well it seems that buying the social and political loyalties of the largest generational cohort with public money becomes increasingly problematic with every monthly payment as that generation retires. in other words, the post-1989 experiment is now entering its first actual political loyalty stress test where it has to face the fact that its legitimation mechanism is, quite hypocritically, fully a generationally-targetted keynesian holdover. no sympathies for the french politikants' vote-buying scheme
The problem is that French pensioners built their financial planning around this system. Maybe it’s not fair, I certainly think it’s overly generous, but the problem is that any policy making that impacts current pensioners is going to result in a lot of old folks who genuinely can’t afford to live, while any system that preserves the current system at further expense of the youth is going to cause political chaos. France is going to have to fuck over a generation and it’s almost certainly going to be the very young or very old.
French pensioners make more than working age employees - on average. If the pensioners want to claim they can’t afford to live, how do they expect the workers supporting them to?
Exactly especially when/if they have wealth they could be spending down. For wealthier pensioners, it's not fair to think you are necessarily entitled to hold onto your house until you die and can pass on your savings. If you want to keep the house in the family let your children help support that. Reductions in pensions could be made progressive based on wealth, such that low wealth people aren't affected.
> In 2025, there were 3.7 million second homes, representing 9.8% of all housing in France
> A more detailed study by the Statistics and Data Studies Office (SDES) published in June 2025, found that 15.1% of French people aged 80 to 89 owned a second home
As a luxury space communist, even I was uncomfortable with Picard retiring to like, an estate? How does every pensioner get such things? Is this a class divide for people with high starfleet rank? That is even worse! Or his family's vinyard was grandfathered in, like they did communism without affecting property rights?
RIP Sir Stewart.
PS, they're sticking old people in holodecks aren't they? Landchads stay winning, even after energy is essentially unlimited.
Sounds like a solid FAFO situation. The old folks just reached the find out phase of their bad financial decisions. As also stated by others, they didn't have to lend money. Sending the debt to the next generation is a dick move.
Except that not even the French protesters are demanding that the French pensioners reap the Find Out portion of the timeline after all their decades of Fucking Around.
The economically literate French protesters are saying that the ECB will inflate the euro to save France while Germany bails it out, while the economically illiterate protesters are just demanding more money for everyone
You can be economically literate and still be politically, socially, or culturally captured. Or just plain wrong.
The only difference is in what they speak about how the process could work- not if that process might actually happen.
Example: If my plane gets deboarded/delayed because of a maintenance issue. The passengers all call friends and family, and explain the situation (quite annoyed I'm sure). The vast majority will call and say "my planes broken". The mechanics/engineers in the crowd might call and say "the engine is broken" or "looks like a compressor blew out".
All three are correct. Some are more accurate than others. All know that a technician will need to fix it before they can fly.
None of them can control if the airline will say "lol, nope. No budget for repairs, figure out how to put them on other flights"
And if this theoretical "plane broken" issue occurs mid-flight. It doesn't matter how literately you scream at the pilot what he needs to fix, your plane is still falling out of the sky.......
>The economically literate French protesters are saying that the ECB will inflate the euro to save France while Germany bails it out, while the economically illiterate protesters are just demanding more money for everyone
You just made that whole paragraph out of fantasy, didnt you
> French pensioners make more than working age employees - on average
What's your source for that? Everything I can find says that that's not true.
Their standard of living is effectively the same as working age people though. So like, total house hold disposable income divided by the number of people in the household using that income is the same for workers and pensioners, which is pretty unique. Pensioners still make less money though, but they also spend less since they own their homes and don't have dependents.
Ah so Fortune's definition of "make more" isn't gross or net income, it's discretionary income. That's pretty misleading imo. I think most people would read "make more" as actually making more money, not just having more money left over after all of their expenses. Lines like "they’re even out-earning those with jobs" are just outright lies unless there's some way to twist that to fit discretionary income.
I feel like that sort of misleading blabbering is pretty typical for this subreddit. Which is a bummer because this is also supposed to be more of a rigorous subreddit.
It's been at least 10 years that people who actually graduated in this field or a mixture of econ with other fields requested better moderation or a better subreddit because of the obvious pseudo economics takes you find daily here.
Nothing has changed. People are literally making shit up here.
>French pensioners make more than working age employees - on average.
Patently false. Average monthly salary is mid-2000 euros. Average monthly pension is below 2000 and ranges between 1500-1800 euros. If you have numbers showing what you're falsely claiming, I'd love to see them.
> or the older generation will need to make significant changes to their life style if the pension is lowered?
Yes. A lot of older people can make significant changes to their lifestyle. If they have a house, they can rent out a room to someone else who isn't as fortunate. A lot of people can and should live more interdependent lifestyles, not independent lifestyles.
Pooling resources mathematically saves a lot of resources compared to dividing them. 7 people living in one house saves tremendous resources such as time, money, energy, space, and environmental resources compared to 7 people renting their own apartments.
Did the French even practice the extended family historically? The extended family was very important to Spanish, Portuguese, and Italian culture. A lot of people are going to have to get more used to extended family lifestyles instead of independent lifestyles funded by the government.
For what its worth, at certain age "significant changes to one's lifestyle" can be a death sentence.
Then again, maybe this is morbid but that would ultimately work towards resolving the problem (not that I'm suggesting that strategy, I SAID IT IN JEST YOUR HONOR)
I would specify it more to certain income levels vs age. As another commentator stated, we could lower the highest pensions and have little or no changes to pensions below "x" amount.
And the Germans have basically already done that over the last 18 years without it needing to be imposed from outside, and they are still having some moderate budget issues. The French will need it done to them as well
I think it's a false choice to imply that all older people would need to be fucked over, you can make reductions quite progressive and accomplish some kind of compromise, so that low wealth older people aren't affected.
Whenever that gets brought up as a reformed for Social Security in the US people freak the fuck out. It just feels like an impossible conversation to have.
It's inevitably a no-win situation. Everyone who paid into social security has a very real legal right to disbursements, but also a lot of retirees are straight up millionaires and do not need SS benefits to survive. It's true that those type of people don't need it, but also true that they're entitled to it. Our political culture doesn't know what to do when opposing sides have fair and reasonable points.
USA government can change it without their permission, but the vote system basically makes it impossible for them to do something like that without next term basically voting them out. Touching their wallets is basically one way trip to getting voted out.
Eh, the changes requires for Social Security to survive more or less as-is in terms of the function it serves/level of benefits provided aren't really all that dramatic. (although they are more dramatic than they would have been if we'd addressed the problem 20 years ago).
This is true as far as I have seen. They don't bother saving because they're promised generous-enough pensions, and investing is seen as a "rich fucker" activity, not something for normal people to do, other than maybe home ownership (flat, condo, apartment, whatever, generally, not specifically SFH.)
>
the problem is that any policy making that impacts current pensioners is going to result in a lot of old folks who genuinely can’t afford to live, while any system that preserves the current system at further expense of the youth is going to cause political chaos.
You’ve identified the key issue. What is needed is for politicians to bite the bullet and say “yes, some old folks are going to suffer because they didn’t save for retirement. They will probably die without care or live in poverty without a robust pension system if they didn’t self-fund. The alternative is to continue funding the current pension system and cripple future generations”. And say it with your chest. If forced to choose between two unappealing choices, choosing to prioritize younger generations is a completely understandable position.
Self funding vs public funding doesn't make a fundamental difference. The real question is what percentage of production goes to real capital vs the young/working vs old/retired, and how productive society is. It is not obvious that self funding is better for productivity - it comes with an incentive towards the FIRE movement, and taking those that may be most productive out of working early, which is bad. It also comes with an incentive to putting money in the stock market which increases real capital and is good. There probably exists data on the various effects here, but I'm not familiar with it
> but the problem is that any policy making that impacts current pensioners is going to result in a lot of old folks who genuinely can’t afford to live
Yeah, but they can raise the retirement age so that there are fewer pensioners. This is fair, since life expectancy keeps going up.
A uniform increase is not as fair as it seems at first glance. Per some quick research, the increase in life expectancy is not evenly distributed. At least since the 1970s, it is concentrated towards the top economic end. As of the last published measurements from Insee, France's statistical agency, in December 2025, the bottom 25% economically even had decreased life expectancy over the last 8 years.
There is also a difference in how much of retirement gets consumed by an increase in retirement age. At French retirement age, the richest 5% of men have 8 years longer life expectancy than the poorest 5%. Over 40% extra. And it gets worse if you look at healthy life expectancy. The poorest typically does physical work, and only expect non-disability life up until mid 60s. Increasing retirement age eats very heavily into non-disability retirement time for them, and not for the rich.
I think increasing retirement age is still going to be necessary. The cost will be uneven, so it's not going to be "fair", but it will be necessary. The only escape is if a technical revolution increases productivity a lot and the younger generation stands for their standard of living being kept constant to pay for the retirees. So far the numbers don't point at that much of an increase from AI/robots.
Is that uniquely French? Il asking cause I’m American and I’m 60. I’ve never considered Social Security, the US version of a state pension, to be guaranteed in any way. In fact the opposite. All my planning assumes it does not exist for me. If it is there, great! If not, I’m prepared.
All of my peers here do the same.
Maybe cause it’s been drilled into us Social Security won’t exist. Maybe the French view it differently?
My older sister depends on social security and has shit for savings. My wife and I have spent $150k+ keeping her afloat and now building a small home on her daughter’s property.
This is the most common attitude I've heard, but the truth is that if you're financially on track to retire without counting on SS, then you are in the minority. So, even if everyone doubts its availability, ultimately most people are hoping SS will pay out for them, because they haven't prepared for the alternative.
Assuming you retire at 68 or so, I’d bet you’ll get social security for at least the first 10-12 years of your retirement. Maybe even as many as 17-20. I could see, on the longest possible end, social security lasting for another 30 years or so. But for people who are younger than 50, planning on social security being there for more than a few years of your retirement at best is beyond foolish.
For those under 35 they should just expect it to be gone by the time they get to 70
> But for people who are younger than 50, planning on social security being there for more than a few years of your retirement at best is beyond foolish.
This is nonsense.
A lot of people ignorantly believe that SS will be gone. It won't be, and you need to stop making shit up.
What exactly are you basing your arrogant proclamations on the basis of? What reason do you have to think social security will still be making payouts in any way comparable to what it does now in 30+ years? I’m seriously asking
If you are instead saying that an agency known as the social security administration will still exist in the 2050’s, sure, I agree with that. I just don’t think it will have anything close to the massive impact per retirement age person that it does now
State pensions should probably be just enough to keep the pensioner out of poverty. Guarantee survival but it’s increasingly obvious, that generous pensions will damage society in ways that aren’t desirable.
The issue there is that the children typically became primary caretakers of the elderly back then. People have much fewer children now and they often move out of state when they come of age.
Pensions actually alleviate pressure on working age people in that way, was one of the primary arguments for social security when it was first designed
The fewer children thing is why the pension system will inevitably fail. You need a high dependency ratio to provide any real quality of living to the dependents.
I love how the articles title implies it's the voter rebelling against "fiscal reality" and not the fact that french politicians have been ignoring "fiscal reality" in favor of short term personal benefits.
