Quarterly Journal of Austrian Economics
On Understanding France and the French SituationTags LiberalismSocialismInterventionism
Abstract: The French social model is mainly a model of state interventionism, which creates a strange contrast between two things: the fact that France is a collectivized society and the fact that it has produced some of the most famous and important intellectuals (for instance, Turgot, Bastiat, and Jean-Baptiste Say). We are inclined to wonder why these liberal writers—who are famous all around the world—have not been able to convince French people so that France would be a model of liberalism.
socialism interventionism liberalism france
Pascal Salin (email@example.com) is professor emeritus at the Université Paris-Dauphine, and former president of the Mont Pelerin Society.
The present article is a lecture made at the Property and Freedom Society meeting in Bodrum, Turkey, in September 2018.
It is often said in France that there is a “French social model” which all people around the world do envy. But the French social model is mainly a model of state interventionism, since France has the sad record of being the country in which public expenditures and taxation are the highest. And it may also be one of the countries with the greatest number of public regulations. As a consequence of this situation, France has had a low economic growth rate and a high unemployment rate for many decades.
There is therefore a very strange contrast between two things: the fact that France is a collectivized society and the fact that it has produced some of the most famous and important liberal intellectuals (for instance Turgot, Bastiat, Jean-Baptiste Say, etc.).
As we may believe that “ideas have consequences,” we are inclined to wonder why these liberal writers—who are famous all around the world—have not been able to convince French people so that France would be a model of liberalism. Truly, I have always tried to find answers to this important question, but I must confess that, for the time being, I am not certain that I have found convincing explanations.
Milton Friedman answered to someone who wondered why liberalism had not been implemented in France: “To describe Hell correctly, you have to live inside.” This is certainly true. However, the most important liberal thinkers wrote their famous books at a period which has not been the worst in France. France has become less and less liberal—more and more close to hell—along the whole 20th century and the 21st century so that we are certainly living in hell now. However it is not during this recent period that outstanding liberal authors have been the most numerous.
Therefore we may even assume that there is a reverse causality: state interventionism is an obstacle to the development of liberal ideas. However it is also true that—maybe as a reaction to the present situation—there are more and more young people who are much interested by liberal ideas and I must say that it is the main hope I have for the future of my country.
In the present presentation I will recall some characteristic facts concerning both the history of France and the history of French liberal ideas. I will also tell about part of my own experience. And I will try to analyze the interplay of ideas and reality (the influence of ideas on policies and the influence of public powers on ideas).
In reality, there has always been in France the juxtaposition of liberal and extremely interventionist and authoritarian positions.
Until the end of the 18th century—i.e., until the French Revolution in 1789—France was a very centralized kingdom in which the king had important powers.
As regards ideas in the 18th century (the “enlightenment century”) one must stress the influence of the physiocrats who believed in the importance of individual freedom and of natural law. Turgot is a remarkable representative of this liberal thought. According to him, each individual, looking for his personal interest, will contribute to the “general interest” because there is a natural order. Turgot, as a finance comptroller of the state, suppressed internal customs and promoted the free movement of corn. He had tried to suppress corporations, which would be done by the French Revolution. The physiocrats thus laid the foundations for a liberalism which will be developed by French and English writers.
The French Revolution
The French Revolution in 1789 may be considered as an example of the influence of ideas on social events. In fact, one may consider that the physiocrats had contributed to a change in the ideology of many people. Thus the Revolution has been a strong supporter of individual freedom, of the freedom of contracts and human rights (for instance property rights).
The official motto of France is “freedom, equality, fraternity.” It appeared during the French Revolution. This slogan became the official motto in the Constitution of 1848. Initially equality meant “equality in rights” as it has been claimed in the “Declaration of the Rights of People and Citizens” (1789) according to the famous sentence, “All human beings are born free and equal in rights.” But in the 20th century particularly, equality has been interpreted as an equality in standards of life and as a justification for redistributive policies. Similarly, fraternity has been interpreted as meaning that the state is in charge of charitable activities.
