France is in a massive bind. It's almost subtext in this article, the part where it says France tries to pass a new budget, but that's actually what has been causing the collapse. Four or so...
France is in a massive bind. It's almost subtext in this article, the part where it says France tries to pass a new budget, but that's actually what has been causing the collapse. Four or so finance ministers in two years and none of them have a credible plan to get them out of the ever mounting debt. Their debt to GDP ratio is scary, so much so, that the country is worried they can no longer afford repayments and face having to pay interest on those loans with... more loans.
The French population being what they are, sleeping with pitchforks under their pillows, go apeshit every time a finance minister proposes an austerity rule. Sometimes warranted, other times questionable. Like, I don't think your current retirement plans help long term financial health, France. The finance ministers know this too, their proposals often include pensions but the changes are so incredibly unpopular they can't force the changes through. All while France's debt spirals and spirals further.
This time it's the students, next time it'll be the unionists. Then these, or those.
France is the only country where pensioners have a higher average income than working age adults. Someone’s going to have to cut retirement benefits and extend the retirement age and no one wants...
France is the only country where pensioners have a higher average income than working age adults.
Someone’s going to have to cut retirement benefits and extend the retirement age and no one wants to be the party that does it, but no one also wants to the party in power when France runs out of money for social services.
Ive been watching from afar and it kinda seemed to me they’ve got the same problem the rest of the world has, that there are incredibly wealthy people living in France who wont contribute any...
Ive been watching from afar and it kinda seemed to me they’ve got the same problem the rest of the world has, that there are incredibly wealthy people living in France who wont contribute any meaningful amount in taxes.
I won't refute that particular point. That clearly seems to be the case everywhere, as the K shape widens. Even so, this is also a policy problem. The French are unwilling to go through any pain...
I won't refute that particular point. That clearly seems to be the case everywhere, as the K shape widens.
Even so, this is also a policy problem. The French are unwilling to go through any pain to resolve the mounting debt issue. It's unlikely the rich alone are able to bridge that particular gap by donatives or paying taxes as this is a nation state with a spending problem. They're one of the deepest indebted countries even if they're just one of many with a spiraling debt to GDP ratio. If Japan is potentially the canary in the coalmine, France is the verification canary.
France is in a worse spot than Japan. They are not fully sovereign in their monetary policy. Their debts are denominated in Euros and they do not solely control the ECB. A high spending France and...
France is in a worse spot than Japan. They are not fully sovereign in their monetary policy. Their debts are denominated in Euros and they do not solely control the ECB.
A high spending France and a famously austerity-loving Germany share jointly the position of dominant EU economy. They are going to have very different positions on Euro monetary policy.
I don't think it's time for France to pay the piper. Japan's going to face the music however, when in less than a few years they no longer have a working force left. To your point though,...
I don't think it's time for France to pay the piper. Japan's going to face the music however, when in less than a few years they no longer have a working force left.
To your point though, Germany's industry is a shell of what it was, on account of the indelible and intransigent auto industry, while France is unable to stop the bleeding coming from that massive hole in their hands. Any hint a finance minister wants to touch something regarding pensions and France's workforce creates an impromptu unsanctioned holiday. But.. their workforce is still a couple of years removed from stressing that pension fund to its limit.
Neither of them control the purse strings, I agree with you that this is fairly risky indeed.
I'm genuinely unsure who's going up in flames first. My guess is Japan though. That ~220% debt to GDP ratio in Japan is looking mighty awful right now, especially since their policy of forcing banks to buy bonds is no longer effective in keeping inflation down. This is shaking up the carry trade too, causing the US to intervene which didn't help a lick. Investment dries up, inflation spirals even further, the workforce is literally dying, and the debt is uncontrollable.
Their only saving grace is that inflation may help them in the short term with debt payments.
The long and short of it all is that a lot of modern economies are teetering on the edge, but also show a remarkable resilience when put under stress (how Russia is still going is black magic, honestly).
I'm not nearly educated enough to tell you who or what goes first, if it goes at all.
I don't know how much this will help, but it seems relevant that as the result of running a trade surplus for many years, Japanese investors own a lot of foreign assets, and as the yen drops, they...
