Economics 101: Labor Day and the American economy under President Obama

From The Philadelphia Inquirer:

Five years after recession, American workers are scared, cautious, and worse off
By Jane M Von Bergen, Philadelphia Inquirer Staff Writer | Published Monday, September 1, 2014, 1:08 AM

Anthony Reynolds lost his job in 2009. The replacement job he found at Philadelphia International Airport pays half as much and does not include benefits. (Photo by Michael Bryant, Philadelphia Inquirer Staff Photographer)

When the phone call came, Anthony Reynolds, a big man with a ready laugh, cried like a baby.His ex-wife, living in Texas, had taken their son, 7, to a hospital for an important but minor procedure, and the hospital had turned them away. No insurance.

She called. He cried.

“When I lost my job, I didn’t have the heart to tell her that my benefits had been cut,” he said.

“I was so ashamed,” he said. “I’m 1,800 miles from my kids, and I can’t do anything for them.”

By the statistics economists gather, the recession officially ended five years ago, in June 2009. Reynolds lost his job in October 2009. He now cleans airplanes at Philadelphia International Airport, earning half what he once did, in a job with no benefits and no future.

“The recession is over?” Reynolds said. “I didn’t get the memo. I’ve been struggling.”

It’s a now-common journalistic practice to lead off articles on topics like the economy — once called the “dismal science” — with a human interest story, in this case to tell the reader that no, the economy really hasn’t recover yet, and here’s a guy who’s struggling. Only someone as rotten as your Editor would point out here that part of the reason that Mr Reynolds is struggling is because he and his wife divorced, and they are trying to support two households, not one.

But, after that human interest beginning, the story gets down to the meat of the dismal science statistics:

Five years after the recession, so much has changed in the world of work – celebrated, or at least noted, on Labor Day.

Hiring is up, with 209,000 jobs added in July, pulling the nation’s total payrolls ahead of where they were when the recession began in December 2007. The stock market has also risen, with the S&P 500 index breaking a record to close above 2,000, a key benchmark.

Even so, there is growing pessimism among the nation’s workers, with Americans in all walks of life worried about the future. Financially, they are worse off, as wages have stagnated and many jobs created since the recession are in occupations that pay less.

And this is the point at which the reader needs to refer to the Inquirer original to get the rest of the story; I’ve directly quoted more than is my wont. But note the rather odd way that the author put it: “Hiring is up, with 209,000 jobs added in July, pulling the nation’s total payrolls ahead of where they were when the recession began in December 2007.” Well, it’s true enough that the number of people employed is now higher than in December of 2007, 146,352,000 compared to 146,273,000, an increase of 79,000 more jobs. The trouble is that it is a 0.054% increase, when the working age, work eligible population1 increased by 14,867,000, or 6.38%. The official unemployment rate has come down from its recession highs2, but that is because the labor force participation rate3 has dropped from 66.0% to 62.9%. That’s a 3.1 percentage point decrease, but, mathematically, a 4.7% decline.4 Finally, a statistic at which The First Street Journal looks at closely, the employment to population ratio has declined from 62.7% to 59.0%, a 3.7 percentage point decrease, but a 5.9% decline.5

More simply put, 5.9% less of the work eligible population is actually working.

That has a huge impact on everything else. The Inquirer article noted that “wages have stagnated and many jobs created since the recession are in occupations that pay less,” and that all falls on the employment to population ratio: with so many more work eligible people not working, the supply of labor vis a vis the demand for labor has jumped significantly. Businesses don’t pay more for labor because they don’t have to pay more to actually get people to work.

 

The response of President Obama and his Administration? The same people who told us that the $816.3 billion American Recovery and Reinvestment Act of 2009 would hold unemployment to a maximum of 8.0% now want to address “income inequality” by raising the minimum wage, blithely unaware that increasing the costs of labor on the minimum wage employers means that such employers must either raise their prices or reduce the number of people who receive the increased rates, or some combination of both. The President and his economic team have been so wrong, so often, that the wiser bet, without having any other information at all, is to do the opposite of what they suggest.

