Why has the European political left fallen on such hard times?

[article from the Economist]: There is old joke that a righty is just a lefty who has been mugged by reality.  In France, President Hollande has been mugged by the markets:

Elected in 2012 on the slogan “time for change”, he promised to curb austerity and reboot the economy. But a 75% tax rate on the rich was dropped after bringing in paltry receipts. The rest of the euro zone insisted that deficit limits which had previously been ignored now had to be taken seriously. With markets breathing down his neck, unable to devalue and spooked by the prospect of France being lumped in with the EU’s struggling south, Mr Hollande cut business taxes and made savings in the budget.

Bottom line:  markets punish politicians much more quickly and effectively than voters ever will.