$700 billion! The spectacular announcement by the United States government to recover doubtful debts in order to clear the accounts of banking institutions has, we are told, marked the end of the global financial crisis and heralded the grand return of the State. This extraordinary bailout plan envisaged by the American Administration, with the probable agreement of Congress, indeed shows the extent of the dangers that were lurking for the “international financial system.” Sacred union obliges, both candidates for the White House have endorsed this initiative without flinching. Which, by the way, says a lot about how both Democrats and Republicans know how to comply with the imperatives, whether they are related to security, trade, or finance, defined by the constants of American policy.
The question remains whether the fully responsible approach will be enough to calm the completely irrational movements of speculators who swiftly return to the path of stock investments as quickly as they left it.
For the euphoria that greeted this “return of the State” does not seem to be appropriate. President George Bush’s comments on the otherwise dramatic consequences for the American citizen of any “laissez-faire” and a wait-and-see stance so dear to liberal thought across the Atlantic, attest to the fact that it was indeed constrained and forced that the Bush Administration had to resort to these astronomical sums. In fact, rather than the return of the State, it is more a State held hostage by a faltering real economy that must intervene to try to limit the damage: the damage from the excessive enthusiasm of a few thousand reckless speculators, the bill for which taxpayers—Americans today, Europeans tomorrow—will undoubtedly have to pay painfully.
For their part, the French are not mistaken, despite eternally reassuring statements from the Minister of the Economy, who still claimed in September 2007 that “the crisis was not a crash but a simple financial correction.” However, it was undeniable for the occupant of Bercy to recognize on September 15 the seriousness of the events.
Two polls, one from Le Figaro (Politoscope Figaro/LCI on September 18) and the other from the Journal du Dimanche (JDD on September 21), provide telling numbers: 80% of those surveyed believe that the current difficulties of banks and borrowers will lead to a serious economic crisis. The same sentiment is echoed by 81% of the JDD respondents who say they are worried about the future of the French economy. Proof that states are more suffering from than acting against this financial crisis, 66% of the French questioned by Le Figaro, across all political affiliations, do not trust the Government to protect them from the crisis.
Awaiting the important economic speech Nicolas Sarkozy is to deliver next Thursday in Toulon, one can only understand and share the concerns about the forthcoming repercussions of this crisis in terms of employment and increased risk of business failures. With growth of barely 1% for 2008 and “equally sluggish in 2009,” one can at least hope for a speech from the head of state as clear and realistic as the one he gave previously on the “empty coffers.” But regardless of the significance of the measures that may be announced, one certainty remains: If the financial crisis is over, the economic crisis is just beginning.
