When the French government needed someone to invest in the failing Goodyear tyre plant in Amiens, Maurice Taylor, Chief Executive of the Titan Corporation, seemed an obvious person to approach. His refusal took the form of a letter lacerating French business practices which, probably as intended, caused outrage in France – mainly because most of what it said was true and everyone knows it.

He criticised French trade unions and working hours. Even when the workers were actually in work, he said, they only worked an average of three hours per working day. The rest of the time they were either talking or having lunch.

He said that French workers were quite open about this and told him, “That’s the French way!”

Now it is tempting for the – patriotically British – authors of the blog to leave it at that, and let the national stereotype hang in the air. However, honesty obliges us to point out, albeit through gritted teeth, that the number of technological innovations and successful businesses that have come out of France suggest that the French are not a lazy people.

They have their own way of doing things, but it can be very effective. Just as the apparently slothful Spanish afternoon siesta allows more productive labour in the morning and the cool of the evening, so French lunching and talking may be beneficial, so long as they are not taken to extremes. Research confirms that well-fed and well-rested workers are more efficient, and having everyone talking about a problem is more likely to find the right solution.

The French malaise is therefore not national laziness but a broader national inefficiency. French workers are capable of excellence but Dark Ages business practices give them little incentive to aspire to it. The trade unions are unreconstructed. The State interferes constantly, despite the fact that it is run, irrespective of the party in power, by an inward-looking oligarchy with hardly any experience or understanding of business. The net result is that France is a country to which one goes for pleasure, not for business. That is fine if your business is pleasure, but not for a country that still imagines it is major industrial power. France is a mess and getting worse.

In common with other EU states, France coasted for many years, very comfortably, on its natural advantages and its inherited glories. Increased competition from China and Russia means that will not be an option in future. Instead of being offended by Mr Taylor, the French should pay attention to what he is telling them for their own good.         

When the French government needed someone to invest in the failing Goodyear tyre plant in Amiens, Maurice Taylor, Chief Executive of the Titan Corporation, seemed an obvious person to approach. His refusal took the form of a letter lacerating French business practices which, probably as intended, caused outrage in France – mainly because most of what it said was true and everyone knows it.

He criticised French trade unions and working hours. Even when the workers were actually in work, he said, they only worked an average of three hours per working day. The rest of the time they were either talking or having lunch.

He said that French workers were quite open about this and told him, “That’s the French way!”

Now it is tempting for the – patriotically British – authors of the blog to leave it at that, and let the national stereotype hang in the air. However, honesty obliges us to point out, albeit through gritted teeth, that the number of technological innovations and successful businesses that have come out of France suggest that the French are not a lazy people.

They have their own way of doing things, but it can be very effective. Just as the apparently slothful Spanish afternoon siesta allows more productive labour in the morning and the cool of the evening, so French lunching and talking may be beneficial, so long as they are not taken to extremes. Research confirms that well-fed and well-rested workers are more efficient, and having everyone talking about a problem is more likely to find the right solution.

The French malaise is therefore not national laziness but a broader national inefficiency. French workers are capable of excellence but Dark Ages business practices give them little incentive to aspire to it. The trade unions are unreconstructed. The State interferes constantly, despite the fact that it is run, irrespective of the party in power, by an inward-looking oligarchy with hardly any experience or understanding of business. The net result is that France is a country to which one goes for pleasure, not for business. That is fine if your business is pleasure, but not for a country that still imagines it is major industrial power. France is a mess and getting worse.

In common with other EU states, France coasted for many years, very comfortably, on its natural advantages and its inherited glories. Increased competition from China and Russia means that will not be an option in future. Instead of being offended by Mr Taylor, the French should pay attention to what he is telling them for their own good.         

There is serious concern that the sale of new cars in the UK will be reduced in the coming year because superstitious people want to avoid the 13 numberplate. Practical people may dismiss this as credulous nonsense but the prejudices of consumers, right or wrong, are still in their own right economic facts with which business has to deal.

