And now we see the Èlysée Palace has buckled under pressure and capitulated to the (upcoming) Fourth Reich.
PARIS/BERLIN (Own report) – Berlin is loudly applauding French President François Hollande’s adaptation of Germany’s model of austerity. His announcement of a cutback in public expenditures to clearly favor business, could “only be seen as good news,” declared Foreign Minister Frank-Walter Steinmeier. German media point to the fact that Hollande has announced measures that – in certain aspects – are modeled on Germany’s “Agenda 2010,” which had been developed by the Federal Chancellery under the auspices of Frank-Walter Steinmeier, at the time, Federal Chancellery Chief of Staff under Gerhard Schröder. It had enabled Berlin to consolidate its economic predominance over Europe. Whether Paris will be able to imitate the German austerity policy is unsure. Hollande’s predecessor, Nicolas Sarkozy had tried, but he lost the presidential elections in the spring of 2012. Notwithstanding, in Berlin further steps to cut back on social welfare achievements are again in discussion. Yesterday, German President Joachim Gauck complained that the term “neo-liberal” has a negative connotation, which must be changed.
Wage Waivers as Competitive Advantage
Paris’ change of course, was induced by massive pressure from Berlin and France’s growing economic deficit in relationship to Germany. The latter grew out of an aggressive German austerity policy. Back in the spring of 2010, a French expert calculated that labor costs in Germany had sunk by 1.3 percent since 2000 – thanks to the “Agenda 2010” – while, in France, they had risen by 17 percent in the same period. Between 2000 and 2008, German real income shrank by 0.8 percent, whereas in France, it rose by 9.6 percent. The wage waivers of German employees had provided German companies competitive advantages, which have resulted in a strong growth of exports. Therefore, the German foreign trade surplus in relationship to France had risen to around 40 billion Euros by 2012, a clear indication of the aggressiveness of the German – and the docility of the French – economies. This can also be seen in a direct comparison: Whereas in 2000, the French added value was at 50 percent of the German, by 2010 it had fallen to merely 40 percent. Because Berlin adamantly refuses any change of course toward a more demand-oriented economy, Paris has now decided to introduce its own austerity measures – to favor French industry.
Sarkozy, the German
With his change of course, President Hollande is taking the same path that, nearly two years ago, had cost his predecessor, Nicolas Sarkozy, the presidential elections. Following defeat in his power struggle with the German Chancellor over the strategy for handling the EU crisis, Sarkozy capitulated in 2011 and began initiating reforms along the lines of Berlin’s austerity model. There was “growing reference” to Germany “in the discourse of President Sarkozy’s conservative UMP” party, according to the German Council on Foreign Relations (DGAP) at the time. “What is being presented in France as the German model corresponds largely to the Schröder government’s Agenda 2010.” In December 2011, Sarkozy ostentatiously invited Schröder to the Èlysée Palace for a debriefing on the “Agenda 2010”. Sarkozy had his cabinet’s Minister of Agriculture, Bruno Le Maire, a specialist on Germany, to elaborate the UMP’s election program – in direct collaboration with Germany’s CDU party. Making reference to his pro-USA orientation, at the beginning of his term of office, the DGAP notes that “Sarkozy, the American” as he liked to call himself, became “Sarkozy, the German.” In the elections in the spring of 2012, Sarkozy had no chance against Hollande, who campaigned on a platform of resistance to German austerity policy – and won.
Full article: Le Modèle Gerhard Schröder (German Foreign Policy)