Good evening, Pierre Gattaz. Thank you for being with us. You were the boss of bosses at the head of MEDEF for a certain time. You are yourself a business leader; your company is called Radiall.
Forgive me, not to mispronounce it. It's an electronic components company, and you are also the author of the book "Earning More Is Now." It sounds like a campaign slogan; we'll talk about it. There is France's budgetary situation, Mr. Gattaz, to which is added, moreover, the great geopolitical blur, since there is a resumption of strikes on Iran. A very concrete question: How does a business leader like you, like perhaps thousands who are watching us tonight—of a large, medium, or small, very small structure—how do they manage to anticipate anything in such a situation, in such a fog? How do you do it?
Well, it's very complicated. There is a lot of stress, great nervousness among all business leaders, the smallest ones, particularly the medium and large ones. There are two compounding problems. There is the general economic problem, geopolitics. It's stressful, but we're used to it; there are crises to manage. I have lived through four major crises at Radiall over 30 years—we handle it. Then you have enormous political uncertainty with, I would say, the soundbites since the dissolution of parliament, which are unbearable for us and add an enormous dose of stress and nervousness. Because, you know, confidence first of all accounts for 50% of growth. That's the first point. And for an economy to work, businesses need, I would say, business leaders to be listened to, to be pampered—those who represent employees, who have factories, etc. That was very much pampered by some, and today, since the dissolution, it's a horror. We have soundbites flying in all directions; there are these three-way split majorities; we are being insulted, quote-unquote, I would say, every week. And if you will, we wonder: is this going to last another eight months?
Let's go there; let's talk about this rhetoric since you bring it up. We talk about superprofits—sometimes there are mega-inheritances, large transfers, the ultra-rich, harms to the economy. What do you think, Pierre Gattaz, is behind this rhetoric that nonetheless leaves an impression, perhaps on a part of the French public, I don't know, for the presidential campaign?
Listen, what I see is that there is enormous nervousness among the French on the one hand because—and that's why I wrote this book with a few friends: "Earning More Is Now"—there is a purchasing power problem. The French, in fact, 40 years ago, when you were on minimum wage, you could double your purchasing power in 10 years.
It was wonderful. The economy was working; we had 2-3% growth, or even more. Industry was at 20%; it was extraordinary. And for 40 years, we wanted to do welfare, welfare, welfare without taking the economy into account. That is to say, we flouted the economy, we said, "Work less." François Mitterrand: we went from 65 to 60 years old for retirement. That costs us 500 billion out of the 3,000 billion in debt that we have. 500 billion. Then, the 35-hour workweek. It's not good, it's not right to... So, if you will, we created an impoverished people with a very generous social model.
But who thirsts for class struggle? You travel a lot, Pierre Gattaz. Is this specific to France? Is this rhetoric, this genuine opposition specific to our country?
In fact, yes and no. I think the French have less hope of becoming wealthier, of increasing their purchasing power. The social elevator is broken. We brought industry down from 20% to 10%, which is very specific to France. I lived through the "40 Pitiful Years," as I call them. If you will, I am the last of the Mohicans in French connectors. I had 20 competitors, and because the labor code was tightened, because the wealth tax was put in place before the Dutreil laws, which annoyed...
Mr. Gattaz, where were you—not you personally, but where were all these business leaders when this bleeding of industries occurred? When deindustrialization took place?
Of course, but we had to fight. We fought, many business leaders, my predecessors fought. When I saw François Hollande arrive in 2013, I ran for the MEDEF leadership with a fighting MEDEF for growth and jobs. And I said, if you implement these tax and social measures, we can create one million jobs. People made fun of me.
Oh boy! With the famous pin, yes. I remember.
And imagine that, it worked. Imagine that, according to clear statistics, we created one million jobs.
Yes, but today... Forgive me, you are talking about a period that people under 20 no longer know.
Yes, but that is to say that it can work: a supply-side policy that lowers taxes.
Does it work in this context? I quoted a few phrases to you earlier. Do you consider them declarations of war? How business leaders are perceived is important.