Right, the biggest factions for the Presidential elections are pushing to either; Raise taxes even more (Far-Left) or lower the pension age and increase payouts (Far-Right.)
The people are actively choosing between these two when other options exist, it's entirely on them to stop supporting the politicians who are pushing them towards bankruptcy.
In case you haven't seen it, the left 'manifesto' is also lowering the pension age.
This isn't left vs right. It's populism vs pragmatism/realism. The next French election might/is likelty to have two versions of populism battling it out.
But like hasn't the centre been the one in power and been the one to get everyone into this mess? Surely from a political economy perspective the popularity of the far left and far right is symptomatic of a centre that has failed at their technocratic ideological goals?
The public demands populist policies that reality cannot deliver. The Centre cannot deliver because reality cannot deliver. The Right and The Left don’t have magic answers for how to bypass the limitations of material reality, they just plan to ignore reality in ways that will likely destroy the French Fifth Republic.
They made those plans knowing they’d exploit the youth. The youth deserve to afford to live. Appeasing the old will be wishing for chaos indeed as it isn’t long till they’re dead anyway and you’re left with the screwed over youth.
If thats the case, given the French have been in deficit for decades, and their taxes are sky high, one wonders where the money has gone, couldn't have been pensions since this issue has been on-going for decades and the pensions issue is a recent issue.
It can be pensions, and other welfare, if the situation is getting worse over decades, which it has, it's death by a thousand choices over a long time.
the answer would be to start adequately raising (real) wages so that parts of those would go to elder care within families. certainly a comfortable degree of per capita real productivity is achievable both within france and europe, even if profit margins as an incentive would inevitably get squeezed for the moment, before an episode of intersectoral profit reallocation and a final normalisation due to the decoupling+reindustrialisational shock to the trade profile. i find that this would be not just well-sitting but concomitant with intraeuropean reindustrialisation, given that beijing's walmarting of the continent has at this point become a security issue as well. a deficit of 1B euro per diem just means that europe is only left exporting ownership over its own assets sooner or later. disinflatory trade keeps taking precedence as the line of least resistance over actually making things for ourselves again, which means that this is a problem squarely originating with the political classes who are dependent on beijing for their careers and hence too gormless to tear off the bandage. of course, there's no doubt that restarting domestic european production where it's needed the most would come with an initial inflatory shock, as profits are de rigeur the main economic incentive, but it would be quickly welcome for the fact alone that it would relocate pretty serious amounts of clout away from bureacratic desk-jockeys and political party top echelons who are already showing signs of, to quote dj khaled, suffering from success, and seem to have an increasingly strained relationship with factual reality
I know -- real wages cannot increase without increases in productivity. Otherwise real wages is at expense of capital. that does not lead to a better outcome in the long run
That's not financial planning, they should have foreseen this. They can sell their property and move to more rural location for one, scale down everything.
This is a completely false paradigm that is breaking in real time. In the future, everyone is going to look back at this ridiculous panic over public debt and think we were cruel idiots.
“We just haven’t appeased the billionaires and the markets enough yet!” Give me a break.
The problem is that you need to reign things in and make unpopular choices before the need for austerity, but those problems seem so far away that it's a hard sell politically.
That's why Macron was elected to begin with, but every time he proposed a reform that would prevent fiscal doom there was an instant massive revolt. In the end everything got watered down to the point that they've gotten the worst of both worlds, people aren't getting their benefits cut but they are getting their services cut with no actual fiscal relief is sight.
I feel like at some point the French drank their own kool aid. like they think it's cool to revolt and that's what they're known for internationally and almost seem to have this level of pride for protesting.
I think protesting is great but the French are good example of how it backfires. you cant keep blaming politicians forever, to a certain extent it's obviously the populations fault if they keep stopping any fix
Pretty much yeah, the French aren't willing to accept hard realities anymore and think populism combined with spending money that they dont have will somehow prevent a fiscal crises. I dont know what they want or what Future french leader(either from the left or right) will do to appease such an, at times, ungrateful population
It’s a conflict of interest for politicians to make tough choices on behalf of people who may have different priorities or timelines in mind.
The US has consistently acted fiscally irresponsibly in a similar way- so much so that our sustainability bet is almost wholly riding on AI + supply chain automation.
The government will not be able to slow its spending while automation takes hold…but that’s what will likely be needed.
The sad part is looking at this as solely a fiscal problem and ignoring many of the regulatory issues that got them to slow GDP growth, high youth unemployment, etc.... This problem could be far less if they fixed many of their labor regulations so hiring people wasn't such a massive risk.
The major issue is the entire French economy ended up formed to protect those with a seat at the table in every way possible, but in doing so it reduced the number of seats for others to join.
This is the core of France's problem. France has had high FDI, high R&D outlays, an outsized representation among Fortune 500 companies, strong global demand for its brands, and a healthy tourism sector. It was one of the first European countries to exist the 2000 fiscal crisis.
So why is it stagnating? Because its regulatory environment is so restrictive, French businesses would rather invest in England's mess of an economy than at home. If it relaxed its burdensome employment rules even a little to support the small to medium sized businesses that drive service economies, and trimmed its pensions to something sustainable it wouldn't be having these problems.
France seems to have forgotten that it's a service economy that relies on a strong domestic labor market. It's trying to have Scandinavian style socialist policies without the industrial and primary sectors to support them.
True, a likely real solution will be a mix of improving the areas that slow economic growth while also cutting certain costs, taking a bit from every group.
Except austerity never worked, except twice in very particular conditions (high-growth economies and exchange treaties around the country that implemented austerity). In ALL other cases, austerity made things worse, not better
That's why France needs to start fixing these problems now.
Countries can only spend more than their tax revenue if someone will loan the difference.
Bond investors are increasingly unwilling to lend France more money.
If France does not somehow restore faith in its fiscal situation, the lending will stop and France will be forced to balance their budget immediately by default.
This analysis of austerity has always struck me a bit similar to saying chemo is really terrible for people.
Countries only implement austerity when they’re at the end of their rope and are about to run out of the ability to keep debt financing public spending. The status quo isn’t the alternative option - Zimbabwe is.
The problem is that people don’t live in the short run. Growing up in poverty is something people never recover from, we know that brains develop differently under the stress and absence of opportunity. So while it looks like it’s making up for the past,austerity actually borrows from the future. Better to improve conditions through borrowing and redistribution than fuck your society’s future.
Then it sounds like we know who needs to go: those at the end of their lives. They voted for this, so perhaps it's time to let them ride off into the sunset.
(Specifically: fuck those self-enriching retirees that are cutting down the very forest that would house their children)
I’m interested in this data. Something tells me wavering conviction is what harmed the long run. Austerity isn’t pause for a while so we can reload. It’s supposed to be pause now, reengineer for the future. My guess is it’s the second part that doesn’t gain traction.
The problem is that systems that don’t provide economic value shouldn’t be invested in, in the first place unless you can guarantee long term solvency.
You’re correct that many traditional high investment projects like universal healthcare and universal education are not the problem.
Those systems create economic value, that is theoretically worth more than they cost. Because they’re designed to help working age/productive people.
Social security and the Pension system by their very nature don’t. They’re money pits that go to people who have no hope of generating the value that they’re currently costing.
These systems do need to be cut, and to be honest they need to be removed completely. And we need to accept the consequences of that.
Social security and pensions absolutely aren't "money pits".
Things that don't provide economic value (proven over, and over, and over, and over, and over, and over again) include "trickle down economics", and yet neoliberal governments are trying to make you think that's the only way to grow
I think the government needs to stop putting direct cash in their wallets.
But your comment illustrates why it’s so hard to have this discussion, you can’t talk about taking away benefits for the elderly without seeming like a monster.
At the end of the day France only has a few realistic options to deal with this(as long as their economy doesn’t magically grow to unreasonable rates)
They either need to raise the retirement age to a point where it’s fiscally responsible to provide pensions.
Or they need to cut it off completely, and tell families that you need to take care of your elderly relatives, and if families refuse then cheap state run elder care facilities need to be constructed.
I would be in favour of reducing pensions significantly, cutting into other expenses, and raising the retirement age. Anything to avoid a default. So I think we agree in general. It's just that you phrased it in a way that sounded extreme, and I wanted to clarify that point.
I think we could also look at how spending is done in healthcare. There is no point in spending 1500€ for a pair of glasses. Hospital often overcharge with useless acts to gain money. Dermatologists use social security and health insurance to fund changing facial feature with public money
Out of countries that have taken the IMF doompill (Austerity) which had any other choice? Countries are dragged screaming and crying to austerity and you talk about it like they have alternatives.
There are alternatives. Like restructuring the debt, and doing good investment choices to get back on track. Instead of just refusing to increase taxes on billionaire and keep increasing debt to give them fiscal presents, it's not hard to understand
Restructuring the debt is the long storied tradition of Argentina. Look where that has gotten them historically. No one can seriously think that's a good idea. It just makes it so that the next time you need to take debt, it's at a higher premium because they think you are not going to pay it, which just takes you into a vicious spiral that's impossible to get out of.
I did similar math recently for America including seizing all wealth not only of the top .1%, but the top 1%. It would get us about 25% of our debt paid off, obviously cut our taxes significantly, and even if taxes stayed exactly the same we would still be nearly 1T in the hole deficit wise.
Simply put for America the only way out is inflating or taxing everyone, for France it's likely cutting taxes.
Pray tell, who do you sell all that confiscated wealth to? Because you need cash to pay off debts, which means turning all these assets into money aka a sale.
So who's the counterparty to the massive selloff of assets in the ballpark of 30% of American GDP? Santa Claus?
It's quite amazing to see someone talking about state debt as if the goal is to pay it off. And this after 40 years of western Reaganomics. The Neapolitans have a saying, that at each low one stoops to, there's always another knock from below.
Modern economics is obsessed with the concept of state debt and never goes far enough to question: who owns that debt?
The answer is: the rich, usually of that very country.
Imagine if these rich people no longer had the capacity to own the country they live in, because the state owned itself.
Because they are few? Especially when "progressive" politicians only want to soak the handful of billionaires and not those who make/have as themselves.
Have you noticed how Bernie, when he joined the millionaire rank, stopped ranting about "millionaires and billionaires" and switched to just "billionaires"?
The EU rules make it VERY easy for capital to move across EU borders. Austerity in Greece just means capital moves their official country of residence to Germany, France, or Romania rather than Greece. The EU really needs to federalize or capital will continue to have more power than democracy.
Great way to kill supply. Nominal currency is not a real good or service. The only way to effectively enact austerity is to allow for competition. Remove barriers.
You also need to give workers incentives. Without those, economies crumble. Also retirement should be at 67.
You can only tax so far. And the French are at their limits. They are the most heavily taxed nation on earth.
Where do u tax when corporations can simply setup shop in Germany or any other eu country? When your rich citizens can just live in Belgium and Luxembourg because u want to take 90% of their income?
The French are past the time for cuts. In everything. Including their crappy bureaucracy
This is the fundamental question of democracy. Are politicians meant to be trustees or delegates? If the population votes to drive the country off a cliff, do the leaders have an obligation to listen to the will of the people?
