May 7, 2012

Hollande take over France

Angelique Chrisafis, Guardian, UK - After victory over Nicolas Sarkozy, Socialist says he will fight back against German-led austerity measures

Fran├žois Hollande has won the presidency of France, turning the tide on a rightward and xenophobic lurch in European politics and vowing to transform Europe's handling of the economic crisis by fighting back against German-led austerity measures.

...Hollande said France had voted for change, but he had a heavy responsibility to drag the country out of economic crisis. Vowing that France would no longer be fractured, divided or riven by discrimination, or those in the poor high-rise suburbs and abandoned rural areas cast aside, he said: "No child of the republic will be abandoned."

...Hollande, who has vowed to begin his reforms as soon as he takes office on 15 May, has accepted he will have "no state of grace" leading a country crippled by public debt and in economic crisis, with unemployment nudging a record 10%, a gaping trade deficit, stuttering growth and declining industry. Public debt is so high that interest repayments alone account for the highest state expenditure after education. The rating agency Standard and Poor's this year downgraded France's triple-A credit rating, citing in part that over-high state spending was straining public finances.

 ...Hollande's manifesto is based on scrapping Sarkozy's tax breaks for the rich and levying more from high earners to finance what he deems essential spending, including creating 60,000 posts in France's under-performing school system. He has pledged to keep the public deficit capped but for his delicate balancing act to work he needs a swift return to growth in France, despite economists warning of over-optimistic official growth forecasts that need to be trimmed.

In a major upset that will not be welcomed by the crisis-plagued country's eurozone partners, the two forces that had agreed to enact unpopular belt-tightening in return for rescue funds appeared headed for a beating, with none being able to form a government.

After nearly 40 years of dominating Greek politics, the centre-right New Democracy and socialist Pasok saw support drop dramatically in favour of parties that had virulently opposed the tough austerity regime dictated by international creditors.

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