In any case, even among the practical – especially among the practical – it is difficult to find anyone with serious business experience who is unworried about the year ahead. The euro looks shakier than ever. Italy’s technocratic but unelected government has retained the confidence of the markets but is in its last days: it will probably be replaced either by a leftist coalition under a former communist or possibly by the return by Silvio Berlusconi – neither a force for stability. In Spain, a new government trying to cope manfully with the consequences of its predecessor’s free spending faces huge unemployment. France’s attempt to develop an alternative to German austerity has been undermined by its reliance on a 75% top tax rate. The flight of that epitome of all things French, Gerard Depardieu, across the border to Belgium is symbolic of a general flight of confidence.

Any one of these three giants going the way of Greece and Ireland would be a greater catastrophe than both the latter put together – and any or all of the three could go next year. It will be a minor miracle if none of them does.

Before that, there is the small matter of America’s “fiscal cliff” to avoid. In a squalid bargain that does credit to no one, Democratic President Barack Obama and Congressional Republicans put off tough decisions on the budget deficit until after the elections. Now the elections are over, and tax cuts passed under the younger President Bush are set to expire. Almost no one in Washington wants that to happen, but President Obama, flushed with victory after his re-election, has initiated a very dangerous game of chicken.

He says he will veto the renewal if it includes the tax cuts on higher earners. Republicans who control the House of Representatives are pledged to apply the tax cuts to everyone. Whether they were wise to make such a pledge is beside the point: the political fact of the matter is that everyone remembers how the elder President Bush never recovered from going back on his equally unviable pledge of “no new taxes.”

Compromise is still possible, but there is very little trust and goodwill between the two sides. In any case, this is no way to run a global economy. Whether it is initiated in America, France, Italy, Spain, or one of a dozen other danger points, a crisis in 2013 is more likely than not, and this one will be down to the politicians, not the bankers and borrowers as it was in 2008. Hold on: it may be a rough ride in the coming year.

As patriotic Britons, the authors of this blog would not normally be unduly upset by the impending self-destruction of the French economy, followed by the collapse of the euro. We are actually rather fond of France, and have met a number of agreeable French people, but a thousand years of rivalry leave their mark.

Yet the world has changed. Markets have become more integrated, and confidence is still shaky after 2008. Global recovery is a very fragile structure, jerry built out of any bits and pieces that were found lying around, and it sometimes seems that it would take no more than a sneeze to bring the whole thing crashing down.

Europe sneezed twice over the weekend. First the Greek people voted against the parties which approved of a technocratic government to implement the austerity programme demanded by the EU if Greece is to remain in the euro. This should have surprised no one. The fundamental weakness of technocratic governments is that for austerity to work in a democracy, the voters must accept responsibility for it, but they have no inducement to so that when the government and people have been separated.

Then came the election to the French Presidency of a man who apparently has no business experience whatsoever – it certainly looks that way from the financial illiteracy of his programme.

Could this be the beginning of the end of the deals put together by Angela Merkel, the forceful German Chancellor, to save the euro? Are Franco-Hellenic demands for renegotiation going to prompt other reluctant signatories to band together with them? If so, the German fiscal discipline that has been the only thing giving the euro any credibility will be gone. Then the euro will either become a joke currency – which the Germans will not tolerate – or the eurozone will have to split in some way.

Many may not see this as a bad thing. It has been obvious for some time that the euro in its current form is unsustainable. Few would object to an orderly restructuring – but that is not on the table.

The problem is that another forced restructuring of the euro, probably with all the errors that came with previous forced restructurings, will undermine the already fragile confidence of the world markets. Investors will worry about what they have already tied up in the eurozone and be reluctant to commit more. Business will worry about the reduction in European purchasing power. These worried investors and businesses are American and British and Chinese as well as European. It is ironic for someone who has never been convinced by the European project to have to write these words but, for the moment at least, the global recovery may depend on the preservation of the euro.

That said, the euro is clearly unsustainable and is proving to be a recessionary instrument itself. We have previously referred to it as The Devil’s Currency. Sooner or later it will have to be fundamentally restructured or abandoned altogether. We would normally argue for ‘the sooner’ as the longer these things are left the more pain is ultimately suffered by ordinary people, or in our case ordinary businesses.

However, our concern now is that the fragile global recovery, if indeed one is under way, seems to depend on the euro staying in one piece for the time being. But, let there be no mistake, the euro has done enough damage already. Once a recovery is on more solid footing that should be the end of this ill conceived project once and for all.

