Où l'austérité? The phrase fits neatly into one of the lines of the French national anthem, but also summed up my impression's of the country's economy on a recent visit.
Paris, even in the absence of Parisians in the summer months, was thronged with tourists of all nationalities, but with Asians appearing to be in the majority. Hotels were full and pricey, all the usual attractions had impossible queues, and the city's upmarket boulevards were packed with free-spending shoppers.
Perhaps Paris, as the capital of the most popular tourist destination country in the world, is untypical of the rest of France, and for sure, like London, the city has its own powerful local economy.
But the story was the same elsewhere in France. In a small regional town in the south-west, the shopkeepers were busy, restaurants had to be booked well in advance, and local people had an air of satisfied affluence.
In La Rochelle, on the Atlantic coast, it was almost impossible to walk the city's historic streets for hordes of visitors, most of them French and all wanting, it seemed, to spend, dine or drink at the same time, and at near-Parisian prices.
Perhaps I shouldn't have been surprised at the exuberance of the French consumer economy at the height of the summer holidays, but I must admit I was expecting something different from a country that has been stripped of its top investment grade status by the ratings agancies and which, according to many economic analysts, has had a torrid time since the beginning of the euro crisis.
The experts say France has been in a form of suspended economic animation since the global financial crisis of 2009. GDP growth for the past two years, as the euro crisis raged, was less than 1 per cent for Europe's second biggest economy.
There were serious concerns about high levels of government and corporate debt, and an electorate ready to vote for the official austerity policies advocated by the new socialist government of François Hollande. The people were, it appeared, ready to take their medicine in order to achieve economic recovery.
The high tax regime forced through by Mr Hollande is severe, with some people at the top end effectively working for a year for nothing, but it was generally acceptable in a country that has a curious attitude to wealth and public ostentation of it. A republican/socialist disdain is never far below the hedonistic surface.
So the president's austerity consisted largely of cutbacks in public spending and withdrawal of benefits like short working hours and long holidays, as well as increases in value-added tax and state-sector owned utilities such as electricity.
The president promised too to reduce unemployment by the end of this year, though economists have argued that will not be possible against the background of lower state spending and absence of any fiscal initiatives.
The main victim of Mr Hollande's austerity seems to have been Mr Hollande himself.
Voted in last year with a mandate for radical change in the economy, he has an approval rating of 30 per cent, and many pundits say he will be a one-term president.
That, however, is not inevitable. A week ago the French government announced official figures that showed GDP had grown by 0.5 per cent on the second quarter of last year, the highest in over two years, prompting hopes that the economy is back on a recovery path.
There are still worries about the financial situation of the French banking industry, in particular its exposure to even more highly indebted Italy and Spain; worries about the big overhang in its smaller European neighbours is preventing credit growth at home, viewed as essential for a sustainable recovery.
Business confidence remains weak, as evidenced by purchasing managers' statistics. The experts are unconvinced that a full-blown recovery is under way.
But French people seem to have decided that serious consideration of that issue can await the end of the summer holidays. For the moment, they appear determined to enjoy their own, peculiarly Gallic style of austerity.
fkane@thenational.ae
