So France now offers the world a vision of the hope of the fall of global corporatocracy. The people have spoken and overwhelmingly and enthusiastically embraced socialist Hollande for President, having had enough of the capitalist boot licking of Sarkozy and his participation in the increasingly crushing pressure of global capitalists on the last vestiges of government for the common good.
Unfortunately most Americans know very little about this revolutionary act on the part of France’s people as the corporate press is quick to pass over such news. With little critical mass over the masses, so to speak, the real story gets buried between the Kardashians and fluffy puppies.
But, a bright light shall shine out of the darkness and on September 27th, news ran over the internet such as this post from Addicting Info that summarized the news of Hollande rolling out a reversal on capitalist created impoverishment:
France Tells Austerity ‘Go To Hell’
Across Europe, the failure of austerity is clear. However with the weakness of the Eurozone’s de-centralized government apparent, France took upon itself a very different path to rectifying its financial woes. Instead of cutting services, punishing its population for the excesses of the élite, France has taken a page out of history, and taking the old tactic of raising its taxes.
The new tax rates top off at 75% of income earned over $1 million euro (approximately $1.3 million USD) for individuals. Some economists are quick to proclaim that such a tax rate would cause the economic conditions to become worse and that it sends a message that France does not like the rich and is not open for business.
This of course is nonsense. France, like many nations, has a tax penalty for taking money out of the country. France also utilizes a value added tax on goods going into the country. This means if a business decides on moving, to say Africa, to avoid the higher taxes, it would find any of its goods at a severe penalty when they returned to sell their goods and services to one of the largest economies in the world. Any business which decides on not selling to the market, of course, is being stupid. They are doing the metaphorical cutting off of their nose to spite their face. Every business can be replaced, so if a market is there, a company will come to fill it.
Instead of being anti-business or anti-rich, it is instead very pro-business. Now a business cannot waste its resources in supporting overpriced leisure-rich. Instead, the businesses which for invest in expansion, in its customers, and in its employees will find themselves rewarded. This becomes a very business friendly environment, companies which work in France will be very pro-growth. This will in turn expand their owners fortunes and overall wealth.
This is not a record for taxes, the United States once sported a 94% income tax rate. What this is, however, is a rejection of the Chicago and Austrian school of economics which have dominated the world for the past 40 years, and an embrace of the American school of economics, a school which has been sorely missing from the austerity debate.
But it all seemed too good as they say and as typical, all one need to do is wait for the wakes to break the shore line from the rock falling into the muddy, still waters of capitalist propaganda. Today, October 7th, the Huffington Post runs (a willing servant of the corporate class, despite its ruse of being left leaning) an article on Hollande and his socialist agenda run with the usual requisite capitalist outlook.
Quick to assert that Hollande’s policies of taxing the rich and daring the corporatists to play chicken with him has failed after only a few whole days of real time, the Huffie-Post writers beat the drum. In this paragraph they claim that France has had it with Hollande and his economic plan, after not making change in three days:
But the freefall in his popularity ratings shows that many erstwhile supporters are already asking whether he has a plan at all, as his inexperienced ruling coalition is buffeted by events rather than shaping them.
Then in the next few paragraphs we hear from “Stephane Rozes, head of political consultancy Cap” who then goes onto characterize France’s social safety net as “generous welfare state and high level of labour protection.”
Of course, those silly silly French with their lattes, red wine and protectionist trade policies. You know the country is just on the brink of disaster, the streets teeming with welfare queens and labor thugs running around in berets, eating government issued Crème brûlée and quoting Proudhon or hiding in dark alleys with guillotines and singing the Internationale, waiting to beat up poor capitalists trying so hard to
suck the labor out of everyone and give back nothing make the economic system work for just plutocrats everyone.
But we digress..what deserves attention the most is the paucity of critical information regarding France and Hollande. Reuters refers to Stephanie Rozes of the consultancy Cap or CAP. Since many news organizations use Reuters as their resource, the story with his quote has been repeatedly dozens, if not hundreds of times in the US press without further analysis. This scrap about Rozes was dug up after extensive plowing through French language news publications. Apparently he’s quoted quite a bit, but one might make the assessment that “advises companies” places him firmly in the pro-capitalist camp. Which one could logically infer would not jump to approve Hollande’s refusal to coddle plutocrats and capitalist speculators.
The former director general of the CSA polling institute, now head of the Cap (analysis and perspectives), which primarily advises companies, communities or states such as Monaco or African countries, confirms: “I work with Francis on the fundamental issue of the country.“
In May before Hollande’s President’s chair had a chance to be warmed, Timothy Geithner, commenting on the apparent but rarely spoken fact that impatience with economic policy can be self defeating. But then Geithner’s comments are followed quickly by
New York TImes, May: Change in Paris may Better Suit the US
“If every time economic growth disappoints, governments are forced to cut spending or raise taxes immediately to make up for the impact of weaker growth on deficits, this would risk a self-reinforcing negative spiral of growth-killing austerity,” Treasury Secretary Timothy F. Geithner told a Congressional committee in March, comments echoed since then in his statements at many international forums.
