Less than two weeks from now French voters choose which two candidates for the presidency will fight the decisive second round, in the most important elections since the Socialist landslide of 1981. My guess is that the two will be the ruling party’s Nicolas Sarkozy and the Socialist Ségolène Royal — a salutary opposition of starkly opposed economic ideas.

But French opinion polls are famously unreliable, not least because voters tend to conceal their support for the far Right’s Jean-Marie Le Pen. That “unknowable” haunts not only Mr Sarkozy but also Ms Royal because the beneficiary could be the race’s dark horse — the old-style centrist François Bayrou, who has come close to surging past Ms Royal with an improbable but soothing “third way” pledge to unite the country in a grand coalition.

The Bayrou campaign appears to have stalled. This may be because voters have even more doubts about what he would do in the Elysée than they have about the consequences of electing Ms Royal, whose most consistent theme has been, as she put it last week, that “this campaign is all about me”.

The curiosity is that all polls agree that if Mr Bayrou reached the second round, he would win.

The headway made by this dullest of candidates has unnerved both of his mainstream opponents. It should also concern those, in France and abroad, who see this as the country’s chance to escape from immobilisme and set a modernising course. Mr Bayrou embodies the risk-averse politics of gradualism: precisely what France does not need.

This keenly watched campaign is all about what it takes to be modern. Ms Royal got off to a flying start last summer by projecting herself as fresh and new, an intuitive, empathetic politician inspired by popular “hopes for the future” — the title of her soft-focus website — and paying no more than lip-service to Socialist dogma. Mr Sarkozy, more bluntly, declared France’s “social model” bankrupt, promising a “rupture” with policies that had been “discouraging initiative and punishing success” for 25 years. The big unknown is whether the French want to be modern, if that involves loosening the cocoon of welfare benefits and ubiquitous state intervention.

It is received wisdom that no one wins votes in France by praising the profit motive or free markets. In a Globescan poll in 2005, 71 per cent of Americans, 66 per cent of the British — and 74 per cent of Chinese — agreed that capitalism is the best economic system. In France, only 36 per cent thought so. Even Mr Sarkozy, the nearest thing to an economic liberal that France has seen in years, carefully speaks of “popular” or “family” capitalism, rails against hedge funds and, illogically, insists that while he detests protectionism, free trade should be “managed” and “regulated”.

Yet it is possible that the received wisdom is outdated. Mr Sarkozy’s gamble is that France is “impatient” for reforms. He has tried hard to convince voters that France’s two big problems, ballooning public debt and structural unemployment of at least 8 per cent, are connected: that when the State absorbs 53.7 per cent of the nation’s wealth, high taxes crowd out wealth creation, just as overprotective labour laws destroy jobs.

To all but the hardcore Left — and to Ms Royal — it is obvious that France cannot simply spend its way out of trouble. Public finances are heading the way of Italy. Despite social security contributions that add more than 40 per cent to payrolls and deduct 22 per cent from wages, the welfare budget will be €37 billion in the red by 2009. A report last year by Michel Péribeau, chairman of BNP Paribas, caused a sensation by stating that on current trends, France’s accumulated public debt would reach 100 per cent of GDP in the next seven years.

Besides, big spending has not delivered. Growth in the past six years has been only 1.6 per cent. Despite fortunes spent on subsidising jobs, and hiring an extra million civil servants, the official employment rate is 8.4 per cent — 25 per cent among the young — and less than two thirds of the workforce is economically active.

The “Royal effect” has not entirely worn off, but the “lady in white” looks more Red by the day, promising three impossible, uncosted, things before every breakfast. She denounces the “unsustainable” level of public debt, yet pledges higher pensions and unemployment benefits, more state-subsidised jobs — and a minimum wage of €1,500 (£1,021) a month, far beyond the affordable. Her views on the relations between capital and labour are neo-Marxist. She believes that the State should “get involved” in the distribution of company profits, and would toughen the 35-hour week rules, to stop hard-pressed employers “exploiting” workers by demanding more flexible hours.

On style, she goes down better with voters than does the sharp-tongued Mr Sarkozy; but on trust, she scores badly. If she wins, it will because voters decide to keep Mr Sarkozy out.

Mr Sarkozy deserves to win, and I think he can. He has better lines and he has rehearsed them hard. What he says about work, family, merit and individual responsibility, he means. No one knows what Ms Royal means about anything. But would France really change, if he does?

The answer would depend on whether the electorate got Sarkozy Mark I, or Mark II. Sarkozy I is a radical ready, street fireworks and all, for a supply-side revolution. He would cut tax and social security charges by $15 billion, reform pensions, bring in healthcare charges and workfare for the unemployed, and ease labour laws. He would reduce, although only cautiously, the five million-strong civil service. Most audaciously of all, he would bring in strike ballots and curbs on picket lines. He would preserve and even increase the State’s “strategic” control of key economic sectors — this is France, after all. But, borrowing from Gordon Brown, he promises to borrow only for investment, not current outlays.

Mark II, the Sarkozy of recent weeks, is markedly less of a free marketer and is almost as vague as Ms Royal about curbing budget deficits, saying only that VAT receipts will rise when lower taxes leave people more to spend. “ J’ai changé,” he said in his nomination speech, and perhaps he has. Or perhaps it is a matter of “ réculer pour mieux sauter”.

Pragmatism is the word he prefers. In this, at least, Mr Sarkozy is a traditionalist. It is 414 years since a Protestant nobleman converted to Roman Catholicism to win power, saying “ Paris vaut bien une Messe”. Henri IV rebuilt France.

rosemary.righter@thetimes.co.uk

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