The balance of public finances and the health crisis in France

Abstract

The balance of public finances has been a cardinal point of financial doctrines since the French Revolution, until today. Sometimes it was conceived as a budgetary balance, of the liberal type, sometimes as an economic and financial balance, of the Keynesian type. Since the beginning of the 2000s, the French state has been looking for “a third way”: The state is now conceived as an actor having to seek to manage itself like a business; This objective will find a translation in the “organic law relating to the finance laws” of 1 August 2001. This text introduces into the legal system a certain form of public finance balance, neither completely liberal nor entirely interventionist. But in the current context, faced with a health crisis of an exceptional magnitude and a violent and lasting economic and social crisis, the objective of balance seems exceeded, the State is not a private person nor a public person like others. It has no obligation to balance its budget and the main thing for it is to inspire confidence in the financial markets in order to borrow at the best rate. Given the current health and economic situation, it is essential for the state to continue to borrow in order to protect its population and jobs in the country. Finally, the question that will arise at the end of the crisis is undoubtedly not that of balancing the budget, but rather that of knowing whether this is not the moment to initiate structural reforms, including our legal system and economic needs for several decades.