According to the French Prime Minister, Francois Fillon, the French government is planning to freeze public spending for the next five years to eliminate the country's high budget deficit and bring down spending as a share of GDP.
It is not yet clear whether the spending freeze would be a nominal or real terms one, nor whether it would encompass France's highly indebted social insurance system.
Still, by any reckoning, this is a bold and necessary move. And one so far ahead of anything planned by any of the main parties in Britain - let us not forget that the three main parties are still pledged to increase spending by 2 per cent per annum in real terms for the next three years.
It's not often that British politicians need to learn lessons from the French, but here is a lesson staring them in the face.
Yeah, except we aren't France, are we? Completely different economy- they are catching up to, effectively, neo-liberal economics that were put in place here 20 years ago.
You wouldn't call for the same interest rates in the UK as in France (i.e. The Euro zone) due to economic differences. Same reasoning applies.
Posted by: David | Thursday, January 24, 2008 at 10:10 PM
How does a politician define the word "freeze"? You can bet it will not be a freeze in CASH notes terms.
By the time it has been "seasonally adjusted" and "GDP deflated" and a touch of "business cycle adjustment" and squeezed through the "CSR spending envelope", etc etc etc, you can bet the French, like us, will be paying more tax.
Posted by: Acorn | Saturday, January 26, 2008 at 08:47 AM