Unfortunately, the President’s policies concerning wages are not the only ones which are bad for our economy. The Administration is trying to impose regulations which would impose huge new costs on businesses, costs which must be passed along to the consumers, concerning CO2 emissions, has constantly stymied (by the mechanism of simply delaying approval) the Keystone pipeline project (costing thousands of high-paying jobs), and, of course, the biggest cost of them all, the Patient Protection and Affordable Care Act, mandating that everyone have health care insurance and thus increasing burdens on businesses. All of these things stem from American liberal philosophy, from thinking how great things would be if everyone was just a good liberal, without having the first clue as to the economic costs of all of those things. We have said it before: if liberals actually understood economics, they wouldn’t be liberals anymore!6

And now the Inquirer is telling us what we have known all along: it doesn’t matter that President Obama and his Administration have claimed to have made great progress, because this economy is just plain rotten. The gentleman pictured in the Inquirer article almost certainly voted for President Obama, if he voted at all,7 but the recession isn’t over for him yet, just as it isn’t over for a lot of people.

Your Editor is somewhat amused by the very existence of the Inquirer article. After all, the Inquirer endorsed President Obama in his re-election campaign, concluding, “BARACK OBAMA is the better candidate in the presidential race. A vote for him is an investment in a strong future, which is why The Inquirer endorses his reelection.”

“An investment in a strong future?” Boy, did they get that one wrong!
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Related Articles:

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  1. The Bureau of Labor Statistics refers to this as the “civilian non-institutional population,” meaning those people 16 years and above, who are not in the military, nor prison, nor some sort of other long-term treatment or care center.
  2. 10.0% in October of 2009, eight months after the 209 stimulus bill which was supposed to hold unemployment to a maximum of 8.0% was passed.
  3. The percentage of the workforce eligible population which is actually employed or looking for employment.
  4. 3.1 ÷ 66.0 = 0.04697.
  5. 3.7 ÷ 62.7 = 0.05901.
  6. The Editor has watched Star Trek plenty of times, and he’d love to see the Star Trek future, where everyone has a great job he loves, poverty has been abolished, and energy is provided from completely clean and renewable sources, but the Editor understands the differences between science fiction and reality. He doesn’t think that the left do.
  7. President Obama won 93% of the black vote in Pennsylvania, and he received every single vote in 59 heavily black precincts in Philadelphia.

Is there a worse Attorney General in any state, anywhere, than Kathleen Kane?

Attorney General Kathleen Kane (D-PA) Click to enlarge.

The First Street Journal has run several stories about the silliness of Pennsylvania Attorney General Kathleen Kane, (D-PA), who squashed a sting and an investigation into bribery by some members of the Pennsylvania state legislature because, surprise! everyone caught has been a Democrat, an action so egregious that even the editors of The Philadelphia Inquirer complained. And now, it looks like she’s in trouble again:

Special prosecutor probes Pennsylvania Attorney General’s Office
Craig R. McCoy and Angela Couloumbis, Philadelphia Inquirer Staff Writers | August 31, 2014 6:45 AM

A special prosecutor is investigating whether the office of Pennsylvania Attorney General Kathleen G. Kane leaked confidential grand jury material to a newspaper in a bid to strike back at former prosecutors in the office who had been critical of her, according to several people familiar with the matter.

The special prosecutor has issued several subpoenas to Kane’s office and others to explore how secret records became public this year about a 2009 investigation by the Attorney General’s Office involving Philadelphia political activist J. Whyatt Mondesire, the sources said.

Though there have been periodic inquiries into grand jury leaks in the past, this appears to be first time the state attorney general or top staffers in the office have come under scrutiny.

Reached for comment late Saturday afternoon about reports of the leak probe, J.J. Abbott, a Kane spokesman, referred those questions to Renee Martin, Kane’s acting communications director. Martin did not return phone calls.

It is unclear who commissioned the investigation, nor was The Inquirer able to determine the special prosecutor’s name. But typically, sources said, such a decision would need approval from the Pennsylvania Supreme Court.

A person who violates grand jury secrecy rules may be found guilty of contempt of court and sentenced to up to six months in prison.

More at the link. But we are officially amused that the lovely Mrs Kane, who won her office by campaigning on investigating whether Governor Ton Corbett (R-PA), then the state’s Attorney General, deliberately slowed the investigation into former Assistant Coach Jerry Sandusky on child sexual abuse allegations, for some sort of political advantage, charges on which an investigator completely cleared Mr Corbett, is now facing an investigation that she has misused the Attorney General’s office to get back at her critics.

And make no mistake about this: a special prosecutor investigation authorized by the state Supreme Court is a serious thing, and to authorize such against the state’s Attorney General, who is the state’s official litigant before the Court, is a very serious matter, one that the Justices1 would never undertake if they did not perceive a real problem with the Attorney General and her office.

