People sometimes ask me why on earth I am so interested in French politics, implying they must be as boring as the Anglo-Saxon variety. In many ways they can be, but I became interested in French politics through the extraordinary, grotesque, almost Shakespearian character of certain French politicians. Take, because it’s August and you’ve got not better to do, Bernard Tapie. A has-been, many people say (or said until a couple of weeks ago). Not a bit of it – or indeed, so what if he is: Shakespeare based one of his best plays round a has-been, King Lear.
A couple of weeks ago, aged 65 (perhaps Lear’s age?) Bernard Tapie, a former Socialist minister, was handed some 40 million euros. By today’s standards that’s not huge wealth, but the particularity of this money is that it, and a very great deal more, has to be paid by all of us living in France. In total Tapie has just been awarded 295 million euro by an arbitration tribunal, with interest that goes up to an estimated 400 million, a figure confirmed by the Ministry of Finance. Why the Ministry of Finance? Oh, because it is they who will make out the cheque. The money, awarded because of the irregularities of the Credit Lyonnais bank, will be paid out of our taxes. As a comparison that’s more money going to an individual than to all the military towns put together affected by the dissolution of various regiments under Sarkozy’s recent defence cuts. And their compensation is spread over 6 years, Tapie gets his in fewer months.
He was awarded 295 million but he owes 250 million in back-taxes and other debts – so that’s where the figure of 40 million comes from. As for the interest payments (an estimated extra 105 million), that’s all very flou.
What is not flou at all is the sense of public outrage, and for several reasons. But first of all, who is this man, this past and future politician? A household name in France but virtually unknown outside. Like Sarkozy, Mitterrand, Chirac, Pasqua, Dumas and others he is unlike any British or American politician I can think of (Nixon, perhaps?). Margaret Thatcher and even Tony Blair were not, I don’t think, so cynical nor so colourful, so utterly lacking in souciance about feathering their own nests, so hypnotized by the prospect of power and its glittering trappings.
Born in 1943 in a working-class area of Paris, Tapie began his career as a car salesman (shades of Nixon, the “used-car salesman”?), graduating to selling televisions, both, in the early 1960’s, decidedly bling-bling objects. Then he became a pop singer, well, more of a crooner really. He made the natural step up into business and began buying companies, very much an Anglo-Saxon habit at the time. Amongst others he bought La Vie Claire which sponsored a highly successful bicycle racing team. He bought into Olympic Marseille, a football team which under his presidency also became very successful, developing some of France’s best players of the 1980’s and 90’s. In 1995 he was sent down for eight months for fixing a match, paying the other team not to play too hard or to deliberately injure his men since they had a difficult UEFA Cup match against AC Milan shortly afterwards.
But in the meantime he had become first a député (1989-1995), then minister of urban affairs (1992-1993) under François Mitterrand. This gave him certain standing, prestige and of course protection, particularly over his debts. For in 1990 he had bought Adidas. He didn’t use his own money but borrowed from the Crédit Lyonnais, then a nationalized bank. Within two years he had a debt of one billion francs. That same year Mitterrand, who adored him, made him a minister, it being understood that a nationalized bank will not hassle a government minister, even if it is for a billion francs.
Some people might raise an eyebrow at a Socialist minister wheeling and dealing as Tapie did, but not the working class left-wing in France, for whom Tapie was a hero if not a god. He was a very popular populist politician, self-made, abrasive, ebullient, womanizing, football and bicycle-mad: genuinely one of the boys (as Sarkozy tries so hard to be), so very different from Hollande and/or Royal.
But the debts kept mounting, so Tapie asked the Credit Lyonnais to sell Adidas for him. The company was not doing well and there were few offers. Finally Robert Louis-Dreyfus expressed an interest, but not at the asking price (anyone who has read Carmen Callil’s excellent “Bad Faith”, a biography of Louis Darquier, may remember Louis Louis-Dreyfus, the highly successful businessman with his fleet of ships etc. Robert is either son or nephew). In the end Robert Louis-Dreyfus bought Adidas off Tapie for a good price, then shortly afterwards floated the company on the stock exchange for at least double. Tapie was outraged, feeling he had been cheated by the Crédit Lyonnais whom he accused of deliberately under-valuing Adidas. In fact they had bought part of Adidas themselves at the knock-down price and then profited from the floatation.
That was back in 1995 and the case was only cleared away last month. All along it’s been a messy business, but the most shocking was the final part. In 2005 the Appeal Court awarded Tapie 135 million euro. A year later the Supreme Court (Cour de cassation) overturned this decision, in the same breath sending the case back to the Appeal Court to think again. From somewhere came the idea of going instead to an arbitration tribunal – that is out of the Courts’ jurisdiction altogether and into a world reserved for private or international companies to resolve their differences. No part of the French state apparatus had ever used this kind of arbitration tribunal. Some say the idea was suggested by the Minister of Finance’s cabinet director, who happens to be a close friend of Sarkozy (who indeed used to employ Sarkozy when the latter was a lawyer). Others that Tapie decided in January 2007, coincidentally just as Sarkozy was beginning his election campaign. Certainly soon after that Tapie, still a member of the Parti Radical de Gauche despite his wheeling and dealing, publicly backed Sarkozy’s presidency and in return Sarkozy is said to have promised to “get Tapie out of this mess.”
