French press review 23 July 2012

On the front page of the weekend edition of Le Monde, Mario Draghi, the president of the European Central Bank, says he has absolute confidence in the survival of the euro.

"There is no going back," Mario is quoted as saying, perhaps setting himself up for a place in history alongside the captain of the Titanic ("There is no iceberg") or 1930s British Prime Minister Neville Chamberlain ("There will be no war with Germany").

Super Mario says we need more Europe, not less, and that the road to salvation is paved with hard times, bread and water. Austerity is the only answer. Whatever the question.

They won't like that one little bit in Spain where the government is trying to cut 65 billion euros from the budget, making even bread and water look like the lap of luxury. The problem is that Spain is sinking ever deeper into the troubled waters of recession, with one young person in every two on the dole queues, and the rate of business bankruptcy up by 400% since 2007.

Worse, the Spanish cuts are further weakening the education system, and have frozen research and development, as well as infrastructure projects.

Dossier: Eurozone in crisis

According to the Nobel Prize-winning economist, Paul Krugman, quoted in Le Monde, Madrid has got it all terribly wrong, since it is Spain's economic future that is being compromised in a mad scramble to meet the European Central Bank's criteria to secure a 100 billion euro loan to prop up the local financial institutions.

There's a new employment dilemma for the government here in France, already reeling at the news that the wheels are coming off the motor industry.

This time it's the mobile phone business that's got the jitters, with ten thousand jobs threatened because the operator Free has cut margins to such an extent that the share holders in the big rival companies, like Bouygues and SFR, are beginning to squeak.

And, as any self-respecting boss will tell you for nothing, in any toss-up between the shareholders and the mere employees, it's heads we win, tails they lose.

Speaking of less-than-completely-gruntled shareholders, right-wing Le Figaro tells us that the flight of the fortunate has already begun. Even before the law is voted allowing for the taxation of the filthy rich at 75%, businesses have already put in place schemes to allow their top managers be paid in neighbouring countries where the tax regimes are less, well, socialist.

Le Figaro says the proposed tax is mistaken since it affects the economy's main movers and shakers and will lead to a brain-drain as well as to the expatriation of an awful lot of cash.

Instead of making the rich pay, says Le Figaro, the government should concentrate on making them stay. In France, that is, where they can be useful.