France's problems actually derive less from a 19th-century German than from a 17th-century Frenchman. Lagarde works in an office complex with portions named for Jean Monnet and Robert Schuman, two 20th-century French pioneers of Europe's path to a single market. But another portion is named for Jean-Baptiste Colbert (1619-83). On behalf of Louis XIV, Colbert practiced mercantilism, using subsidies, tariffs, price controls and other regulations to manage the economy. The French tradition of dirigisme -- pervasive state intervention in the economy and society -- lives.
Two years ago Le Figaro newspaper inveighed against "the American ogre" Pepsi, which was interested in buying Danone, the yogurt and bottled water (Evian) company. Practicing "patriotisme economique," Sarkozy, then a Cabinet minister, urged mobilization of Danone shareholders to block the sale.
Such "patriotism" aggravates France's social sclerosis, and is inimical to Europe's project for burying its "terrible past." In 1951, war-weary Europe, groping toward transcendence of nationality and hence the furies of nationalism, created the European Coal and Steel Community, an attempt to weaken control by nations of two primary commodities for their war machineries. This was the tentative first step toward today's European Union, which limits -- although not nearly enough -- the ways states can intervene in markets.
These limitations serve Lagarde's project of prying the fingers of politics off vast swaths of the economy. She favors slashing inheritance taxes and preventing any person from paying more than 40 percent of income in total taxation. One index of her success would be decreased emigration by young college graduates, driven abroad by the fact that French unemployment has not been below 8 percent in 25 years. Since, that is, 1982, when President Francois Mitterrand, a socialist, was keeping his 1981 campaign promise to "break with the logic of profitability."
Another French citizen with deep understanding of America warned about France's "regulating, restrictive administration which seeks to anticipate everything, take charge of everything, always knowing better than those it administers what is in their interests." So wrote Alexis de Tocqueville 150 years ago, defining France's problem and Lagarde's challenge.