France's Austerity Program: One Party, And Two Boxes of Cigars, But It's A Start
Yesterday we saw that the U.K.'s finance minister has proposed an "emergency" budget on Albion, cutting spending on nearly everything except health care. France has made some belt-tightening, but has signaled the austerity to come with more pointed short-term measures.
In addition to announcing forward-looking moves to reduce state spending, raise the retirement age from 60 to 62, and increase taxes, French president Nicholas Sarkozy also has canceled the traditional party celebrating Bastille day. This we learn from the Financial Times:
The annual July 14 party in the grounds of the presidential palace is a highlight of the season with invitations provided to several thousand politicians, business leaders, celebrities and selected members of the public.
However, with the bill for last year's festivities coming in at €733,000 [a million bucks, more or less], the event has been criticised as too lavish and in straitened times it has become a symbol of the French state living well beyond its means.Separately, French Prime Minister Francois Fillon ordered Christian Blanc, the minister for Greater Paris, to reimburse the state for about $15,000 worth of cigars. (Good ones, too -- Cohibas!) This tidbit was first reported by Le Canard enchainé, an irreverent left-wing newspaper. I couldn't find the original item, but here is a rehash by Le Monde:
Christian Blanc a réaffirmé avoir lui-même réglé sa consommation de cigares des dix derniers mois, à hauteur de 3 500 euros, dès qu'il s'est rendu compte de l'ampleur des sommes réglées sur fonds publics pour cette période (12 000 euros). "Parfois, la tête prise par mon travail et Dieu sait s'il y en eu, j'ai saisi des cigares sans me préoccuper de leur provenance" s'est-il également justifié, selon Le Figaro.fr. "Deux belles caves à cigare ont été achetées. L'une d'entre elles était dans le bureau de mon chef de cabinet. L'autre, je l'ignore, même si j'ai des soupçons", accuse-t-il ensuite en rejetant la responsabilité de toutes ses dépenses sur son cabinet.In essence, M. Blanc concedes that yes, his people purchased the cigars with government funds, but kept them in someone else's office, and yes, he smoked a few, but he was so busy with work he didn't really give a thought to their provenance. M. Blanc says he limited his own consumption of Cubans to about $5,000 worth, and anyway has repaid the government for that.
Back to the big picture, from the Financial Times:
François Fillon, prime minister, has said that Paris needs to find €45bn a year in spending cuts or tax increases by 2013. But the word "austerity" remains taboo in government circles...
The French government has sent mixed messages about its public spending plans in recent weeks, trying to reassure the markets about its commitment to fiscal retrenchment while not alarming the public about impending austerity.It will be a shock to the system, but we're all going to have to get used to smaller government.