NYT: France's Stimulus Projects, Unlike in U.S., Were "Shovel Ready"

Submitted By Trader Mark
There go those "socialists" again, somehow implementing programs faster than the capitalists - how dare they be efficient. They really better be careful over there or I'm going to have to rewrite some of the dogma talking points! Cmon folks, we're getting out stimulated by the French! No one makes the US look bad like this and gets away with it.

What to do??? Collectively we are going to put down our hotdogs, stamp our feet, take to the streets (ok skip that last part...that would require actual effort) and you know what happens next. We're going to incite change by relabeling foodstuffs! Freedom Fries - here we come.

Via NYT
  • French workers normally take off much of the summer, but this month, there is something of a revolution going on here at this former royal chateau roughly 30 miles southeast of Paris. The throngs of tourists will be jostling alongside stonemasons, restoration experts and other artisans paid by the French government’s $37 billion economic stimulus program.
  • Besides Fontainebleau, about 50 French chateaus are to receive a facelift, including the palace of Versailles. Also receiving funds are some 75 cathedrals like Notre Dame in Paris.
  • All told, Paris has set aside 100 million euros in stimulus funds earmarked for what the French like to call their cultural patrimony. It is a French twist on how to overcome the global downturn, spending borrowed money avidly to beautify the nation even as it also races ahead of the United States in more classic Keynesian ways: fixing potholes, upgrading railroads and pursuing other “shovel ready” projects. (oh, how can I show my face in Paris ever again after this....)
  • “America is six months behind; it has wasted a lot of time,” said Patrick Devedjian, the minister in charge of the French relance, or stimulus. By the time Washington gets around to doling out most of its money, Mr. Devedjian sniffed, “the crisis could be over.” (I love the light prejudice even in our liberal 'rags' - the frenchman "sniffed") (and don't worry about us being behind Mr. Devedjian - we'll keep doing it until we get it right... $180B from Bush, $780B from Obama v1.0, and just wait until the next one coming next year - we might be late, but we come big! and often - so take your so called Palace of Versailles and let me raise you a ladybug preservation farm. Checkmate.)
  • Gallic pride aside, Mr. Devedjian has a point. While he plans to spend 75 percent of France’s stimulus money this year, the White House is giving itself until fall 2010 to lay out that big a share of the American expenditure. “All projects must start in 2009,” Mr. Devedjian said. “We want rapid results.”
  • As it turns out, France’s more centralized, state-directed economy — so often criticized in good times for smothering entrepreneurship and holding back growth — is proving remarkably effective at deploying funds quickly and efficiently in bad times. (sort of like the Chinese I suppose)
  • The Organization for Economic Cooperation and Development expects France’s gross domestic product to drop 4 percent from the peak of the economic cycle, far less than the 7.4 percent plunge expected in Germany, the nation’s economic rival. The economic decline and loss of jobs are also likely to be significantly milder than in Spain, Belgium and Britain, according to the group, a Paris-based intergovernmental research and policy advisory agency for the world’s industrialized countries. (hold on, let me go get my dogma bullet points.... how do I counteract this. Ah yes - right here, chapter 46: "Look France, when your economy grows as slow as one of those fancy snails you eat in your restaurants, of course it doesn't fall as much.... so take your swarmy attitude i.e. sniffing - and 6 weeks of vacation and take that!" There, now I feel better)
One of my favorite pet projects - comparing benefits across countries and how other countries differ from our "Reverse Robin Hood" policies adopted since the early 80s.
  • Under French job regulations, unemployed workers are guaranteed up to 67 percent of their former salary and can collect as much as 70,000 euros ($98,000) annually in benefits for two years.
And that French folks is why your economy will never thrive like ours - which simply needs bubbles every 4-6 years along with now trillions of stimulus to show GDP growth. Nevermind the amassed liabilities; that is "off the balance sheet" and our economy is strong and the best in the world.... and we don't need no stinkin' manufacturing no more either!
  • “There’s a growing possibility that (French) G.D.P. could grow in the third or fourth quarter,” said Eric Dubois, head of the short-term analysis department of Insee, the National Institute of Statistics and Economic Studies.
Doh!
  • So what about the criticism that Europe is not being as aggressive as the United States in combating the global slowdown, with only tepid stimulus packages? That’s not the way the French see it.
  • “You lost time with changing a president and no decisions were made in the last three months of 2008,” Mr. Devedjian jibed. “Nothing happened in January 2009, and in February, there was just a speech.” “The country that is behind is the U.S.,” he said, “not France.”
Freedom Fries!

*******************

Meanwhile stateside, long time readers will know I made a prediction last year after the BUSH stimulus a new stimulus would be coming after the election - I thought $500 Billion in size. They showed me! I thought I was being aggressive; not so much.

Readers will also know I said the moment that stimulus was announced there would be another. Lo and behold, even though >50% of the stimulus money won't even be spent until 2010, my prediction is becoming more possible by the day. Boo Yah, our pockets are endless and our unborn grandchildren bountiful. NEXT!
  • Some economists are pressing the White House to enact a second round of stimulus spending or find some other way to avert a prolonged job and wage slump. But the White House is in a tough spot. Officials want to give the $787 billion stimulus package passed in February time to work -- only 10% of the spending is out the door so far -- and there is little appetite in Congress, particularly among Republicans, for spending more money at a time of record deficits.
  • White House economists are discussing whether a second round of stimulus is needed, but a decision isn't expected until at least the fall. "Any discussion of a second stimulus is premature at this point."
"Premature" will turn into "necessary" by next winter - count on it. Plus it's an election year. Maybe the fact Obama handed this program to Congressional Democrats as a "thank you" instead of crafting it to do actual benefit might be part of the problem. But not to worry - there is always the next stimulus to "get it right".



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