I don't know how much this will help, but it seems relevant that as the result of running a trade surplus for many years, Japanese investors own a lot of foreign assets, and as the yen drops, they become more valuable (in yen):
I don’t think they could change the policy without the rich on board though. I imagine something like, the rich agree to give so and so matching percent, and then they can start taxing the pension...
I don’t think they could change the policy without the rich on board though.
I imagine something like, the rich agree to give so and so matching percent, and then they can start taxing the pension money.
The one that executed 16 nuns because they refused to renounce their vows, ended up in a military junta, then an empire ruled by an emperor, then with the same monarchy that they started with?
The one that executed 16 nuns because they refused to renounce their vows, ended up in a military junta, then an empire ruled by an emperor, then with the same monarchy that they started with?
Pulling on the heart strings for the 16 nuns and ignoring the hundreds of thousands (possibly over a million) who died in preventable famines in the years prior to the revolution says a lot about...
Pulling on the heart strings for the 16 nuns and ignoring the hundreds of thousands (possibly over a million) who died in preventable famines in the years prior to the revolution says a lot about what you value.
The revolution removed heavy taxes and unfair dues paid to rich lords, applied laws equally to all citizens instead of giving privileges to the nobility and the church, allowed regular people the right to own land and eat better food, and created a clear system of laws across the country. If you keep pushing inequality on people, they will eventually push back. If a man sees his child starve or goes homeless, it would be hard for him to care about 16 nuns. Or maybe all those peasants should've become nuns in order to convince you of their suffering.
The point is that it wasn’t much of a solution. It was a revolt against the ancien regime, yes, but it was both incredibly disorganized and mostly led by the petty bourgeoisie as opposed to “the...
The point is that it wasn’t much of a solution. It was a revolt against the ancien regime, yes, but it was both incredibly disorganized and mostly led by the petty bourgeoisie as opposed to “the people” as we think of it today.
The guillotine was used on far more innocent civilians witch-hunted by paranoia and purity tests than the nobility.
The governance in that era was an utter disaster, not particularly better economically, and that’s why Napoleon had the golden opportunity to take over.
I mean, that's true of pretty much every revolution, inclusive of the USA's and Russia's. The petty bourgeoisie leverage populism to improve their positions at the expense of the boutgeoisie....
I mean, that's true of pretty much every revolution, inclusive of the USA's and Russia's.
The petty bourgeoisie leverage populism to improve their positions at the expense of the boutgeoisie.
Fairly certain pretty much every civil war/revolution/coup ends with more than a handful of decades of poop economy and more than rarely a followup coup or three.
I meant the guillotine rather than the entire revolution. We don't, yet, need to change everything but we do need to prune the top and if the top isn't prepared to do that without...
I meant the guillotine rather than the entire revolution. We don't, yet, need to change everything but we do need to prune the top and if the top isn't prepared to do that without gravity-and-steel powered persuasion then so be it.
I do wonder how many billionaire heads we'd have to remove before the rest of them came around to the idea of paying some tax at a very reasonable rate of, let's say, 99% past the first $1bn. You can still be rich enough to live your entire remaining life in absolutely insane luxury, but you can't be a billionaire any more. I'm betting it's not many.
The guillotine, as stu2b50 pointed out, didn't even get used on the highest individuals and yet change happened. The popping of a single healthcare CEO suddenly made claims get paid. Seems that...
I do wonder how many billionaire heads we'd have to remove before the rest of them came around
The guillotine, as stu2b50 pointed out, didn't even get used on the highest individuals and yet change happened. The popping of a single healthcare CEO suddenly made claims get paid.
Seems that the powers-that-be don't need much to be reminded that they exist because we allow them to, but it does appear they need to be reminded.
There is no convincing evidence that claims changed at all with the murder of Brian Thompson. There were multiple articles right after the murder suggesting that claims would change, but...
The popping of a single healthcare CEO suddenly made claims get paid.
There is no convincing evidence that claims changed at all with the murder of Brian Thompson. There were multiple articles right after the murder suggesting that claims would change, but statistically there was no difference.
African proverb, but it seems France is rather intimate with this concept as well. When status quo is painful, revolution is inevitable. Even if the results are worse than before, any change in...
A child rejected from his village will burn it down to feel its warmth
African proverb, but it seems France is rather intimate with this concept as well. When status quo is painful, revolution is inevitable. Even if the results are worse than before, any change in the heat of the moment will feel like progress.