However, the French Revolution also offers to us an example of the ambiguous characteristic of French ideologies and policies. Thus, there have been nationalizations and as early as 1793 there was what has been called the “Terror,” i.e. a situation in which the state did not hesitate to kill political opponents. The Terror was also a period of hatred against bourgeois and wealth. In reality, people may have focused more on the organization of the state and its representatives than on individual rights. They cared mainly about the disappearance of kings.
In fact, the French revolution may be considered as a fundamental cause of the importance of the powers taken by the state. Thus, a few years after the Revolution, emperor Napoléon took public power and developed a very interventionist and authoritarian regime. Most activities became state activities, in particular education.
Liberal Ideas at the Beginning of the 19th Century
The development of the liberal theory was particularly important at the beginning of the 19th century:
- Thus, Benjamin Constant and the “groupe de Coppet” (Mrs. de Staël) were supporters of individual freedom. Benjamin Constant may be considered as the first supporter of liberal democracy, namely a democracy in which public power is limited to be respectful of individual freedoms. It is not sufficient to have a state organized according to the precepts of Montesquieu, i.e. a “separation of powers” in which public institutions are controlling one the other (“checks and balances” in the US).
- Frédéric Bastiat is certainly one of the most important French liberal thinkers. He wrote several books, such as Economic Harmonies, and it is not necessary to summarize his ideas since they may be well known. But it is characteristic that Bastiat has been completely forgotten in France for a very long time: from the end of the 19th century his books were not republished until 1983, when a French economist (Florin Aftalion) published a book entitled Œuvres économiques with some of the most interesting contributions of Bastiat.
- Jean-Baptiste Say had stressed that the value of goods were not to be explained by labor value but by utility. Moreover one may consider Say’s Law (“supply creates demand”) as a fruitful argument against Keynesianism. Jean-Baptiste Say stressed the role of the entrepreneur and his famous statement “goods are exchanged against goods” implies that there is no risk of overproduction; adjustment is done by prices and freedom of exchange.
During the 19th century, liberals were called economists. Their opponents were “socialists.” Liberal economists expressed their views in the Journal des économistes and the Société d’économie politique. They were not University professors. These French liberals were not utilitarist—as might be Anglo-Saxon liberals—but they considered individual liberty as a natural right.
In his famous book, Les soirées de la rue Saint Lazare, Gustave de Molinari imagined debates between three persons, an economist (liberal), a socialist, and a conservative. Now, it is interesting that, quite often, the socialist and the conservative agree together and disagree with the economist. One may compare this approach to that of Friedrich Hayek who stressed the opposition between liberals and constructivists: the constructivists may be either socialists or conservatives.
Evolution of Intellectual Ideas at that Time
However, in spite of the outstanding importance of liberal ideas, this period offers a characteristic example of the great divergence between dominant ideas. After the physiocrats, opposite ideas developed. Thus, at the end of the 18th century and the beginning of the 19th century, Saint-Simon got an important intellectual position. He believed that human will can rationally decide economic activities. Members of the Saint-Simon school—sometimes called “positivists”—are against private property and they suggest that the State be the owner of the means of production.
Charles Fourier in the same period was in favor of “phalanstères,” namely great production corporations in which workers would live together and decide production.
Proudhon is famous for having said “What is property? It is robbery.”
The explanation by Friedrich Hayek of the French situation may be the best answer to the initial question of the present article. In his book, The Counter-Revolution of Science, he devotes several chapters to the problems of France and one might be impressed by his incredible knowledge of French history and French writers. According to him the French problem is mainly a methodological problem: France has produced at the end of the 18th century and the beginning of the 20th century some of the most famous physicists. Given their success, people and intellectuals have been inclined to think that the method used in physical sciences ought to be used to understand social problems. Thus there has been a development of what Hayek calls rationalism, namely the belief that one may be clever enough as to understand and to manage social phenomena. Thus, there has been a development of social engineers, i.e. people who believe that they can rationally organize a society, as they would do for practical problems.
From this point of view Hayek pointed out the importance of École polytechnique (founded by Napoléon) in which the French elite has been educated, precisely with this positivist prejudice.
