Politics: Hey, maybe a 75 percent tax rate will bring prosperity to France

Published by: Dan Calabrese on Friday September 28th, 2012

Dan Calabrese

By DAN CALABRESE - New rate "has always been billed as a symbolic measure since it will bring in very little revenue."

In France, Socialists don't mess around. Today, the government is unveiling a budget about which its finance minister proudly says"This is a serious budget, it's a leftist budget and it's fighting budget."

Well it sure is leftist. Anyone who makes more than 1 million Euros a year will be smacked with a 75 percent tax rate. That, the Socialists have admitted, is pure symbolism. They know it won't bring in much money. More onerous is the 45 percent rate being levied on anyone who makes more than 150,000 Euros. (That's about $193,000 US.)

What the French Socialists have not done, predictably, is gotten serious about spending discipline. They claim they're going to get a third of the deficit reduction they need from spending cuts, but the only thing codified into law is the tax increase. And keep in mind, the Socialist government is expecting no better than economic growth rate of 0.8 percent in the next year.

That's it.

Tell me again how the social democratic model in Europe works so much better than our free-market system? Even Obama's crappy 1.7 percent growth thus far in 2012 beats what France has been able to do.

You realize, of course, that Obama and his fellow travelers would like nothing better than to institute tax rates like the ones we're talking about here. The only difference is that the French Socialists admit the 75 percent rate is pure symbolism, and that they don't expect to really bring in any money as a result of it. Obama, on the other hand, goes around claiming that gimmicks like the "Buffett Rule" and "asking the wealthy to pay a little more" would make a serious dent in the deficit, when anyone who looks at the situation honestly will tell you it would hardly make a dent. The only way to balance the budget is to cut spending back to around 18 percent of GDP instead of the 25 percent we're spending now, while instituting growth-friendly policies that expand the tax base and as a result bring in more revenue.

French Socialists are just like American Democrats, except that they know higher rates don't automatically equate to higher revenue. They just don't care because their real agenda consists of symbolism and punishment. And with policies like these, I'd say the French would be lucky to hit that big 0.8 percent growth rate they're dreaming of. Just like America is kidding itself if it thinks we're going to experience prosperity as long as we're operating under Obama's policies.