keeping both parties more honest.
Oh well, here it is: yes, Virginia, the BND shared enormous amounts of surveillance material with the NSA, both from their military SIGINT group deployed with the German army in Afghanistan and from, well, Germany. Officially, this didn’t contain any information on German citizens. Also, the Germans offered the Americans the use of two software applications they developed, presumably as part of the deal for X-KEYSCORE.
Meanwhile, the Germans have given notice on an agreement from 1968 that permitted the western allies to request surveillance in cases that affected the security of their forces in West Germany. This document had apparently not been used since 1990 (they say). Oddly, the US and UK agreed immediately to terminate it by exchange of notes, but the Germans were still negotiating with France yesterday.
A “banking system responsive to local needs” quickly becomes “piggy bank for local politicians”.
Well, local politicians are elected, after all. Democracy is a thing. But I know what he means. That Spanish caja that was run, into the ground, by the Catholic Church. That kind of thing. WestLB back in the day when it financed William Hague’s best friend buying all the pubs and the Ministry of Defence married quarters and Peer Steinbrück was its regulator, before it blew up and the explosion threw him all the way from Hannover to Berlin and he got to be federal finance minister, SPD leader, Mr Prudent McBluebollocks an’all.
lrb.co.uk/v35/n11/neal-a… > “The fact that the global bank disaster scarcely touched Germany, with its strictly controlled banking system”…
— Alex Harrowell (@yorksranter) May 29, 2013
Does Neal Ascherson really not know about HypoVereinsbank?
I think the operational question here, certainly as far as the UK is concerned, is “are we a low-trust or a high-trust society?” It works for the Germans (for some values of works, and except when it doesn’t work), it doesn’t work for the Spanish (except of course when it did).
Sparks = high trust, cajas = low trust. We like to think we are a high-trust, low-corruption north European country, but I often think the history of the UK post-1979 is the history of an emerging low-trust society.
Of course, when we were canonically much more trust-y, Jimmy Savile was raping everything in sight, the Met Police was basically our biggest organised crime gang, and the MOD was perfectly happy to test nuclear weapons on our own soldiers. But then, trustful Germany has had some pretty decent scandals. Do you remember before Wolfgang Schäuble was All Better Now, when he was responsible for a massive illegal party financing system linked with the Elf-Aquitaine scandal? ‘Course you do. And further back, when he did precisely the same thing with German arms manufacturers?
But trust is an interesting concept. If you knew for a fact the people you dealt with were honest, you wouldn’t need to trust them. Trust and betrayal go together. High-trust societies are ones where people behave as if they could trust each other, and that choose to deal with the inevitable abuses of trust in certain ways. Low-trust societies are ones in which people behave as if they cannot trust each other, and especially, as if there was no realistic hope of sorting out abuses of trust later.
I actually wonder if the distinction is really about what happens after a breach of trust is discovered. J.K. Galbraith’s bezzle, the inventory of undiscovered embezzlement in an economy, is a universal phenomenon but the means of dealing with it differ dramatically. When an aeroplane crashes into the ground, in the UK or, say, the Netherlands, the first people on the scene after the fire brigade are the AAIB inspectors, whose mission is to establish the facts. In Italy, or Greece, the first people after the fire brigade are the police, come to arrest any of the crew who survived. The distinction is telling. If you can’t expect justice, and you can’t expect the truth, you might as well practice cynicism like you practice an instrument, as a skill or even an art.
In a sense, social trust is an ideology. We choose to believe that our neighbours are basically decent people in a civilised society, or that of course they’re all the same and all crooked, but wouldn’t you be if you had the chance, and so you better look after number one. And if it is an ideology, it is part of the political sphere and it can be changed. Now there’s something for you – hope. But I fucking hate hope and hope-mongers, so…ah.
One way of looking at Francois Hollande’s campaign for the “moralisation of politics” is an effort to do just that, to keep France from becoming even more of a low-trust society than it already is. Of course, whether France is a Latin country (stereotypes: Catholics, inflation, tourists, Picasso, bureaucracy, conspiracy politics) or a northern one (stereotypes: Vikings, Gothic buildings, electrical engineering, the Republic, international modernism, ENA) is a cliche up there with whether Britain is facing Europe or the high seas or whether Russia is in Europe. But perhaps there’s some truth to it. Is it…spreading?
