The News in France this week is that there is to be a runoff
election between the incumbent president Nicolas Sarkozy and socialist
challenger Francois Hollande. Many are
predicting this could be the end for Sarkozy, polls seem to indicate Hollande
is slightly ahead of Sarkozy. If elected
Hollande will be France’s first socialist president in 17 years.
Sarkozy has attempted to reclaim votes by appealing to
France’s right wing voters by discussing issues such as restriction on
immigration. Hollande has been arguing
for his policy to tax earnings over 1million Euros at 75%. Hollande has also proposed, as a response to
the financial crisis, to separate retail and investment banks.
Both Candidate clearly have opposite view when it comes to
the economy and reform. Sarkozy’s
popularity has fluctuated in the past years, he came under criticism for
raising the retirement age from 60 to 62 in 2010, yet he also was praised for
being both vocal and active against Gaddafi by using NATO to fight Libya’s
former leader. So who will win? Many
seem to think it will be Hollande on the platform of socialist reform. Other’s think Sarkozy could win by a very
thin margin. What do you guys think is
the future for France?
Here are the candidates policies on the French Economy
4 comments:
It seems Hollande has won. I don't know what to make of his policy of a 75% tax on earnings above 1 million Euros. Sounds like a campaign promise that would be difficult to carry out, especially since he is not massively popular with only 52% of the vote. I can understand the separation of retail and industrial banks and can see easy justification for doing so-the end of such a law in the US can be considered partially responsible for the economic crisis. As for the retirement age... it's only 60? Well, 60 for those with 41 years of contributions to their social security that started at 18, but still, it's seven years below that of the US (for people born after a certain year).
I have no idea how Hollande will affect France, but if Hollande is able to get most of his campaign promises enacted, the rest of the European Union will have to get used to dealing with a different France.
The 75 percent tax for incomes over 1 million euros seems very interesting to me. 1 million euros is almost 1.3 million dollars which is a lot of income to make per year. How many people in France make that much? i would imagine not very many so he will not be alianating as many peopleas some may think. As Joseph noted the polls are very close, but I think this income tax of 75 percent on the extremely wealthy will help Hollande instead of hurt him. The upper class constitutes only a very small fraction of most if not all economies. when the middle class gets taxed they are resentful, but when they see others being taxed they support it because that is less tax money that their economic class needs to raise. Sarkozy raising the retirement age does not help his chances either. if someone has been working hard their whole life with the expectation of retirering at age 60, they definately will not be in support of raising the retirement age when they are so close relatively speaking. This policy alienates many of the 40 to 60 year olds who are also much more likely to vote in an election than people of different age groups. Therefore Sarkozy is alienating a larger group than Hollande is which could eventually result in his demise.
Now that Hollande has won, it seems that he will work with the EU to promote growth and decrease austerity. Hollande is inheriting a very, very debilitated economy, but the fight is far from over. France will be electing all members of its lower House of Parliament in the next five weeks, so Hollande could face a majority of Sarkozy's Popular Movement and thus be largely obstructed from fulfilling his campaign promises.
Hollande confronts rather serious issues: an enormous budget deficit that must be cut without slowing growth. I personally think that Hollande won this election not because of his own politics, but rather due to the fact that he was running against France's most unpopular president since WWII.
Another possible crisis France might encounter is a splitting of its close partnership with Germany. Chancellor Merkel of Germany had long worked closely with former President Sarkozy due to a multitude of shared policies and interests, but Hollande does not represent any of these commonalities. I think Franco-German relations will be a hotspot for the next few weeks as Merkel and Hollande see where they stand, with or against each other.
On the note of the 75 percent tax on earnings above 1 million Euros, I would like to point out that many Scandinavian countries have similarly high progressive taxes. Of course, the economies and social demographics of such Scandinavian countries are unlike that of France; however, I would just like to make the point that a high progressive tax rate is not unheard of.
On a separate note, I feel that the mass protesting sparked by the change of the retirement age is in many ways a sad reality of politics. Personally, I am all for an increase of the retirement age. And while I understand that, for many, this change does not seem "fair," people must come to terms with the fact that a public social security program cannot bend to the will of the people. The average lifespan is indeed going up. If the retirement age is not increased now, when will it be increased? The postponement of the increasing of the retirement age is only pushing an impending problem onto latter generations.
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