Mises Wire

Decentralize the French State

With the gilets jaunes (yellow vests) protests raging for more than three months, the European Union’s viability as a political entity has come into question.

Indeed, the EU has gone through a whirlwind of economic and political upheavals since the eurozone crisis of 2009. In 2016, the EU experienced a political earthquake when the Brexit referendum occurred, and British voters decided that it was time for the UK to leave the EU.

To a certain extent, the Brexit vote was a manifestation of British populism. Now, the French populists have made themselves known in the form of the yellow vest movement.

But what are the implications of this?

France’s Out-of-Control Leviathan

France is not exactly in the best economic shape. The unemployment rate has hovered around nine to ten percent during the past decade. The cost of living has risen considerably thanks to government regulations. So, Macron’s failed gas tax proposal, which would have hurt the working class pretty hard, only exacerbates France’s sub-optimal economic situation.

And this is only the tip iceberg as far as France’s over-burdened economy goes.

Research from the Institut Économique Molinari found that the tax burden “typical workers” in France face is higher than any of its European counterparts. Fiscal restraint has not been France’s strong suit with government spending accounting for 56 percent of GDP. On the regulatory front, France is a mess. Its Code du Travail, a 1,600 page, 10,000-article legislative monstrosity, has greatly hamstrung its labor market. According to the Heritage Foundation’s 2019 Index of Economic Freedom, France’s Labor Freedom score places it very close to the “repressed” category.

In a cruel twist of irony, France has reverted back to its monarchical political economy, dominated by an interventionist state that heavily regulates, subsidizes, and controls certain sectors of the economy.

Sadly, many of the yellow vest protestors have not comprehended the 800-pound elephant in the room that is French statism.

Could Flawed Ideology Derail the Yellow Vest Movement?

Claudio Grass noted how the yellow vests protestors have “no unified or homogenous political beliefs, party affiliations or ideological motivation.” In fact, some of their demands are quite contradictory and reek of statism. When we take a look at the yellow vests’ demands, they are all over the place. From tax cuts for the working class, to rent control and an increased minimum wage, this movement is the embodiment of ideological incoherency.

However, the yellow vests are not necxessarily doomed as there’s always a silver lining in political crises such as these.

The Decentralization Silver Lining

The yellow vest movement does present a golden opportunity to position the ideas of decentralization.

In other words, this movement should first pivot to a “Frexit” of sorts that emphasizes a withdrawal from the EU. But like Brexit, France shouldn’t stop with just leaving the EU. As Philip Booth pointed out with the UK, most European countries like Britain and France still have work to do in liberalizing their economies.

Convincing millions of Frenchmen to arrive at some kind of political consensus that favors free markets is still a tall order in the current intellectual climate of interventionism. Instead of getting caught up in the ideological intricacies of promoting drastic changes to the French political economy, there should be a focus on more radical forms of decentralization.

Proposals that include the decentralization of the welfare state should obviously be on the table. But why stop there? The French should listen to the separatist movements taking place in regions like Brittany and French Catalonia and let them break away. The more competing jurisdictions within France, the better it is for human freedom and innovation.

The 20th century was one of hyper-centralization and government encroachment in all aspects of human life. France can break free from this cycle of centralization by carrying out its own Frexit and then facilitating breakaway movements within its traditional nation-state boundaries.

The 21st century need not repeat the errors of the 20 th century. France can lead the charge by bucking universalist political wisdom and fully embracing separatism.

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