Low-trust societies, I think, emerge when the norms imposed by the elite are both compulsory and also impossible, and especially when the elite doesn’t seem to practice them itself. You could put it another way: it’s Berlusconi’s Europe, and we’re just living in it.
(Because it is!) I should probably do more French politics blogging, I think. A couple of themes lately:
Cahuzac x Sarkozy.
There’s been a major scandal around the budget minister Jérome Cahuzac, spearhead of a campaign against tax-evasion, who turned out to have hidden his own multi-million euro fortune in Switzerland and had to resign. As a result, the president announced a campaign to “moralise politics” and legislation to force politicians to declare their financial interests. Ministers were ordered to go first and set an example.
Cahuzac is a weird character, a cardiologist who turned expert in cosmetic hair transplants to make money, and whose wealth was managed by a veteran of the extreme-right student movement, a long-standing member of Cahuzac’s circle of friends, a group of men with a surprising tilt to the far Right. Marine Le Pen’s spokesman was strangely calm about the whole affair, describing it as “anodyne”. This may suggest that the FN’s tax affairs are not entirely in order. Allegedly, some of his patients paid in cash so he could ship the money straight to Reyl & Cie of Geneva.
This even overshadowed the news that the former president, Nicolas Sarkozy, is under police investigation over his campaign finances. The story goes back to the great Bettencourt affair; at the time, certain daring voices (like this blog) suggested that Liliane Bettencourt’s envelopes of cash had reached the president himself. It’s probably most interesting that the issue has been officially recognised – it’s no longer something for intrepid journalists and radical bloggers. It’s also interesting, though, that the investigators are treating the case as one in which Sarkozy manipulated the old lady into handing over her money, rather than, say, the richest person in France and owner of one of its biggest companies pouring untraceable cash into the political system. Clearly, there is a limit to how far anyone is willing to recognise the issue.
That said, Cahuzac’s bank is going to be the object of more inquiries, and it apparently served many other politicians, so you should certainly look out for more revelations.
Salon de thé
Is that a tea party in French? Here’s an interesting blog post on the French conservatives. You may recall that they couldn’t elect a leader after losing the elections, and fell to fighting among themselves. They eventually agreed to try again in a year’s time, which is coming up fast. Lately, would-be leader Jean-Francois Copé, the man once voted the most annoying politician in France, has been suggesting that perhaps they could forget about the election and it’s all better now. Unsurprisingly, would-be leader 2, Francois Fillon, isn’t having that.
And then the government began passing the gay marriage legislation, and the Right put aside the row in order to mobilise against it. Or, as the link argues, they mobilised against it in order to put off the row until later, in a more-or-less conscious imitation of US Republican tactics. They didn’t have the votes to stop it, and it’s popular, but they could agree on putting down 700 amendments to the text, staging demonstrations, and generally going to the mattresses, and so that’s what they did.
Everyone was surprised about the capacity for mobilisation of the rightist and Catholic network, and the whole thing took on its own momentum, ending up with members of parliament coming to blows and thugs attacking gay bars. Now, the law is on the statute book, and although another demo is planned for the 26th of May, you wonder what the point is…other than putting off the evil day when they have to pick a leader.
Also, if you think Cahuzac is a slightly unlikely figure what with the hair transplants and the fascist mates and the socialism, check out the anti-gay marriage campaign’s leader.
Bernard G.‘s comment here is recommended.
The French Socialists’ internal policy machinery has been activated to express increasing frustration and anger at the constraints of the Eurozone, in the context of rising unemployment and basically no sign of anything improving. Specifically, they’re trying to start a row with the Germans, and somewhat less obviously, Britain. The key quote is here:
“Le projet communautaire est aujourd’hui meurtri par une alliance de circonstance entre les accents thatchériens de l’actuel premier ministre britannique – qui ne conçoit l’Europe qu’à la carte et au rabais – et l’intransigeance égoïste de la chancelière Merkel – qui ne songe à rien d’autre qu’à l’épargne des déposants outre-Rhin, à la balance commerciale enregistrée par Berlin et à son avenir électoral”, écrivent également les dirigeants socialistes pour qui “la France possède aujourd’hui le seul gouvernement sincèrement européen parmi les grands pays de l’Union”.
