French-American Foundation Weekly Brief highlights political, economic and cultural news stories related to France and French-American relations as well as trans-Atlantic and European issues.
France and the United States, as well as four of the strongest European economies pledged on Thursday, July 26, to reinforce the fight against tax evasion by instituting a free exchange of financial information on foreign accounts, Le Monde reported.
France
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France and the United States, as well as four of the strongest European economies pledged on Thursday, July 26, to reinforce the fight against tax evasion by instituting a free exchange of financial information on foreign accounts, Le Monde reported. The United States will now share the tax information of citizens of the UK, Spain, Italy, France and Germany with their respective countries, and vice versa. Prior to the agreement, this information was only available with reasonable suspicion of tax evasion. Exploring this issue further, Reuters and The Financial Times reported that the Tax Justice Network estimated the total sum of money placed in foreign accounts to be as much as $21 to $32 trillion, meaning about $281 billion in lost income tax. This campaign represents the furthering of the U.S. Foreign Account Tax Compliance Act passed in 2010, to which the Swiss bank Credit Suisse announced it would submit in late June 2012.
Responding to severe droughts in the United States and Russia, French president François Hollande called for increased vigilance on the global grains market, Europe 1 and Le Figaro reported. “The farmers face a particularly tense situation due to grain prices; this is why I have asked [Minister of Agriculture] Stéphane Le Foll to call upon the G20 leaders so they can understand the size and scope of the volatility of the price of raw materials, notably of grains,” Hollande said while visiting a farm in the southwest of France. These comments come in the wake of unprecedented dryness in the United States, causing a 20 percent reduction in the soybean crop.
Nathalie Kosciusko-Morizet, National Assembly deputy from Essonne and former ecology minister under the presidency of Nicolas Sarkozy, critiqued on Friday, July 27, the preparations required of candidates for the presidency of the recently ousted Union for a Popular Movement party, as candidates are not allowed to seek endorsements online, Libération reported. Kosciusko-Morizet declared on Saturday, July 21, that she would seek the party presidency to provide an alternate choice as it has been torn between two past icons, current secretary general Jean-François Copé and former Prime Minister François Fillon, as covered by The Telegraph and Le Figaro. With little time and no possibility of employing the Internet, many have speculated that the 39-year-old will have difficulty acquiring the requisite 8,000 signatures of elected officials to present her candidacy as hopefuls have until September 15 to announce their intention to seek the head of the party.
After four hours of debate lasting until the early hours of Friday, July 20, France released its amended 2012 budget, drawing criticism from American publications Bloomberg and The Washington Times. The budget buries measures such as the value-added social tax and the tax-exempt status of overtime pay, both of which were championed by former president Nicholas Sarkozy. Measures included in the new bill, such as the tax on financial transactions, which will be levied on 109 top French companies, were decried by Bloomberg’s editors, who called its expected revenue “negligible,” and predicted that it will “frighten away investment.”
United States
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The United States’ growth continued to disappoint in the second fiscal quarter, with an overall GDP growth of 1.5 percent, Boursorama and The Wall Street Journal reported. Decreased consumer spending and slower business investment were cited as the primary reasons for the slowdown, and it has consequently kept the unemployment rate above 8 percent, according to Businessweek. This report is par for the course among Americans, as growth has consistently fallen every quarter since the last few months of 2011, when it jumped to 4.1 percent. Another weak report could play solidly into Republican hands as they seek to reach voters in November on a platform of economic reform.
In an attempt to display his pro-Israel stance, Republican presidential candidate Mitt Romney stopped in Jerusalem on his overseas tour this week, Le Nouvel Observateur and Le Point reported. In front of Prime Minister Benjamin Netanyahu, Romney stated that he would support an Israeli military intervention in Iran after trying all other options in an attempt to show himself as a tough, savvy diplomat after his widely panned appearances in London. After meeting with Netanyahu, Romney spoke at a breakfast meeting for top donors such as Sheldon Adelson on the “dramatically stark difference” in the Palestinian and Isreali economies, as covered by the Christian Science Monitor. Drawing claims of racism from top Palestinian officials, Romney did not comment on the Israeli restrictions on Palestinian trade, instead “recognizing the power of at least culture, and a few other things” as driving their prosperity. In addition to Israel and England, Romney also stopped in Poland before resuming his campaign stateside.
Washington’s friendly relationship with once-key strategic ally Rwanda seems to be over. On Sunday, July 30, the Obama administration froze aid to Kigali indefinitely to show its concern for Rwanda’s support of Congolese rebels M23, called an “open secret” by Congolese President Joseph Kabila, Agence France-Presse and The Washington Post reported. “We have told the Rwandan government over and over that we are profoundly discomforted by their support of a rebel Congolese group called M23,” declared State Department spokeswoman Victoria Nuland. Since April, fighting between M23 and the DRC government has displaced more than 270,000 people, stated The Chicago Tribune. This cooling of relations is a stark shift in policy toward Rwanda, long seen as a regional leader and a fast friend of the United States. In a statement, Rwandan Foreign Minister Louise Mushikiwabo cited a lack of respect from the United States, declaring “this parent-to-child relationship must end.”
