lundi 1 juin 2015

Funny economics : the weird fear of growth in France !

by Jean-Jacques COURTEY, Doctor in Economic Geography, Ph. D
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The last statistics about growth in France over the first quarter 2015 are clear : France knew a growth rate of 0.6% !
Our leaders feel very annoyed by this totally unexpected figure.
And everybody is trying to explain why such a rebound occurred !
With all the contra-cyclic measures taken, this "economic accident" should never have happened !
Nothing was preparing the country to that !
At the opposite of other countries in the world, France cannot be content with growth.
America for instance would be happier to get it, instead of its - 0.7% over the same period.

Our leaders are feeling worried because of the writings of Tocqueville, which are taken as prophetic by anyone who happened to study in "Science Po".
The parents of the French Alexis de Tocqueville (1805 - 1859), were strong royalists at the time of Robespierre (1758 - 1794), and they narrowly avoided guillotine because his dictatorial republic fell down with him. The two volumes of "Democracy in America" (1835 - 1840), written by Tocqueville were followed by another masterpiece among other writings, "The old regime and the revolution" (1856). In the latter, he observed that when things are improving, protest forces intend paradoxically to feel freed.

At the moment in France, almost everybody agrees that our country should reach the target of 1%, or may be 1.5% by the end of the year.
Isn't it a strange calculation ? Normally, if you multiply 0.6 % per four, you obtain 2.4 % in reality !
Oh la la, not this figure ! Oh la la, what a nighmare !
Nobody wishes the people to descend in the streets to manifest, and claim rises and a share in "the growth's fruits", as General de Gaulle (1890 - 1970) would have called them !

Of course, Tocqueville wrote in "The old regime and the revolution" that "the reign of Louis XVI had been the most prosperous of the old monarchy", and that "this very prosperity fastened the revolution". But his fateful Book III, is not the "stick-lightning" of Zeus, which Athena, his preferred daughter, would be playing with for a masked ball or Halloween ! Thus France shouldn't worry so much about growth's increase, as the country doesn't count real revolutionaries, behind usual catchwords just for rhetorical effects.

And there is no need to be so much mesmerized by this surprising rise. It just means our country is refusing to die, and that it has still a capacity of rebound in spite of all the wrong measures taken against Public Spendings (which are representing 57% of the French GDP). To speak clearly, diminishing them of 5% is mechanically reducing our GDP of 2.85 %, and almost impeaching any growth then. So the French present situation is almost miraculous, and obviously very puzzling !


 




When presently the USA are negociating the TTIP agreement ("Transatlantic Trade and Investment Parnership" ) with EU to stimulate notably growth, the French situation can even appear quite paradoxical. Anyhow France is growing without TTIP at the moment !
Surprisingly, the negociations are going on rapidly, with next talks in the beginning of this summer and then in automn. It's a bit astonishing because of the basic differences of interests on various subjects (agriculture, cultural goods, access to public markets, defence industry, energy possibly, etc.).

Equalilly, it's rather unexpected as the key topics of multinationals' immunity of jurisdiction and the possibility opened to them to claim against states (near the private arbitration court of Washington) for the losses they would record due to the states' regulations - or their changes of rules -, are something very unusual. If finally signed that way, and enforced, it would certainly be a great success for American negociators. 

Thus, far from the French funny concerns about the growth rate rising, the future of the world is certainly going to change soon and overnight. And in France, no important TV media is talking about it, when media themselves seem to be included in this historical treaty. The only "disputes' settlement" are between politicians oriented on yesterday, who can't see what will be "the real tomorrow" !

"Ameropa"may surge then over suddenly in a total indifference, when representing almost 46 % of the World GDP !
And coincidentally, depending on the results of the British referendum by 2017 - about staying or not in EU -, UK may not have to apply this potential treaty if leaving !
But let's come back to funny economics, in a country situated over the Moon, "Teethyland" and its "ridicule" !
 
Say the final French growth rate of 2015 would be 1.8%, everybody should rejoice about it, as it would mean the end of the economic slope for our country !
Without all the unremetting economic counter-measures our country is knowing, France could most likely have 4% rise a year ! So let it have a breathe on its own, and be itself !
It's still below what was observed from 1958 to 1969, at the great epoch of General de Gaulle, as the percentage was oscillating between 5 to 6% a year !