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That seeming inevitable represented a major and ironic defeat for Charles de Gaulle. It was he who had forced France to practice severe austerity at home in order to build up the huge gold hoard that he used to support the new solid, or so-called heavy franc. The solidity of the franc was the basis of his foreign policy. It was he who had lectured other countries on the value of a sound currency. He had not been above engaging in a bit of monetary warfare to undercut the dollar and pound, with the notion that he was enhancing France's grandeur and independence. Now the franc was in danger.
Not surprisingly, there was some chortling in capitals that had felt the sting of De Gaulle's mercantilist monetary policies. In France itself, there was an unparalleled outpouring of scorn on him for letting the franc blunder into a crisis. As the rumor of devaluation raced through Paris and was soon accepted as certainty, Le Monde wrote, "The regime itself is devalued." Equally hard to take was West Germany's victory at the Bonn meeting. De Gaulle's France, reflected Jean-Jacques Servan-Schrei-ber, lost "the most important battle against the Germans—the economic one." Meanwhile, the West Germans savored the notion that they had triumphed over France. NOW THE GERMANS ARE NO. 1 IN EUROPE! bannered the Bild Zeitung. Many people detected a shift in Europe's center of gravity. As the Times of London put it, "The primacy of power in Europe has passed from Paris to Bonn."
Against that forbidding background, the French Cabinet assembled in the Elysée Palace presumably to set the rate of the devaluation, which was expected to be somewhere between 7% and 20%.
The worry was that the General, in his anger at being forced to shrink the franc, would devalue so sharply that he would bring down with him the British pound and perhaps even the dollar, since a massive devaluation on the order of 15% to 20% would rend the fabric of Western trade and monetary arrangements.
Script Rewritten
"Great leaders have always stage-managed their effects," De Gaulle once wrote, and last weekend's events in Paris had the air of a coup de theatre. By the time the ministerial Citroens began sweeping to stops on the gravel courtyard of the Elysée for the special Cabinet meeting, the French press was printing down to the third decimal point exactly how large the rate of devaluation would be. Le Monde, France's most prestigious daily, said the figure, which was attributed to excellent sources, was 9.785%. Paris-Presse, which closely reflects Gaullist views, devoted most of its coverage that day to the austerity program that would accompany the devaluation. The Ministry of Information put out the word that the Cabinet meeting was expected to last the ordinary amount of time—about 90 minutes.
Some 70 French and foreign reporters gathered at the Information Ministry at 69 Rue de Varenne in Paris' seventh arrondissement at the usual time.