It came from the mouth of an American businessman, but it struck a raw nerve here in France.

“The French work force gets paid high wages but only works three hours,” wailed the chief executive of Titan International, a U.S. tire company, in a letter to France’s industry minister. “They have one hour for their breaks and lunch, talk for three and work for three.”

Ironically, the high-profile dig made headlines just as France’s president, François Hollande, was winning praise for launching gutsy military campaigns in Somalia and Mali this winter. A recent Newsweek piece even hailed Hollande for putting France back on the map as a “manly superpower.” But back at home, it’s increasingly clear that stifling union rules, high unemployment (and higher taxes), and a baffling lack of entrepreneurial spirit signal a country in crisis. And the deepening sense of dread can be traced directly to the educational system.

“It’s a culture of nul,” says Peter Gumbel, whose bestseller On Ach è ve Bien les É coliers (They Shoot School Kids, Don’t They?) criticized the French school system for creating a generation of bureaucrats who refuse to think out of the box. Nul, or “worthless,” is a familiar word to the French—it’s often tossed at schoolchildren who do not get their lessons right.

The aim of French schools isn’t to impart the wonder of learning, according to Gumbel, but to learn to endure an achingly competitive system. French children are taught to parrot, not to analyze—to memorize endless passages and vomit them out. The ones who survive get filtered out to lead the government and the private sector. The ones who don’t are ridiculed shamelessly.

Hence, Gumbel argues, there is no French Mark Zuckerberg, or Richard Branson, or Steve Jobs. Sure, there are plenty of brilliant minds in France, such as the phenomenal former finance minister Christine Lagarde, a former competitive synchronized swimmer. But Lagarde’s career was largely honed in America, and her detractors called her L’Americaine. She also left France to take up Dominique Strauss-Kahn’s former post at the International Monetary Fund.

France has huge resources and potential—it’s a leader in the aerodynamic industry, the luxury good industry, the cement industry, and yes, the tire industry. But no one’s taking advantage, it seems.

“There is not the spirit of entrepreneurship here,” said one French management consultant who made it through the rigorous French graduate school system, worked in finance in London, and came back to Paris to raise his family. “The state system and its huge amount of administration and paperwork discourages venture capitalism.”

Fric, the slang for money, is seen as vulgar. The consultant cites as an example Bernard Arnault, the CEO of LVMH—which includes the luxury brands Louis Vuitton and Christian Dior—who was publicly mocked as a sale con (dirty asshole) because he is a successful, rich businessman. Wealthy, or striving toward wealth, is not a compliment in France.

At the last World Economic Forum in Davos, where global leaders of government and big business mingle in the Swiss Alps, France was woefully under-represented. Despite the fact that David Cameron of the U.K., Angela Merkel of Germany, and many other world leaders were present, Hollande—a Socialist president who must appeal to the unions—skipped it entirely.

Representing France instead was Fleur Pellerin, 41, the brilliant minister of Internet, small businesses, and innovations. Pellerin is unusual: born in Korea and abandoned at birth, she was adopted by French parents. Now she is trying to carve an energetic niche for New France, one that can encourage and use its talent to compete with the Brazilians, Chinese, Indians.

“Education is so vital,” she says, in perfect English.

But Pellerin is only a junior minister (at present, anyway—my prediction is that she will end up being the next Lagarde), so there is a limit to her influence, even if she has caught Hollande’s eye with her brashness and vitality. Also at Davos were great French visionaries such as Christophe de Margerie, CEO of Total, the oil giant, and Maurice Levy, the P.R. wizard behind Publicis. These men, however, are the rare French globalists. Rarer yet, they are fluent in English.

This may seem like a joke, but it’s true. Even Nicolas Sarkozy, the former president of France, who was touted to be the next Margaret Thatcher (but was not), could not speak English when he was elected to office. Former presidents Jacques Chirac and François Mitterrand also refused to speak English. When they did, it was with heavy, Inspector Clouseau-type accents.

If linguistics seems too simple a solution to France’s isolationist arrogance—something archaic, out of L’Academie Française—even Pellerin wearily admits that the French often don’t enter the world stage because they don’t feel they need to compete globally. What they have at home should be enough, and forget about the rest of the world.

You get the feeling that Hollande sent Pellerin down to the World Economic Forum, in her leather trousers and fluency in languages, to be a symbol of what France can be. As it stands, the youth of France who can afford it are running to American or British universities. A Harvard or Stanford MBA is a badge of honor, but the problem is that those bright youth are staying in the Silicon Valley or Wall Street, not coming home to share their skills.

There is painful joke that Europeans often tell of their Gallic neighbors: God created France, the most beautiful country in the world with so much good in it, and ended up feeling guilty about it. He had to do something to make it fair. And so, he created the French people.

My French friends and French husband, even my 9-year-old French son, hate this joke. And yet, there is a terrible ring of truth to it. Often the French, with their extraordinary lifestyle and la belle vie, can be their own worst enemies.

Whether they like it or not, they must globalize or die.