I keep hearing about the socialist Francois Hollande and him being the next president of the French Republic. I keep wondering if that will pay out for the french people the way they hope it will if they elect him.

Hollande is said to be much less European minded than Sarkozy is at the moment. It indeed appears to be the case when I look at his rhetoric on his website he does seem to favour more relaxed spending rules than those which have been agreed upon in the “new” stability pact last week. He wants to back off from that agreement.

With Hollande choosing for more spending and chasing away the rich he’ll make a good gesture towards the poor 80%, but He’ll also scare off the 20% of the people who bring in 80% of the dough. (The Pareto equilibrium is still more or less valid for France)

I wonder if the french people realize that the markets will punish them for such a choice.

I know that the inequality between the rich and the poor in France has grown at a much lesser rate than in the rest of Europe, but this has come at a cost. The labour markets are frozen up because they’re overregulated and factories are moving away because of a relatively low productivity.

He promises to keep factories open, but I wonder at what cost he’ll manage to do that. The only way to do this in the long term is to subsidize the factories, which is against EU policy. It isn’t a viable long term strategy anyways. A good example are European farmers. They have been subsidized since the start of the European collaboration, and if they would have to sell at market prices today they’d go bankrupt very soon indeed. The french economy would be insulated from the reforms it needs so badly for much too long if Hollande will be chosen president. It might very well lead to soaring costs to keep those factories open at the expense of the state. I don’t think it will be a good way to improve the national debt, even though he says he wants to lower it.

With deficits rising and the economy not being reformed the way it should, france would drag the whole of Europe into a new crisis if his plans are put into action without being diluted to accommodate the needs of reality first.

I don’t have the confidence that Hollande will alter his stance in a way which will enable France to refrom as the resistance to European influence in France seems to be one of his major succes factors. This could in turn very well lead to a lower rating for France and higher rates on interest. (just a gut feeling here)