The victory of anti-austerity Socialist leader François Hollande in the French presidential election has sparked discussion about the future of European economic policy. Winning 51.62 percent of the vote, Hollande's campaign was founded on the promise to introduce "a new direction to Europe," with a focus on growth and investment, in lieu of the austerity policies of outgoing French President Nicolas Sarkozy and German Chancellor Angela Merkel, which Europe followed in recent months to no apparent avail. Does his victory on these issues mark an end to austerity measures and an ideological shift across Europe?
Benedict Brogan of The Telegraph suggests that it does. He argues that the French election "gives the left in Britain a script to follow about an unpopular government detached from the people by wealth and austerity." Brogan indicates that the French election could prove problematic for Conservative British Prime Minister David Cameron, who has championed austerity measures in the past.
Although Jeff Sica of Sica Wealth Management asserts that the rise of Hollande marks the death knell for the French-German rapprochement seen under Sarkozy, on Monday German Chancellor Angela Merkel spoke of austerity measures "plus growth"—a nod toward Hollande's desire to focus on investment. Sigmar Gabriel, leader of the Social Democrats in Germany, stated Monday that the Socialist victory will "not only change France, but finally help Europe go in another direction." Facing criticism in Germany for her tough austerity measures, Merkel may be forced to soften fiscal policies.
New York Times columnist Paul Krugman has his doubts. He is pessimistic about an ideological shift in Europe, arguing that France's election is just a case of those on the outside benefiting from "the fact that they aren't in, and the economy stinks."
Perhaps a changing of the guards can only ever have minimal impact in the context of an economic crisis. As Jerome Roos of online magazine Roar succinctly puts it, "If the events of the past three years have taught us anything, it is that politicians do not rule Europe—financial markets do."
Whether or not the election of François Hollande will dramatically change the political landscape of Europe remains to be seen. However, his victory has raised questions about the success of austerity, and it opens the conversation to a diverse range of economic policies.
Further Reading:
Global Ethics Corner: Goodbye Euro?
Top Risks and Ethical Decisions 2011, with Daniel Altman, Ian Bremmer, Zachary Karabell, Art Kleiner, and Joel H. Rosenthal
"The European Union: Still a Global Power?" Zornista Stoyanova-Yerburgh, Carnegie Ethics Online.
"The Moral Consequences of Economic Growth," Benjamin Friedman, Carnegie Council Public Affairs
Global Ethics Corner: The Debt Crisis: Are Politicians the Problem?
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