Tuesday, July 10, 2012

Le socialisme gestionnaire

Out of power, the Socialists pretended that France's competitiveness problems could be solved by "innovation." Creativity, after all, costs nothing, while the idea of nurturing it can justify the hiring of 60,000 additional schoolteachers. In power, however, the need to compete now, not ten years from now, has seemed more urgent and compelling. So, heeding calls from the Medef and left-leaning former EADS CEO Louis Gallois, among others, François Hollande has signaled his readiness to reduce employer contributions to social security and shift the burden to the CSG, which will broaden the tax base (including to income from capital) while presumably--presumably--allowing companies to reduce prices. Of course the additional burden on taxpayers may reduce demand as well (but, since every cloud has a silver lining, a reduction in demand for imports would in fact be welcome). Apparently, an increase in the VAT has been ruled out, for reasons that are unclear (to me, at least).

Whatever the merits of the move, this is the kind of reversal of direction that makes many people despair of politics. The ease with which firm principles and convictions are shed as a party moves from opposition to government easily leaves the impression that most political debate is Kabuki theater. Alas.

UPDATE: And right on cure, the UMP shows that it, too, can play this mug's game. Although only yesterday it was ready to approve a social VAT, today the idea of a "tax increase on those who work" is anathema:

"Une augmentation de la CSG, pour moi, c'est criminel", a déclaré mardi 10 juillet l'ancien ministre UMP Laurent Wauquiez sur France 2, en commentant la conférence sociale qui se déroule depuis lundi à Paris."La réalité, a-t-il poursuivi, c'est qu'on s'apprête à nous habiller sous des grandes phrases une hausse brutale d'impôt, et à augmenter la CSG mais surtout sur ceux qui travaillent".

1 comment:

Anonymous said...

A probable CSG hike was doubtlessly chosen over a VAT increase because it is considered to be rightly of wrongly a more "progressive" form of taxation, i.e. it touches the rich proportionally more the "l'homme de la rue".
Perhaps Art you should consider revising your use of the term "kabubi theater" which has become a meaningless and erroneous cliché: