Thomas Porcher: "This crisis is an ideal moment to pass the worst laws"

The epidemic of COVID-19 and the confinement of the population make an inevitable new financial crisis?What can the state in the face of the unprecedented health situation it is going through today?Interview with the economist Thomas Porcher, author of the Les Abandés Book (Fayard, 2020).

Yellow vests, suburbs, farmers and downgraded executives.These are the four categories - to say the least heterogeneous - that Thomas Porcher mobilizes in the neglected (Fayard editions, released on February 26, 2020) to evoke a "archipelago" France where all do not necessarily share the same interests but have in commonto be "neglected" by an economic system less and less accepted, and which only benefits a minority.

Does the triptych "Globalization-Fineciarization-Austerity", to resume the terms of the economist, arrives out of breath with the unprecedented health crisis that is currently going through Europe?Not so sure.Lack of European solidarity, ever more important weight of the actors of finance in the economy, questioned of certain social rights through laws taken in emergency ... For Thomas Porcher, the threats are already too numerous to decreasethe guard.Interview with an economist who calls for "not letting himself go" and "think after" now.

Usbek & Rica : Les mesures économiques d’urgence se multiplient depuis quelques semaines.How does the current crisis situation make it possible to "release" so much money at once, when it is often heard that there is "nothing in the boxes" the rest of the year?

Thomas Porcher: Whenever there is a crisis like this, the State finds the necessary resources.In his speech in Mulhouse on March 25, Emmanuel Macron announces a massive plan for the hospital after the crisis.It's stupid: he would have done better to make a before!It is not as if caregivers have not expressed their lack of means and staff.Before, there was no "magic money" for hospitals, it was necessary to make 15 billion euros in savings on health insurance, to suppress positions of civil servants ... Why?Because it was necessary to compensate for the loss of tax revenues due to the 20 billion lower taxes granted to the richest and to companies.In the end, because of these political choices, the French will cross one of the most serious health crises in their history, with under-to-do hospitals and a lack of caregivers.And Macron, who wanted to hold the deficits, will not hold them.Populations such as supporters of budgetary orthodoxy are losers.This way of managing the economy is catastrophic.

In your book, you distinguish between operating expenses of administrations and services to show that what is called "public spending" actually covers a variety of devices.What is the difference between operating expenses of administrations and services?

Because of the 2008 crisis, banks almost collapsed.So we reinjected public money to support them.Our debt rose from 65 % of GDP in 2007 to 79 % in 2009.Then we had a recession, that is to say a loss of activity.However when you have little activity, you have fewer tax revenue from companies and unemployment that explodes.And as we have a system that gives services to the unemployed, well these services increased: between the crisis of 2008 and 2018, we had 1.5 million unemployed more, or 1.5 million additional people affectingperformances.Our public expenditure has therefore actually increased in recent years but because we have paid more services, not because we have too many civil servants or given too much to the administrations!It should also be remembered that these services are not placed in an account in Switzerland but are directly consumed, which benefits the private sector.

In reality, our public operating expenses, which represent the remuneration of civil servants and the intermediate consumption of administrations, have been stable since 1978 and lower than that of the United Kingdom or Denmark.The question of public spending is today instrumentalized to make believe that there are too many civil servants and that you waste money anyway.In general, it must be understood that public expenditure represents only what we want to give to the public, nothing more.With us, it takes into account pensions but also systems that benefit businesses such as the CICE [tax credit for competitiveness and employment, a system implemented in 2013 and which constitutes a tax advantage over businesses, editor's note..

On Twitter, you stressed that "in 10 years, Italy has reduced spending on 37 billion euros for its health system, a loss of 70,000 beds, 359 service closings and many small abandoned hospitals.»Are we in the same configuration in France?

Hospital problems do not date from Holland and Macron, even if the latter have strengthened "austerity" logic.François Hollande already wishes to save 3 billion euros in the hospital.And in 2018, under Macron, the hospital had to make 1.6 billion savings.This has very concrete consequences: since 2003, there have been more than 69,000 beds removed, including 4,200 in 2018.

But we must not pretend we discovered that!Hospitals have been on strike for years, last year almost all emergency services were mobilized, which was unprecedented.1,000 hospital doctors have even resigned.Everyone knew.No one did anything.Hollande "offered" 40 billion euros with the responsibility pact and the CICE, Macron added 20 billion lower taxes for the richest and businesses.There was nothing for public services, only savings programs.

Since the pandemic won Europe, the French and German states have not exclusive nationalizations, and Italy has already embarked on this path.What is the interest of such a practice?

Nationalization is used to prevent businesses by flowing.We keep saying that the state is ineffective, but when a large company is in danger it often appeals as a last resort, and there it is the taxpayer who comes to the rescue.We saw it in 2008, we will see it again with this crisis.This time, do not nationalize just to nationalize.That is to say that you should not let the company operate as before.If we do this, nothing will change.

