French Socialist to Lead Capitalist Charge into Eastern Europe : Banking: Jacques Attali was the architect of France’s failed program of nationalizing industry. Now he’s the head of a pro-privatization bank.

Eight years ago, Jacques Attali, in his powerful role as special counselor to President Francois Mitterrand, directed the Socialist government’s disastrous program of nationalizing industry and banking in France.

The program soon backfired and contributed to the Socialist defeat in the 1986 parliamentary elections, after which most of the policies were reversed.

Now more influential than ever at the Elysees Palace--where he is nicknamed “Sherpa to God”--Attali last week took over as president of the new European Bank for Reconstruction and Development, created to revitalize and privatize the economies of Eastern Europe.

To U.S. officials who served during the controversial early years of Mitterrand’s first term, when the Socialists ruled alongside Communists and instituted many leftist economic reforms, the conversion from Attali the militant socialist to Attali the free marketeer could hardly be more amazing.

“I was in France one day in 1982,” former U.S. Assistant Treasury Secretary Marc Leland recalled in an interview. “Jacques Attali called me to the Elysees, saying, ‘I want to explain what we did this morning.’ That was the day they nationalized the banks of France.”

Leland, who directed international economic policy in the Reagan Adminstration, added: “I find it no little irony that the man who nationalized the banks in France in 1982 is now the man in charge of showing Eastern Europe how to deregulate and privatize.”

However, French political observers, accustomed to Attali’s impressive intellectual powers--he is the author of 15 books--and political acrobatics, are not as shocked by the transition.

“Jacques Attali sees himself as a man of ideas,” Figaro editor Franz-Olivier Giesbert wrote in a best-selling book severely critical of Mitterrand and his staff, “but they are rarely his own. He claims everything as his own, without . . . scruples.”

For his part, Attali, 46, a blade of a man with dark, arching eyebrows and long, swept-back black hair, denies any political-economic metamorphosis.

“I’m still the same person,” he declared last week at a news conference in Paris. “It is just that the conditions in Eastern Europe require massive privatization.”

But in typical Attali fashion, he went on to explain that the London-based bank, which has assets of $12 billion, would have serious political as well as financial dimensions.

“It will be the first financial institution to impose conditions of democracy and human rights on its clients,” he said, adding that he plans to run a tight ship, assembling a small core staff of Europe’s “best and brightest” to scout investment opportunities.

Anyone worried that he might steer the bank away from its free-market course, Attali added, can take solace in a statute in the institution’s charter requiring that at least 60% of its loans go to the private sector. The other 40% will be used for projects to clean up the environment, rebuild the region’s infrastructure and restructure state-run companies.

Indicating that he considers himself solidly among the “best and brightest,” Attali said in an interview after the news conference that he intends to keep his job as senior adviser to Mitterrand--at least in the months it will take until the bank’s 40 member-countries, including the United States and the Soviet Union, ratify the charter and a permanent home is found for the institution in London.

When asked who might replace him as Mitterrand’s chief confidant, Attali quipped, “In life, one always likes to think of himself as irreplaceable.”

In light of such comments, some have dismissed Attali, as one senior former U.S. diplomat did recently, as a “typical arrogant French intellectual.” But few people seem to begrudge him his new job, which is described by some as representing a Marshall Plan for the other half of Europe.

For one thing, the bank itself was mainly Attali’s inspiration. After Mitterrand presented the idea to near-unanimous acclaim at the European Community summit in Strasbourg last December, he credited his aide with the original concept.

On other occasions, Mitterrand has described Attali as a brilliant idea man. “If only one idea in 10 were a good one,” Mitterrand reportedly said, “the relationship would still be worthwhile.” But from the looks of things, Attali’s batting average is higher than that.

Among contemporary historians, there is a debate over whether Attali met Mitterrand at a nightclub or a restaurant. But from that moment in 1974, Attali has served as the French president’s intellectual spark plug.

Indeed, Attali so jealously guards his relationship with Mitterrand that he once refused to tell French Prime Minister Pierre Mauroy about a Mitterrand plan to visit Beirut. He is a regular companion for the president on his daily strolls through the streets of Paris.

In his years at the Elysees, Attali has supervised major French initiatives ranging from a massive dam project in Bangladesh to a quirky bicentennial parade last summer celebrating the 200th anniversary of the French Revolution.

But despite his powerful influence, Attali is more Day-Glo orange than eminence grise in the French government.

Which other senior official and bank president, for example, would invite a clown in pea-green underwear as the honored guest at his own wedding? Attali did. And when his clown friend later died, Attali delivered a stirring eulogy.

“Adieu, my pet,” he concluded, calling the clown his best friend.

How many other international luminaries consider their political role subordinate to their craft as a writer? Attali does. A recent book of essays, “Skylines,” spent 14 weeks on the French best-seller list. Attali rises each morning at 4 to work on his essays and novels. Two of his recent projects include a children’s book and a series of television profiles of great men in history.

In many ways, Attali is the stereotypical model of a French intellectual engaged at the same time in the world of politics and art. Few have ever succeeded as well or as broadly.

Still, some of his friends feel he may be stretched too thin. Some critics have panned his writing as having more volume than value. Political associates complain that he regularly cancels meetings or schedules several at the same time.

Commented one friend of 20 years: “The main problem with Jacques is that there is a little too much Walter Mitty in him. He wants to prove himself as the proper civil servant, as an international banker and as a talented writer all at the same time.”

Times staff writer Art Pine contributed to this story.