I think this is so reductive that it's probably not very useful. There are ~50 billionaires in france and ~200 billionaires in Germany (and ~1,000 in the US), so France has fewer billionaires per...
I think this is so reductive that it's probably not very useful. There are ~50 billionaires in france and ~200 billionaires in Germany (and ~1,000 in the US), so France has fewer billionaires per capita. It's hard to estimate effective tax rates for billionaires, but most sources seem to put it between 20 and 30% for the ultra-wealthy in all three countries - which all are in extremely different economic situations.
I'm sympathetic to the idea that ultra-wealthy are not paying enough in taxes, but to say that they don't contribute any meaningful amount is flatly untrue. The top 1% of earners pay 40% of federal tax revenue in the US, for example. It's also, again, simply too reductive to blame all economic woes on that fact.
Getting into the bits that I don’t know about France, but in the US the wealthy have actually driven tax policy for like, the last 40 years at least. The US deficit is actually their doing. The US...
Getting into the bits that I don’t know about France, but in the US the wealthy have actually driven tax policy for like, the last 40 years at least. The US deficit is actually their doing.
The US deficit, a number in the trillions now, represents the cumulative amount that we come up short every year because the wealthy and their businesses are siphoning money away from the government in the form of government contracts and tax breaks.
If France is anything like that, then it is their fault.
To calibrate my response, are you arguing that this is how things actually are or just speaking rhetorically to express your anger at the wealthy?
The US deficit, a number in the trillions now, represents the cumulative amount that we come up short every year because the wealthy and their businesses are siphoning money away from the government in the form of government contracts and tax breaks.
To calibrate my response, are you arguing that this is how things actually are or just speaking rhetorically to express your anger at the wealthy?
Regarding your first point, I think it's fair to say that nobody really knows. I think it'd be very difficult to convincingly argue that randomly giving someone a billion dollars would be a net...
Regarding your first point, I think it's fair to say that nobody really knows. I think it'd be very difficult to convincingly argue that randomly giving someone a billion dollars would be a net positive for society, to your point. The issue is that generally, that's not how billionaires are created. Generally, they become billionaires because they own large shares of successful businesses they have founded. I don't know how good this data is, but citing forbes data it holds that 27% of US billionaires inherited their wealth and the other 73% are self-made. (I understand and agree that self-made is often "self-made" based on inherited advantages. Let's set that aside for now.)
So the real questions are a lot more about implementation. Even the most parasitic businesses still drive American economic activity - they're still a net positive. How do you prevent billionaires without preventing the businesses that produce them? This question is a lot harder to answer than it seems. For example, progressive taxes. That's fine on income and even on actual cash holdings, but imagine that you are a smart programmer who started a successful IT business. Over the years you grow it to be worth more than $1.5B while remaining the sole owner. You pay yourself a huge salary of $2M/year. You're a billionaire because you own that IT business, but you've only ("only") got a couple million in cash and investments. The government could take all of that, leaving you effectively penniless, and you'd still be worth over a billion dollars. But your business being worth a billion doesn't mean that it has a billion in a bank somewhere - that's an implied figure based on profitability and all that. So even your business doesn't have a billion for the government to take.
This is a simplified example, but even in real life inexpertly applied wealth taxes can try to take people for far more than they actually have.
Even with taxing the rich at a higher rate, France will find itself still at a deficit of > 4.8% of their GDP by my estimates. It's just not sustainable without both raising taxes and cutting some...
Even with taxing the rich at a higher rate, France will find itself still at a deficit of > 4.8% of their GDP by my estimates. It's just not sustainable without both raising taxes and cutting some retirement benefits.
What the US does is instead tax social security if your income is over some amount, like if you have work related pension, 401k income, etc that puts you over some monthly income, the ss gets...
What the US does is instead tax social security if your income is over some amount, like if you have work related pension, 401k income, etc that puts you over some monthly income, the ss gets taxed at some % this way they never had to actually cut the benefit it would just get taxed at 100 for some people.
I haven't looked at where the cutoff would be there, but intuitively if France is at a state where pensioners make more than working adults per @stu2b50, that cutoff would have to be at a point...
