Sure enough, President Hollande has finally shown some steel — moving forcefully to suppress critics of his slavish adherence to the austerity demanded by Germany and Brussels.
The question I would ask is, what do Hollande and his inner circle think will make the situation turn around? Europe’s austerity drive has now gone on for four years; over the course of those four years the euro area has seen economic recovery shrivel, a much-touted comeback also stumble, and now a slide toward deflation. French economic performance tends to track the eurozone average; why should anyone expect France to come roaring back?
I’ll try to produce a more systematic analysis later today or tomorrow; but does anyone think that the Élysée Palace has a well-thought-out vision of how ever more austerity is going to produce a French renaissance? It’s just stumbling along day by day, waiting for something to turn up — when it’s much more likely that everything will turn down instead.
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