France is destroying 8,000 jobs a day....

“The house is on fire. France is destroying 8,000 jobs a day,” said Pierre Gattaz, the new leader of business federation MEDEF.

Mr Gattaz said the avalanche of “very dogmatic” measures imposed by Mr Hollande during his first months in power have put companies under enormous stress, and little has been done yet to reverse the damage despite a change in tone. “The government must step up to its responsibilities. Companies can’t till a soil full of rocks and brambles. It is private enterprise that will save France. The public sphere can’t create jobs, only companies can do that, and they’re the heroes.” The chief executives of top firms including Peugeot Citroën, EADS, Sanofi and Publicis signed a joint letter to Les Echos, complaining that France is being suffocated by high taxes and an over-regulated system that is no longer fit for purpose.

“Unemployment has reached record levels. The trade deficit is getting worse. Profit margins are the weakest in the eurozone. This calls for urgent measures. It is a bitter reality, more so because other countries touched deeply by the crisis such as the US or Ireland are recovering," the letter read. The group called for a radical shake-up of labour markets to let each firm set its own working hours, and a “coherent” energy policy to bring down costs from current ruinous levels. Gas prices are three times as high as in the US. Where do you start reforming a state with majority control (55%) of the economy and a culture that private industry is simply a means to  maintain  the current French way of life?

Throw in the lack of its own currency and the unshakable belief by most of the population, particularly  the political class that  France is Europe's core instead of simply a painted pig. 

Perhaps you don't reform. You merely mutter the words the electorate wishes to hear. And hope 'growth' appears like a miracle for France's luxury export markets. I notice the official expectations for GDP this year have just been revised upwards.

Take energy. France is 75 % dependent on nuclear energy. Of the remainder, 14 % on gas of which 92.1 % had to be imported in 2010 according to Eurostat. As Ambrose points out gas prices are three times as high as the US due to the impact of shale gas.

Now here's the rub. France has abundant shale gas reserves. In 2011 France announced a moratorium on the exploration of shale gas. On 14th of September 2012 Hollande extended that ban for the rest of his Presidential term. Prior to the ban France was the second most promising country after Poland in Europe for shale exploration and investment opportunities.  No doubt a popular decision in France, particularly for those small French farmers reliant upon CAP subsidies.  Yet in September 2012 Hollande also pledged to cut nuclear energy from 75% to 50% in the energy mix. How?

It is France's grave misfortune to have a President who is a believer in a 'Hail Mary' economic 'growth' strategy instead of reform.  Yet all is not lost provided two events happen.

France requires its own currency not Germany's. And a leader  with the courage to tell the electorate how it is, driving  through the necessary reforms.