Audio Transcript:

Marco Werman: So, Greece looks set to stay on the austerity path. France, on the other hand, is looking to stimulate growth through spending. That's the mandate anyway of France's new socialist president Francois Hollande and now he's got parliament on his side. Over the weekend, Hollande's Socialist Party won big in France's parliamentary elections. It now controls an outright majority of the legislative seats. Pierre Haski is the co-founder of the Paris-based political analysis website, Rue 89. Francois Hollande is now in a strong position, Pierre, to push against the idea of budget cuts demanded by Germany and, in fact, Greece and other countries are apparently saying that those cuts are worsening their financial situation by stifling growth. So, with the Socialist having won big in France, how will Hollande's position now play out in Europe?

Pierre Haski: Well, he needed first to have a strong base in France and that's what he got. He won the presidential election last month and now, with this parliamentary big success, he is in control of every power in France. So, this gives him a very strong hand and a mandate to go and negotiate in the European scene. It's very timely because the European leaders are about to meet at the end of the month for a very crucial meeting in which the whole debate about growth and austerity will be on the table. At the moment, you have a big gap between Chancellor Merkel of Germany on one side and President Hollande of France on the other. But, I'm almost convinced that there will be a compromise that the leaders of Europe at this stage cannot afford to end up this meeting with contradictory positions.

Werman: Well, we remember the close relationship between Angela Merkel and Nicolas Sarkozy. I mean, for example, they were all about balanced budgets, but the first thing Hollande is going to try to do is delay any balanced budget in France until 2017. What do you think are going to be the big stumbling blocks in terms of Hollande kind of having the same entaunt with Merkel that Sarkozy had?

Haski: You know, European politics is all about give and take. So, if Hollande wants to take — that means to get the European funds to support growth — he will have to give, and he will have to give both in terms of his promise to reach a balanced budget within the next few years but also in terms of more integration on the political level. I think that's what's on the table at the moment; it's sharing the burden both of the debt and trying to stimulate the economies again, but on the other side we need to integrate more politically and avoid the kind of situation that we've had in the past where divergent economies within the Eurozone have almost rocked the boat.

Werman: You know, it's interesting—the Socialists are in power right now in France but there were some gains made by the far-right in France as well as Greece in this weekend's election. Is that all significant for you?

Haski: Of course. This is the political background to the whole economic situation of Europe at the moment. The austerity measures are pushing more and more big shifts in European politics, particularly as European politics have moved towards larger disengagement of the state. You can see in the result of the French elections that the extreme-right have made the biggest gains in the regions where public service has weakened and you can see that it all leads to a single situation — no more trust in the political system. We go to the extremes and that's a very scary situation and I think that's pushing a lot of pressure on the European leaders for their meeting next week.

Werman: Pierre, let me ask you about one more political trend in French elections. In this weekend's parliamentary election, French expatriates were given the chance for the first time to vote for local representatives to the French Assembly. Eleven foreign districts were created for those expatriates and 8 out of those 11 new districts elected left-wing candidates including for the U.S. and Canada where the trend had been conservative until now. Why do you think there was this big swing from right to left?

Haski: First of all, as you said it's the first time the expatriates were given the chance to elect representatives in the Lower House. I think two things happened. One is that the turnout was very low and probably left-wing voters were motivated by the events in France and the shift of politics in France to go to the polls. The other, I would say, but that's a personal guess, is that I think the period of Nicolas Sarkozy has not been very good for the self-esteem of the French. I think they felt that he was not representing the nation very well and I think a lot of people have punished the right most likely by not voting for some of its candidates. If you take the example of the U.S., the right-wing candidate was Frederic Lefebvre a former minister very close to Sarkozy who is not being taken very seriously by the electorate and I think he was punished for that.

Werman: Pierre Haski with the political analysis website, Rue 89; thank you very much.

Haski: Thank you.