Friday, November 21, 2008

Whither the PS?

About all that I can say now is that the PS leadership vote has ended in the worst possible outcome for the party: a nearly 50-50 split that could go either way, leaving whoever wins--and for now it seems to be Aubry--in command of a party split every which way. Aubry-Fabius is about as incoherent a line as you could wish for: Monsieur Non et Mme la Fille de Monsieur Europe. What sense does that make? Throw in the Jospinien wets, the lame-duck ex-Monsieur Royal, and le marquis de Hamon de la Gauche de la Gauche and you have a party that stands for nothing except a hollow promise not to ally with MoDem, though Aubry already has done so back home in Lille.

Against this motley crew, which threw everything it had at her, Ségo still got 50% + or - epsilon of the vote, a pretty remarkable showing for a supposed political incompetent against a determined TSS front. Say what you will about Ségo, she cut deals where she had to and showed pretty good gut political instincts. If it turns out that she's come up short for now, I wouldn't count her out just yet for 2012. The party will still have to deal with her -- if it remains a party. I wouldn't be surprised if she struck out on her own, consummating the divorce.

Pragmatist or Blunderbuss?

Judah Grunstein and Max Bergmann together try to make sense of Sarkozy's scrambling on the world stage.

Beaujolais Nouveau and Institutionalist Economics

Rationalité limitée has an interesting post this morning explaining the enthusiasm for beaujolais nouveau in terms of institutional factors shaping the market for wine. The example is extended to explain the influence of "reputational intermediaries" in shaping the market for complex financial products. In plain language, the wine lobby was able to persuade a lot of people that beaujolais nouveau is worth celebrating even though it isn't very good, and Lehman Brothers was able to persuade a lot of people that collateralized debt obligations were a valuable risk-dispersing innovation, even though they turn out to be a lot more toxic than this year's primeurs de Beaujolais.

Caciques Socialistes

Bernard G. has used Google to investigate whether the word cacique is used more frequently in connection with the PS than with other parties, and the answer is a resounding yes. Now, this is interesting, in part because, as Bernard notes, the PS probably has more "prétendants à la chefferie" than other parties. The word cacique comes, after all, from cacichi, the word for "king" among certain South American tribes. But it also has a secondary meaning in French, slang for "premier d'une section à l'École Normale," a usage attested as far back as 1907 according to one dictionary. This definition does not fit the current crop of prétendants à la chefferie particularly well. To take just the two premières, while both are énarques, neither is a normalienne, and more to the point, neither is particularly notable for her braininess. A curious comparison crops up just this morning, because David Brooks, the conservative New York Times columnist, has been struck by the academic accomplishments of Obama's first round of appointees. It seems that America is headed for a government of caciques in the second sense, and Brooks, despite his political proclivities, seems positively relieved, after eight years of government by dunces, to welcome this "valedictocracy," as he calls it. (But Dani Rodrik bemoans the prevalence of law school graduates and the dearth of representatives of his own institution, the Kennedy School of Government--about as close as we come to an American ENA, I guess).

For Bernard's interpretation of Ségo's good showing in round one, see here. I concur.

French SWF

So how are we to think of the French sovereign wealth fund? President Sarkozy said that it would be a fund of 20 billion euros, but 14 billion of that consists of shares in companies in which the state already participates. The remaining 6 billion are to be borrowed. Money will be spent to protect "strategic" firms in danger of foreign takeover, firms with promising technologies for the future, firms engaged in "durable development," etc. One could justify each of these types of investment in a variety of ways. But the SWF is also being proposed as an "anti-crisis" measure. Is it credible as such? The only stimulus involved here is the borrowed 6 billion, which amounts to roughly 0.25 pct of GDP. Not much in the way of stimulus. And stimulus is needed now. What spending targets have been identified? Other than Daher, the firm where Sarkozy made the announcement, nothing has been revealed.

As so often in the past, we have an announcement, great fanfare, vague promises of imminent action, and a dearth of details. Patience was permissible in normal times, but the crisis demands more decisive commitment.

Round One to Royal

Ségo 43, Martine 34, Benoît 22, 60% turnout. As divided as ever, in short. If Aubry does manage to make up her deficit in the second round, her election would hardly constitute a ringing endorsement of whatever mushy compromise her candidacy is supposed to represent. If Royal wins, well, I suppose we can look forward to a few further defections among the Old Guard. But what can you say about this contest? A confirmation of chaos? A mandate for muddle?

My guess? Royal 51.5, Aubry 48.5.