It seems that Mrs Kane, once called the Democrats’ new “it girl” in Pennsylvania, is exactly what we have called her before: an intellectual lightweight and an embarrassment to the Commonwealth. Perhaps she can get a guest appearance on Orange Is The New Black.
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  1. Four Republicans and three Democrats.

I’ll bet that Vladimir Putin is scared now!

From the Associated Press, via The Washington Post:

EU sets Russia ultimatum, threatens sanctions
By Juergen Baetz and JimM Heintz | Associated Press

Ukrainian President Petro Poroshenko, right, talks with German Chancellor Angela Merkel during an European People’s Party summit ahead of the EU summit in Brussels, Saturday, Aug. 30, 2014. EU leaders, in a one day summit, are set to decide who will get the prestigious job as the 28-nation bloc’s foreign policy chief for the next five years. They will also discuss the current situation in Ukraine. (Yves Logghe/Associated Press)

BRUSSELS — Despite tough rhetoric decrying Russia’s increasing military involvement in Ukraine, European Union leaders on Sunday stopped short of imposing new sanctions against Moscow right away.Instead, the 28-nation bloc’s heads of state and government tasked their executive body to “urgently undertake preparatory work” for tougher economic sanctions, according to summit chairman Herman Van Rompuy.

The sanctions will depend on the evolution of the situation on the ground but “everybody is fully aware that we have to act quickly,” he added. The preparatory work will start Monday, he added.

The fighting between the military and Russian-backed separatists in eastern Ukraine has so far claimed 2,600 lives, according to U.N. figures. NATO said this week that at least 1,000 Russian soldiers are in Ukraine, which Russia denies. Another 20,000 Russian troops are amassed just across Ukraine’s eastern border, NATO says.

The U.S. and the EU have so far imposed sanctions against dozens of Russian officials, several companies as well as the country’s financial and arms industry. Moscow has retaliated by banning food imports.

German Chancellor Angela Merkel said the new sanctions would target the same sectors as previous punitive measures, which also included an export ban for some high technology and oil exploration equipment.

Ahhh, but here are the money quotes:

Several European leaders had called for additional sanctions at the outset of the meeting in Brussels, but the fear of an economic backlash apparently prevailed and led the bloc to grant Russia another chance at avoiding tougher action. New sanctions would have required unanimity among the leaders.

Russia is the EU’s No. 3 trading partner and one of its biggest oil and gas suppliers. The EU, in turn, is Russia’s biggest commercial partner, making any sanctions more biting than similar measures adopted by the U.S.

In other words, if the European Union angers President Putin enough, he can turn off the gas, and it gets pretty darned cold in the winter in Europe. The sanctions could hurt Russia’s economy, but Russia could freeze Europe to death.

So, I’ll put it bluntly: if President Putin wants to seize the eastern part of Ukraine badly enough, he can and he will, and the European Union will fuss and bluster and fulminate, but they cannot and will not do anything to actually stop it. I wrote about the West’s inability and unwillingness to do anything to actually stop Russia, months ago, using this tweet from Hale Razor:

So, the Western leaders threatened to impose new sanctions, huh? It’s pretty obvious that the previous sanctions didn’t bother President Putin in the slightest, so it’s rather difficult to see how these new sanctions are going to have him quaking in his boots. Heck, Russian bombers even violated Dutch airspace, something which has happened before, but given the heightened tensions, the Russians would be more careful these days . . . if they hadn’t already judged President Obama and the other Western leaders as milquetoasts.

There is really no reason at all for Russia not to invade the eastern half of Ukraine, where much of the population is Russian, because the West has proved that it cannot and will not do one thing to stop the bear.

Dr Strangelove put it most simply: “Deterrence is the art of producing in the mind of the enemy the fear to attack.” Mr Putin has no fear of attacking at all, because he knows that he can, and, as Hale Razor put it, the most serious consequence will be that Mr Obama will unfriend him on Facebook.

It was true when I wrote that last April, and it’s still true today.

