French President Francois Hollande, by reputation, is an
unlikely budget hawk; as a candidate for office, he ran against
austerity measures. But the realities of governing sometimes
complicate politicians’ promises. After taking office, the euro crisis is now forcing Hollande to pledge to cut the French
budget deficit down to 3% of GDP by the end of 2013. To keep
the crisis from France’s door, although he is raising taxes
too, he is preparing to cut at least $42 billion from the budget.
Sounding rhetorically more like German Chancellor Angela Merkel or
American conservatives and libertarians, Hollande argued that better
finances would restore economic growth to a stagnant French
economy — not that such austerity would bring about economic
collapse. With government spending accounting for more than 56% of GDP, the French economy, like those of many nations in
Europe and that of the United States, is being chronically dragged down by
excessive government expenditure and debt. Hollande seems to
realize, unlike many American politicians, that economic growth is
unlikely to be restored until deficits and debt are reduced.