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France, Unlike U.s., Is Deep Into Stimulus Projects

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http://www.nytimes.com/2009/07/07/business...ml?ref=business

French workers normally take off much of the summer, but this month, there is something of a revolution going on here at this former royal chateau roughly 30 miles southeast of Paris. The throngs of tourists will be jostling alongside stonemasons, restoration experts and other artisans paid by the French government’s $37 billion economic stimulus program.

Their job? Maintain in pristine condition the 800-year-old palace of more than 1,500 rooms where Napoleon bid adieu before being exiled to Elba and where Marie Antoinette enjoyed a gilded boudoir.

Besides Fontainebleau, about 50 French chateaus are to receive a facelift, including the palace of Versailles. Also receiving funds are some 75 cathedrals like Notre Dame in Paris. A museum devoted to Lalique glass is being created in Strasbourg, while Marseilles is to be the home of a new 10 million euro center for Mediterranean culture.

All told, Paris has set aside 100 million euros in stimulus funds earmarked for what the French like to call their cultural patrimony. It is a French twist on how to overcome the global downturn, spending borrowed money avidly to beautify the nation even as it also races ahead of the United States in more classic Keynesian ways: fixing potholes, upgrading railroads and pursuing other “shovel ready†projects.

“America is six months behind; it has wasted a lot of time,†said Patrick Devedjian, the minister in charge of the French relance, or stimulus. By the time Washington gets around to doling out most of its money, Mr. Devedjian sniffed, “the crisis could be over.â€

Gallic pride aside, Mr. Devedjian has a point. While he plans to spend 75 percent of France’s stimulus money this year, the White House is giving itself until fall 2010 to lay out that big a share of the American expenditure. And many experts predict that Washington will fall short of that goal.

As it turns out, France’s more centralized, state-directed economy — so often criticized in good times for smothering entrepreneurship and holding back growth — is proving remarkably effective at deploying funds quickly and efficiently in bad times.

“All projects must start in 2009,†Mr. Devedjian said. “We want rapid results.â€

The confidence evident in the words of Mr. Devedjian, a close adviser to President Nicolas Sarkozy, echoes a broader pride among French business and political leaders that their government has done a better job dodging the worst of the economic turmoil than its European neighbors like Britain, Germany and Spain.

The Organization for Economic Cooperation and Development expects France’s gross domestic product to drop 4 percent from the peak of the economic cycle, far less than the 7.4 percent plunge expected in Germany, the nation’s economic rival.

The economic decline and loss of jobs are also likely to be significantly milder than in Spain, Belgium and Britain, according to the group, a Paris-based intergovernmental research and policy advisory agency for the world’s industrialized countries. (By comparison, the American economy is expected to shrink by 3.5 percent before starting to grow again.)

While many economists predict Germany and much of western Europe will remain in recession through mid-2010, France’s official statistics agency expects the economic situation to stabilize by the fourth quarter of 2009, about the same time many analysts predict that the American economy will finally start to improve.

“There’s a growing possibility that G.D.P. could grow in the third or fourth quarter,†said Eric Dubois, head of the short-term analysis department of Insee, the National Institute of Statistics and Economic Studies.

For all the confidence expressed by the French, though, France remains highly vulnerable to the threat of rising unemployment. The O.E.C.D. expects the French jobless rate, currently 8.9 percent and lower than the 9.5 percent rate in the United States, to hit 11.2 percent by the end of 2010, above the expected American peak of 10.1 percent.

“There has been a lag with unemployment, but now it will start to bite,†said Hervé Boulhol, head of the France desk at the O.E.C.D.

Paying for all those jobless French will not be cheap. Under French job regulations, unemployed workers are guaranteed up to 67 percent of their former salary and can collect as much as 70,000 euros ($98,000) annually in benefits for two years.

Indeed, without major changes in government policies, France faces costs that will probably be crippling in the long run. “We’re insulated from the shocks, but the next generation will pay for it,†Mr. Boulhol warned.

For now, though, the deluge seems far off into the future at Fontainebleau, much as it did to Louis XIV, the Sun King, who spent each fall here for his annual hunt. The well-tended gardens and canals shimmer in the summer sun, while artisans clean stonework and repair the courtyards and kitchen buildings where royal feasts were once prepared.

If your going to blow money on stimulating the economy it has to be on projects aiming to improve productivity or cutting long term costs.

Making old buildings look nice is a waste of time.

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Its amazing how France has such a huge public sector yet they can still get things done.. Seeing them carry out big projects over the years it doesn't surprise me that their stimulus is hitting first.

In the anglo-saxon countries some people commented it will take 10 years before these stimulus projects, actually have a shovel hitting the dirt. Too much planning commissions, lawsuits, public consultations, private consulting studies, political bickering, audits, etc..

The centralized nations without all these checks and balances and powerful courts who can halt things, are showing their strength so far in this economic crisis. The Chinese also got their stimulus spending moving very quickly. The first shovels were hitting dirt like a month after their stimulus plan came out.