Practically, if you will. I find that these are parties—always the same ones, by the way—that have no vision, that don't know business, that have never worked in the private sector. They are often party apparatchiks, sometimes in power; many have not worked in companies either, relying on magic money that they have never created. They have never created money. We, as entrepreneurs—small, medium, and large—merchants, craftspeople—and I think a lot about them right now—architects, veterinarians, you earn your living. We earn our living. The politicians today, those who insult us every day, do not earn their living and do not know what they are talking about.
There are also predators, if I may say, quote-unquote, among business leaders. You have also denounced them, I remember, in your book and through various... You have mercenaries, CEOs who sometimes dress up their results to get a golden parachute.
But it's a minority. It happens, but in every community, you have business leaders who are, I wouldn't say crooks, but almost, etc. It exists everywhere; in all communities, you have that. The problem, if you will, is that the majority, the vast majority of business leaders are heroes of the nation because they took the plunge, including our employees. Heroes of the nation, but heroes of the nation because they create wealth, they are locomotives, they create jobs, they create growth, they fight. And worst of all is that you have a complicated economic environment, with tariffs in the United States, with consumption that has dropped in France, the growth rate... All these people are very nervous because they see their revenue stagnating or falling. And facing that, they have employees to pay, etc. And they are told, "We are going to raise your minimum wage by 15%." And if you will, it's completely crazy because we are going to be forced...
...overprotected. For example, let's talk about the tax on superprofits. We just want to be like the others, like other European countries, that's all. Neither more nor less, citizens like the others. Just don't despise us, don't mistreat us, don't think every five seconds about taxing. You see, the parties you're talking about, their program, their vision is to tax. It's always taxing, taxing more. Taxing, if you will—we know very well that the French are tired of being taxed. We are the most taxed country in the world. As you know, redistribution: before redistribution, it's 1 to 23 between the richest 10% and the poorest 10%. After redistribution, it's 1 to 4 or 1 to 5. You have a Gini coefficient that measures the wealth of the French compared to others; we are at 29, meaning in the European average.
Yes, and in fact we want to continue.
So here you have an enormous problem, which is that these people don't understand that we need to make spending cuts. So we cannot solve a deficit problem with taxes. What will taxes bring in? 5 billion, 10 billion. They will demotivate people, and we will pour those additional taxes into the sand. The sand is public spending that is not managed, that is poorly managed. So all of this is totally... As I said, I express a muted, controlled anger, but...
Yes, well, we hear it a lot tonight nonetheless.
But I remain very enthusiastic.
I hear you well. We are going to talk about this enthusiasm, and I will tell you why.
Of course, because there are avenues forward.
For example, I would like to mention and speak about the CEO of Total, Patrick Pouyanné. He reaffirmed, Mr. Gattaz, that TotalEnergies would maintain the fuel price cap—so €1.99 for gasoline and €2.25 for diesel—for as long as the conflict in the Middle East lasts. But the CEO of the oil and gas giant issued an unequivocal warning. I quote his phrase: "In the event of a tax on superprofits, this measure, which already costs the group between 250 and 300 million euros, will end definitively." And what happened a few days later? Prime Minister Sébastien Lecornu said, "No, but wait, this is exceptional." Sometimes the exceptional lasts and gets renewed. One gets the impression sometimes that the CEO of Total asks and the government complies.
No, I think Mr. Pouyanné is entirely right to say, "Listen, the state must manage its sovereign functions: security, justice, police, foreign affairs, a part of national education—and bravo—and public hospitals." In Germany, it is private. That is the scope of the state's responsibility. Today, the state is present everywhere, wants to constrain us, wants to tax us, wants to tell us how to set our prices, wants to say... We've had enough. We want freedom; we are in the country of freedom. So everything we are doing today is totally... What we are hearing is liberticidal. So what must be done? Well, we must do what we wrote in this book, "Earning More Is Now." I'll tell you why.
Before the avenues forward, the diagnosis. Because all the ministers and former ministers follow one after another saying the situation is catastrophic. We agree that you share this diagnosis, and what is the risk if you had to characterize it?
