France is dead, only the French haven’t realized it yet. It died on 6 May 2012, when the turkeys in France voted for Christmas. In the final runoff in the election for President of the Republic, socialist François Hollande with 51.63% of the vote defeated Nicolas Sarkozy with 48.37%. France had a new President who was reported to have once said “I hate the rich”.
In his campaign the victor had promised a socialist assault on the rich, by increasing the tax on incomes over €1m, temporarily (where have we heard that before), to 75%. After a raft of tax increases that were intended to raise an extra 30 billion euros in 2013, the Court of Auditors, which oversees the county’s accounts, tell us that the amount raised in a mere 16 billion. And at what cost?
Despite being elected on a anti-austerity platform, Hollande has been forced to implement spending cuts, saying France “cannot live with such heavy debt”. The end of 2013 saw unemployment hit a record high of 11%. There was zero growth in the first three months of 2014, and a significant number of the wealthy are jumping ship – so less taxes will be collected in future.
Just as we say in our upcoming book ‘The Flight of the Golden Geese’, the politics of envy doesn’t work. The state ends up collecting less taxes, and in the process the economy is destroyed.