I suspect that, if Friedrich Hayek were writing his book now, he would stress the role not only of the École polytechnique, but also of the École nationale d’administration (ENA, national administration school) which is educating nearly all high civil servants. Many politicians are also former students of this school. Once I was asked to deliver a course on international economics to the students of ENA, but I had first to meet the students in order to tell them what I wanted to teach. I mentioned to them several important topics which we could study, but all students, without an exception, told me that they had no interest in ideas and that the only thing about which they cared was to know how civil servants were making their decisions. I could not deliver the course, but I thus got an interesting (and regrettable) illustration of the intellectual characteristics of those who have the power in France.
Hayek also wrote several chapters in his book about Saint-Simon and the Saint-Simonians (the positivists) and he stressed that they have played an important role in the development of French ideologies and French policies.
Thus, the characteristics of the French society and French politics are certainly contrary to what the famous liberal thinkers have written, but they are coherent with other ideas, those of the positivists. From this point of view there is not a paradox in the French situation because of the divergence between (liberal) ideas and realities, but there is a coherence between these realities and part of the intellectual mainstream (positivist ideas).
Hayek also devoted many pages in his book to explain why one might consider that Saint-Simon inspired the ideas of Hegel. From this point of view, it can be said that ideas have consequences, at least bad ideas! And the importance of Marxist ideas in France in the 20th century is coherent with the importance of Saint-Simonian ideas.
I must also say that I am fascinated by the attention devoted by Friedrich Hayek to French problems, which may mean that it is impossible to find something similar in other parts of the world: the French situation is very specific and needs specific explanations. Friedrich Hayek used to say that “whenever France becomes liberal, it will mean that the whole world would already have become liberal.” He thus considered France as the least liberal country in the world.
Let me then tell something which is one of my great memories. With some friends of mine we had organized a lecture of Friedrich Hayek at the National Assembly. The day after I visited him at his hotel and he told me, “your friends and you are part of the hope I have in the world.” He considered it as a great achievement and a great hope that liberals do exist in a non-liberal country such as France.
Economic Policies in the Early 19th Century
There have been rather liberal economic policies, for instance free trade and free enterprises; the Revolution had suppressed the corporations and had eliminated internal customs. There was in the 19th century an important development of industrial capitalism and a great increase in the number of wage-earners.
End of the 19th Century
In the second half of the 19th century there was a development of social Catholicism (Lamennais, La Tour du Pin, Le Play, etc...) advocating for trade unionism and State interventionism (“Le Sillon”—“the furrow”—of Marc Sangnier).
In the 20th century, after the first world war, social Catholicism will inspire several organizations which have had a very great influence: Action Catholique (specific organizations for students, women, etc..), Christian trade-unions, “Social weeks” (regular famous conferences).
Marxism has been successful in France, for instance with Jean Jaurès (end of the 19th century and beginning of the 20th century). After the second world war, it might be the most important ideology in France, particularly in universities.
In 1895 a revolutionary trade union was created, CGT (Confédération générale du travail). It was in favor of a state representative of trade unions, with workers owners of means of production. It has been close to the Communist party and it is still very active in France (for instance as organizer of many strikes).
EDUCATION AND IDEAS IN THE 19th AND 20th CENTURIES
France has been for many centuries a very centralized country with a strong state. Thus, people are used to such a situation and, moreover, the state has the possibility to influence mainstream ideas. It is particularly true for education since there is a quasi-monopoly for public education in schools and universities. Some so-called private schools do exist, but it is forbidden to have more than 20 percent of private schools in France and, moreover, these schools are in fact much dependent on state decisions, for instance as regards teaching programs or the hiring of professors. As regards universities they are all public universities, with the exception of some so-called “great schools.” Thus there is a sort of vicious circle between the state and education: mainstream ideology is in favor of state interventionism and the state is imposing its ideology. Being a liberal in French universities is very difficult. Thus, when a student told me that he wanted me to be the supervisor for his doctoral dissertation, I felt obliged to tell him that, if ever he wished to do an academic career, he took a risk by writing his dissertation with a liberal supervisor such as myself.
