Global Agenda: The French invasion

The threat to the French moneyed classes is clear and pressing. Those who have already made it perceive an urgent need to get their money out of France.

By PINCHAS LANDAU
Euro symbol near European flags 311 (photo credit: REUTERS/Francois Lenoir)
Euro symbol near European flags 311
(photo credit: REUTERS/Francois Lenoir)
The most recent example of a successful French invasion of England was almost a millennium ago – in 1066, to be exact. Every English schoolchild learns about the Norman invasion, led by William (note the Anglicized name) the Conqueror, who overcame the English (Saxon, actually) forces under King Harold, at Hastings. Subsequent efforts, although mounted by much more powerful monarchs who really were French and ruled the whole of France, were nevertheless uniformly unsuccessful. Invasions in the other direction – of France, by the English – also ended in failure, although that end took generations to be reached (see “Hundred Years’ War”).
The net result is that the English and French, while living in close proximity and despite being allies since at least 1850, do not tend to intermingle much. True, there are many Englishmen (and women) who retire to France, or at least own a holiday home there. But this phenomenon is less prominent and probably smaller-scale than the parallel English presence in Spain. There have also been, over the centuries, waves of French immigration to England, notably by the Huguenots (French Protestants) in the wake of the bitter religious wars of the early modern period. Indeed, the descendants of some of the Huguenot families became prominent in the economic and financial development of their adopted country.
But it is doubtful whether, in the long and volatile history of relations between the two countries, there has ever been a phenomenon comparable to that currently under way.
London – arguably now a different country from “England” and certainly from “Great Britain” – is witnessing an influx of French money and French citizens on what is probably an unprecedented scale. But although some Londoners and many Englishmen, inured with the traditional anti-French attitudes of their culture, regard this as a new invasion, it is nothing of the sort. If anything, it is exactly the opposite – an exodus, now verging on flight.
The seeds of the current development go back to the Thatcher era in Britain. The policies pursued by Thatcher in the 1980s, notably the reduction of direct taxation and the rolling back of state involvement in the economy, stood in glaring contrast to those preferred by the first Socialist president of the Fifth Republic, Francois Mitterand.
In both countries, the traditional manufacturing sectors were hammered, but in Britain the rise of the financial sector and of the City of London, coupled with the lower tax rates on offer, attracted a growing number of bright young French graduates. The Channel Tunnel, when it eventually opened, further facilitated the process by allowing French expatriates in London to smoothly speed back to Paris on Friday evenings and spend the weekend with their families in Paris.
Like so much else in the global economy, small-scale developments a generation ago have matured into massive operations. In recent years the flow of French capital, human and financial, into London has swelled dramatically.
Now, with the unprecedented leftward swing of the political pendulum in France – newly elected President Francois Hollande has at his command an absolute majority in parliament – the threat to the French moneyed classes is clear and pressing. Those who have already made it perceive an urgent need to get their money out of France, while those who are young and want to make it in the future see the necessity of getting themselves out.
With entry to the US increasingly difficult, London is the preferred goal for ambitious young French looking for jobs and opportunities, as well as the primary target for French money looking for a safe and solid home – typically, in the form of a house in an upscale London neighborhood.
This is not a mere anecdote. In the context of a crumbling European financial system and, above all, in light of the deep-seated structural flaws that characterize the French economy and are hobbling its performance, the growing flight from France is the strongest evidence available that the next target of the rolling crisis is none other than France itself. Italy may still become the next domino to fall, but it’s also possible that the markets will prefer to skip it and advance directly to the core of the EU, without further delay or dalliance in the periphery countries. Certainly, the policy positions of Hollande and his party are making that possibility more, rather than less, likely.
Thus as France moves toward Bastille Day and then les vacances, assuming all the while that the world will allow it to maintain its unaffordable lifestyle, the French elite are working under very different assumptions. So, too, are French Jews, who have long realized that the demographic and cultural trends at work in the country pose long-term threats to them and their community. Now, the deepening economic crisis is exacerbating these threats and spurring the efforts made in recent years by many French-Jewish families to prepare their emigration. Most of them, however, are not looking toward London, but rather expect to come to a neighborhood near you. That may happen sooner than you, or even they, currently expect.
landaup@netvision.net.il