Nationalization must be an opportunity for the State to change the rules of the game: to ensure that the company is no longer the toy of financiers, to ensure that inside the company do not opposestakeholders such as employees and shareholders, ensuring that profit is not the only goal.Employees must be in greater numbers on the boards of directors;also integrate representatives from local communities and customers.Finally, the state must give a roadmap to these companies to put them at the service of a project, in particular the ecological transition.We must take advantage of this moment to regain control, and the state must become a strategist state.But for that, there must still be strategists at the head of the state.And there, it is not won ...

How do you look at the law establishing a "state of sanitary emergency", which has just entered into application?

Macron has not stopped telling us that we were at war and his law establishing the state of health emergency only concerns working time, financial support for businesses, the methods of the holidays ... Nothing or almost on theHospital, on the production of masks, nothing on the construction of respirators or the recovery of closed hospitals such as the emergency room of the Hôtel-Dieu hospital in Paris, for example.We remain on the drop in the rights of employees.One has the impression that this government is working on sight and cannot have a minimum of anticipation.In general, you have to be careful because this type of crisis is always an ideal moment to pass the worst laws.It is important not to be redone 2008.

A new financial crisis, like this 2008, inevitable?

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It depends on the duration of the health crisis.The longer it is, the stronger the uncertainties in the financial markets, the greater the risk of crisis.In China, it took three months to stem the propagation.But in Italy or France, comparisons of the curves of evolution of the number of contaminated show that we are on a slope greater than that of China.This means that there are risks that it lasts longer.However, the more the health crisis is drained, the stronger the economic crisis.Because businesses, restaurants and SMEs lose a lot of money, but also because the financial crisis has repercussions on the economy, in particular with layoffs to compress the wage bill and preserve dividends of shareholders.

In the introduction of your book, you say that "our ability to take the blows is astonishing" and that "the resilience of the system is impressive".What you call the triptych "Globalization-Fianciarization-Austrité" could therefore be very crisis?

In principle, whenever there is a major crisis, there is a change in the mode of regulation of the economy.Between 1950 and 1970, we had a rather administered economy - quite close to that which I ask today, but without the ecological component.Then in the 1980s, after the oil crisis, a new regulation mode under the leadership of Thatcher and Reagan developed.In 2008, this liberal capitalism showed its weakness with the financial crisis.We should then have attended a change in the mode of regulating the economy ... But that did not happen!We were even further in the liberal logic.This is what worries me a lot today.Italy, Spain and Greece have undergone drastic cuts, the latter even knowing an unprecedented recession in peacetime.

The conclusion of these episodes is that liberal logic has an enormous resilience capacity.And I am afraid that this is still the case.In the heads of people who govern us and many individuals, there is no alternative.Many are subject to the system, have accepted without even reading his program to vote for a candidate, Macron, who withdrew 15 billion euros from health insurance, in other words to health.This period must be a clarification for all, and I already operate mine.For a long time, I wanted to chat with some people believing that they could be convinced and make them evolve, but I believe that this era is over.The majority of us suffer and a minority puts its pockets full.We will have to make sure that those who take the most blows, those whom I call the "neglected", become a majority force, as I explain in the book.

In these circumstances, do you still believe in European construction?How to explain the lack of solidarity between neighboring countries?In Italy, it is mainly Chinese, Russian or Cuban doctors who seem to provide help to local health services ...

Can we cite a concrete European solidarity act?Since the 2008 crisis and even before?When Alexis Tsípras won in Greece, and Yánis Varoufákis went around Europe to offer mainstream solutions largely supported by American economists, no one listened.France has not even supported it.From this point of view, we can say that there has never been solidarity in Europe.Frankly, can we speak of solidarity in a space where we have mistreated the countries of the South, and where today a Greek, an Italian or a Spaniard is poorer than ten years ago?

In the coronavirus crisis, the problem is that all countries were struck at the same time.In any case, no country has sufficient room for maneuver due to the budget cuts imposed by the treaties, there was therefore no possible support.There was even a form of cynicism, for example from the spokesperson for our government Sibeth Ndiaye, who said that what the Italians did "did not work" ... before doing the same thing three days later.

I write in the neglected that you have to establish a balance of power but, in all frankness, I also think that it will be necessary to draw all the consequences of this crisis.Perhaps by leaving the European Union.As I explain in my book, the EU corresponds to the creation of a single market and a monetary area.Then to the implementation of several treaties which aim to limit the budgetary weapon of states.We must draw the conclusions that the situation imposes, and to stop the fantasy of these "boomers" which repeat that "Europe is peace" without any other argument.You have to look at Europe as it is, and it is not very glorious.This crisis reminds us even more.We are all victims of the European matrix.You have to have the courage to say it.

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One: Thomas Porcher Image.Credits: © Antonin Menage/Fayard editions.