So, they accuse Angela Merkel of thinking of nothing but German creditors, the German trade surplus, and her party’s prospects, and describe this as intransigent egoism. Well, perhaps they have a point. They blame all this on David Cameron for having a “Thatcherite tone” and only thinking of “Europe a la carte and with a rebate”. And apparently, the French government is the only sincerely European one.
Now I had no idea Merkel was such a poor weak insignificant figure that her policy was dictated by Britain. You may be surprised to learn that this diplomatic triumph is insufficiently publicised in the UK. Further, I clearly remember that the reason for austerity in the UK was meant to be that things were bad in the eurozone and we were going to be like Greece. Don’t just ask the prime minister, ask Sir Mervyn King. It’s as if British politicians tend to blame everything on the EU and French politicians tend to blame everything on the Brits, or something.
However, not only are they right on the actual issues, they have a point about Thatcherite Europe.
Margaret Thatcher was underrated as a European politician. As prime minister, she was very much in favour and deeply engaged in the creation of the Single European Act and therefore of the single market. It is a cliche to say that the Brits only think of the European Union as a single market, but this is ahistorical – in the mid-80s, single market completion was the absolute top priority on the European agenda. If Europe is a project under construction, the single market was the phase that was completed in the 80s. The notion of catching up with Europe, competing with Europe, trading across Europe – all of this was ingrained in Thatcherite style, tone, and rhetoric.
British macro-economic policy in the Thatcher years was also driven by European integration. After giving up on monetarism, the UK government decided to establish a fixed exchange rate with the D-Mark, and later formalised this by joining the Exchange Rate Mechanism. In fact, the UK spent as much time under Thatcher tracking the D-Mark as it did targeting the money supply. The notions of “importing credibility” that were used to promote the Euro in the 90s and 00s had an earlier run-out in the UK in the 1980s.
With an open capital account and a currency pegged to the D-Mark at a dramatically high parity, the UK in the late 1980s looks rather like a peripheral European economy of the mid-2000s, with inflows of capital chasing yield, a growing financial sector, a trade deficit, a housing bubble, and a political elite frantically clapping themselves on the back, before the crash.
The UK’s broader foreign and defence policy could have been reduced to the word “NATO”, which is another way of saying that it was focused on Europe. In the early 1980s, UK defence plans were all about the BAOR operational area in Germany and the NATO Northern Flank. In fact, if it hadn’t been for the accident of the Falklands, they would have been much more so, sharply reducing the Navy at the expense of the Army and RAF and the nuclear world. Similarly, Thatcher really didn’t care about the Commonwealth or anything much outside, yes, Europe or the North Atlantic.
I can hear a storm of whataboutery building by now. What about the rebate? What about “give me my money back”?
Well, what about it? A lot of European politicians spent the 1980s ripping into each other over narrowly national interests. (They did in the 70s and 90s and 00s, too.) Were any of the various ferocious defenders of the CAP as it applied to them un-Europeans? Was Helmut Kohl un-European for insisting on reunification, to head right for the reductio ad absurdum? Germany was obviously pretty keen on exporting cars – was Hans-Dietrich Genscher a Eurosceptic, then? This is simply hypocrisy, with a dash of sexism chucked in. (Do we have to quote Mitterrand fancying her again?)
I also think it’s important to distinguish Thatcher, prime minister, from Thatcher, post-prime-ministerial pontificator. Her swing to Euroscepticism was post-1990, post-power, rather like her swing towards the climate-change deniers. It’s worth noting that the Eurosceptics were not passive, either – they deliberately sought to claim the Thatcher myth as a source of legitimacy for their efforts to topple John Major. She also, I think, adopted Euroscepticism as a way of projecting influence in the Tory Party after leaving office. That said, we should surely consider action before 1990 as weightier than words after 1990. And her foundation was very much involved in the Central European transition to a certain idea of democracy – in the EU, in NATO, in the stability pact, eventually in the Euro.
So why isn’t this more obvious? I think the answer is that the European Union has not turned out to be the nice alternative to Thatcherism it was sold as in the 1990s. Ask a Spaniard. No, go ahead.
