Monday, February 07, 2011

France's Public Works Indebting the Country's Local Governments

Corrèze is the most indebted of all of France’s 100 departments
writes Steven Erlanger,
and former President Jacques Chirac appears to be the prime reason.

…As president from 1995 to 2007, Mr. Chirac directed many expensive public works projects to the area, including roadways, an airport and a strange sort of museum devoted to displaying nearly all the varied gifts he received as president.

Built on farmland 19 miles from the departmental capital of Tulle, the museum was opened in December 2000 and then expanded in 2006. It cost a total of 16.7 million euros, or about $23 million, shared by various levels of government, but with the largest part borne by Corrèze.

It is beautifully designed and holds a fascinating collection of lavish kitsch given to Mr. Chirac from the world’s variety of democracies and despots.

The financial problems of Corrèze reflect a larger national difficulty with budget deficits. As France struggles to cut its deficit, which is putting a strain on its bond ratings, the perilous finances of its departments is getting more attention.

… through various “decentralizations,” the national government has been dumping responsibility downward onto the departments, including the costs for most roads and maintenance, school construction and caring for the elderly, the handicapped and the long-term unemployed. … About a third of France’s departments are deeply in debt.

… “The museum is only a small part of the problem,” [said François Hollande, the president of the Conseil Général and a member of the National Assembly from Corrèze], but it is a good symbol of it.