Illegal ISIS Planet Warming is Number ONE Threat

Labor Day Weekend. HMMMM, where is the laboring of the mind of the Government? Big issue coming up, Sams not selected for the RAMS team roster. ILLEGAL IMMIGRATION still on, companies can’t discriminate against ILLEGALs. (What a dumbass idea that is) Football distraction is back. Obama still contemplating how to screw the country on legalizing lawbreakers. Illegal immigrant lawbraker murderers still on the loose. BO still issuing EO’s acting like a Dick-Tator. But, a supposed ISIS attack gets no mention. Allies like the UAR, Egypt and Saudi keep telling us about this. Guess it’s low Priority at the 1814 burned Sandstone Mansion in DC. We have Muslim Brotherhood plants at the 1814 Burned Sandstone Mansion. BO is still Fundraising and Golfing and still has no Strategy as admitted. Personal aide Jarrett from Iran?? CIA Director allegedly a muslim, and we’re told everything is OK. I just wonder when our collective asses will be shot out from under us. But NO FEAR, GLOWBALL WARMING IS OUR No. 1 Threat to the country. And Russia has “VACATIONING SOLDIERS IN UKRAINE” (see other article for that war)

THE COMMENTATOR
Michael Curtis
On 22 August 2014 09:33

ISIS, Hamas, Muslim Brotherhood and Western delusions

With a new report in mind, the startling delusions of top British diplomats about the Muslim Brotherhood mirror wider Western denial about the nexus between Hamas and ISIS, and the Islamist threat generally

-snip-

Cameron, who has delayed publication of the report, is not the only individual startled by this conclusion. Saudi Arabia, Egypt, and the United Arab Emirates have banned the Brotherhood as a terrorist group. The court in Cairo has sentenced 529 members of them to death so far in 2014 and has imprisoned many others. The crown prince, Zayed al-Nahyan, of the Abu Dhabi royal family, even informed the British Foreign Office of the danger he felt in London from members of the Brotherhood.

It is difficult to reconcile the Jenkins report with the behavior of two organizations, ISIS and Hamas, associated with the Brotherhood, as well as with the actions, which include the murder of tourists on a bus in the Sinai Peninsula, of the Brotherhood itself.

Moron This Here:
http://www.thecommentator.com/article/5182/isis_hamas_muslim_brotherhood_and_western_delusions

recto-cranialinsertion

Rule 5 Blogging: The Яussians are coming, the Яussians are coming!

It’s the weekend and time, once again, for THE FIRST STREET JOURNAL’S version of Rule 5 Blogging. Robert Stacey Stacy McCain described Rule 5 as posting photos of pretty women somewhat déshabillé, but, on this site, our Rule 5 Blogging doesn’t put up pictures of Milla Jovovich in her summer clothes, but women, in full military gear, serving their countries in the armed forces. The terribly sexist authors on this site celebrate strong women, women who can take care of themselves and take care of others, women who have been willing to put their lives on the line in some not-so-friendly places, women who truly do have the “We can do it!” attitude.

This week, we are featuring soldiers from Ukraine, because, once again, the Russians are coming. The West is, of course, very concerned, and has issued very strongly worded condemnations.

Keeping track of the Russians

Keeping track of the Russians

Continue reading ‘Rule 5 Blogging: The Яussians are coming, the Яussians are coming!’ »

From Around the Blogroll

My darling bride (of 35 years, three months and 11 days) made me work around the house, on a long procrastinated project, so I’m late getting to this post!

The Los Angeles St Louis Rams waived defensive end Michael Sam, the first open homosexual on an NFL roster, in the final cuts to reach the 53 man roster. I anxiously await the stories that he was cut because of his sexual orientation.

Deanna Fisher of the Victory Girls: Amanda Marcotte is For Women! Unless Their Story Wrecks Her Narrative. Then Never Mind.

Robert Stacey Stacy McCain: Feminists Courageously Defending Their Right to Another Red Solo Cup. Apparently, giving women the advice that one of the wiser ways to avoid date rape or acquaintance rape is to not get stinking drunk is horribly sexist!

William Teach of The Pirate’s Cove: Enviros Wonder Why “Green” Groups Are So Darned Lilly White. Mr Teach says that he’s “going to brand the modern enviro/climate change movement as racist. They have to prove they aren’t,” using the left’s tactics against them. Of course, the real reason is that most racial minorities are more concerned about putting food on the table, rather than why the Antarctic ice pack is expanding to record levels despite the predictions of the warmists. I’d bet that if someone were to check the income levels of the greens, it would be found that most of them have more green in their wallets than average as well, and don’t really have to worry about the effects of their policy proposals on their economic survival.

EPA chief Gina McCarthy, not exactly a Person of Color.

Of course, Hube of the Colossus of Rhodey wrote Obama EPA Chief: “Fighting Global Warming Is About Protecting Communities of Color,” even though People of Color — supposedly a very acceptable phrase, though Colored People would earn the writer immediate condemnation — don’t seem to participate very heavily in the environmental groups. Am I allowed to suggest that it’s really white people telling people of color what’s good for them?