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....

Making old buildings look nice is a waste of time.

The idea of France's projects is and always has been, to provide employment not to get anything done. That's what wins votes here. Everywhere you look there are people needlessly employed doing something. Picking up litter (why not just leave it like the Brits do?) or cleaning old buildings (why not just let them fall down in a pile of rubble to be an eyesore like the Brits do?)

That is why France is so much nicer to live in than England.

But, there's no denying that we are deeply, deeply in debt for the next generation or six to pay for it.

Edited by non frog

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Our society has become so obsessed with preserving the past. Did other great societies suffer from this disease? To me it sums up how backwards looking we are as a society.

If old buildings can't be re-used for a productive purpose then they should be knocked down and the materials re-used.

Can't be doing with English Heritage, listing buildings or museums.

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Guest DissipatedYouthIsValuable
http://www.nytimes.com/2009/07/07/business...ml?ref=business

If your going to blow money on stimulating the economy it has to be on projects aiming to improve productivity or cutting long term costs.

Making old buildings look nice is a waste of time.

Perpetual growth of productivity?

What do humans need? Food, shelter, healthcare and distraction.

The monetary system should serve man, not man the monetary system.

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Its amazing how France has such a huge public sector yet they can still get things done.. Seeing them carry out big projects over the years it doesn't surprise me that their stimulus is hitting first.

In the anglo-saxon countries some people commented it will take 10 years before these stimulus projects, actually have a shovel hitting the dirt. Too much planning commissions, lawsuits, public consultations, private consulting studies, political bickering, audits, etc..

The centralized nations without all these checks and balances and powerful courts who can halt things, are showing their strength so far in this economic crisis. The Chinese also got their stimulus spending moving very quickly. The first shovels were hitting dirt like a month after their stimulus plan came out.

Their state is quicker at spending its citizens' money than our state! Wooppee do!

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Our society has become so obsessed with preserving the past. Did other great societies suffer from this disease? To me it sums up how backwards looking we are as a society.

If old buildings can't be re-used for a productive purpose then they should be knocked down and the materials re-used.

Can't be doing with English Heritage, listing buildings or museums.

Past super powers looking back at their greatness, which they no longer have.

I would much rather see a space program or big ugly particle accelerators than an old church.

Edited by cells

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Guest DissipatedYouthIsValuable
Past super powers looking back at their greatness, which they no longer have.

I would much rather see a space program or big ugly particle accelerators than an old church.

I'm all for reliable nuclear fusion.

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Our society has become so obsessed with preserving the past. Did other great societies suffer from this disease? To me it sums up how backwards looking we are as a society.

If old buildings can't be re-used for a productive purpose then they should be knocked down and the materials re-used.

Can't be doing with English Heritage, listing buildings or museums.

Couldnt agree more. In Scotland, every city centre is designated as a Conservation Area with most of the buildings Listed. Many of these buildings are ill equipped to take modern uses and conversions can take forever and have astronimcal costs especially with Historic Scotland / English Heritage / Local Authority interfering. In 1000 years, if we last that long, our city centres could still look the same as they do today. :angry:

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AS the world's number one tourist destination by far. this is surely a real investment, not a Gordon Brown investment?

There're a lot of people out there who'd struggle to work productively in any other sector.

Beat me to it with this quote ;)

These projects will hopefully enhance France's position as the #1 destination. In a downturn, they need to keep tourists coming to their country. Remember, there are plenty of tourists who look for a bit more than sun, sea and a Union Jack pub when they are on their annual break :rolleyes:

If your budget is tight, you might decide against spending 20€ a head to visit a delapidated Versailles palace or a rusting Eiffel Tower. If it's clean, bright and attractive you may be tempted.

As for keeping the towns and streets clean? A no brainer. On the Riviera , rubbish collections are 6 days out of 7. In some town centres, twice a day. I've been to Brighton and the like in the summer and saw at first hand the local authorities once a week rubbish collection scheme. Dismal. :(

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It is sick how obsessed we are with preserving the past.. We look back and yearn for that better time.

But in different parts of our society like the education system a lot of the goal is to wipe out our cultural legacy out of shame at the alleged sexism, racism, predatory nature of colonialism, capitalist past..

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Our society has become so obsessed with preserving the past. Did other great societies suffer from this disease? To me it sums up how backwards looking we are as a society.

If old buildings can't be re-used for a productive purpose then they should be knocked down and the materials re-used.

Can't be doing with English Heritage, listing buildings or museums.

Your argument is a bit stoopid, mon ami.

There are plenty of towns, villages in Europe that date from 10C and before. Lots more from 16C onwards.

Preserving good buildings and towns has been going on for more than 1000 years. Every generation decides to keep the good ones to pass onto future generations. Nothing wrong with that. B)

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Its amazing how efficient the French state is too. Like they have their national electric company EDF. It delivers a large profit to the state each year.. AND they have the lowest electric costs in Western Europe.