France is a frustrating place. She ought to be the richest country in the world. She boasts a beautiful climate, a perfect location at the heart of Europe but looking out to the Atlantic, a wide range of natural resources, more signature products than any other nation, a global image that is associated with sophistication and prestige, a population prepared to seek their fortunes beyond her boarders, good international contacts leftover from her days as a colonial power, and a cultural tradition with tangible cash value.

The latest evidence of that last asset is the proposal to build a theme park near Paris celebrating the life and times of the Emperor Napoleon I. If that sounds eccentric, consider two facts. First, France already makes huge amounts of money from its history and art, from the Louis XIV at Versailles through the Impressionist painters to Asterix the Gaul, who already has his own theme park, the success of which has encouraged the Napoleonic investors.

Second, the Napoleon name is already one of France’s – many – successful brands. The Emperor has, amongst other things, a pastry and numerous cognacs named after him – which is ironic because he was noted for his moderation in eating and drinking, at least by French standards. A chicken dish named after one of his battles, Marengo, has a slightly better claim to a genuine connection, and there are a number of sites and events associated with the great man which attract the many people, often high-achievers and therefore high-spenders, from around the world who like to think of him as a role model.

Yet, although Napoleon is a business success story, he may also be a fitting symbol of the reason why France is not as wealthy as the sum of her assets suggests she ought to be. The French have always admired strong rulers – Richelieu, Louis XIV, and Napoleon, among others – and the ostentatious centralised government they impose. It is no coincidence that the word dirigisme – meaning state direction – comes from France. While this has had some positive advantages in terms of keeping a diverse nation together, the negative side is that it has prevented the natural entrepreneurial abilities and inclinations of the French people from developing to their full potential.

Intelligent people in France have long seen the dangers of this. The last two Presidents, Chirac and Sarkozy, were both elected on a ticket of reform, but both became bogged down in a war of attrition with the vested interests of the ruling bureaucracy, and both lost their nerve when they were put to serious tests. However, for all Mr Sarkozy’s failings, and there are many, there can be no hope for France in the probability that he is about to be defeated by a man who believes his country’s problems can be solved by a 75% tax rate.

Perhaps it takes a Napoleon to run France – but France needs a Napoleon who understands basic economics.

One of the more amusing snippets to be found on WikiLeaks is a memo from a rather humourless American career diplomat describing a jolly-sounding lunch with Prince Andrew, the Duke of York, who was in Kyrgyzstan to promote British business interests.

The media tell us that the Prince has been “criticised” – for his remarks

...not by the business community! On the contrary, it is a pleasant change to see our business interests being represented by someone who sympathises with us and understands some of our problems. The American diplomat also refers to the Prince’s “unmitigated patriotic fervour” – which is just what any country would like to see in someone selling it abroad, and which one rarely sees in career diplomats. The Prince’s main points are summarised below in italics, followed by our comments.

1   “Doing business in Kyrgyzstan involves dealing with corruption.” Did anyone think any differently?

2   “...Just like France.” A bit unfair ... perhaps. France may not be quite that bad – but French officials certainly know how to make your life Hell if you do not play ball with them.

3   “Outsiders cannot change the culture of a country any more than they can cure someone of anorexia.” If only Western governments grasped this simple truth, a lot of unnecessary suffering could be avoided.

4   “Russia is playing the Great Game in Central Asia again and this time Western governments should win.” A brilliant analysis, putting current problems in their proper strategic and historical context, which has so far escaped the Western governments themselves.

5   “The media are not helpful when business deals are being negotiated.” You only have to look at England’s 2018 World Cup bid for proof.

6   “The British anti-corruption investigation of the Al-Yamama deal with Saudi Arabia was idiotic.” Self-evidently true.

7   “British and American governments plan for 10 years where people in Central Asia think in terms of centuries.” Another brilliantly perceptive observation.

8   “The British are better than the Americans at geography.” A generalisation to which there are numerous exceptions on both sides. However, British businessmen are generally pro-American and go to great lengths to find out about America, and are often shocked to find how little many American decision-makers know about the rest of the world. Our humourless American career diplomat seems to be a case in point.