When a leader reverses positions diametrically, is he or she responding wisely to new circumstances, or weakly abandoning principles under pressure, or cynically triangulating among political forces? Those eternal questions are embodied in one man this week, French President Francois Hollande. He’s in the news for multiple reasons, hosting the U.N. COP21 climate change conference in Paris, managing France’s response to the terrorist attacks, intervening in the Middle East, and facing regional elections in six days.
Hollande’s transformation has been so dramatic that it will be studied by scholars and political analysts for years. He’s a small, bespectacled Socialist who spent his career demonizing corporations and the rich, aggrandizing the state as the solution to society’s problems, and shying from confrontation. As he campaigned for the presidency in 2012, Britain’s Guardian newspaper noted that he “so hates fights that he was once nicknamed ‘the marshmallow’ within his own party.”
Now he aspires to be the opposite of the marshmallow, declaring war on “jihadi terrorism,” bombing ISIS positions in Syria, and promising to eradicate it around the world. He has declared a state of emergency that gives him extraordinary powers. He has promised to revoke the citizenship of convicted terrorists who hold two passports and to expand France’s security forces. All these initiatives are antithetical to longstanding Socialist doctrine.
Hollande has reversed himself even more dramatically on economic policy. Immediately after taking office he famously instituted a 75% top tax rate on personal incomes over €1 million a year. The tax yielded minuscule revenue compared with the country’s huge budget deficit, and it hobbled French companies trying to attract top-performing executives and French soccer teams bidding for players. When the tax expired after two years, Hollande made no attempt to renew it.
More significantly, broader business tax increases that he had instituted in his early days as president were slowing the economy, which was barely growing at all. So Hollande transformed himself into a tax-cutting supply-sider who is shrinking government’s role in the economy. He is pushing through a €41-billion package of tax reductions and other benefits for business. This is decidedly novel policy for a Socialist.
In reversing so many position, is Hollande reacting prudently to hard realities or just fighting to save his own political life? He is France’s least popular leader in modern times, and the political right has seized on the terrorist attacks as an issue; even after the Charlie Hebdo massacre in January, they say, Hollande did not respond sufficiently to keep us safe. The country’s regional elections begin on Sunday, and a shift to the right is virtually certain.
Successful leaders almost always change their positions, and their motivations are rarely simple or pure. That’s only one reason Hollande is especially worth watching just now. Suddenly at the center of global debates on terrorism, Middle East policy, climate change, and economic policy, he has suddenly become the world’s most instructive case study on leadership.
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What We're Reading Today
World leaders talk climate change in Paris
President Barack Obama will join over 100 other world leaders to discuss the impact of climate change and try to develop policy for mitigating it. While such talks have proven ineffective in the past, there's hope that an agreement last year between Obama and Chinese President Xi Jinping to reduce carbon emissions will lead to more productive conversations with a global audience. NYT
Bill Gates to launch a clean-tech initiative
At the climate change summit, Bill Gates, along with France, the U.S., India, and others will launch a research and development initiative committed to doubling funding of clean energy technology by 2020. It's a multi-billion-dollar effort led by Gates meant to encourage other countries to follow. Fortune
Russia hits Turkey with sanctions
In response to Turkey's shooting down a Russian fighter jet along the Syrian border, President Vladimir Putin announced economic sanctions against Turkey. The move bans trade in some goods and ends some labour contracts for Turks working in Russia. Meanwhile, the European Union agreed to provide funds and to open talks on adding Turkey to the EU if the country agrees to hold more refugees within its border. Aljazeera
Planned Parenthood criticizes GOP candidates
Following the shooting at a Colorado Planned Parenthood clinic that led to three deaths over the weekend, executive VP Dawn Laguens admonished Republican candidates. Calling out Donald Trump and Carly Fiorina specifically, she says they helped create the environment that led to the shooting and are using it to rally supporters. ABC News
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Worth Considering
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A-B InBev plans to sell Peroni, Grolsch brands
The SABMiller brands will go up for sale in order to ease regulatory concerns in Europe over the merger of the world's two largest brewers. Anheuser-Busch InBev CEO Carlos Brito's decision to unload Peroni and Grolsch means it's losing two of the four global brands under SABMiller's umbrella. WSJ
Elon Musk looks to Germany for his home-energy venture
Musk wants to power homes using technology similar to what he has developed for Tesla vehicles. Germany has the most solar powered homes in the world and high energy prices, making it a great test market. But Musk will face heavy competition. Reuters
Up or Out
CEO of Brazilian investment bank BTG Pactual André Esteves resigned following his arrest last week amid investigation of corruption in the state-controlled oil company Petrobras. Marcelo Kalim and Roberto Sallouti will succeed him as co-CEOs. WSJ
Fortune Reads and Videos
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Swatch, Visa team up...
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Amazon shows what drone delivery will look like
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VW bosses may have known about problems last year
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Today's Quote
"I have self-doubt. I have insecurity. I have fear of failure. I have nights when I show up at the arena and I'm like, 'My back hurts, my feet hurt, my knees hurt. I don't have it. I just want to chill.' We all have self-doubt. You don't deny it, but you also don't capitulate to it. You embrace it." - Los Angeles basketball player Kobe Bryant, who announced yesterday that he will retire from the National Basketball Association at the end of the season.
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