Their friendship goes back a long way: back in 1995 prime minister Edouard Balladur was going to stand in the presidential elections and Sarkozy was his main man. Balladur, on the right, was terrified that Jacques Delors, on the left, would stand against him, so Sarkozy was sent to make a deal with Delors’ fellow-Socialist, Bernard Tapie: ‘if Delors stands, you stand too, to reduce his votes in the first round. In the second round you then change your party, transfer your support to Balladur and we’ll see you right afterwards’. 2007 was not the first time Sarkozy had played the ouverture card, picking up members of the opposition for his own government. But in 1995 it came to nothing because Delors didn’t stand, Chirac beat Balladur and Sarkozy was thrown to the wolves. But they have remained friends, they are similar in some ways: both are populist politicians, both are self-made, both advocate “straight-talking” (i.e. using the gros mots of ordinary Frenchmen), both adore Rolex watches, big houses and fast cars. Both have high opinions of themselves.
So for reasons that remain unclear, it was decided to go to “private” arbitration: a first for a French government in this type of case. The controversial decision was justified by Madame Lagarde, Finance Minister, because, she said, the case had dragged on too long: through 3 presidents, 6 prime ministers and 13 finance ministers. Three judges were appointed, one by Tapie, one by the Credit Lyonnais and one for luck. Each was paid 300,000 euro for their work. The tribunal was held in camera, no full transcript has emerged, not even of the final judgement. All we know is that the judges found the Crédit Lyonnais had been at fault firstly for “not respecting the obligation to show loyalty to a client using them as an agent to sell property” and secondly for buying part of the company Tapie was selling through them, something again banks are forbidden to do, abusing, presumably, inside information. Thus for these two errors 293.4 million euro plus interest. But of public money. Thus, as you will have worked out by now, those of us paying French taxes are the ones who have to pay for Bernard Tapie’s back-taxes and debts.
Many people made an outcry. The Socialist party was rather quiet (but then it usually is) because Tapie was a former Socialist Minister and the less said about Mitterrand’s reign the better, as far as they are concerned. The most coherent criticism has come from a man I respect and like enormously, Charles de Courson, who was one of two parliamentarians (one from each house) sitting on the 5-person board of the EPFR, the state-run over-seer of that part of the Crédit Lyonnais which, from the outset, had been at the heart of the dispute with Tapie. Charles de Courson was always against the idea of going to arbitration, this privatization of Justice. He hoped his fellow parliamentarian, the senator Roland de Luart, would agree with him so together they could squash it. However De Luart announced to the EPFR board that he had received a telephone call “from high places” (it was never clear whether he meant the Elysée or the Finance Ministry), informing him that those in power preferred arbitration. Courson, realising he’d lost the main argument, nevertheless insisted that whatever decision the arbitration judges eventually reached, it must be in line with the one handed down by the Cour de cassation (Supreme Court), which had overturned the Appeal Court’s compensation of 135 million. Apparently this was agreed. But in the event the arbitration judges not only ignored the Cour de cassation entirely, they doubled the amount of money proposed by the Appeal Court. Courson says that this is because the arbitration judges “wrongly” calculated the value of Adidas at its flattering floatation level and not at the correct level, when Tapie sold it. This shifting of the value date doubled the amount Tapie was awarded.
However it is also clear to cynics like myself that if Tapie had only been given 135 million euro he could not have paid off his back taxes (190 million) let alone the other 60 million he owed to others. Thus had he only been given 135 million he would have ranted on for another ten years. You can see that the state was anxious simply to get rid of this affair, but the only way to shut Tapie up was to give him what he wanted – whether that was just or not. There may also be more to it: there is a strong feeling that Bernard Tapie, popular as he still is, may be invited back into government, but this business had to be cleared up first.
Immediately after the judgement, Charles de Courson said the appalling decisions of the arbitration tribunal should be over-turned by the government. The government indeed had three weeks in which they could do this. But on the 28th July, with the smell of the seaside already in their nostrils and knowing that most of their compatriots, already on the beach, had switched off, they announced that the decision will stand. Tapie will get at least 40 million as well, doubtless, as a large part of the 100 million interest. Out of the tax-payer’s purse.
Finally, to add a bit of colour to the man, two brief illustrations of Tapie’s character: on the 29th June 1994 the gendarmes descended on his hôtel particulier to arrest him on charges connected with the huge luxury yacht which he seemed to be using for his own, private purposes even though it was paid for by the burghers of Marseille. They swooped at dawn, of course, and he was in bed, naked, of course. After the usual reaction (“petits cons, ânes bâtés, et c’est la moitié de ce que je pense. Je me souviendrai de vos têtes, tous sans exception….” according to the later court transcript) he agreed to be taken to face the examining magistrate, but refused to get dressed. Proud of his physique, striding around his house without a stitch ordering then eating his breakfast, he insisted he be taken as he was to face Madame la Juge, the then-darling of the press, Eva Joly. “She comes looking for me at 6.00 o’clock, the tart (la salope). Well, she can see me naked!” It took his own lawyer 5 hours to persuade him to at least cover his vitals. I find it hard to imagine any UK or American cabinet minister having that amount of savoir faire.
The other story also concerns his vast and beautifully furnished hôtel particulier, one of the most expensive residences in Paris. During Tapie’s bankruptcy proceedings the court put a hold on the property so that it could not be sold. That was 14 years ago, and ever since it has been a virtual property of the state. Yet all that time Tapie has continued living there, for nothing. The rates are paid by Les Amis de Bernard Tapie. The director of the Crédit Lyonnais, hearing that it was furnished more lavishly than any palace (Tapie was said to have bought every available piece of Louis XV furniture, plus countless paintings), and wanting some of the debt re-paid, asked the courts to send in the bailiffs. The night before they arrived two enormous vans were parked in the front yard of the building. Later one was stopped: it was full of furniture. The other has never been seen since.
time saved