Well, in fact, the risk is that nothing happens. If you will, today, every second that passes between us, we have 5,000 euros more debt—5,000 euros of debt per second added. During the time of our interview, which is very telling, the state will have spent 10, 15, or 20 million more euros. The debt is growing today, so I wouldn't sleep well in the shoes of Mr. Lecornu and Mr. Macron. 5,000 euros of debt, so there is an extremely grave situation. Growth is sluggish, France has ground to a halt. So it's true that economically, if you will, something must be done. In our companies, well, we do things, we decide. What do we do in our companies, small or very large? First, we motivate the people who can bring growth to the fullest—merchants, etc. Let's go, let's seek revenue, let's seek GDP, and we reduce the structure, always. And it is possible to reduce the structure.
The structures are the civil servants.
It's civil servants, it's public spending, it's optimizing the social model.
"Optimizing," you say. Optimizing the social model.
And plenty of countries have done that. You have the Swedes who ended the civil service tenure status; you have Social Democrats like Mr. Schröder in Germany...
...who was not reelected, by the way.
Yes, but those who run want to be reelected, Mr. Gattaz—that hasn't escaped your notice.
Can one reach the highest responsibilities by telling the truth to the French?
I believe we need to have a vision. There is a cruel lack of vision. The vision of the blocs I mentioned is taxing in all directions. I have a vision for my country, and that vision is that by 2040 we will be at full employment, 4%. It is that the youth unemployment rate will not be at 21%; it will be like Germany's, 6%. It is that the social elevator will work again. It is that industry will go back up from 10% to 15% of GDP.
And I describe all of that in my book, and I describe all of that in the think tank I created called the Institut des Solutions. And from there, do you want to reach full employment, French citizens? Do you want your net salary to increase? We estimated it on the order of 30% over 10 years. Well, there are solutions. The solution goes through the economy.
And it also goes through those who are going to hold the steering wheel. You might think this is a partisan question, but do you think those who held the steering wheel and led us to this situation can get back into the driver's seat?
If you will, that is a political question to which I will try to respond.
Yes, without mincing words, right?
No, but I will tell you, I don't mince words at all. I knew a Socialist Party under François Hollande that became social democratic. Fine, and I was very happy; I arrived leading a combat MEDEF in 2013, and we tried to push a certain number of reforms, including the Responsibility Pact, the CICE tax credit which helped lower payroll taxes, the corporate tax rate which dropped from 33% to 25%—it is possible. That was about ten years ago, etc. Yes, but that means they were Social Democrats in the German fashion; I was reassured. I told myself, that's it, the country will be able to alternate between left and right, right and left, and businesses won't be bothered anymore. Macron continued this policy for two years with the abolition of the wealth tax, with the Pénicaud labor reform laws simplifying the Labor Code, with the labor court compensation scale. And afterward, what happened? Everything shattered into pieces. Everything shattered. And that's where the problem is, I tell you. That's where the problem is. The fact is, this supply-side policy was wonderful; it yielded results—two million jobs created, that is very important, confidence... The only problem is that they didn't cut spending alongside it.
Of course, they didn't cut spending, so when growth was there, well, you managed to do all that, increase the employment rate, and as soon as...
I don't want to make you name who understands business best today, but hearing you, no one understands it in this political landscape.
No, some understand it; a few don't. But if you will, I am very disappointed by the left bloc today, which I once knew as social democratic. Again, I don't do politics. I'm just saying I saw Socialists who had the courage to enact reforms toward business and the economy. Fine, and afterward, boom, they all collapsed, as you say. And on the right, there are quite a few of them; the problem is they have no... I hear the economic, pro-business speeches, fortunately, but they shouldn't have 5, 10, or 15 candidates—they need one.
So a primary of the right and center. And then there is, well, La France Insoumise. You mentioned them; I think what you think of them is quite clear.
Oh well, La France Insoumise, if you will, for me is chaos; it's bankruptcy with chaos.
