It's never been about the deficits

Or we have always been at war with Eastasia, or something...

The Plot Against France - NYTimes.com

Seems those self-appointed police of the morality play that passes for conservative economic thought don't like France. Gee! There's a surprise!

S&P downgraded France's bond ratings, and the markets don't seem to care. They still pay near record low interest on their bonds.

So what’s going on here? The answer is that S.& P.’s action needs to be seen in the context of the broader politics of fiscal austerity. And I do mean politics, not economics. For the plot against France — I’m being a bit tongue in cheek here, but there really are a lot of people trying to bad-mouth the place — is one clear demonstration that in Europe, as in America, fiscal scolds don’t really care about deficits. Instead, they’re using debt fears to advance an ideological agenda. And France, which refuses to play along, has become the target of incessant negative propaganda.

And contrary to the expectation of those champions of everybody else's fiscal responsibility:

According to standard estimates, French workers were actually a bit more productive than their German counterparts a dozen years ago — and guess what, they still are.

But if France is doing OK, why the uproar?

Here’s a clue: Two months ago Olli Rehn, Europe’s commissioner for economic and monetary affairs — and one of the prime movers behind harsh austerity policies — dismissed France’s seemingly exemplary fiscal policy. Why? Because it was based on tax increases rather than spending cuts — and tax hikes, he declared, would “destroy growth and handicap the creation of jobs.”

In other words, never mind what I said about fiscal discipline, you’re supposed to be dismantling the safety net. 

France's real sin is in having a healthy economy without taking money from poor people and giving it to a handful of rich people.

 If all this sounds familiar to American readers, it should. U.S. fiscal scolds turn out, almost invariably, to be much more interested in slashing Medicare and Social Security than they are in actually cutting deficits. Europe’s austerians are now revealing themselves to be pretty much the same. France has committed the unforgivable sin of being fiscally responsible without inflicting pain on the poor and unlucky. And it must be punished.