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Its amazing how efficient the French state is too. Like they have their national electric company EDF. It delivers a large profit to the state each year.. AND they have the lowest electric costs in Western Europe.

Don't worry the french tax payer will pick up the decommissioning costs.

Remember privatise the profits socialise the losses.

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The idea of France's projects is and always has been, to provide employment not to get anything done. That's what wins votes here. Everywhere you look there are people needlessly employed doing something. Picking up litter (why not just leave it like the Brits do?) or cleaning old buildings (why not just let them fall down in a pile of rubble to be an eyesore like the Brits do?)

That is why France is so much nicer to live in than England.

But, there's no denying that we are deeply, deeply in debt for the next generation or six to pay for it.

I worked for a french company - 6 billion turnover. At one of their sites they had a whole room dedicated to hand writing cheques. Woe betide any roast beef who tried to come in an automate the process.

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Its amazing how efficient the French state is too. Like they have their national electric company EDF. It delivers a large profit to the state each year.. AND they have the lowest electric costs in Western Europe.

I think this too relies on future generations picking up the tab. If you factor in de-commissioning all the nukes French electricity is about the same price as distilate of rocking horse dung.

The secret of a quality life in France is to be over 35 :D

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These projects will hopefully enhance France's position as the #1 destination. In a downturn, they need to keep tourists coming to their country.

snip

As far as I remember, the French have a fairly low income tax but very high VAT/sales tax on goods, which is why everything seems so friggin' expensive in France. If they use their stimulus plan to bring in more tourists who will certainly spend money while visiting, they are also generating more tax income through the higher rates on goods.

I have been on a trip to see the chateaux of the Loire valley years ago and would like to go back next year and I would be sorely disappointed if they let the palaces and castles turn to ruins. I think that art and culture are important in their own right and worth their upkeep (as for the Turner Prize, now THAT's a completely different story).

:rolleyes::)

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It is sick how obsessed we are with preserving the past.. We look back and yearn for that better time.

But in different parts of our society like the education system a lot of the goal is to wipe out our cultural legacy out of shame at the alleged sexism, racism, predatory nature of colonialism, capitalist past..

That is quite a refreshing statement. I have always wondered the same. You put words to it. Many thanks.

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We moved to France end of last year, and its the best decision we've ever made.

France is clean, not rushed, and the health care is 2nd to none.

The UK is an absolute crap hole, full of chavs and Gordon Brown, and everyone used to say 'if you hate it so much leave' - well we have, and with no regrets!

Vivre la France!!!

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Guest redwine
Its amazing how France has such a huge public sector yet they can still get things done.. Seeing them carry out big projects over the years it doesn't surprise me that their stimulus is hitting first.

The public sector can't get anything done as for more money for the "chateau" it can be translated as

Local french councils giving public money to "mates" to do a useless job with alot of back-handers

France is a country of civil servants there are over 5 million civil servants in France

As for France being the top tourist destination it all depends on how you count the tourists

The french only count people entering and leaving France

Unemployment here is worse than in the UK wages are low and at the end of this year the govt are talking about over 10%of the working population without work

The private sector suffers from "bad management" and there old business model of father to son companies isn't working anymore

The french don't like" change " so i can see things only going from bad to worse

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The first successful semi socialistic country?

Now don't quote me on this and keep this to yourself, but I now rather admire the old frogs!

They stick to their guns, do what they want and even the police look after the frogs first. God knows how the economy works but some how it does, they fought for the outrageously biased farm subsidies and won! Even in world wars they get the despised British and Yanks to do the fighting for them. Let us not forget, we like to kid ourselves no one has ever beaten us, well the ice cream sellers did, the Romans invaded us and stayed. The French did the same in 1066.

They have great public transportation with far cheaper housing. It's a country that provides mountain skiing with the Med coast as well. It has roughly the same population but is five times the size. It's rivers make ours look like someone has urinated on a country walk and their Chateaus make our castles look like mere gate houses. On my travels their women are stylish beyond our women's comprehension and their politicians don't even get a look in unless they have a wife and a lover, what's more the public expect this!

I think I might just pack my bags, leave and go frog side! South of France anyone!

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Now don't quote me on this and keep this to yourself, but I now rather admire the old frogs!

They stick to their guns, do what they want and even the police look after the frogs first. God knows how the economy works but some how it does, they fought for the outrageously biased farm subsidies and won! Even in world wars they get the despised British and Yanks to do the fighting for them. Let us not forget, we like to kid ourselves no one has ever beaten us, well the ice cream sellers did, the Romans invaded us and stayed. The French did the same in 1066.

They have great public transportation with far cheaper housing. It's a country that provides mountain skiing with the Med coast as well. It has roughly the same population but is five times the size. It's rivers make ours look like someone has urinated on a country walk and their Chateaus make our castles look like mere gate houses. On my travels their women are stylish beyond our women's comprehension and their politicians don't even get a look in unless they have a wife and a lover, what's more the public expect this!

I think I might just pack my bags, leave and go frog side! South of France anyone!

True true.

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