Sister Toldjah: The most desperate, stupid #NCSEN attack line you’ll see this year

John Hitchcock on Truth Before Dishonor: All Multi-Nationals Should Invert Away From US

The Lonely Conservative: Obama Plans To Regulate Every Appliance In Your Home

L D Jackson of Political Realities: New York Government Tries To Force Christian Farmers To House Same-Sex Marriage

And Darleen Click of Protein Wisdom noted that the left have accomplished their mission: rather than compromise their religious values, the Giffords have decided not to host weddings at all in the future. For the homosexuals, it isn’t enough that they be allowed to do their own thing, but that they have to try to use the law to force everyone else to go along with it.

William Jacobson of Le*gal In*sur*rec*tion: Support for Israel remains strong after Gaza conflict. Newly-released Pew survey shows much more sympathy for Israel among Americans than Palestinians. Of course, support for Israel lessens among Democrats, to whom American Jews routinely give around three-quarters of their votes, and Democrats have much greater support for the Palestinians. All that this shows is that the Democrats are just plain stupid, and American Jews not much brighter when it comes to casting their votes.

There’s nothing on Bridging the Gap that’s either new or worth going over to see.

Ed Morrissey of Hot Air: WaPo: Say, this President doesn’t seem terribly competent at foreign policy, huh?

Donald Douglas’ view of how Secretary of State John Kerry looks

Donald Douglas of American Power: John Kerry’s Demand for ‘Global Coalition’ Signals Cowardice, Weakness, and Appeasement. Well, I don’t know how Secretary of State Kerry could look very good on foreign affairs, given that he has to work under the policies of President Obama. The obvious question is: if Hillary Clinton runs for President, as is widely expected, how can she separate her poor performance as Secretary of State other than by claiming that she was hampered by the policy restrictions of the President?

Steven Hayward of Powerline: Coming Soon To Climate Change: The “Rewind” Button?

The much prettier Dana, writing on Patterico’s Pontifications: Ft. Hood Shooter’s Unsurprising Request. It seems that Nidal Hasan, the Fort Hood murderer, wants to become a citizen of the Islamic State. Perhaps we could grant his wish, and then have him beheaded, with a knife, and the video sent to the Islamists. But, then again, I’d much rather that he waste away in prison, staring at four walls for a couple of decades, knowing that he’s a helpless prisoner of a Christian state. And when he does go to his 72 virgins, being that he’s paralyzed from the waist down, they’ll stay virgins.

Our retirement home. Click to enlarge

Our retirement home. Click to enlarge

Finally, a picture: Though I’m not planning on retiring for another five years, my lovely wife and I are buying our retirement home back in Kentucky. We were only planning on looking for a piece of land, a few acres or so, with water on the property, on which to build, when this just fell into our laps, for a ridiculously low price. Just a hair under eight acres, with 500 feet of frontage on the Kentucky River. The land to the right of the road, with the light yellow house, will be ours on September 16th. The mountain behind it isn’t part of the property, but is part of the Daniel Boone National Forest. The tree line to the right is along the river bank. We’ll be renting out the house for the next five years, and retiring in the spring of 2019 . . . assuming that I don’t drop dead earlier than that.

And you wonder why I think that the Palestinians are stupid?

I’ve said it before: the Palestinians could have their independent nation, in Gaza and the West Bank, if they’d just stop shooting into Israel.

That’s all that they’d have to do; they are the only people of whom I can think, in all of history, who could win their war by not fighting. If they’d stop shooting, if they’d just behave like civilized people, the Israeli voters would, within a couple of years, force the government to grant independence to the Palestinians. The Israelis are tire of war, tired of almost universal conscription, and tired of having to deal with the Palestinians and terrorism; if the Palestinians just quit fighting, the Israeli public would be happy, relieved, overjoyed at them gaining independence.

Israel is a democratic nation, under a proportional representation parliamentary system. The ruling party almost never has a majority in the Knesset by itself, and is forced to forge coalitions with minor, single issue parties to form a government. If the people want a new government, a couple of the minor parties will drop out of the coalition, and the government will fall, forcing new elections. Thus, either the current ruling party would be forced to grant independence, or a new government would be elected and do just that. But somehow, the Palestinians have been unable to see that.

Well, this might be evidence of why they can’t: apparently, they’re just plain stupid:

Gazans Celebrate Hamas “Victory” by Firing into Air, Killing Each Other
August 28, 2014 by  

There’s no way this can go wrong

Those death blossoms bloom in the Gaza summer. If they celebrate any more victories, they’ll really strain the morgues.