I haven't looked at where the cutoff would be there, but intuitively if France is at a state where pensioners make more than working adults per @stu2b50, that cutoff would have to be at a point that affects a lot of pensioners, not just the uber wealthy. Taxing at 100% for a broad portion of people is a benefit cut, just phrased differently.
Policy lives and dies by phrasing differently for marketing purposes. Republicans really don't like when you point out that a tax cut is just preemptive welfare.
Policy lives and dies by phrasing differently for marketing purposes.
Republicans really don't like when you point out that a tax cut is just preemptive welfare.
Some of the demands don't sound very expensive, though. A government website that works? I've read that there has been an impressive build-out of public transportation near Paris. Is that winding...
Some of the demands don't sound very expensive, though. A government website that works?
I've read that there has been an impressive build-out of public transportation near Paris. Is that winding down?
Demonstrations swept across France on Tuesday as union activists rallied in solidarity with high school students who have spent two weeks blockading their schools over understaffing, overcrowded classrooms and dilapidated buildings.
Roughly 6,000 people have been arrested since the protests began and about 300 high school students and school staff have been injured, as well as more than 700 police officers.
Among the injured was a 15-year-old boy whose left hand was mutilated during unrest on Monday in northern France by what the interior minister, Laurent Nuñez, said was possibly a stun grenade. In southern France, a 15-year-old was arrested after he aimed a makeshift flamethrower, formed from a spray container, at a health care assistant during a protest in Marseille, according to the local prosecutor.
The demonstrations have also heightened scrutiny of a far-left party, France Unbowed, whose leader, Jean-Luc Mélenchon, could make the runoff in next year’s presidential election, according to recent polling. Centrist government officials and far-right leaders have accused France Unbowed, which backs the protesters, of fomenting the violence — an accusation it denies.
The students’ complaints include frustration at a state-run website that students must use to apply for higher education programs. The site, called Parcoursup, has been called opaque and impersonal, in part because it has left tens of thousands of applicants waiting for months before learning if they have earned a place.
Many university students have joined the movement, and several trade unions have also expressed support, calling on their members to join protests on Tuesday.
“Today’s high school and college students are tomorrow’s workers; they should not have to pay the price for austerity policies,” the C.G.T., one of the country’s main workers’ unions, said in a statement.
The protests come amid efforts by the French government to pass a new budget that would reduce spending on parts of France’s welfare system. The push to save money has been compounded by the rising interest payments that France must now make to its creditors, payments that are now almost as high as during the post-2008 financial crisis.
France is in a massive bind. It's almost subtext in this article, the part where it says France tries to pass a new budget, but that's actually what has been causing the collapse. Four or so finance ministers in two years and none of them have a credible plan to get them out of the ever mounting debt. Their debt to GDP ratio is scary, so much so, that the country is worried they can no longer afford repayments and face having to pay interest on those loans with... more loans.
The French population being what they are, sleeping with pitchforks under their pillows, go apeshit every time a finance minister proposes an austerity rule. Sometimes warranted, other times questionable. Like, I don't think your current retirement plans help long term financial health, France. The finance ministers know this too, their proposals often include pensions but the changes are so incredibly unpopular they can't force the changes through. All while France's debt spirals and spirals further.
This time it's the students, next time it'll be the unionists. Then these, or those.
France is the only country where pensioners have a higher average income than working age adults.
Someone’s going to have to cut retirement benefits and extend the retirement age and no one wants to be the party that does it, but no one also wants to the party in power when France runs out of money for social services.
Ive been watching from afar and it kinda seemed to me they’ve got the same problem the rest of the world has, that there are incredibly wealthy people living in France who wont contribute any meaningful amount in taxes.
I won't refute that particular point. That clearly seems to be the case everywhere, as the K shape widens.
Even so, this is also a policy problem. The French are unwilling to go through any pain to resolve the mounting debt issue. It's unlikely the rich alone are able to bridge that particular gap by donatives or paying taxes as this is a nation state with a spending problem. They're one of the deepest indebted countries even if they're just one of many with a spiraling debt to GDP ratio. If Japan is potentially the canary in the coalmine, France is the verification canary.
France is in a worse spot than Japan. They are not fully sovereign in their monetary policy. Their debts are denominated in Euros and they do not solely control the ECB.