After the shooting that killed 12 in an Aurora, Colorado, movie theater, gun sales have surged in the Western state, Le Figaro reported on July 25. Between July 20, the day of the massacre, and July 22, more than 2,800 requests for a police record – necessary for carrying a handgun – were filed. Moreover, this increase was not unique to Colorado, with sales in Florida, Oregon and California all increasing by double digits.
Business & Economics
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Mario Draghi, president of the European Central Bank, said over the weekend that the institution would do anything necessary to save the Euro, creating optimism as markets anxiously await the final meeting of ECB’s governing council on Thursday, August 2, before leaving on summer break, CNN and Les Echos reported. Draghi’s dedication was quickly echoed by leaders from various eurozone nations, including France and Germany, showing signs that multiple actions were possible for European leaders and the union’s central bank to take considerable measures to address the ongoing debt crisis as fears spread toward Italy, as covered by Business Insider.
The European Union seemed in disarray as European nations voted down on Tuesday, July 24, a proposed budget for 2014-2020 presented by the European Commission. Commission President Jose Manuel Barroso quickly voiced disappointment with the leaders’ determination of the budget increase for 2013 to 2.79 percent, down considerably from the 6.8 percent he said the EU needs to meet its pre-existing commitments, BBC reported. As nations prepare for ongoing battle over the future budgets, as the European Parliament will enter negotiations in September, French Deputy Minister for European Affairs Bernard Cazeneuve called on European nations to build a fund for the European Union to operate its own budget, decreasing reliance on national contributions. Others from across the continent rejected proposed increases in national contributions in the coming years, as covered by Les Echos and Le Parisien.
The ongoing battle between Samsung and Apple has shifted to the courtroom in the biggest patent trial of all time, as covered by Libération. Accusing the South Korean company of stealing or copying its patents protecting tablet computers, Apple stands to win more than $2.5 billion from Samsung. On its end, Samsung has filed countersuits against Apple, alleging that the maker of the wildly popular iPhone and iPad series has infringed on key Samsung patents. The trial is slated to take place in San Jose, California, and will test the wills of the two electronic giants, who hold between them 49.5 percent of the global market in multifunctional cellular phones.
The European Commission announced on Thursday, July 26, that Ryanair had requested from antitrust regulators approval of a €694-billion bid to take over Aer Lingus, the third bid to take over the airline of which it is the largest shareholder at 30 percent, The Wall Street Journal reported. Aer Lingus, of which the Irish government is a 25-percent shareholder, requested that the EU watchdog overseeing antitrust reject the bid, as it had for a similar offer in 2007, according to Reuters.
International
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The forces of President Bashar al-Assad increased pressure on rebels with heightened violence in the Syrian city of Aleppo on Sunday, July 29. The United Nations claimed 200,000 had fled the besieged city but rebel leaders said the mounting attacks were not thwarting their efforts to combat the repressive leader’s regime, as covered by Le Figaro and The LA Times. The escalations in the ongoing conflict came as Great Britain’s Foreign Office announced on Monday, July 30, that Syria’s highest diplomat in London, Khaled al-Ayoubi, had defected, as covered by The Washington Post.
Months of negotiations on a United Nations treaty to regulate the expansive international arms trade reached an impasse on Friday, July 27, when the United States announced it would need more time to consider the treaty before Russia and China followed suit, Le Figaro and CBS reported. Several experts and diplomats placed blame on President Barack Obama, saying his wavering on the treaty - the first that would impose considerations of human rights on global arms sales - is related to his re-election campaign as he is set to face off with Republican Mitt Romney in November.
Romania held a referendum on Sunday, July 29, to determine whether to keep President Traian Basescu in office. Early results indicated that the vote would be deemed invalid due to low voter turnout, with just more than 46-percent participation and falling short of the requisite 50-percent turnout, Le Figaro reported. The movement to oust Basescu was initiated by Prime Minister Victor Ponta, a political opponent who has struggled to find common ground in three months of tumultuous co-leadership with the president. The New York Times and Le Monde explored the challenges faced by the post-Soviet nation.
Tens of thousands of Japanese gathered around the nation’s parliament on Sunday, July 29, to protest nuclear energy as anti-nuclear proponents formed the first green party of the nation devastated by the earthquake, tsunami and nuclear-reactor meltdown at Fukushima power plant a little more than a year ago, as reported by RFI and The Guardian. The mass protests came as the first anti-nuclear candidate, Tetsunari Iida, lost a local election in the Yamaguchi prefecture, a race that had been considered a bellwether in Japan’s future anti-nuclear political movement, according to The Wall Street Journal and Ouest-France.