French search in vain for Hollande vision

JUST five months after bringing Francois Hollande to power, many French voters are already despairing that he can deliver on the vision they voted for.
It was always going to be tough for the Socialist leader to get France's stagnating economy back on its feet, with much of the rest of Europe close to recession and struggling to resolve a three-year sovereign debt crisis.
But the free-fall in his popularity ratings shows that many erstwhile supporters are already asking whether he has a plan at all, as his inexperienced ruling coalition is buffeted by events rather than shaping them.
"Hollande was voted in to secure an economic recovery while preserving our social model," said Stephane Rozes, head of political consultancy Cap, referring to France's generous welfare state and high level of labor protection.
"But he has been gradually driven off course," he said, bemoaning the government's "lack of communication, lack of coherence and lack of credibility."
So far, there is a gaping disconnect between Hollande's promises to create jobs and the stark reality of unemployment at 13-year highs above 3 million. More lay-offs are to come, and data point to economic growth stuck at zero.
In the latest setback for Hollande's push to revive France's industrial base, union sources revealed on Friday that carmaker Renault would build more than 70 percent of its Clio models in low-wage Turkey.
That came days after steel giant ArcelorMittal said it would close two furnaces in the northeastern former industrial heartland of Lorraine despite a last-minute rescue dash to the region by Industry Minister Arnaud Montebourg.
The trip turned into a public relations own-goal for the government as Montebourg ended up having to explain to hundreds of workers, some weeping at the prospect of unemployment, that the plant would shut unless a buyer could be found.
"Somehow he (ArcelorMittal chief Lakshmi Mittal) managed to arrange it so it was the minister who had to announce the closure. Pretty fantastic!" Francois Chereque, head of the CFDT union, commented wryly of the outcome.
Efforts to present the 2013 budget as a decisive step to knock public finances back in shape also came unstuck.
Grasping the nettle of budgetary rigor, Hollande unveiled on Sept. 28 a public spending freeze and tax hikes to claw in 30 billion euros ($39 billion) and bring the public deficit down to 3 percent of output, as promised to euro zone partners.
But within days the government hurriedly toned down a rise in capital gains tax on equity sales after an Internet campaign by an anonymous group called "Les Pigeons" — "suckers" in French slang — attacked the move as a disincentive for entrepreneurs.
Equally damaging has been the widespread incredulity at its assertion that only the top 10 percent of earners would be worse off, as tax experts stripped apart the budget and argued that many in the middle classes would also feel the pinch.
"In general terms, the government's policies are seen as disadvantageous to most sections of the population," Gael Sliman, deputy head of pollster BVA, said of a survey showing 54 percent of French thought the budget was unfair.
Such perceptions have contributed to a plunge in Hollande's personal ratings to just 41 percent in early October — down from 55 percent just after his victory — and fed speculation that his Prime Minister Jean-Marc Ayrault could be sacrificed in a cabinet reshuffle.
But more serious is a growing sense that Hollande's election promises on boosting jobs and growth are incompatible with the pledges of budget discipline made to European Union partners under conservative predecessor Nicolas Sarkozy.
Hollande's official line is that France can have both — a return to balanced budgets by the end of his term and the first shoots of an economic recovery mid-way through.