A high spending France and a famously austerity-loving Germany share jointly the position of dominant EU economy. They are going to have very different positions on Euro monetary policy.
I don't think it's time for France to pay the piper. Japan's going to face the music however, when in less than a few years they no longer have a working force left.
To your point though, Germany's industry is a shell of what it was, on account of the indelible and intransigent auto industry, while France is unable to stop the bleeding coming from that massive hole in their hands. Any hint a finance minister wants to touch something regarding pensions and France's workforce creates an impromptu unsanctioned holiday. But.. their workforce is still a couple of years removed from stressing that pension fund to its limit.
Neither of them control the purse strings, I agree with you that this is fairly risky indeed.
I'm genuinely unsure who's going up in flames first. My guess is Japan though. That ~220% debt to GDP ratio in Japan is looking mighty awful right now, especially since their policy of forcing banks to buy bonds is no longer effective in keeping inflation down. This is shaking up the carry trade too, causing the US to intervene which didn't help a lick. Investment dries up, inflation spirals even further, the workforce is literally dying, and the debt is uncontrollable.
Their only saving grace is that inflation may help them in the short term with debt payments.
The long and short of it all is that a lot of modern economies are teetering on the edge, but also show a remarkable resilience when put under stress (how Russia is still going is black magic, honestly).
I'm not nearly educated enough to tell you who or what goes first, if it goes at all.
I don't know how much this will help, but it seems relevant that as the result of running a trade surplus for many years, Japanese investors own a lot of foreign assets, and as the yen drops, they become more valuable (in yen):
https://pages.skybrian.com/2026/japanese-financial-assets-abroad/
I don’t think they could change the policy without the rich on board though.
I imagine something like, the rich agree to give so and so matching percent, and then they can start taxing the pension money.
Why do the rich need to be on board? They don't seem to care if the "poor" are on board when there's a change they want.
Just how the world works man
The French came up with a solution for that problem once already.
The one that executed 16 nuns because they refused to renounce their vows, ended up in a military junta, then an empire ruled by an emperor, then with the same monarchy that they started with?
Pulling on the heart strings for the 16 nuns and ignoring the hundreds of thousands (possibly over a million) who died in preventable famines in the years prior to the revolution says a lot about what you value.
The revolution removed heavy taxes and unfair dues paid to rich lords, applied laws equally to all citizens instead of giving privileges to the nobility and the church, allowed regular people the right to own land and eat better food, and created a clear system of laws across the country. If you keep pushing inequality on people, they will eventually push back. If a man sees his child starve or goes homeless, it would be hard for him to care about 16 nuns. Or maybe all those peasants should've become nuns in order to convince you of their suffering.
The point is that it wasn’t much of a solution. It was a revolt against the ancien regime, yes, but it was both incredibly disorganized and mostly led by the petty bourgeoisie as opposed to “the people” as we think of it today.
The guillotine was used on far more innocent civilians witch-hunted by paranoia and purity tests than the nobility.
The governance in that era was an utter disaster, not particularly better economically, and that’s why Napoleon had the golden opportunity to take over.
It’s not a particularly good role model.
I mean, that's true of pretty much every revolution, inclusive of the USA's and Russia's.
The petty bourgeoisie leverage populism to improve their positions at the expense of the boutgeoisie.
Fairly certain pretty much every civil war/revolution/coup ends with more than a handful of decades of poop economy and more than rarely a followup coup or three.
Hot take: the Reign of Terror was a scary time to be alive.
I meant the guillotine rather than the entire revolution. We don't, yet, need to change everything but we do need to prune the top and if the top isn't prepared to do that without gravity-and-steel powered persuasion then so be it.
I do wonder how many billionaire heads we'd have to remove before the rest of them came around to the idea of paying some tax at a very reasonable rate of, let's say, 99% past the first $1bn. You can still be rich enough to live your entire remaining life in absolutely insane luxury, but you can't be a billionaire any more. I'm betting it's not many.
Only one way to find out!
The guillotine, as stu2b50 pointed out, didn't even get used on the highest individuals and yet change happened. The popping of a single healthcare CEO suddenly made claims get paid.
Seems that the powers-that-be don't need much to be reminded that they exist because we allow them to, but it does appear they need to be reminded.