As the cease-fire began in Gaza, Tuesday evening—it was supposed to start at 7 PM but rockets and mortar shells continued to fall in Israeli territory as late as 7:15 PM—the V Day celebrations erupted in Gaza, after 50 days of clashes.

And then people started to drop in the streets.

According to tweets from Gaza, as many as 2 locals were killed from those gunshots, and at least 25 were injured.

An 8 PM tweet in Arabic read: “Gaza: wounded in shooting in the air, internal calls for citizens to express their happiness by other means.”

It’s either killing Jews or killing each other. Since there are no Jews in Gaza, the options are limited.

It’s kind of like this brilliance.

A sad, sad photo.

Taken Thursday, August 28, 2014, at 1835 @1835 EST. Click to enlarge.

Taken Thursday, August 28, 2014, at 1835 @1835 EST. Click to enlarge.

It was taken this evening, Thursday, August 28, 2014, and you can see the start of the leaves turning and falling to the ground.

It’s still August! It’s still Summer! Where’s my Global Warming?

It only reached 76º F today in Jim Thorpe, and the forecast is for tonight’s low to be 51º F . . . in August! We haven’t seen a 90º F degree day since June, and we have almost never used the air conditioning this Summer.

Economics 101: It doesn’t matter how liberal you are, eventually you have to do something radically conservative like pay your bills

We have previously noted, in our 18th Century Technology category, the financial travails of newspapers these days. But it’s not just newspapers, and even companies owned and run by liberals are not immune from market forces:

Bloodbath at CNN, HLN: Axing of 550 Jobs ‘Imminent’

Today’s news of a coming bloodbath at CNN and HLN is a reminder that while CNN has been able to use the unrest in Ferguson to race-bait its way to better ratings, everyone knows that’s temporary. Without something that allows the left-wing network to appeal to the lowest common denominator, CNN is almost certain to fall back into the ratings basement until something else comes along for the network to cynically exploit. So here come the layoffs and buyouts.

In the headline, The Wrap describes these layoffs as “imminent‘:

Some 550 buyouts are to be offered at Time Warner’s Turner network this week, including a large number of those at CNN and HLN, which will lead to layoffs if they are not taken voluntarily, according to an individual with knowledge of the network’s plans.

The buyouts will come across the Turner division, with a couple of hundred expected at CNN and HLN, the individual said.

A CNN spokeswoman had no immediate comment. …

HLN has been struggling in the ratings, regularly finishing fourth in total viewers and in primetime across the key cable news demo, viewers 25-54. It did edge out MSNBC in the demo across a total day measurement in 2014′s second quarter.

CNN’s ratings have been doing well during times of big, national breaking news — but the cable news net regularly ranks far behind Fox News and battles with MSNBC probably more than it would prefer.

More at the link.

In a way, it’s karmic justice once again making itself felt: it doesn’t matter how liberal or noble or whatever the good people at CNN are, the laws of economics and business realities still apply, and economics and business are inherently conservative in orientation. And, along those lines, it seems that voting socialists into power doesn’t always mean that they can stay socialists. From Donald Douglas:

Left-Wing Revolt Plunges Hollande Into Crisis

At Telegraph UK:

The French president is forced to order a reshuffle after two dissident cabinet ministers launch an open rebellion against his economic policy.

François Hollande was forced to order his second reshuffle in less than five months today after a revolt within the cabinet threatened to cripple his presidency.

The Left wing of France’s ruling Socialist Party is furious over Mr Hollande’s shift to more centrist economic policies with the introduction of tax and spending cuts aimed at reducing the country’s huge budget deficit.

The outgoing government, headed by the reformist prime minister, Manuel Valls, was appointed in March with the aim of bringing an end to infighting and the cabinet’s apparent lack of direction.

However, it was plunged into crisis over the weekend by Left-wingers led by Arnaud Montebourg, the flamboyant economy minister.

He defied Mr Hollande’s authority by publicly urging him to discard austerity and break with what he described as deficit-cutting measures imposed on the eurozone by “the most extreme orthodoxy of the German Right”.

More

Reality bites, doesn’t it? Monsieur Hollande has introduced economic measures he finds personally distasteful, because he has no real choice: his socialist experiment has led to huge budget deficits, and all of Europe is, to paraphrase Margaret Thatcher, running out of other people’s money.