The policies it delivers – open trade, austeritarian macro-economics, open capital flows, no real redistributive budget, and a permanent war on inflation – are basically nothing Margaret Thatcher would not have welcomed. Even the way she thought tact was something sailing-ships did would fit right in with German newspapers claiming Cyprus is a richer country than Germany. And the EU’s generally sane approach to things like environmental regulation would work for the post-1987, Montreal Protocol and IPCC-championing, “first scientist prime minister” version of Thatcher. It did at the time.
I wonder, in conclusion, if Thatcher can be understood from a European point of view as an ordoliberal politician, rather than a libertarian or just a conservative? Britain has always been more like Germany than it lets on. Thatcher was a European; it’s Europe that’s the problem.
The French conservatives tearing their party up are weird enough. And they’re still at it, with one important figure trying to get deputies to support having a new election, others picking a fight with Sarkozy’s rightist advisor Patrick Buisson, appeals to Cope to step down and rowdy public meetings, the Socialist in charge of parliamentary financing scheming to offer Fillon a little extra. Tonight’s headline: Discord persists between Cope and Fillon. You could say that.
But it’s as nothing to this German story. So there was this guy who repeatedly claimed that his wife’s division of HypoVereinsBank was smuggling cash into Switzerland for the benefit of its wealthy, tax-evading private clients. He even pressed charges with the Bavarian police but nobody took it at all seriously, although he named 24 of the clients and their advisors at HVB and gave details of the Swiss bank accounts. Eventually, he was arrested for assaulting her.
Well, you can’t condone this kind of behaviour.
Unusually, he was sent to a secure psychiatric hospital, and has been there ever since, while HVB surfed the bubble and sank in the crash. Had he been found guilty, he might not have done time at all. No, stop. Going by the account here, he was held responsible, but acquitted on the grounds of diminished responsibility and sent to the funny farm because he thought HVB was crooked, a belief that only a madman could apparently hold.
And now it turns out he was…right in every detail, even if he accused another figure in the case of being on the side of the bankers because he lived next door to one. HVB’s private clients operation was hugely involved in tax evasion, and yes, carloads of raw cash were driven to Switzerland, to be paid into accounts with codenames like “Monster”. The original file on the case has been shredded. And HVB’s internal audit knew as long ago as 2003.
Now, although the state minister of justice is getting support from the top, this isn’t stopping the taxman from working down the list, reminding those on it that an arrangement could always be made for those who voluntarily choose to settle their outstanding debts.
And if that wasn’t good enough, with its distinct Jimmy Savile flavour, a sinister lobbyist hacks into the Ministry of Health’s e-mail on behalf of one of Germany’s most powerful interest groups…the pharmacists.
Here’s a really interesting piece about French interior minister Manuel Valls and the network of friends around him from his days as a student activist. They include Alain Bauer, Nicolas Sarkozy’s security adviser and the man who got the contract to install Vitrolles’ CCTV surveillance network for its FN mayor.
Hubert Vedrine, former minister, was asked to prepare a report on NATO and France’s return to the integrated command structure. Olivier Kempf blogs it. The recommendations are that NATO stays very much in its classical form, a military alliance with a nuclear dimension centred in Europe and the North Atlantic, that France assert itself in the alliance more, and that the European Defence Agency and NATO Supreme Allied Command-Transformation, which are both headed by French officers, should coordinate more closely on industrial and scientific issues.
He seems to be more suspicious of the UK than of NATO as such, and is very critical of the EU defence initiatives as mostly creating duplication, committees, and complexity.
History is made at night records the moment when “discotheque” became a word in English.
So, France’s conservative party just blew up. This is surely a major story, as the French Right is one of the most successful political organisations in the democratic world even though it’s not particularly organised most of the time.
It’s common for a party that loses an election to have a bout of feuding. Out of the beating at the polls, two major candidates emerged. Jean-Francois Cope, the party’s secretary general, argued for “getting rid of the Right’s complexes” and moving closer to the FN. Francois Fillon, Sarkozy’s prime minister, argued for moving to the centre and emphasising the Gaullist heritage. This is close to the historic dividing line between the “classical right” and Gaullism, but the division doesn’t map precisely, as it’s complicated by the UMP/FN divide, and the generally loose and personality-driven nature of French rightwing politics. It might be better to think of Fillon’s supporters as conservatives, being pro-business, pro-Euro, mildly authoritarian, and varying between mildly Atlanticist and traditionally Gaullist on foreign policy, and Cope’s as identity rightists*, being much more authoritarian, less pro-Euro, but economically more rightwing, and keen on asserting national identity (e.g. by being nastier to immigrants).