There is no convincing evidence that claims changed at all with the murder of Brian Thompson. There were multiple articles right after the murder suggesting that claims would change, but statistically there was no difference.
Insurance companies are all about playing the odds, and from their perspective, Luigi Mangione was most likely a one-off crazy.
African proverb, but it seems France is rather intimate with this concept as well. When status quo is painful, revolution is inevitable. Even if the results are worse than before, any change in the heat of the moment will feel like progress.
I think this is so reductive that it's probably not very useful. There are ~50 billionaires in france and ~200 billionaires in Germany (and ~1,000 in the US), so France has fewer billionaires per capita. It's hard to estimate effective tax rates for billionaires, but most sources seem to put it between 20 and 30% for the ultra-wealthy in all three countries - which all are in extremely different economic situations.
I'm sympathetic to the idea that ultra-wealthy are not paying enough in taxes, but to say that they don't contribute any meaningful amount is flatly untrue. The top 1% of earners pay 40% of federal tax revenue in the US, for example. It's also, again, simply too reductive to blame all economic woes on that fact.
Getting into the bits that I don’t know about France, but in the US the wealthy have actually driven tax policy for like, the last 40 years at least. The US deficit is actually their doing.
The US deficit, a number in the trillions now, represents the cumulative amount that we come up short every year because the wealthy and their businesses are siphoning money away from the government in the form of government contracts and tax breaks.
If France is anything like that, then it is their fault.
To calibrate my response, are you arguing that this is how things actually are or just speaking rhetorically to express your anger at the wealthy?
Being angry
But they are siphoning money away from the fed
What benefit for society is there to billionaires (or even centimillionaires)? If you tax it progressively no one would ever get to a billion.
Regarding your first point, I think it's fair to say that nobody really knows. I think it'd be very difficult to convincingly argue that randomly giving someone a billion dollars would be a net positive for society, to your point. The issue is that generally, that's not how billionaires are created. Generally, they become billionaires because they own large shares of successful businesses they have founded. I don't know how good this data is, but citing forbes data it holds that 27% of US billionaires inherited their wealth and the other 73% are self-made. (I understand and agree that self-made is often "self-made" based on inherited advantages. Let's set that aside for now.)
So the real questions are a lot more about implementation. Even the most parasitic businesses still drive American economic activity - they're still a net positive. How do you prevent billionaires without preventing the businesses that produce them? This question is a lot harder to answer than it seems. For example, progressive taxes. That's fine on income and even on actual cash holdings, but imagine that you are a smart programmer who started a successful IT business. Over the years you grow it to be worth more than $1.5B while remaining the sole owner. You pay yourself a huge salary of $2M/year. You're a billionaire because you own that IT business, but you've only ("only") got a couple million in cash and investments. The government could take all of that, leaving you effectively penniless, and you'd still be worth over a billion dollars. But your business being worth a billion doesn't mean that it has a billion in a bank somewhere - that's an implied figure based on profitability and all that. So even your business doesn't have a billion for the government to take.
This is a simplified example, but even in real life inexpertly applied wealth taxes can try to take people for far more than they actually have.
Even with taxing the rich at a higher rate, France will find itself still at a deficit of > 4.8% of their GDP by my estimates. It's just not sustainable without both raising taxes and cutting some retirement benefits.
What the US does is instead tax social security if your income is over some amount, like if you have work related pension, 401k income, etc that puts you over some monthly income, the ss gets taxed at some % this way they never had to actually cut the benefit it would just get taxed at 100 for some people.
I haven't looked at where the cutoff would be there, but intuitively if France is at a state where pensioners make more than working adults per @stu2b50, that cutoff would have to be at a point that affects a lot of pensioners, not just the uber wealthy. Taxing at 100% for a broad portion of people is a benefit cut, just phrased differently.
Policy lives and dies by phrasing differently for marketing purposes.
Republicans really don't like when you point out that a tax cut is just preemptive welfare.
Some of the demands don't sound very expensive, though. A government website that works?
I've read that there has been an impressive build-out of public transportation near Paris. Is that winding down?
Brief summary:
Despite being a gifted link I still got a paywall so thanks for this summary!
Yeah sorry I think there's something going on with the gift links
Charitably, it's to deter bots. Alternatively, free user data.