At the end of the 19th century and the beginning of the 20th century, even economists considered liberals were in favor of state interventionism, particularly with regard to the labor market and protectionism. Between the first world war and the second world war the extreme left and the socialists were often successful in elections and there were fewer and fewer liberal economists. In fact, the first world war had increased the role of the state and state interventionism remained important in the twenties and thirties. It may be added that the great crisis of 1929 has certainly had an important influence on French minds, since it has been interpreted as a proof of the instability of capitalism.
During the second world war communists were first linked to Russia and Germany; then trade unions—mainly CGT and CFTC (Christian trade union)—joined the informal liberalization movement (Conseil national de la Résistance) and, when the war ended, they influenced the important reforms designed by General de Gaulle (usually considered as conservative, but who has been very close to communists and trade unions). Many state interventions were created at that time and they still exist now (for instance the privileges given to trade unions, the public monopoly for health insurance, etc.). After the end of the second world war many great firms were nationalized and national planning was decided. General de Gaulle claimed that “planning is an ardent obligation.”
For a long time, the communist party has had many members in the Parliament and there have been several communist ministers. Thus some French politicians have had close links with Stalin! Right now, the Communist Party has nearly disappeared, but there are several very active extreme-left parties.
In the forties there was the development of what has been called neo-liberalism, which is pragmatically in favor of state interventions. The Journal des économistes disappeared in 1940. It was also a period in which social Catholicism was developing.
Let me quote some of the economists who were considered liberals after the second world war:
- Maurice Allais, Nobel Prize of economics, who is usually considered as a liberal economist, tried to develop a synthesis between liberalism and socialism. He claimed, for instance, that profits and interest rates should be suppressed, he was in favor of collective property for soil. He participated in the first meeting of the Mont Pèlerin Society, but declined to become a member of the Society because it stressed the importance of private property rights!
Maurice Allais was a former student of École polytechnique. His methodology was close to positivism and opposite to Austrian methodology. He developed mathematical models of economics and he can be considered as a “social engineer,” according to the terminology used by Friedrich Hayek. Maurice Allais was mainly in favor of protectionism and I often heard people saying that protectionism was justified since a liberal economist such as Maurice Allais was supporting it!
There is a tremendous gap between someone like Frédéric Bastiat and Maurice Allais. It may be considered a symptom of the decline of liberal ideas in France. In my book, Libéralisme, I show in details which are the main ideas of both economists. I consider Frédéric Bastiat a representative of what I call “humanistic liberalism” and Maurice Allais as representative of “utilitarian liberalism.”
- Among intellectuals it was usual to say that “it is preferable to be wrong with Sartre than right with Aron.” Jean-Paul Sartre—founder of “existentialism”—was close to the Communist Party. As regards Raymond Aron he is often considered one of the most important French liberals in the 20th century. But, in fact, he was mainly opposed to communism, without a good understanding of economics (he was spontaneously more or less Keynesian and in favor of state interventions)
- Jacques Rueff—who is also one of the most famous French liberals—is another example of utilitarian liberalism. Former student at École polytechnique, he was a director of the public Treasury and he was most respectful of the state as a high-standard civil servant. To some extent he was famous more as an important civil servant than as a liberal.
An autodidact in economics, he used his own language and there is no real relation between what he wrote and traditional liberal literature. As with Maurice Allais, he was in favor of private property as an instrument of economic efficiency, but not for ethical reasons. He said that he was a liberal because the price system made possible economic equilibrium.
He was not against state interventionism insofar as it is not an obstacle to the working of the price system. But he did not criticize taxation because he considered that it did not modify the free working of the price system. Thus he was against price regulations by the state, but not against public expenditures and taxes.
He is certainly an important example of the traditional French “engineer-economists.” However, I remember a dinner at my home with Jacques Rueff and Friedrich Hayek (a long time ago) and, in spite of their intellectual differences, they had very friendly relations (since they met each other in the Mont Pèlerin Society meetings).