As it happened, they appealed to almost precisely equal numbers of party members. That was when the trouble started.
Cope claimed victory. The chairman of the party’s election committee said he couldn’t say who’d won. Cope claimed victory again, by a bigger margin. Fillon claimed victory. Then, it turned out that the election committee had forgotten to count the votes from three French overseas territories. Counting them put Fillon ahead. He appealed to the party’s appeals committee, which is controlled by Cope’s supporters and refuses to hear him.
France watches, fascinated, as half the political spectrum rips itself apart on live TV.
Alain Juppe, elder statesman, former finance minister, current senator and mayor of Bordeaux, still a possible presidential candidate, and convicted criminal, is called in to mediate between the pair. Juppe asks them if they can agree on who is the party leader. No. He suggests they hold a new election. Cope suggests that he should just declare victory again. Fillon insists the votes from Wallis & Futuna be counted. Cope says that he wants to protest the ballots from the Riviera, where former industry minister Christian Estrosi’s influence network delivered the election for Fillon, and suggests just striking out all the “contentious” ballots. Obviously there are more people in Nice and Marseille than Wallis & Futuna. Juppe concludes that there is literally nothing the two men can agree on, and steps aside.
Nicolas Sarkozy, for it is he, returns from making money in Shanghai and gives them a deadline to agree, or he’ll denounce them as unfit to lead. Everyone assumes he’s hoping they’ll both quit and he’ll be party leader.
Fillon sends a bailiff to the UMP HQ to seize ballots. Cope’s supporters physically prevent him from removing the ballots.
Fillon accuses Cope of misappropriating a huge quantity of party funds for his campaign. His supporters join another party, the Rassemblement UMP or RUMP, which turns out to exist in New Caledonia. This is handy because the party immediately achieves the status of a parliamentary group and becomes entitled to state funding. In all, 70 senators and 77 deputies follow Fillon. Cope is left with the rump of the UMP rather than the RUMP and, importantly, all its debts.
Fillon threatens to sue. Cope suggests voting again, but not until after the local elections next year. The Socialist parliamentary group, meanwhile, get on with passing their legislative agenda, because the UMP delegation has stopped turning up to debates. And both men’s poll ratings plummet, although Fillon remains far more popular support than Cope.
What does it all mean? Well, you wouldn’t want to bet on them not finding some way to settle their differences. French conservative politics is dominated by personalities rather than organisation, and they did manage to rule for most of the 20th century. But there is certainly no effective UMP for the time being. That creates political space for Hollande and also Le Pen.
It’s very hard to predict how the crisis will affect the competition between Le Pen and the UMP; it weakens the UMP, but it also discredits the identity-rightist current around Cope and intensifies the distinction between the rightists and the Gaullists. The project of a UMP-FN alliance is only worth having if lots of UMP deputies change sides – if it just scrapes off a few, while solidifying the rest as a centre-right block, it doesn’t change very much.
*Only re-reading this did I notice that I had alluded to the extreme-right student movement, Bloc identitaire, without knowing it. In fact, some of the same people are involved.
Paul Krugman presents a chart of UK and France growth and public debt (as share of GDP) relative performance in the 1920s. The charts show that using 1913 as a common base, France appears to have overtaken the UK in real GDP by the early 1920s, and its debt ratio went lower than the UK in 1926. Keep a note of that year. For Prof. Krugman, the message is clear —
So virtue was not rewarded, and French political weakness [devaluation and inflation] actually led to a better economic performance.
This conclusion is certainly consistent with the most recent IMF World Economic Outlook, which noted the inability of the UK to lower public debt in the 1920s. But at least for those of a certain age, references to French economic policies of the 1920s should ring a bell, back to a time when the so-called freshwater economists were paying a lot of attention to economic history and specifically the apparent monetarist stabilizations following World War I. Continue reading