* French economy minister urges president to change course
* Says govt should help households, not just business
* Comments signal growing tensions among Socialists
PARIS, Aug 24 (Reuters) - The time has come for France to resist Germany’s “obsession” with austerity and promote alternative policies across the euro zone that support household consumption, firebrand French Economy Minister Arnaud Montebourg said on Sunday.
Deficit-reduction measures carried out since the 2008 financial crisis have crippled Europe’s economies and governments need to change course swiftly or they will lose their voters to populist and extremist parties, Montebourg told a socialists’ meeting in eastern France.
“France is the euro zone’s second-biggest economy, the world’s fifth-greatest power, and it does not intend to align itself, ladies and gentlemen, with the excessive obsessions of Germany’s conservatives,” Montebourg said.
“That is why the time has come for France and its government, in the name of the European Union’s survival, to put up a just and sane resistance [to these policies].”
Montebourg said consensus was growing among economists and politicians worldwide on the need for growth-oriented policies and mentioned his German socialist counterpart Sigmar Gabriel and Italy’s premier Matteo Renzi as potential allies.
He cited former president Charles de Gaulle and former British prime minister Margaret Thatcher as having effectively spoken up to change the course of EU policies they opposed.
Montebourg said he had personally asked President Francois Hollande for “a major re-direction of our economic policy”. The government should now focus less on cutting debt than on supporting households to revive consumption, a traditional economic driver, he said.
Montebourg, who makes no secret of his own presidential ambitions, is known for his frequent attacks on austerity, but his latest comments are likely to embarrass Hollande, who despite mounting pressure said just days earlier he would not back away from his policy based on spending cuts and corporate tax breaks.
Hollande’s business-minded policies have alienated many left-wing lawmakers and voters already frustrated with his failed pledge to curb unemployment. He is now the most unpopular president in over half a century, with an approval score of 17 percent in the latest Ifop poll.
In an interview published on Saturday, Montebourg had already warned the austerity measures pursued by France and its European peers were strangling growth.
Six years after the collapse of banking group Lehman Brothers and the start of the global economic crisis, the United States and Britain have returned to growth while euro zone economies are still shrinking or stagnating, he noted on Sunday.
“There is a disease specific to the euro zone, a serious disease, persistent and dangerous,” Montebourg said, arguing that fiscal and monetary austerity would not help end the crisis but had only worsened and extended it.
“The time has come for us to take on an alternative leadership, to set up an alternative motor and promote ideas and practices alternative to this destructive ideology,” he said. (Reporting by Natalie Huet, editing by David Evans)