As regards politics, some politicians have been considered liberals during this period, for instance Raymond Barre or Valéry Giscard d’Estaing. But, in fact, they developed interventionist policies. As regards Raymond Barre, let me just relate the following anecdote. Taking the opportunity of the presence of Friedrich Hayek in Paris, I went with him to meet Raymond Barre, who was prime minister at that time. Raymond Barre had translated into French part of Hayek’s book, The Counter Revolution of Science (but not the chapters about France!) and I thought that both would appreciate this opportunity to meet. However, Raymond Barre did not want the meeting to last more than ten minutes and when Hayek suggested some reforms to be made (for instance as regards monetary policy to fight against inflation), Raymond Barre laughed and said : “It is not as easy as you believe!”
- Valéry Giscard d’Estaing—who was president of the Republic from 1974 to 1981—claimed to be in favor of “advanced liberalism,” but he prepared the way for the coming of socialists. At that time I used to say that Giscard was doing an “under-higher bid.” By using this expression, I meant that, whenever socialists were proposing a reform, Giscard d’Estaing, instead of supporting an opposite reform, agreed with the proposal, just saying that it ought to be somewhat smaller than what was sugested by socialists. He had said that, if ever taxation was to increase beyond 40 percent of GNP, the country would become a socialist country. But during his presidency, taxation increased from 33.5 percent to 39.4 percent, thus very close to socialist taxation according to his own opinion!
Taking the opportunity of a meeting with Giscard d’Estaing, after he had failed to be elected once more as president of the Republic in 1981, I asked him, “Why have you not carried out a liberal policy when you were president of the republic?” He answered : “As there was an economic crisis I did not want to implement liberal policies because people would have said that liberalism was responsible for the economic crisis.” He had not understood that liberalism was the way to cure the economic crisis!
In 1981 the extreme socialist François Mitterrand was elected as president of the Republic. I would like to quote a statement which is characteristic of the political mentality of this period. A socialist member of the Parliament answered to a member of the right: “You are wrong from a juridical point of view because you belong to a minority from a political point of view.” François Mitterrand decided upon dangerous socialist reforms, but a few years later the disappointment of people was so great that there was an exceptional growth of liberal ideas in public opinion and I had the feeling that France could become a liberal country. It appeared that socialists might soon lose the elections at the national Assembly in 1986, which was in fact the case. Liberalism was more and more desirable because of the obvious failure of socialism which was unable to solve the most important economic problems.
Therefore, anticipating this important change, before 1986 we had regular meetings between academics and liberal politicians to prepare the program of the government in 1986.
Meanwhile Jacques Chirac, who had previously claimed that he was in favor of “labor philosophy of the French fashion” (“travaillisme à la française”), happened to be convinced that a conversion to liberalism was politically fruitful. Therefore, in order to appear as a liberal politician, he asked me in 1984 to make a very long interview of him in an important magazine (Figaro-magazine). I wrote the numerous questions of the interview, but also most of the answers (which however were discussed with him and his adviser, Alain Juppé). Unhappily, some time later, he made statements which were not perfectly coherent with what was written in the interview.
The period 1986–88 was a period of great hope for me and all liberals: The Right won the elections at the National Assembly (but François Mitterrand was still the president of the Republic). There were six liberal ministers who were friends of mine and I had very regular contacts particularly with Alain Madelin, minister of industry, and Edouard Balladur, minister of economy and finance.1 We had designed some important reforms, but, unhappily, Jacques Chirac, prime minister, did not really carry out a liberal policy and in 1988 Mitterrand again won the presidential election and socialists won elections at the National Assembly. Jacques Chirac was a candidate at the presidential election and, as he did not succeed, it was said that it was because he was liberal, in spite of the fact that he had not done many really liberal reforms, except, maybe, suppressing the wealth tax (but many people, particularly on the right, suggested that he lost elections because of this reform).
