France: A Case Study In Socialism: Does It Work?

For several years I have been saying that France will be the next big financial shoe to drop in Europe and the repercussions will be felt by everyone. France offers a case study in one of the easiest to understand, yet most often ignored facts by those that push big government.

That is – when prices and costs change – people’s behavior changes.  It is never as easy as saying governments receive more revenue by raising taxes because at some point people will leave the country or change other behavior that reduces government revenue.

The following article by Anne-Elisabeth Moutet published in the Telegraph received unprecedented response. It outraged some French people because it challenged France’s well entrenched welfare state while others are outraged that the government is blind to the consequences of its actions

The point is that the results in terms of record numbers of people without work, record youth unemployment, record debt and flatlining economic growth speak for themselves.

The question is – how far down that same road do we want to go? – MC

By Anne-Elisabeth Moutet

A poll on the front page of last Tuesday’s Le Monde, that bible of the French Left-leaning Establishment (think a simultaneously boring and hectoring Guardian), translated into stark figures the winter of Francois Hollande’s discontent.

More than 70 per cent of the French feel taxes are “excessive”, and 80 per cent believe the president’s economic policy is “misguided” and “inefficient”. This goes far beyond the tax exiles such as Gerard Depardieu, members of the Peugeot family or Chanel’s owners. Worse, after decades of living in one of the most redistributive systems in western Europe, 54 per cent of the French believe that taxes – of which there have been 87 new ones in the past two years, rising from 42 per cent of GDP in 2009 to 46.3 per cent this year – now widen social inequalities instead of reducing them.

This is a noteworthy departure, in a country where the much-vaunted value of “equality” has historically been tinged with envy and resentment of the more fortunate. Less than two years ago, the most toxic accusation….

Continue reading the full article HERE