{"id":27772,"date":"2012-05-06T22:20:50","date_gmt":"2012-05-07T03:20:50","guid":{"rendered":"http:\/\/www.shotinthedark.info\/wp\/?p=27772"},"modified":"2012-05-06T22:20:50","modified_gmt":"2012-05-07T03:20:50","slug":"hollande-vacation","status":"publish","type":"post","link":"http:\/\/www.shotinthedark.info\/wp\/?p=27772","title":{"rendered":"Hollande Vacation"},"content":{"rendered":"
\"Hollande,

Hollande, looking sauced<\/p><\/div>\n

France goes on a holiday from financial reality and makes Sarkozy pack.<\/p>\n

The future of the European Union (and worldwide markets) may hinge on the following question: Is\u00a0Fran\u00e7ois Hollande a “fool or a knave”<\/a>?<\/p>\n

Hollande, seeking to become France’s first Socialist President since\u00a0Fran\u00e7o<\/span><\/a>i<\/span>s Mitterrand, won a narrow victory Sunday over Nicolas Sarkozy<\/a> – ending the Fifth Republic’s brief and troubled flirtation with mildly conservative economic policies. \u00a0Hollande’s election was not only a victory for a Socialist Party in political disrepair but for his former domestic partner and 2007 Socialist nominee (remember, it’s France)\u00a0S\u00e9gol\u00e8ne Roya<\/span><\/a><\/span>l. \u00a0Whether his win proves to be a defeat for the economics of the EU will have to wait to be seen. \u00a0As the UK’s Telegraph<\/em> details, (having asked the above question about Hollande’s political motivations), France faces extraordinary fiscal challenges<\/a>:<\/span><\/span><\/p>\n

Today,\u00a0the top corporate tax is 34.4 percent<\/a>\u00a0(compared to 15.8 percent in Germany) and France has a \u20ac96 billion budget shortfall, which caused it to lose its high credit rating.\u00a0The absurd 35 hour week largely remains in effect<\/a>. Here\u2019s the most damning statistic: government\u00a0spending now accounts of 56 percent of France\u2019s GDP<\/a>. It\u2019s only higher in five other countries in the world<\/strong> \u2013 including Iraq and Cuba.<\/p><\/blockquote>\n

Keep in mind, these figures were after 5 years of Sarkozy’s supposedly “draconian” policies and political rule by his center-right\u00a0Union pour un Mouvement Populaire<\/em>\u00a0(UMP). \u00a0Hollande, in theory, wants to undo the same policies through increased progressive taxation, including the\u00a0creation of an additional 45% for income above 150,000 euros and capping tax loopholes at a maximum of \u20ac10,000 per year.<\/p>\n

In an economic era defined by deficit spending and a general lack of funds,\u00a0Fran\u00e7ois Hollande seems intent to upend the Franco-German alliance<\/a> that has sought to force austerity measures on the rest of the EU. \u00a0“Germany doesn’t decide for all of Europe,” Hollande intoned during the campaign. \u00a0Yet what is the alternative? \u00a0A nation drowning in debt can no more spend it’s way solvent than a fat person can eat themselves thin.<\/p>\n

Marine Le Pen should be proud. \u00a0The leader of the supposed ultra-conservative (more social nationalist) National Front and daughter of the 2002 run-off presidential candidate announced her intention to leave her ballot blank<\/a>\u00a0– a signal to the 18% who voted for her to ensure Sarkozy’s defeat.<\/p>\n

Sarkozy would hardly be recognized as “conservative” across the Pond. \u00a0Three of his ministers were leftists. \u00a0He pushed for legislation to fight global warming. \u00a0He worked to help Socialist\u00a0Dominique Strauss-Kahn<\/span><\/a>\u00a0become head of the IMF (when Straus-Kahn wasn’t trying to plow room service<\/a>). \u00a0Far more damning, Sarkozy’s response to the 2008 economic meltdown was vintage Socialist – declaring<\/a> that\u00a0“laissez-faire capitalism is over” and decrying “the dictatorship of the market.” \u00a0Yet, he raised the retirement age, cut taxes and attempted, unsuccessfully in the end, to ween France off the entitlement teat.<\/span><\/span><\/p>\n

How the markets react may be the most important question in the aftermath of Hollande’s victory. \u00a0Coupled with the showing\u00a0of\u00a0Alexis Tsipras in Greece<\/a> – whose policies mirror Hollande in a desire to\u00a0tax the rich and delay debt repayments – the concern over the fate of he EU will renew Monday morning. \u00a0Greece had agreed to impose pension and wage cuts in return for two international rescues worth 240 billion euros. \u00a0Either the policy continues or the payments stop. \u00a0An end to payments would suggest an economic amputation from the Euro Zone, with Greece either leaving or being forced to abandon the Euro. \u00a0A Greek departure could easily start a domino effect in the EU and send worldwide markets into a tailspin.<\/p>\n

Hollande may be forced to continue may of the policies he publicly campaigned against. \u00a0Short of a desire to commit economic suicide, he has little leverage to do otherwise.<\/p>\n","protected":false},"excerpt":{"rendered":"

France goes on a holiday from financial reality and makes Sarkozy pack. The future of the European Union (and worldwide markets) may hinge on the following question: Is\u00a0Fran\u00e7ois Hollande a “fool or a knave”? Hollande, seeking to become France’s first Socialist President since\u00a0Fran\u00e7ois Mitterrand, won a narrow victory Sunday over Nicolas Sarkozy – ending the […]<\/p>\n","protected":false},"author":425,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[68,105,74,73],"tags":[],"class_list":["post-27772","post","type-post","status-publish","format-standard","hentry","category-capitalism-v-socialism","category-first-ringer","category-the-great-recession","category-western-civilization"],"_links":{"self":[{"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=\/wp\/v2\/posts\/27772","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=\/wp\/v2\/users\/425"}],"replies":[{"embeddable":true,"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=27772"}],"version-history":[{"count":4,"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=\/wp\/v2\/posts\/27772\/revisions"}],"predecessor-version":[{"id":27776,"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=\/wp\/v2\/posts\/27772\/revisions\/27776"}],"wp:attachment":[{"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=27772"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=27772"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.shotinthedark.info\/wp\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=27772"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}