In 1995, Jacques Chirac was elected president of the republic and Alain Juppé became prime minister. Alain Madelin, the most liberal politician, was appointed as minister of economy and finance and I had again a great hope that liberal policies would be adopted. In particular I had prepared wih Alain Madelin, before his appointment, a very important tax reform and I was quite certain that it would be implemented. Unhappily, three months after having been appointed, Alain Madelin—who rightly disagreed with Alain Juppé—was dismissed by Jacques Chirac and our tax reform was never adopted. In 2002 Alain Madelin was a candidate in the presidential election and he got only 3.91 percent of the votes. Jacques Chirac was reelected president of the Republic at this same election.
In universities there were, in the second half of the 20th century, liberal economists and economists who stressed the importance of sociological facts. For a long time marginalism and Keynesianism have been mainly studied outside universities. “Structuralism” (André Marchal) was mainly descriptive and did not care about the influence of institutions on individual behavior. These “realist and sociologist” economists were rightly critical of a mathematical approach of economics, but for them the solution consisted in describing economic structures and institutions and not in analyzing human behavior.
It must be stressed that there has been no department of economics in French universities in France until recently; economics were taught as a small part of the education of students in law. It was the case when I began to study at the University. However there has been for a long time a “concours d’agrégation” in economics (namely a national examining committee to appoint new professors in economics in all French universities), but examining committees cared more about teaching capabilities of candidates than their ability to do economic research.
According to François Facchini (2015), “in 1877, among Professors of economics, 64 percent were liberal, 9 percent socialists and 27 percent were in favor of a compromise between both schools”; “In 1970 liberals were 8 percent, 32 percent socialists and 59 percent in favor of an intermediate approach.”
In 1877 several professors of economics were appointed in law universities and in 1897 an option in economics was added for the “concours d’agrégation” of law. Until then economics had been taught mainly in “high schools.” Thus, at this time economics was taught by law professors. According to François Facchini, they were inspired by the Journal des économistes (a liberal publication), but they rather developed a kind of historicism since they did not believe in economic laws. In 1887 the Revue d’économie politique was created as a reaction against the Journal des économistes and this new magazine was intended mainly to contribute to the education of people in judicial, administrative, and political activities. These professors in favor of a mixed economy inspired politicians, for instance minister Méline, who made protectionist decisions. But some liberal economists still existed (for instance Daniel Villey). Moreover, the president of the “concours d’agrégation” was appointed by the government—as it is still the case now—and this had certainly an influence on the selection of candidates.
All the economists I have known in the fifties to eighties were Marxist and/or Keynesian.
Napoléon had decided to create a monopoly in the teaching of law, but this monopoly extended to economics and there has always been a vicious circle between state activities and academic activities. From this point of view one might say that ideas have consequences, but ideas may be manipulated by public authorities.
To illustrate part of what has been said before, let me give some examples from my own experience.
My family was much inspired by the ideas of social Catholicism and I had to discover liberalism by myself. I certainly did not learn anything from my professors at school and in universities. My academic training in Paris could be described as a social chatter with good feelings (for instance Christian charity, which was also inspiring the MRP which was the government party).
However, learning microeconomics I had the feeling that individual behavior was the foundation of any understanding of economics. I was frustrated because I felt that there was something else than what had been taught to me. With a few friends we created the Jean-Baptiste Say seminar of economic theory, but it was a provocation to our professors. They told us: “you read American journals and you are therefore in the trailer of American imperialism. You ought to develop a specific French way of thinking.” However the Jean-Baptiste Say seminar has been recognized and funded by the University and considered seriously.3
As regards the French University, as soon as Keynesian economics were discovered in France, it became the dominant ideology (with Marxism) in both universities and in public opinion, certainly because it brought justification to state interventionism. And the teaching of economics which was in my time a “mundane chatter,” quickly became a mathematical approach. This is also consistent with the French tradition giving importance to engineers (and social engineers, as stressed by Hayek).
I learned economics with my friends of the Jean-Baptiste Say seminar mainly by reading American and British journals (such as AER, JPE, etc.). We had the feeling that we had learnt nothing during the numerous years we had been university students. But, at the beginning we had the prejudice that, to be a scientist, one has to do equations, and we even organized specific courses of mathematics for ourselves.
I also remember that I was shocked that Keynes was not well known in France. Thus, on the occasion of a meeting organized by the Jean-Baptiste Say seminar with Jacques Rueff, we were surprised that he did not understand the fundamental equations of Keynes.
But our first discovery was the Chicago school and we wrote a book on permanent income. Thus I got contact with Milton Friedman, who later introduced me to the Mont Pèlerin Society.
I discovered Robert Mundell, whose writings inspired my doctoral dissertation, particularly the monetary approach to the balance of payments which I still consider as an important contribution to economic theory.4
Later on I discovered Hayek and the Austrian School. I had immediately the feeling that I had always been an Austrian economist without knowing it. I think that the first text I read was “The Use of Knowledge in Society.”
As a further example of the difficulty to be liberal in the French academic sphere, I would like to give the following example. In 2003 I was appointed by the minister of education as president of the “concours d’agrégation” (the committee in charge of appointing new professors of economics in all French universities) because there are traditional rules which implied that I had to be the president. But there was a terrific media campaign against me (and the members of the committee) because it was considered that a liberal ought not to be in charge of recruiting new professors in economics!
This appeared to me as being a particularly obvious—and regrettable—illustration of French intolerance and of the domination of anti-liberal ideas in universities and in public opinion. In fact, nearly all media are always very critical of liberalism.
Finally I would like to end this presentation by quoting the introduction of a new book of mine which is to be published soon and which I have written using articles I have published in various newspapers over about four decades. The title of this book might be Right and Left United in Errors:
The alternation has been frequent between the right and the left in past decades, but it is striking that the policies unfortunately were roughly the same regardless of the ruling parties. Yet it is precisely this regrettable phenomenon which explains the frequency of political alternation. As all presidents and all governments have made bad choices of economic policies, namely socialist policies, they necessarily failed to improve the economy. In the face of these visible failures, voters regularly hoped that a change in the majority could finally solve the problems. However, despite the electoral statements about the necessity of policy changes, the desirable changes have never been decided and thus French people have always been disappointed in their hopes.
Certainly, François Mitterrand, elected President of the Republic in 1981, implemented major policy changes, but in the wrong direction, and nobody radically questioned them. The book recalls the political alternatives and the regrettable similarity of all policies. It points out the severe confusion that exists from the point of view of ideas. Indeed, the failure of the policies conducted by socialists has often led voters to vote for majorities on the right. Insofar as these majorities have continued the same policies as socialists, they have obviously failed; however, as they were decided by majorities on the right, it was frequently argued that it was the failure of liberal policies. Unfortunately we have never had real liberal policies, but only a socialism from the left or from the right...
To conclude let me quote an idea of Bertrand de Jouvenel: When the state is very powerful and has many important activities, people do not try to fight the state, but they fight to get the state power. But one may add that, when a government has a very important role, people are inclined to care more about politics than about ideas. There is a politicization of social life in France and people are more concerned by the choice of politicians than by their programs and the role of the state. It can be considered as an illustration of Bastiat’s famous sentence: “The state is the great illusion according to which everyone tries to live at the expense of others.” Therefore, political debates—and intellectual debates—are more interested in the possibility of specific categories of people to get power than by general views on the working of the society. This may be one reason, among other ones, why liberals have difficulties in being heard.
- 1. I may mention that, at that time, the ministry of economy and finance was located in the famous Musée du Louvre. It is there that Edouard Balladur organized a nice reception to make me a member of the “Légion d’Honneur.”
- 2. Cf. Arena (2000).
- 3. We have still meetings of the Jean-Baptiste Say seminar, but the seminar does not depend on any university or other organization.
- 4. But I am less convinced by another theory of Robert Mundell, the theory of the optimal currency area.
Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
Arena, Richard. 2000. “Les économistes français en 1950.” Revue économique 51, no. 5: 969–1007.
Facchini, François. 2015. “Histoire doctrinale du corps professoral d’économie politique dans les facultés françaises de 1877 à 1969.” AFEP conference, Lyon. Unpublished paper.
Cite This Article
Salin, Pascal, "On Understanding France and the French Situation," Quarterly Journal of Austrian Economics 22, no. 3 (Fall 2019): 453–69.