Economic realities in this case. France does not have high enough GDP growth to maintain their constantly growing social safety net. Deficits skyrocket. Eventually, they will struggle to pay the interest on their own debts. Cuts will be absolutely necessary. A French default is literally unthinkable and any bailout will be wildly expensive to the point everyone who puts in is going to demand cuts regardless.
Okay but cuts where? How do you decide what should be cut and what gets maintained? It's not exactly clear and inherently a political question about priorities, which explains the upheaval happening currently
France would receive considerable fiscal benefits from making spending cuts in the low single digits. Modest pension reform is the obvious solution. If France can’t manage something like this, the ultimate reckoning will be substantially worse. Melenchon on the far left and Le Pen on the far right are both promising magical solutions, default on one hand and doubling down with reckless spending on the other. The streets are saying they will burn the place down if the politicians don’t deliver the impossible.
They are so up to their eyeballs in pension obligations across all public sector workforces that it’s likely going to be pensions that are cut. Additionally you need to increase how long you tax productive years and decrease how much they collect in retirement, so expect retirement age to increase.
Pensions are the obvious suspect since they're making up €300 billion a year in obligations. Cutting the €150 billion business subsidies would probably worsen the problem since France needs economic growth very badly.
Pension is the obvious one. They are a direct spending, doesn’t save you money, isn’t invested. They help consumption but you don’t want an economy based on consumption
Healthcare for rare stuff or old age stuff is another one. The cost is high, for a gain of productivity null anyway
Culture? It goes out
Education has interest. But only if it makes people more productive. So you could limit the place based on results.
For prison, Singapore replaced a few of them by corporal punishment. It’s dissuassive and cost almost nothing
With the money saved you give fiscal benefit to retirement private fund, companies and investment in general
Spending money on the elderly is literally one of the worst ways to spend it. Spend it on the youth first and work your way up. If there is not enough for the elderly, that's their fault more than anyone else's. They had their turn. If they didn't leave enough for everyone, that's because they were too greedy or too lazy when times were good
The social safety net is not growing, that is a crass and gross mischaracterization of the issue at hand here. Problem is, population is getting older and putting strain on the system. And just as the previous center-left government had done some work to at least put the deficit back into tolerable margins, 10 years of supply side economics from Macron wrecked all remains of fiscal discipline.
The issue is not the level of tax. The issue is what people get with the money they spend. In France, you pay about 50% taxes (all taxes combined). In exchange, you've got FREE education, free healthcare, etc.
Now, in the US, you have lower taxes. And you can get bankrupt by getting sick
All the billionaires in France have about $600B total. Divide that among 70M people in France and you have a one time payment of $8500. Everyone gets to retire in comfort, then?
Sure pretty much every country could stand to tax the rich more, but the problem is bigger than that.
If you drive them all out, their money, jobs, the taxes they pay leaves with them. France has a spending problem, not low taxes on anyone. Too many taxes strangles an economy, whoch is part of the problem, already.
That's absolutely untrue. There's something called exit tax. And the best example of this is... the USA! When you're a US citizen, you can move anywhere you want, you will still owe the tax
US is also much more business focused. Too much stick and not enough carrot hurts everyone. Can't just take every penalizing idea from around the world and expect a vibrant economy.
Well, you can't afford what you have, so you better figure it out in a realistic way. You can grow your economy, which means being more business friendly, or cut services and social welfare, or prefferably both. That's your options. Like it or move to Spain or Germany, I guess. Of course many people have more than 10 days vacation in the US. The US is not the hellscape you've been led to believe lol. You people really believe every bit of propaganda you hear, don't you?
Spain has had a leftwing economical policy under Sanchez and grew much faster than the rest of the EU.
You're doing the fallacy of "black or white" thinking.
And, yes, most people (low-wage people) in the US not only don't have 10 days vacation (or even if they had, wouldn't be able to spend to go on holidays), but have to do multiple jobs just to try to have ends meet. I think you're confusing "upper-class people you grew up with" with "most of the country"
The goods and services they sell are still going to be in demand. If bezos throws a fit and shuts down amazon people will still want online shopping, people will still need cloud hosting and consumers will still seek the goods and services they bought on amazon. The datacenters, warehouses and other infarstructure doesn't just vanish.
No, not everything will vanish in a week, but over time people will go to neighboring countries or farther with their companies and wealth. This lessens jobs and tax base. Do you think people don't leave if things get worse for them. Business owners are humans, too. It's part of why Frances economy is so bad, to begin with.
Well, eventually the fiscal reality is going to force the issue one way or another. If they dont voluntarily reform now voluntarily with some control over the situation, they will eventually go broke and have little to no choice in how reforms take place.
The UK had 50 years of Austerity and know they have a Hitler party with 30% of voting intentions when FDR in the 1930's realized that the best direct way of fighting both economic downfall and rise of fascism is for government to do stuff, warfare systems and nation building.
Meanwhile I'm still waiting for a country to become a super power like the US with Austerity when the US did it with Keynesianism.
Problem is that wellfare then was feeding and educating kids, keeping a roof over the head of families temporarily out of work, and building roads and bridges to connect cities.
The welfare increasing now is palliative care for old people and pensions for people who dont work and didn't save.
One increases productivity the more you spend on it, and the other just increases costs the more you spend on it.
People need to save. Lifespan and healthspan increasing are great but it needs to come with increased responsibility.
Some of which includes making positive nutritional and exercise choices and not expecting others to shoulder the weight of a lifetime of poor health choices through health spending.
Nah, see - This is the kind of misleading title that pisses me off!
You don't get to go fiat, spend and borrow irresponsibly (as others like the US are encouraging you to do) and then piss on people for being mad at 'fiscal reality'.
That shit was optional. You didn't HAVE to kick-the-can down the road until it all landed on the later generations.
That was a choice. A choice that has consequences.
They are rallying against the consequences of irresponsible actions taken by previous generations, shouldered disproportionately. SO OF COURSE they're burning things - that's what angry humans with little or no hope do.
Every time the government tried to have rational policies (adapt pension age to life expectancy) you got millions of Frenchmen protesting on the streets
Because many of them did not negotiate the reality they now find themselves in, dealing with the consequences of choices made before their time. Why wouldn’t they revolt if they feel this is unjust, combined with feelings of housing insecurity?
So instead of fixing the problem they do the same as the generation before them push it to the next generation. This is peak "double it and give it to the next person".
They have no leg to stand on being mad at previous generations while burning the country down for a chance to do the same to the next generation.
They want what the olds have been given. Seems understandable to me. The young have paid for the old. They deserve their turn when they're old. Managing it all is the problem. Old need to get less at this point...
If France keeps spending like it does they are getting shit when they are old. They should be demonstrating for spending cuts not against it if they want to save their own future.
To be fair, we are spending on the old... Cutting on the pensions would help everyone under 55 right now. But you would be horrified to see how many students protested against the last retirement reforms.
Generally as a German I really respect the French fighting spirit and willingness to go on the street to advocate for what they want. We are far to tame and orderly to do that here in Germany.
Unfortunately it seems like the french youth has been fighting to actively harm themselves lately. I really don't understand where this idea comes from that excessive government spending is good for the populace, especially when you already have sky high taxes and barely any economic growth.
Well at the same time, for every young people right now, cutting down on pensions would probably mean that young people would also have to pay for their parents, so they mostly won't be better off either
It isn't true. Not from pensions, it works if you add other resources (rents) and because they reintegrate the money they don't have to spend as rent as revenue because most pensioneers are home owners. On average retired earn 1700€. Average salary is 2700€+
I understand why they are doing it and maybe even sympathize with them a little. That does not change the fact that it is highly egoistical and moronic behavior. But that's human nature.
And the people protesting are very young, kicking the can down the road isn't going to work long enough for them to hope to be dead when it all blows up. So they are fucking up both future generations and their future selves.
At some point, someone had to bite the bullet and be an adult. This whole situation is a good argument against ever increasing social services, because they are impossible to dial back in such a climate.
A rational policy would be to have a ceiling on pension spending per individual. Adapt pension age to life expectancy is deeply unfair to those working physical or tiring jobs, which already have the lowest pensions.
People weren't protesting cutting spending, they were protesting doing it unfarily.
>Every time the government tried to have rational policies (adapt pension age to life expectancy) you got millions of Frenchmen protesting on the streets
They still enforced the policies and it didnt help whatsoever.
You obviously didn't read the article mate. It very clearly gives multiple cases where benefits were increased beginning with Mitterand, including a reduction in working hours to 35 hours per week and the retirement age from 64 to 62.75.
This is an Economics discussion. Macroeconomics, specifically. The issue as a whole, not its symptoms.
Not snapshot lending rates. Not pension benefits increasing or decreasing. Not even the burning and looting. Those are ALL symptoms, downstream of the previous choices that lead you there.
The French farmers were blowing shit straight into the Capitol grounds, and have been for... a decade now? Probably longer. Nonstop upheaval, and escalating violence.
That's what HUMANS DO. This is NOT NEW. This is NOT SURPRISING.
There's nothing about market fluctuations that is going to STOP a movements like this when it has maintained critical pressure for a decade, or decades.
Put another way - The only metric that matters is you Citizens Contentment.
If you don't have that... they will EVENTUALLY not be your Citizens anymore, by hook or by crook.
"Oh shit! The Economy!!" says T-Rex, as the Asteroid crashes into Earth
They simply look at this from their ideology and forget what's the point of all this. They are so in their heads they don't see that every thread is repeating the same thing about pensions. There are many other problems in France, many more pressing. But they've been told it's pensions and that's it
Little or no hope? In one of the richest countries on the planet with one of the best social security program and pro worker labour laws. and I’m just sitting here in my country where the monthly wage is less than half of France’s daily wage.
Most of these protests (the economic ones)in advanced economies doesn’t stem from desperation, It’s stem from entitlement. I’ve lived in Europe, Australia and It always the same, the working class are always living very comfortable lives, but always use “bills” and “food on the table” that they can actually afford as excuses (of course there are some cases of actual poverty).
The economic issue isnt actually the rich vs working class, It’s that Western countries need to face the fiscal reality that their industrial might doesnt have the same share of the pie as they did before. Emerging economies are slowly starting to have more share of the pie and are still 100 years away from having the quality of life of those in the west.
I'm from the Philippines, visited Paris recently and the idea that anyone in France could complain about the state of things is super funny to me. Come visit the Philippines some time and you will see what not being able to put food on the table and the government not caring about you actually looks like
OK and your solution is deepthroating billionaires while they get richer taking apart public services and workers rights? Who's the good spiteful little slave? Here's your clown nose and shoes, man.
The point is there is no solution at this point other than actually tightning the belt. It's not fair- and I won't say it is. A lot of my life hasn't been fair to be quiet honest, and I doubt I will get the retirement I am paying into. But if no one will lend them money, then at the end of the day there *have* to be cuts and/or there *have* to be tax rate increase- something hard to do in France with the existing tax rates as they are.
And unlike the USA France can't unilaterally print away because they are in the Euro (which is a good thing- but does give a bit of hardship in this case).
.... compared to the cost of repairing all the fire and riot damage...?
Are you POSITIVE there's ABSOLUTELY nothing else that could be done...?
Because the collateral damage will continue until morale improves.
... so I hope you're wrong...
Let's try it a different way - Who profited off that money lending in the first place? The original round of debt that went out... and money exchanged hands...? Because they got paid.
Could we talk to them? Maybe discuss their moral obligations while the city burns in the background?
The problem is a higher cost of borrowing and an economy that can’t handle its social spending, particularly pensions.
Put your “burning IS the solution” into practical, economic terms. How does this address the situation?
Do the masses rob the rich to pay? Does the system collapse and millions of pensioners suddenly have zero income? Do they get what they want in the short term and pass the buck to the next generation?
Chaos is easy, but what comes after is always unpredictable. As a commenter on an economics sub, put your solution into economic terms. Because burning isn’t a “solution.” It’s a means to an undefined end.
The same way humans ALWAYS address problems like this.
You keep talking about borrowing and money - What's the cost of a Content Population that isn't going to burn your city to the ground?
...what's the cost of NOT having a Content Population, and them burning your city to the ground?
We're at THAT stage of the discussion... not the tea, biscuits, and fluctuating-interest-rates part. That discussion died a decade ago.
If you didn't notice the fires - this the destructions part of the solution. Your idealism is uplifting... but you aren't describing humans. Maybe some fantasy future homo supremis ...?
You're losing sight of the forest for all of the trees.
Unfortunately, it is a matter of math, not morality.
A country can only spend more than its tax income if lenders will loan them the difference.
Lenders are increasingly unwilling to lend to France.
If they stop lending money altogether, France will be forced, by default, to immediately balance their budget because there is no more money to keep spending.
We were never really given that choice as voters.
The current incentive structure for politicians in a democracy is to overspend.
If they don't, the citizens will revolt, as is the case in france and therefore they always choose to kick the can down the road.
Personally, I think that debt should be constitutionally illegal, forcing politicians to compete on policies rather than who can promise more free stuff that we cannot afford.
If lenders won't lend, France has no control over their banks, they can't cut costs, and they can't raise taxes (which, frankly, they are at the end of)... tell me what possibly could be done.
Because a national default is far worse than riots. France and Germany have both had to do it before and it is never pretty. Like this is springtime compared to a nation which defaults (which ends up with services cut anyways as there is literally no money coming in).
You would never get the social services because no one will lend to France for decades, and people who need help starve? Like I don't know what to tell you that's fiscal reality. Why would any nation or individual loan to a nation that doesn't pay back it's loans and defaulted?
Probably a brain drain of the best and brightest French to other Eurozone nations as well a la East Germany and West Germany? Infrastructure crumbling?
Yes I have a degree in history, and I can tell you defaulting on debt literally often leads to death. Like. That's been true since ancient times. Whether early modern- France in the 1790s. Whether modern- Greece. Whether ancient empires running out of cash and shaving coins.
All that happens is it leads to death and destruction... and then the same system keeps going.
Going back to most of history the state provided little to no social services and that meant the poor, disabled, and aged died when nobody was able to take care of them.
I am not sure France, or anyone, wants to return to that past.
The solution was ALWAYS the same. How you achive that solution differs. But people WILL NOT starve. The Default process itself includes provisions to help stabalize the situation.
The problem is that up to a point lenders will simply not lend any money.
Debt is rolling and the French Treasury like other states issues bonds every two weeks to fund itself.
If France has a deficit and no one is willing to lend money to them, France will either have to implement a 0% deficit budget or face default that will result in that 0% deficit budget.
The reasoning is quite simple, why would any financial institution loan money to an entity that defaulted recently and didn’t make any adjustment because it was “unfair” ?
The burning IS the solution. It's what Humans do. It's destructive, and painful, and people are going to get hurt. It's going to get worse before it gets better. BUT THIS IS WHAT HUMANS DO when pushed beyond their means.
It's what we've always done.
...and it USUALLY works remarkably well, once the fighting stops...
Let me put it another way - There's no amount of money in the world that would 'fix' it now. The only way to win was not to play... and almost every Western Country has played the Debt Game.
Now just imagine how the United States is going to look when we finally get our comeuppance.
I propose cutting pensions by the cost of debt service. Make the cuts a ceiling on payments. The debt is largely due to pensioners, so they can pay for it.
Additionally, I propose taxing Elon Musk. Lure him to France with a big bowl of special-K, and then spring the taxes on him.
Now they’re protesting and support of the same thing that are screwing them over. If they were so concerned, they would’ve been fine with raising the retirement age and then they would’ve had a cut back pensions amongst other things. They want more cake while not being able to afford it and then allowing a huge amount of. Refugees that had no intention of going home in.
Exactly these economists act like these equations they or those before them came up with are some kind of natural laws, hinged on people being perfectly rational, in a vacuum, without the context of the choices, political, social and otherwise that enable this "fiscal reality".
It's bullshit and as many people in this sub espouse intellectual superiority and "this subs going to hell, there are barely any economists here. They're more likely to buy this nonsense whole cloth. It's hysterical.
I obviously am not French or can't speak on their economic reality but from an uneducated outside glance it almost feels like the French voter got exactly what they wanted. Like they wanted massive services and safety nets and obviously this would necessitate high taxes + extreme stimulus. It seems like many in France are rioting over this simply because as much as we don't like to hear it, there's no such thing as a "Free lunch" when it comes to even government financing of programs. If the Government finances this off stimulus we get inflation like we did with covid, and tax the rich seems to only be a lemon that's oh-so-squeezable at time.
Bloomberg just had a good video on this which was interesting, they basically broke down French spending and then at some point compared it to Nordic countries (also with high welfare spending) and made the point countries like Sweden and Finland spend a good percentage of their funds on defense and welfare, but their welfare distribution is more equally broken down by age group whereas France concentrates a majority of its welfare into the elderly including with one of the earliest pension/retirement ages in the developed world.
I actually swear i read something today that made the argument the "Swedish and Finnish" dream are dead and their economies also aren't doing particularly well. I think anyone who's honest realizes that safety nets have to be funded from somewhere and this usually means via high tax.
Sweden is to my knowledge above average for economic growth in the EU and has low public debt. Personally my measure of economic success is having low/no debt and providing strong social services to your citizens.
Now I think a lot of economists will disagree because they don't care about the economy as an engine to provide for people but rather an engine to make profit. Maybe those people think Sweden's economy isn't doing particularly well.
I think ultimately social services need a base in which they can be financed. If sweden is able to get that through taxation and a relatively stable economy I can see it being viable.
You're off on pretty much everything that an uninformed outsider can be off on.
France HAD good public services and social welfare. They voted for someone to maintain that. And the centre-left government they voted for then transformed itself into a centre-right government and cut the taxes funding social services while giving no-strings-attached financial gifts to the richest companies. Trickle up economics. Look at a graph of government finances and you'll see 2 things: tax revenue as % of GDP going down while the deficit goes up.
This is a self-inflicted debt crisis so the neo-liberal establishment can point to the debt and go, "Socialism is not realistic!", and continue the capital flight to the rich from the impoverishment of the working class.
Example: stop the financial gifts to the rich tomorrow and the budget deficit disappears.
It's the same infiltration that the Reagan administration has made in essentially every NATO country. And the same regime that suppresses every communist regime since WWII. So it's zero surprise that you've been brainwashed by the same imperialist propaganda.
The fact that this subreddit is called "Economics" tells you everything: the only narrative pushed here is the accepted capitalist neo-liberalist agenda. The propaganda is inherent to the system.
Edit: I thought the stats on this comment were very interesting:
Negative comments from the US
Downvotes from the US
Upvotes from France
Make of that what you will.
If any Americans are interested in economics deconversion material, allow me to recommend Polanyi and Zucman.
No this is France, they've always been overly idealistic idiots they're just continuing the trend. They think they're entitled to everything they want and anyone pointing out it's not possible is to them either a bourgeois or class traitor, and the only ones opposing this are RN who have their own problems.
like how hard is it to understand you can't have 1.5 worker supporting one pensioner it just isn't sustainable it was managable when it was 6 worker for 1 but the demographic has changed
"Tax the rich" won't make the deficit disapears, you are delu AF, stop this LFI copium.
We have been living on the free lunch mojo since decades, far before Hollande. Heck, we could already see we were off the track and reforms were mandatory since Mitterrand.
While you are right about some parts were richs become richer and poors become poorer, that doesn't change the balance of our economy is broken.
Well kinda, but at the same time the underlying problem is that rich companies don't pay taxes, and we allow foreign competition to kill our homegrown competitors, for free
I just feel like i've lived long enough to see that these taxes will never get collected. Seriously. Politicians and companies would clean us out and let us fight each other before they'd ever let any of us get even slightly ahead.
That is for sure but that is also kind of the problem. Those politicians (and company heads) think they can just cheat tax and not feel the public services breakdown it generates
Well no they don't. I mean for now they can yes. But with the world we will see, there is nothing stopping any country to seize wealth pertaining to foreigners
Without tax yes we won't be able to defend them either
I'm just jaded from Canadian politics. We keep having "Scandals" where we find out that the government hired a close family friend who mismanaged a ton of money and there's never even a fine handed out. I see no reason why if it's happening here it's not happening everywhere.
I mean, yes it happens here too. But what I meant is those people still live in the country, and they will face the problem of the country when the country goes forward
What kind of taxes? Sales/VAT? Tariffs? That's the only tax you can subject them to. These companies are not French and their profit is calculated against global expenses in their headquarters in the US.
Sales tax. That is kind of the problem really. They base their profits on avoiding tax on the benefits they make in France, by basing it on a HQ in Ireland.
french voters are furious that the bill for decades of nice promises finally showed up and nobody wants to sign for it. everybody loves the benefits until the tax hike or cut lands on their own block and then its a moral crisis. the realistic fix is boring and unpopular which is exactly why politicians keep kicking it down the road.
Most of Europe has been kicking the debt can down the street to pay for benefits today all of my adult life - and the debt can just keeps getting heavier. Everyone screaming about what the current government did or did not do is entirely missing the point, the has been coming for decades as government after government shoved the debt onto the next generation.
Greece was the first country to break their toe on the can when the debt crisis hit. Its only a matter of time before then next country breaks its toe and if its France then its probably too big to rescue.
The only way out of it is significant hits to living standards or massive deregulation to generate growth. Either would cause riots in France. The French people have been lied to over their free lunch for so long they get angry when anyone tries to tell them the truth - they are not alone in this I think most of Europe is in a similar situation.
Being a member of the EZ makes it a little more complicated but people who pen articles like these always forget/ignore the fact that the money system is closed system. The government debt they decry is also the money in the private sector. Their argument becomes these protesters have too much money, which is weird because the protesters are saying they don’t have enough money (for schools and such, god forbid). All sovereign debt “problems” are just an untaxed wealth problem and today that manifests as a small number of individuals have a lot of that wealth (government debt) while the other 99% are told there’s no more money (too much debt). Acknowledging that might change one’s policy prescriptions, methinks.
This is what happens when someone starts with an ideological conclusion and then cherry-picks economic statistics to support it. France has genuine fiscal problems, but this article is full of misleading comparisons, accounting confusion and unsupported causal claims.
"Americans produce almost twice as much per person."
Only if you compare nominal GDP in dollars and conveniently ignore purchasing power parity (PPP).
World Bank figures for 2025:
US GDP per capita (PPP): $90,027
France GDP per capita (PPP): $63,975
That's a 41% difference, not 100%.
More importantly, GDP per capita is NOT labor productivity. It also reflects hours worked, employment rates and demographics.
According to OECD data, France produced $87.30 per hour worked in 2023 versus $97.05 in the US (PPP-adjusted). That's an 11% American advantage, not remotely the enormous productivity gap the author implies.
Conflating GDP per capita with productivity is a rather embarrassing mistake in an article written by someone holding a PhD in economics.
The €54 billion "spending cuts" that aren't €54 billion in spending cuts.
Here's what the French government's actual 2027 budget proposal says:
Public expenditure in 2026: €1,742 billion.
Public expenditure in 2027: €1,782 billion.
Tax and social contribution revenue as a share of GDP: 43.9% to 44.2%.
Deficit: 5.4% to 5.0% of GDP.
Yes, you read that correctly. Public spending is projected to INCREASE by €40 billion in nominal terms.
The €54 billion refers to fiscal adjustment relative to a baseline, not €54 billion of actual expenditure cuts. It includes revenue measures.
Likewise, comparing a hypothetical 6.4% deficit with a projected 5% deficit without explaining the baseline is misleading.
This distinction is fundamental in public finance. Apparently, not fundamental enough for this article.
A 5% bond yield doesn't mean France suddenly pays 5% on all its debt.
French government debt has an average remaining maturity of approximately 8.4 years, according to Agence France Trésor.
Most existing fixed-rate bonds retain their original coupons. Higher market rates progressively affect debt servicing as bonds mature and new borrowing takes place.
Debt sustainability depends primarily on the relationship between effective interest rates, nominal GDP growth, the existing debt stock and the primary fiscal balance.
The standard debt-dynamics equation is approximately:
Change in debt/GDP = (interest rate - GDP growth rate) × debt/GDP - primary surplus/GDP.
The author discusses rising borrowing rates as though these distinctions barely matter.
They matter enormously.
And a widening France-Germany bond spread isn't exclusively a measure of default probability. It also reflects liquidity, uncertainty and other risk premia.
"Government spends over 50% of GDP" is not the argument he thinks it is.
First, he confuses central government spending with general government expenditure, which includes local authorities and social-security institutions.
Second, government spending includes transfers, pensions, healthcare reimbursements and other payments that subsequently finance private consumption.
A pension transfer isn't equivalent to the government consuming an equivalent quantity of real resources.
The spending-to-GDP ratio alone tells us virtually nothing about expenditure efficiency, economic returns or fiscal sustainability.
What matters is WHAT money finances, how efficiently, and what the alternatives would cost.
The pension comparison is deliberately incomplete.
Yes, French public pension expenditure is approximately 13-14% of GDP, well above the OECD average.
But France finances pensions predominantly through public schemes, whereas countries such as Australia, Switzerland and the US rely much more heavily on occupational and private pensions.
The OECD explicitly distinguishes public from total public-plus-private pension spending.
Moving pension expenditure from a public institution to private pension funds doesn't magically eliminate the economic cost of retirement.
Comparing public expenditure without accounting for institutional differences is a poor international comparison.
The 35-hour workweek argument is equally misleading.
France's statutory 35-hour week is principally the threshold for overtime calculations, not a maximum number of hours employees are allowed to work.
Full-time French employees routinely work more than 35 hours.
And here's the irony: the author complains about French people working fewer hours immediately after using GDP PER CAPITA as evidence of inferior productivity.
If Americans work more hours annually, that increases their output per person without necessarily making their output per hour proportionally higher.
He is effectively using differences in working time to prove differences in productivity.
His healthcare argument collapses when you include private spending.
OECD estimates for total healthcare expenditure in 2025:
France: 11.4% of GDP.
United States: 17.6% of GDP.
The American system consumes roughly 54% more of GDP proportionally, despite relying much more heavily on private financing.
And the French enjoy substantially higher life expectancy.
Whether healthcare is financed through taxation, insurance premiums or out-of-pocket payments, it still consumes real economic resources.
Apparently, expenditure becomes economically virtuous the moment it disappears from the government's balance sheet.
That's ideology, not economics.
His historical examples actually contradict his thesis.
He praises French nuclear energy, high-speed trains, aerospace and technological innovation, then suggests state intervention destroyed French economic dynamism.
Who developed those projects?
France's nuclear expansion was driven by the state-led Messmer Plan.
The TGV was developed by the publicly owned SNCF.
Ariane emerged from European publicly funded industrial cooperation.
These are almost textbook examples of successful industrial policy and public investment.
That doesn't prove state intervention always works. It proves the author's simplistic "government bad, private sector good" narrative cannot explain the very successes he celebrates.
Sweden, Canada and Australia don't establish that austerity automatically produces prosperity.
This is classic selection bias.
Fiscal consolidations depend on monetary policy, exchange rates, global demand, initial economic conditions and the composition of reforms.
Canada and Sweden benefited from macroeconomic circumstances France cannot simply reproduce.
France cannot independently depreciate its currency or set its own monetary policy.
Moreover, IMF research has found that fiscal consolidations generally reduce economic output and increase unemployment in the short run.
Austerity can improve fiscal sustainability under appropriate conditions. It can also damage growth and worsen debt dynamics if implemented badly.
Listing three successful historical episodes establishes neither universal causation nor an appropriate policy prescription for contemporary France.
There's one final irony.
According to the IMF's October 2026 forecasts:
France: public deficit of approximately 5.4% of GDP; government debt around 118.5%.
United States: public deficit of approximately 8.5% of GDP; government debt around 126.8%.
The US has different monetary and financial advantages, of course. But presenting France as the unique warning sign for an American audience while largely overlooking America's own fiscal trajectory is an interesting editorial choice.
The actual economic problem:
France needs to improve its fiscal balance, productivity, employment and the efficiency of public expenditure. Nobody serious disputes that.
But none of these objectives demonstrates that reducing public services, shrinking pensions and deregulating labor markets are automatically the optimal solutions.
Those are policy preferences, not conclusions derived from the evidence provided.
A serious analysis would distinguish nominal from PPP-adjusted GDP, output per worker from output per hour, marginal borrowing yields from average debt costs, public expenditure from total economic costs, and historical correlations from causal evidence.
This article repeatedly fails to make those distinctions.
The author has every right to advocate smaller government. But dressing that preference up as an unavoidable conclusion of economic science doesn't make it one.
Sources:
"World Bank — GDP per capita, PPP" (https://data.worldbank.org/indicator/NY.GDP.PCAP.PP.CD)
A lot of words that still don‘t explain why the situation of France would be anything but very serious. They have neither a grande privilige as to being able to generate money on their own, nor do they have military power or capital assets to back such debt levels.
The references are literally at the bottom of the comment. But since apparently scrolling is harder than dismissing something as AI-generated, here are the primary sources with the actual figures:
World Bank: GDP per capita (PPP), 2025: France $63,975, US $90,027. That's a 41% gap, not the nearly 100% suggested by the article.
French National Assembly: The official 2027 budget documents project public expenditure increasing from €1,742 billion in 2026 to €1,782 billion in 2027. That's €40 billion more, not €54 billion in actual spending cuts.
That's all you got? If you want a debate I'm happy too, but at least read the article not only the title, and at least look at the data I presented it would take 1 minute.
It's AI generated but you asked it to draw the wrong conclusions. You showed that France has LESS productivity than the US (it used to have higher productivity), you showed that its GDP per capita is 40% (!) lower than the US. Add to that that the share of the country's GDP derived from public expenditures is one of the highest in the world. Additionally the country is lagging behind in terms of high-tech companies, and looking at the trend (GDP, expenditures...), its future doesn't look good. France does benefit from the Euro which allows it to borrow at a low(er) rate than if it was having the Franc.
Yes here in France we love to pay for old people who had to work less and benefited from debt and money printing while we (millennial and gen x) will get fucked in the ass
Gotta prompt your AI better to make sense. Abstract points about GDP
measurements aren't super relevant if you look at trends over time. In 2000, France had the same per capita GDP as the US. Now France is way poorer than the US, it runs a deficit every year to pay for its welfare state, and that's before you factor in that France now has to resume defense spending and staff its military due to the geopolitical threat posed by Russia. So whatever PPP adjustment you use, France's system is unsustainable by its own metrics and the system is being strained in 4 directions - an aging population means fewer taxpayers paying for more takers, defense spending now competes for welfare spending and staffing takes productive ppl out of the civilian economy, mass unskilled immigration creates another growing group of ppl who will never be net tax contributors, and the European energy crisis. The left's response to this polycrisis will cause hyperinflation like it did in Argentina
Sure, I think you made some good points. But it does seem like their public finances do need to be addressed.
Most of what you said is that you disagree with their conclusion or how they have presented things in a negative light. But nothing you shared seems to “bring them above” the pile of criticisms.
I agree they are preferences, but it feels disingenuous to try and say there is no credence to the arguments they’ve provided to support their preference.
Look at the GDP per capita of Ireland, which is a tax shelter for the world. Well what other countries have low corporate taxes? The USA, for one. Our GDP is inflated.
I think you guys at r/economics are buying a bit too much into this article which only sees France through its difficulty to borrow debt and not on its economy itself. The lense is also officialy supporting "the principles of free enterprise, limited government, and individual liberty".
What the american reader will miss from this read, as many of my fellow french pointed out to some people, is that our successive government did not in fact do nothing, reducing the size of the french government has been the constant policy for more than 20 years now.
Some thoughts :
Diminishing worker's rights do nothing when you're competing with countries where multinational firms just moves activity to the least moral place, in the end, it just reduces quality of life with economic benefit
The strategy has clearly been about starving the beast, by reducing fiscal revenue to justifiy cutting social and public services.
The high share of GDP which passes through the State is misleading, just because social security is public multiplies this ratio by two compared to the US. There's no actual fiscal nor economic benefit having a mostly private health system unless you're the kind of economist who only look at explaining a country's system through the financial market.
French people would be more willing to accept financial effort if they percieved that effort to be fairly shared. However, starving the beast has in effect offered fiscal presents to large businesses with no requirements from them, tax cuts for the rich that we know doesn't work for the rest of us, by reducing public services, health and education which are components of our core value of equality.
A lot of those policies are perceived (and I'm waiting evidence of the contrary) not by the guise of fiscal responsibility like politicians often claim, but for special interest. For a decade now, Macron's government has seen regulatory capture by some lobbying groups, seeking to reintroduce harmful pesticide for our health and environment.
This general discourse that french people are entitled to their benefits is used at home to justify what are harmful policies which will only worsen the fiscal situation (again, cuts in fiscal revenue, worsening the debt, are used to justify cuts in spending, not the other way around).
And I will remind everyone that most of public debt in the west cannot only been explained by structural issues, which do exist, but are also the result of the State willing to save the economy during crises. In France it rose by 20 points of GDP just in one year in 2008, it rose by another 10 points because of covid, as it was stabilizing before.
The financial markets uses instances of the State saving the whole economy as quantitative indicators of the State's lack of responsibility.
>The strategy has clearly been about starving the beast, by reducing fiscal revenue to justifiy cutting social and public services
second (or first depending on the year) highest public expenditure as % of GDP in the whole OECD
This beat might be bulimic or something idk
>just because social security is public multiplies this ratio by two compared to the US
do you think social security is private in the US (???)
>The financial markets uses instances of the State saving the whole economy as quantitative indicators of the State's lack of responsibility.
the whole point of a market correction is to adapt prices to properly incorporate new information
The State stepping-in is exactly an indicator it will try to hide reality and try to push the river uphill for as long as it's allowed to
COVID is the perfect example, if everything is locked down, you can't pretend it's business as usual just because you pump liquidity in people's pockets
For prices to be a good signal in a market economy, they need to reflect and rapresent the actual reality of an economy. There is no way out of that
>second (or first depending on the year) highest public expenditure as % of GDP in the whole OECD
Most of it is money passong through the State, it's not spending in the sense that the public sector weights that much.
For Example, the US might have a small tax for something, while in France it will have a big tax but it will give back some or more money in fiscal assistance. I might pay a tax for owning a house, but I get a bonus from the state because I have a limited time contract. I will pay a higher income tax than in the US, but I will get money back because I have a child.
You could say that's innefficient or whatever, but this kind of redistribution explains most of the share of public expenditure relative to GDP, not the size of actual public services.
>do you think social security is private in the US (???)
You guys pay high cost insurance to pay for private healthcare in situation where in France I would pay close to nothing because it has been paid by taxes. My situation inflates the share of public spending to GDP but yours doesn't. I'm only explaining this. In the end however, the american individual (and medicaid) will pay more for the same result.
Is it really in r/economics that I have to explain that actually the single payer system is more efficient than what the US has ?
>For prices to be a good signal in a market economy, they need to reflect and rapresent the actual reality of an economy. There is no way out of that
I do agree, but if you're just into laissez-faire, you will just let people starve and die of illness before the market adjusts itself. The way you see the covid crisis is interesting, it shows a political choice that actually it's okay if every business dies for two years if that's what the market leads to. But like, do you think doing nothing would have been the right solution ?
Not any mention of some of the other factors that have pushed French borrowing higher, most importantly Germany's move to issue more of its own debt. France was the "Safe" option for the Eurozone because Germany wouldn't issue debt, now that they have started to, French debt becomes less desirable. Pursuing blind austerity is a great way to worsen the situation at this point.
Government spending is 60% of GDP and the average pensioner in France "earns" more than an average worker. Austerity is definitely needed at this point. It has all got to stop.
Just to put this into context - French government spending is a higher percent of their gdp than the Soviet Union which typically fluctuated between 47-50% in the decades following the Second World War. That is bat shit insane and totally unsustainable for a country like France.
Third highest in the world among major countries, behind only Libya (where private sector was obliterated by war and most of the economy is oil exports) and Ukraine (where private sector was obliterated by war and most of the economy is foreign donations). There's just no way to continue spending this much without a major external source of income.
Wow I didn’t know that. It’s not like France is a country that is tremendously rich in natural resources. The Soviet Union could keep it up as long as they did because state run industries could stick shovels in the dirt all over to exploit vast natural resources. I don’t know what the end game is here for France but it looks bleak.
The Soviet Union at least did some cool shit like land a spacecraft on Venus, create Tetris, and develop the worlds first nuclear power plant. The French just have a generous pension system and substantial welfare state.
But I can bet that the austerity will never hit the pensioners, but the young and the workers. Because the current governments of France only get elected by pensioners.
No that’s just wrong, austerity is inherently done for the future of the country, and its only right that the future generations are less impacted than the boomers.
How does it even happen that someone makes more in retirement then working the average job? Like what voodoo magic happens? Is this literally the voter voted for more free money or is it a little more dense then that?
Sorry i meant like how does a retirement system get that bad? like what's the math that gets done to make it come out like that. Are average wages so insanely low now or are the boomers such a significant block that they turned retirement into a form of free income?
So like inflationary pressure caused by that debt or people voting to bump retirement considerably from that? Not trying to be obtuse or anything just a little overly eager to understand/learn.
It's not. Check Greece, they were many other possible solutions, and austerity just created chaos and had the effect of selling all the productive assets of Greece for penny on the dollar to international funds
No. The fact that the austerity has not been reversed but enforced with extreme vigilance shows that the EU is commiteted to austerity. Time for France to taste their own medicine.
The main issue with Greece wasn't the actual debt. It was the fact that the "elites" of that country put lipstick on a pig by pushing fake reports aided by international consulting groups. That's what led to the loss of trust. And then it was asked of the poor people to pay for it through austerity. You have it backwards
Please elaborate on your proposal for France to regain fiscal stability given that the average wage earner is already taxed at an effective rate of 55% [1].
What part of econ 101 says that cutting spending and/or increasing taxes to pay down your debt and ensure your fiscal security doesn't fall apart is a bad thing?
The issue here is precisely this: the demonstrations in the streets ARE about increasing taxes on the wealthy people and big companies in order to lower the debt.
Except everybody seems to pretend that the "only possible way out" is to use austerity. It's not. Austerity only make things worse
In 10 years, we want better educated and healthy kids in order to grow our country. We don't want "even wealthier" billionaires who just buy media to instill their hate everywhere
Actually it didnt work for Greece not even a little bit, but they (Europeans) keep imposing it. France has zero excuses at this point. They need to start living within their means by lowering their standards of living
That's simply not true. Greece went from massive budget deficits to running surpluses, regained access to financial markets, restored its investment-grade credit rating, and significantly reduced its debt-to-GDP ratio. Unemployment dropped from a peak of 27.5% to below 9%, its banking system became much healthier, and its GDP growth is outperforming both the EU and eurozone averages.
You are answering about an invented argument. I nowhere said that a welfare state should ne sustainable, on the contrary. But calling these barbaric austerity measures imposed to Greece a "sucess" is pure fking hubris.
One does not negate the other.
Only because democracies don't make reforms before it's necessary. Politicians can read the writing on the wall, and see that fiscal responsibility is punished by voters and candy for everyone is rewarded.
"Fiscal responsibility is punished by voters", except that in literally ALL the "fiscally responsible" Republicans governments in the US the debt grew (to give money to the ultra wealthy), and in literally ALL the "free candy" Democrat governments, the debt was kept under control and people got more
You should understand that when laypeople get more, they spend more. Thus suddenly your Mom & Pop stores make more sells, and get better, etc. Giving back to low-wage people helps everybody
Why the hell are you talking about US politics? This is about EU politics and the eurozone. It's a totally different system.
France will not have any money to give in a few years, the interest rates are going to skyrocket. No one is going to lend France money, unless they get extortionary interest rates for it.
What would really fuck a country up (like it happened in the US) is to stop educating people. Then they vote for MAGA, and your whole country gets fucked by Putin.
I’m curious: France has so much debt, and rates don’t seem to lower significantly for a long time in the future. If austerity won’t help, then what will get them out of this rut?
“A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury.”
I mean “blind austerity” doesn’t sound good but they need a healthy dose of austerity, certainly.
I’m not sure France even has the ability to raise enough tax revenue to fund its current programs. Like they’re already collecting ~45% of GDP in tax revenue and are probably not that far from revenue-maximizing rates. Especially over a longer time horizon.
Except the spread on French bonds over Bunds has increased far more than other Eurozone countries. Like you’re not seeing that sort of divergence for government bonds from places like Austria, the Netherlands or Ireland. The increased risk associated with France is definitely the primary factor.
I don't understand why the French can't have all the vacation time they want, retire at 55 with bloated pensions. Just ask Grandpa Bernie Sanders, everything is free.
No. There is no "fiscal reality" and we’re not protesting against it.
The economic right-wing just has a strategy wherein they call themselves the "realistic" ones and "down to earth" politicians, even though their analysis is usually whimsical at best. And politicians therefore now pretend we’re protesting reality.
No, we aren’t. We are protesting the people in power, and the kind of people who wrote this title, because they are the problem.
There are dozens of ways that things could have done better without this neoliberal ideology nonsense. It perfectly possible to fix the issue. Some people simply don’t want to. Because these people want more failure, more fear, and the ability to keep pretending they’re "realistic" for political gains.
If the laffer curve theory was right and France was at it's too in 2017, those 929 billions would automatically have generated an explosion of the french economy.
And you’re doing the same thing as the article, calling your ideology “reality” doesn’t make it so.
Even IF the Laffer curve was a thing (it’s not, given there has been no empirical demonstration of it and models vary widely), given that all tax cuts have resulted in lower tax revenues, we’re clearly not at the peak and could increase tax rates, especially on the wealthy.
You mean the shitty curve that was drawn on a napkin in a restaurant, used as a justification for the Reagan administration, that is disproved by pretty much every economic studies on the matter for 40 years now?
The French tax system is not oppressive. No empirical data supports the Laffer curve currently. Rich people very rarely move simply for economic reasons.
Again, you’re pretending to be "realists", and it’s pure ideology. There is actual data on fiscal exile. If the Laffer curve exists, every single country is miles away from its optimal and we could literally triple taxes on the ultra-ruch. If it doesn’t, it’s irrelevant.
Neoliberal ideology? How exactly does France practice neoliberalism? This comment seems to indicate you don’t understand the problem with France’s finances after all.
I’m literally French. France has been moving right economically for well over a decade, and that is specifically why its finances are not doing well.
Neoliberalism is the art of taking a functional mixed economy, breaking it, then going "see? I told you it didn’t work".
France sold tons of its holdings for pennies to the private sector. It then borrowed money on a market that was simply luring States in with low interest rates to make them dependent. It then changed Laws to make the rich pay less. Finally, it hired people to "save money", and these people are now paid with our taxes to enshittify the public sector and save less than they cost for it.
All of these were neoliberal decisions : privatize infrastructure, privatize sovereign debt, give incentives to work hard, cut needless spending. This is how this nonsense was sold.
France also had opportunities by the gallon. It’s arguably the best weapons manufacturer in the world in 2026, filled with talent, and very productive per hour worked. The fact that it even has issues instead of swimming in money is pure neoliberal incompetence. Gaullists would have resovereigned debt and invested massively in defense years ago, and they’re right-wing. You need intense levels of neoliberal delusion to turn this winning hand into this situation.
Explain to me where french government is supposed to get enough money from to pay for all those public companies and services? It seems to me there is literally not enough money for what the french public demands. Can't have cake and also eat it too.
You don’t understand money, then. Saying "there’s not enough money" is a purely ideological stance. Monetary policy is a choice.
Money is just a tool we use to keep track of various economic factors in a decentralized way. Money helps us keep track of who contributed to society, helps us make barter much easier, helps us keep track of supply for various resources. It’s a tool, nothing more. It’s a complex tool, and you need to wield it intelligently, but "there’s not enough money" is a neoliberal copout.
There are enough resources for what the french public wants. There is also enough motivation, and enough expertise. We know how to do everything the public wants to do, we have the means to do it, it is morally sound and creates no victims. There is no problem from a material or human standpoint.
If money is the problem, it’s a poorly calibrated tool and needs recalibration.
If you want to code a piece of software, have the expertise to do so, the time to do so and the computer to do so, but your windows manager causes an issue when you try to do it, it is not a hardware issue, nor a human issue. It’s a bug.
Good try but wasting your time here my fellow French citizen. The way the French see the economy and politics is completely absurd for most other countries. Most countries are still completely enslaved to capitalism and can’t comprehend that, actually, you can enjoy life, have rights, not work 60h a week and have a decent situation. Fighting for your rights and quality of life? Heck what the fuck is that, we must be glad and thankful for the mighty billionaires and corps for giving us sugar and minimum living wages.
>There are enough resources for what the french public wants.
Replace my money question with resources. Where are these resources? To provide social benefits and pensions for people who don't produce, those that produce need to produce enough in excess. Do they? The math doesn't seem to math, thats the core issue i am asking you about. This is not a vibes thing, it's purely math when you strip it down.
I don’t think you truly understand how much excess there is.
First of all, your notion that work is production is pure ideology. Work includes a lot of non-productive activity, and non-work includes a lot of productive activity. "Production" is a neoliberal copout. If by production you include goods and services that help people survive and thrive, which is the main definition meaningful here, volunteer paramedics (the standard in France) produce more helpful services than telemarketers, who are actually a net detriment to society. Yet only the latter "works" in the neoliberal sense. People who receive pensions and don’t work often produce more than the workers who pay their pensions. So, already, you have demonstrated the ideological axioms that underpin everything you think of.
Anyway, this put aside, we do overproduce food and have an excess of shelters in France. We do also overproduce energy. And we did overproduce health with the best health system according to the WHO before neoliberalism gutted it and made it more expensive. In fact, we:
Can export ~100 TWh/y, which is plentiful and can easily cover the needs of everyone
Waste 10 BKg food per year, mostly needlessly, despite a recent crackdown on companies that purposefully destroyed it for profit
Have 3.1 M unoccupied homes, which could theoretically house 10% of our population assuming 2-3 people live in one dwelling, which is typical
Can export extremely qualitative technical expertise, in order to import consumer goods
In short, we have the resources necessary to house, feed, supply energy to and equip everyone, and more, without any further strain on our logistics.
There is enough production and enough wealth. We have so much we waste it, sometimes purposely.
The idea that there’s "not enough money" is pure, unadulterated ideology. Neoliberals would simply rather leave a dwelling vacant because it’s practical for London City traders to have liquidity on the French real estate market than to let older people have a roof over their heads without breaking their backs. This is an ideological decision. It’s a preference. There is no "realism".
I'm so fed up with the "realist" argument. Any politician using it should automatically be ignored and discarded. It's basically saying that the political power is powerless against the economical power. I don't understand how anyone can vote to give political responsibilities to someone who thinks that politics are powerless.
And I'd have no problem with them having different economic ideas from my own, if they'd use sound arguments to defend them. But no, it's always the same shit about "realism", "pragmatism" and "there is no alternative".
The centrist "pragmatism" is all about bending over for the private lenders. It's financial enslavement through debt accumulation. The total opposite of politics.
You seem to have understanding issues. I'm fed up with politicians acting like they have no power over the economy and that the way things are right now that only benefit a very small minority is the only "reasonable" way. They are entitled to their opinion, I just want them to defend it without saying "I'm the voice of reason and everyone who disagrees is a fool". Especially in a domain such as the economy where different schools exist and there is no scientific consensus. Which is exactly what you're doing here, by the way.
Lmao, it's the same in Germany. The government reduces taxes on the rich and businesses, then there is less money in the budget and the media discusses it as if one didn't have to do with the other and call for reduced spending.
Nice framing in the title lol, but ignorant at best and straight up misleading at worst, especially for someone who actually lives in France.
The neoliberal president gutting this country at the behest of western capital and large corporations, destroying the public services to privatize everything without offering anything in return to the middle class, in fact putting even more burden on them instead is the actual reality.
Energy prices that already very high keep increasing, basic necessities are not affordable, public services are dead, social safety nets are removed, no job good opportunities, young people are struggling to even get an interview let alone find a job, public education and health services in the shitter, taxes on taxes, people struggling to make the ends meet living paycheck to paycheck, this is the actual reality.
I propose a annual elder kumate where at 75 we place them in weight categorys and have them each fight one other to the death. Do this annually should take care of the problem while increasing the physical health of the subjects. I know I would workout if that was coming up in a few years
That's just incredibly cruel and ridiculous. A much better system would be like Inuit culture, where, when people reach a certain age they are celebrated before then volunteering to take their final journey, alone, by walking out into the vast snowfields.
Yes Macron has passed huge tax cuts for the wealthy, removed wealth tax and lowered company taxes, since he's been in office but the "economic reality" is that your pension has to go. The pension you spend your entire working life paying tax into.
The "reality" is always a choice. Someone chose to make life easier for Arnault and harder for you. And then here come the 'economists' to pretend further inequality is the solution. More spending funneled to the wealthy and less to the worker, that'll fix it.
The pension is pay as you go. There is no saved pension pot. Whilst I agree that Macron is a buffoon, Frances PAYG pension system being unsustainable is solely a matter of demographic reality
Only if you keep a fix pension, then yes an aging population will cause such a system to have a deficit. If you make this pay as you go system to work in a way that the ampunt of money distributed is aqual to the amount of money paid in by workers contributibg then there is no deficit, instead the adjustment is made by reducing the pensions when less money comes in (you could reduce in higher proportion above a certain threshhold to make sure noone ends up starving)
French wealth tax never worked and that makes your whole comment suspect. You can ignore reality but you cannot ignore the consequences of ignoring reality.
France is actually spending too much on its public sector, thats why theyre in this pickle. Reducing govt spending is the only way out, there is simply no one left to tax for your plans.
Yep. Most of the countries of Europe that instituted a wealth tax retracted it later as it became clear that the government ended up with less money than it would if it had no wealth tax at all.
The French wealth tax was abandoned like Denmark's bc it was causing capital flight and decreased tax revenue and growth. Norway is trying to keep its wealth tax by passing an east-German style exit tax on people leaving but by then the wealthy had mostly already moved.
In fact, tax loopholes are the only major cause of low tax revenue in developed economies with sufficient evidence. You are welcome to look it up yourself.
Un rapport récent de la Cour des Comptes, organisme officiel de l'administration française qui vérifie les dépenses, a montré que 22B€ prélevé de taxes diverses n'ont JAMAIS reversé à la protection sociale ( Sécurité Sociale) qui est en déficit de 9 à 11B€.
Le système français pourrait être en positif si l'État ne détournait pas les taxes .
En encore un service publique n'est pas censé faire de bénéfices mais plutôt être à l'équilibre.
On pourrait théoriquement redistribuer les 11B€ excédentaires ou diminuer les prélèvements.
That’s the thing that sucks about European social nets in general… it tends to just be the professional classes getting taxed into the ground to support the working classes…
Meanwhile the wealthy get off Scot free
France’s problem isn’t tax cuts for the rich. It’s the retirement system.
The French people have shown poor judgement on policy where every little necessary inconvenience is met with riots. I wouldn't care if they run their public finances into the ground by letting anyone retire at age 38 but Paris will be looking at Brussels to bail them out when push comes to shove.
And when that happens, I know who will be paying the bill: countries that don’t overspend.
His predecessors doing the same for years, distributing public subsidies left and right to undeserving private companies (under the unfulfilled promise of economic growth and new jobs) and selling out the very lucrative highways (funded with taxpayer money) to the private sector didn't help.
Plus d’austérité mènera à plus de récession et ne fera qu’accentuer le problème, c’est un cercle vicieux. Le problème n’est pas une question de dépense publique, c’est une question d’inégalités 👇
Dette publique : pourquoi l’austérité échouera tant que les inégalités persistent https://elucid.media/economie/dette-publique-pourquoi-l-austerite-echouera-tant-que-les-inegalites-persistent
But then how is it possible that France already has one of the highest tax revenues per unit of GDP and still faces such a massive fiscal crisis? I get the inequality issues but those go to who pays. Not how much is being paid. There is a problem with the latter
La France est un des pays où les prélèvements obligatoires sont les plus élevés au monde mais dans les prélèvements obligatoires il y a beaucoup de transferts, c’est de l’argent qui est redistribué, ce ne sont pas réellement des dépenses. La part de la dépense publique dans la valeur ajoutée est autour de 20% du PIB, dans la moyenne européenne. Le fait qu’il y ait plus de transferts qu’ailleurs est dû au modèle social. L’assurance maladie est publique contrairement à d’autres pays. Mais ça ne rend pas le système moins efficace pour autant. Aux Etats Unis la dépense de santé moyenne par habitant est deux fois plus élevée qu’en France et l’espérance de vie est pourtant plus faible ….
Et la France est aussi un des pays qui distribue le plus de dividendes monde…
As the old saying goes "you can't tax yourself into prosperity" government needs to tighten their belt and get the economy fired up with private capital
I'd argue every economy taxes it's way into prosperity. It's how the productive infrastructure gets built, how investment in human capital is funded, how rule of law is established and maintained etc.
La Cour des Comptes elle-même affirme que les allègements fiscaux mis en place par Macron et qui ont bénéficié aux ménages les plus aisés ont contribué à creuser la dette.
Il faut d’abord revenir sur ces avantages qui n’ont pas montré leur efficacité. Et ensuite il faut des signaux forts en terme de justice sociale pour apaiser le pays et retrouver la cohésion. C’est la condition nécessaire pour pouvoir entamer d’autres réformes qui permettront d’avoir une trajectoire cohérente sur la dette
Ce n’est pas une question de niveau de taxe c’est une question de répartition des taxes. D’où le débat sur la taxe Zucman en France car c’est un des pays où les milliardaires sont le moins taxés.
Tax distribution ? Not that I care about billionaires but this narrative is used by the government to punish the people that work hard and are successful and reward the ones at the opposite end of this scale.
When more than half do not pay any income taxes (see below) you need to acknowledge that this system is not sustainable.
Income Tax (L'impôt sur le revenu):
The rich pay most of it. The top 10% of earners in France pay roughly 70% to 74% of all income tax collected. Roughly 55% of French households do not pay any income tax at all, as the system features progressive brackets starting with a tax-free threshold.
Il n’y a pas que l’impôt sur le revenu. Il y a aussi la TVA, les cotisations sociales, etc. Si on prend en compte tous les prélèvements le 2e décile des revenus est prélevé à 71,5% alors que le 10e décile est prélevé à 58,9% (source INSEE 2023).
Et pour le 1% des plus riches ça tombe encore. On est à 30% environ.
