The only difference between France’s Francois Hollande and our Barack Obama is that Obama knows he can’t rush socialism into America while Hollande ran on socialism.
That makes the choice by the French ever more astonishing. They knew what they were choosing.
In 2008, we didn’t know but we know now. Will we follow the French to economic hell or will we look for some real hope and change?
Hollande said he would tax the super rich at the rate of 75%. Not only is that unjust, it’s biting that hand that feeds you because the rich employ everybody else.
The 75% tax on the rich passed parliament on Friday. A new 45% rate is being introduced on annual earnings above €150,000, which is not “super” rich. When the government runs out of that money, as the rich flee the country, they will need to go after the less wealthy.
The most immediate problem is Article 6 of the new tax law, which raises the top rate of capital gains tax from 34.5% to 62.2%. This is truly insane. Who would invest in France when no other country in Europe comes close to that rate? Other countries have rates at about a third of France’s new rate.
Karl Lagerfeld, artistic director of the fashion house Chanel, called Hollande “an imbecile who hates the rich.” The art world is in an uproar over Hollande’s plans to tax art. Lagerfield told the Spanish edition of Marie Claire magazine that “Hollande detests the rich and wants to punish them, so they’re leaving, and nobody is investing.”
Lagerfield added, “Things can’t go on like this. Besides fashion, jewels, perfume and wine, France is not competitive; and who buys French cars? Not me.”
There are rumors that Francois-Henri Pinault, another French fashion magnate, will move executive offices for his PPR luxury goods group, which owns Gucci and Yves Saint Laurent, Francois-Henri Pinault, to London. “I ask myself whether, in a period of severe crisis, political ideology is the best solution,” he said, referring to the 75% tax rate (Europe’s highest)
France’s business federation warns that the country’s skyrocketing tax rates are causing a grave economic crisis as investors flee. Some business leaders are in a quasi-panic. The pace of bankruptcies accelerated over the summer and investors lack confidence. Large foreign investors are avoiding France altogether.
Hollande stated his plans for excessive taxation prior to his election. This shouldn’t come as a surprise.
It is sad to watch France take such a turn for the worst. They always had an overly-large government but they had a working economy. It’s now crashing and burning – quickly. I hope they can implement a recall of their president because, if they don’t, their economy won’t make it to the next election.
People in the United States need to watch the events in France and heed the warnings.