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Is the French Exception Dead?
The French state has meddled in business ever since Jean-Baptiste Colbert ran the economy for Louis XIV. Now some are saying enough is enough. A parliamentary report published last week slammed state-owned enterprises, saying the French model "no longer fulfills new international and European demands." Among firms singled out: France Télécom, which the government has just bailed out with a €9 billion injection; the postal service, which is 25% overstaffed compared with European rivals; and the national utility

INDICATORS Piping In New Money Oil giants Royal Dutch/Shell and Total agreed to a joint venture with Saudi Aramco to exploit natural-gas reserves in Saudi Arabia, the first such exploration involving outside firms in about 25 years. A Packet For A Packet British American Tobacco, the world's second-largest cigarette maker, snapped up Italy's state-owned tobacco company Ente Tabacchi Italiano for €2.3 billion, handing BAT a monopoly for cigarette distribution in Italy. Pole Position FOXSports.com invited aspiring journalists to bid on eBay for the chance to cover NASCAR racing for its website, just two years after parent company News Corporation fired more than 200 online journalists.

EDF, which was slapped for "excessively risky" international expansion.

The report, written by an ally of President Jacques Chirac, may prefigure aggressive privatization: it recommends creating a single agency to handle state holdings and, significantly, transforming all nationalized businesses into joint-stock firms. Air France is likely the first privatization candidate, but the French press concluded that EDF boss François Roussely's job is at risk.

Roussely, calling EDF "healthy, competitive and profitable," noted that government appointees on his board all signed off on his strategy. Plus ça change ... — By Peter Gumbel

Everyone's Seeing Red
Deficits are back in fashion. Shrugging off the E.U.'s straitjacket on borrowing for the third straight year, France and Germany last week all but admitted their economies wouldn't fit the tight rules in 2004. In the U.S., sweeping tax cuts and a costly war in Iraq brought a slide from surplus — that is so mid-'90s! — to a record $455 billion deficit in just three years, with the likelihood of further borrowing next year.

With the U.K. government having declared record holes in its public finances last week, why would anyone bother to observe that fusty old Growth and Stability Pact? Ian Stewart, chief European economist at Merrill Lynch, is even trying to tell Europeans they look good in red. Tax cuts in the U.S. might have gone too far, but euro-zone countries should feel free to give breaks of their own. "Governments should have some control over the economy," Stewart argues. "If they choose to run very large deficits, it's not a huge problem." Now loosen that belt.

Lights, Camera, IPO
Want a piece of the movies? Los Angeles-based Civilian Pictures is offering 900,000 shares in an upcoming picture Billy Dead. At $8.75 a pop, the firm hopes to attract over $7 million to make the murder mystery.

The Bottom Line
	There will not be equality until you have incompetent women in the boardroom
		LAILA DAVOY, Norwegian legislator and sponsor of a bill requiring publicly traded companies to appoint women to 40% of their board seats by July 2005