In France they call it “Economic Patrioism.”
In case anybody is wondering how France is faring on the global competition for capital to feed growth, here’s an example from today’s Daily Deal:
The French government, in a new policy that has already drawn fire from European Union regulators, plans to create a list of companies to be protected from foreign takeover and permit targeted French companies to adopt anti-takeover defenses allowed in the bidder’s own country. French Prime Minister Dominique de Villepin, in fact, coined the term “economic patriotism” to describe the government’s hostile response to rumors in July that U.S. rival PepsiCo Inc. would acquire French food giant Danone SA.
The French government then trumped themselves in the stupid policy department by requesting that pension funds, banks, and insurers direct their investments toward his list of “strategic” industries.
Sure wouldn’t want all that yoghurt to fall into the wrong hands.
Thereby, they have cleverly insured that French workers will have neither a job nor a pension account to live on.
Sacre bleu!
JR
Ohh…. finally I know that by sure they were frenchmen painted in stars and stripes that have thrown back into the ocean those yellow faces of CNOOC trying to buy the all american UNOCAL!
Lester
You are exactly right, Lester, about the US reaction to Unocal. Most of the oil assets of Unocal were in Indonesia, not the US. Xenophobia is active on the streets of America these days. My views on European growth, however, remain the same. European law, especially labor law, has refused to acknowledge the change in global capital mobility in recent years and is systematically driving capital out of Europe. Europe cann’t grow until this changes.
JR
More incredible short sightedness from our French “friends”.
Lets keep doing what we can to make sure that such artificial redirections of investment capital as the result of patriotic poisen pills don’t occur here in the USA. If we ever do privatize Social Security (which on its face would seem to be a good thing), I fear that the political class in Washington, DC will be unable to resist the urge to attempt a re-engineering the American economy with that giant pool of “privatized” investment capital.
The ponzy scheme otherwise know as Social Security is bad enough as is: privatizing it should make things better for retirees, but if any effort to privatize were handled the wrong way, then it could make things much worse for retirees, their children, and the world economy as a whole.
Keep up the good work informing us on issues where politics, investing, and economics intersect.
Tim
Thanks, Tim.
JR
The difference between our government and those of the European countries like France is that they have not completely forgotten that the purpose of government is to serve their citizens; not just their corporations. Over the long run, I believe they will be better off for it. You can debate whether their methods are effective or not but at least they consider the plight of their people. Kind of ironic that all these years after the French Revolution, it is our government whose attitude toward the fast-disappearing middle class seems to be “let them eat cake”.
JR,
Socialism returns to France …
Hawaii with price curbs, now this!