But the article was quick to add correction to Geithner’s statements by adding commentary from an a senior fellow of a think-tank that carries a heavy industry representation on its board.
“The administration hopes, in broad terms, that this election will change the conversation,” said Edwin M. Truman, a senior fellow at the Peter G. Peterson Institute for International Economics. “In principle, you’d be saying, ‘Don’t tighten your belt!’ to the countries with the scope to do so,” Mr. Truman said.
Indeed, possibly the US and France has more belt tightening room than many other countries, the question of course is what group within these countries should do the belt tightening. Their silence on that speaks volumes.
Opinion article in Financial Times of May 14, 2012 : What to Expect from Francois Hollande
First, France’s future depends on delivering all three of growth, social inclusiveness and budgetary discipline. No one element can be achieved without the other two. Without a belief among the French that burdens are shared, it is hard to elicit the necessary sacrifices to achieve budgetary discipline. In turn, fiscal discipline should allow the government to conduct more expansive fiscal policies to boost growth if demand is depressed. Fiscal reform and spending cuts will also allow France to fund investments that support growth.
Make no mistake “fiscal reform and spending cuts” meaning deep cuts in social programs that benefit the public. The capitalist speculator cannot suffer a little without making sure the rest of the world does too, even though the rest of the world has already suffered much more and far longer. A call for the plutocrats and corporatist to pay their fair share gets reduced to ‘sharing the burden’ so to speak. Exactly its time for the ones who created the current condition to step up and pay for it. The proletariat has paid enough.
The Economist in September : France’s Economy: The Performance Gap
The end of the early shift, and workers at the Peugeot car factory at Aulnay-sous-Bois, near Paris, are streaming out through the turnstiles. The anger is raw; the disappointment crushing. In July, when the company announced that the plant, which employs 3,000 workers, was to close, President François Hollande loudly branded the decision “unacceptable”. Two months and an official report later, his government has now accepted its fate. “Hollande said that he would look after us,” says Samir Lasri, who has worked on the production line for 12 years: “Now we regret voting for him.”
The decision by Peugeot-PSA, a loss-making carmaker, to shut its factory at Aulnay, the first closure of a French car plant for 20 years, and to shed 8,000 jobs across the country has rocked France. It has become an emblem both of the country’s competitiveness problem and of the new Socialist government’s relative powerlessness, despite its promises, to stop private-sector restructuring. Tough as it is for the workers concerned, the planned closure may have had at least one beneficial effect: to jolt the country into recognising that France is losing competitiveness and that the government needs to do something about it.
Of course the key problem is that the glue that kept all developed countries together; trade that supported higher labor rates has collapsed. Pressure from global companies that can force “competitiveness” by cheap labor extraction coupled with lower regulation in new hosting countries, has caused the current crisis. Lower labor rates and lax regulation have become the new markers for competitiveness. Which begs the question, can any socialist system exist when surrounded by unregulated capitalism?
Bloomberg in May: Merkel Rejects Stimulus in Challenge to Hollande’s Growth Plans
German Chancellor Angela Merkel rejected government stimulus as the way to spur economic growth in Europe, setting up a clash with French President-elect Francois Hollande before he’s even taken office.
In her first response to Hollande’s victory in yesterday’s French election, Merkel rejected a return to the “huge” stimulus programs following the financial crisis in favor of business-friendly economic changes. She and Hollande will talk “very openly” about the form of growth to pursue, a discussion now taking place across Europe and “to which the new French president will bring his own accents.”
Germany, the center of the banking community in the EU fell in line, demonstrating its preference for recovery from the capitalist/banker point of view; let the market regulate itself. Promoting “business friendly” recovery certainly comes from the pro-capitalist library of euphemisms Bankers and capitalist will not let go of the trajectory that business looks out for the national and global interests, even when clear evidence exists to the contrary.
Then finally we get to the meat of the issue: but we have to get to the French press to get it:
From France 24, from October 9th: Hollande Unveils Two Year Plan, Billions in New Taxes
French President François Hollande pledged on Sunday to honour his campaign promise of a 75 percent income tax on wealthy individuals as he unveiled a two-year economic recovery plan featuring strict budget targets and 20 billion euros in new taxes.
Well there you have it, what the mainstream global press will not say, Hollande shall follow through on his promise to put the squeeze equally on the plutocrat class as well as the working, who have already suffered job losses and other devastation of what has become essentially, Prime Minister Merkel’s efforts at constructing the EU into the miniature domain of bankers and casino capitalists.
With Greece, Portugal and Spain beaten nearly to its knees, global capitalists have turned their attention to reigning into and destroying socialists all over the EU. The upstart France as usual must turn her head otherwise and lead the charge against the take-over.
While certainly this constitutes a simpler analysis, the distillation remains the same; the global capitalists have made their intent clear. They wish to crush the power of labor in some portions of the EU to turn them into their own speculator’s dream market to exploit to produce goods to sell to the wealthier, plutocrats, protected by government support of speculative monetary and economic policy which feeds the global uppers. In addition, as long as the middle classes in countries remain intoxicated with cheap goods, gross consumption that exceeds need and short-term gratification, the money will roll in.