What is the way out for America to escape this reality as well? Let’s face it, we’re only surviving on massive government deficits and debt because we own the world financial system. At some point we will be in the same position unless drastic change is made. Raising taxes, cutting healthcare costs, decreasing defence spending, increasing retirement age are the main levers to rebalance but all will be extremely unpopular and lead political death for those politicians that implement them. Yes l, we have stopped racism but let’s be realistic that the next few decades will be tough.
Honestly... People revolt because they've been impoverished, but they can't say by what; they don't really know who their enemy is, and they aren't actually asking for anything realistic or sensible. Most people don't even know what money is. Ask the people you know, "Where is money created?" and only a few per cent will say that, for the vast majority of it, it comes from private bank lending. Most think it's something immutable, dating back to the dawn of time, that is merely passed from hand to hand. They don't understand the concept of money being created and destroyed. Even if, by chance, they've read Foucault, the idea of money as a social relation rather than a thing hasn't got into their heads at all.
They don't understand that taxes are theft as long as money isn't legal money, and that taxes therefore destroy stock. You can get them to read Georg Knapp and Stephanie Kelton, and they'll still never understand.
They want prosperity, but don't understand that achieving it requires evolution and, first and foremost, eliminating the Moloch that extracts wealth from the many. If you talk about a New Deal, achievable only by building anew, and therefore by de-urbanising, starting with remote working to make it possible, turning Hayek on his head and rediscovering distributism, they look at you like you're an alien. They can't imagine a different world, just as they can't imagine what work looks like today, as opposed to work in the twentieth-century factory.
It's the middle class that ought to be leading the way, but even though it still exists in terms of income, it no longer exists culturally, so it can't lead. The very few who could do so are too few to make up a mass large enough even to reach that empirical 3.5% said to be sufficient to trigger change.
Yeah, and even that isn’t enough, you guys have to cover the about 40% of pensions that aren’t covered by taking a third of everyone’s salary by cutting things like education and infrastructure spending and police, plus racking up annual debt
They’d need about 2/3rds of your and everyone else’s annual salary to pay fully for pensions without cutting other spending or taking on debt. And that ratio will get worse with time as France is currently getting older
And what economists are saying is that the French not allowing that is simply becoming a bankrupt state, the next Argentina in waiting, where constant inflation due to government over-spend and firing up the money printer occurs
It's honestly even worse than Argentina, potentially.
Argentina printed its own currency. It could therefore exercise complete control over its monetary policy.
While its usually a brutal process, countries can inflate their currency to mitigate debt obligations. It's far from ideal, but at least it's an option.
France can't even do that — it can't just start pumping out Euros; it's a shared currency, and other Eurozone countries presumably won't allow it, for obvious reasons.
So unlike countries with their own currency, France can, theoretically, run out of money in a literal sense.
That's basically impossible in most other nations; they might experience rampant inflation, but the country can continue printing money as it wishes, they don't actually run out of money, in the technical sense.
This is the inherent problem with the Euro. A common currency can offer many benefits when things are going well, but can become highly problematic during a fiscal crisis.
The US hasn't yet defaulted, which you seem to advocate for France? So when you default like Argentina, you end up with Argentinian rates, which the US won't have, the initial statement is accurate - "First, many countries have defaulted on their debt in the past. That's part of what makes a debt risky, and why investors ask for interest." your comment, not mine
But for debt restructuring, you have to give lenders faith that you have the ability to repay, which as current situation goes, with your govt running pernicious deficits for decades in a row, that doesn't seem possible
Most countries don't have debt > income, especially since France seems to be one of the special ones running deficits, name one other country that has run deficits for decades other than France?
But as for your request, simply google for countries with debt < 100% of GDP, see how unique France is in its financial irresponsibility
That's the problem when an economy becomes unable to service its debt.
France is borrowing money, to pay for its operating costs.
That money comes from somewhere/someone else.
If people stop lending the French government money, it will simply run out of funds.
And unlike a nation that prints its own currency, France can't try to inflate its way out of debt / otherwise attempt to solve this via monetary policy (which is a difficult path to take, regardless).
So when the French people say "they won't stand for these cuts," that's all well and good, but ultimately doesn't matter.
If France continues to borrow without making significant budget adjustments, it will simply postpone an inevitable shortfall.
If France defaults on its debt, it will run out funds pretty much immediately.
The problem with France is that it has low growth, high debt, and incomplete control over its currency.
You can't have all three of those things, without running into problems.
The US, for example, also has large deficits. But while those deficits are certainly problematic, the United States has much higher growth, and prints its own currency. The high growth generates the revenue needed to service its debt, while monetary policy can provide useful tools in helping to manage its sovereign debt. That doesn't mean the US isn't facing problems — but it's in a much better position to deal with those problems.
France is basically like an airplane that's failed to take off, and is running out of runway.
It can either slam on the brakes now, and cause a lot of passenger discomfort, or it can keep barreling forward until it crashes off the runway and kills most of the people on board.
Neither option is good, but the first one is far better than the second.
I feel for the French people — the situation isn't good for them. But there's a reason most of the world doesn't offer the types of benefits and policies France has; it's very difficult to structure an economy that way.
France is giving an estimated 210 Billion euros yearly to its companies through various subsidies / grants / helps. The youth in the street is asking for 10 Billion in order to have decent schooling.
The "fiscal presents" made by Macron to the richest people and companies over 10 years are estimated to have "cost" around 900 Billion euros to the state.
So it's absolutely not an issue of "France not being able to repay its debt". It's about what is the target of the funds that have been received through the debt
Please, please, please do some Econ 101 before writing such stupidities as your message
We want high spending in future-proof investments that are going to grow wealth over time. That's precisely what debt is about
Using debt to avoid increasing taxes and relying on a phantasy "trickle down economics" (what Republicans, Tatcher, Milei or Macron do) was never going to work
Good investments are: proper education system (so people don't vote MAGA to give the reins of your country to Russia), good healthcare system (so people having cancer don't get instantly bankrupt), good and ecological transportation system (so prices of moving stuff and people around stay low), ecology (because once you fuck up the planet, what are you going to do? stay in your basement watching Netflix and eating popcorn all alone? the US is the only country where people are stupid enough to think that this is a "good life")
I'd still rather live in France, with access to culture, healthcare, education, and good food, than in the US where you fight yourselves over $100 rebates for a TV during black Fridays and where the culmination of gastronomy is the hot dog 🤣
Can someone explain how this is not a Class problem? How have the taxes on the wealthy (who have most of the income and wealth) changed over the decades?
In addition, how is this not a Colonialism issue? Is “France in Africa” a net positive for France as a whole, or just the large French extractive companies?
in practice, the government makes the middle and working classes pay for the gifts given to large groups.
- In 2019, corporate tax weighed less in France (2.2% of GDP) than the OECD average (3.3%),
Here are some change :
- In 2017, the wealth tax (ISF) was replaced by a tax on real estate only (IFI), and a single 30% rate was introduced on capital income, the French “flat tax.” France Stratégie estimated the cost of switching to the IFI at about €3.1 billion. In the end, the official evaluation committee found more dividends paid to households and fewer tax exiles, but could not conclude that the reform worked.
- In 2018, the CICE (Housing Taxe) tax credit was turned into a permanent cut in social contributions, so the state budget no longer paid for this tax gift: it was moved onto social security. Removing it for the richest 20% of households cost nearly €8 billion, 45% of the total cost.
- More than €200 billion of VAT comes in, but not all of it goes to the state budget, because part is transferred to social security to partly compensate the huge cuts in social contributions given to large groups.
- Local governments too: their own taxes on production (like the CVAE) were removed and replaced with a share of VAT.
- Macron wanted to remove the exit tax, created by Sarkozy to fight tax evasion. It brought the state €800 million in 2016. In the end it was heavily softened rather than abolished
- Tv licence fee brought in €3.7 billion and was replaced by a share of VAT.
- The governement has : taxes voted in committee that the government would throw out: a higher tax on financial transactions (which would have brought in €11 billion), a targeted universal tax on French citizens wherever they live (as the US does), and the return of the exit tax, plus the taxes on super-dividends and share buybacks, and the transport levy meant to stop public transport passes from going up.
- Give Billions to companies (You can said it's fine or not) but THEY NEVER LOOKED AT WHAT THEY INVESTED, THERE IS NO DOCUMENT, NO FOLLOW UP.
And some of theses companies have cut employee in france.
- Inflation: corporate tax reached €62 billion because some companies made very large profits and margins thanks to inflation.
Note : Modest household spends almost all its income on purchases, so it pays VAT on almost everything it earns. A rich household saves a large part of its income, and that saved part isn’t hit by VAT.
bljujemvatrupecemleb | 21 hours ago
well it seems that buying the social and political loyalties of the largest generational cohort with public money becomes increasingly problematic with every monthly payment as that generation retires. in other words, the post-1989 experiment is now entering its first actual political loyalty stress test where it has to face the fact that its legitimation mechanism is, quite hypocritically, fully a generationally-targetted keynesian holdover. no sympathies for the french politikants' vote-buying scheme
CapitalEgg8826 | 21 hours ago
The problem is that French pensioners built their financial planning around this system. Maybe it’s not fair, I certainly think it’s overly generous, but the problem is that any policy making that impacts current pensioners is going to result in a lot of old folks who genuinely can’t afford to live, while any system that preserves the current system at further expense of the youth is going to cause political chaos. France is going to have to fuck over a generation and it’s almost certainly going to be the very young or very old.
Call_Me_Hurr1cane | 20 hours ago
French pensioners make more than working age employees - on average. If the pensioners want to claim they can’t afford to live, how do they expect the workers supporting them to?
Berofaforaftor | 20 hours ago
Exactly especially when/if they have wealth they could be spending down. For wealthier pensioners, it's not fair to think you are necessarily entitled to hold onto your house until you die and can pass on your savings. If you want to keep the house in the family let your children help support that. Reductions in pensions could be made progressive based on wealth, such that low wealth people aren't affected.
Asiriya | 19 hours ago
Don't a ton of French own second homes too? Sell out of the cities and spend time in your other home...
P_Firpo | 19 hours ago
A ton? Is this r/economics?
Asiriya | 18 hours ago
Fair enough: https://archive.ph/RHlQB
> In 2025, there were 3.7 million second homes, representing 9.8% of all housing in France
> A more detailed study by the Statistics and Data Studies Office (SDES) published in June 2025, found that 15.1% of French people aged 80 to 89 owned a second home
akade19961 | 15 hours ago
80-90 year olds owning 2 homes is a literally absurd misallocation of resources, generally speaking lol
frogsRfriends | 12 hours ago
Yeah to be honest they shouldn’t even need a full house most need help of some kind
brukmann | 10 hours ago
As a luxury space communist, even I was uncomfortable with Picard retiring to like, an estate? How does every pensioner get such things? Is this a class divide for people with high starfleet rank? That is even worse! Or his family's vinyard was grandfathered in, like they did communism without affecting property rights?
RIP Sir Stewart.
PS, they're sticking old people in holodecks aren't they? Landchads stay winning, even after energy is essentially unlimited.
oldsecondhand | 6 hours ago
Probably the poorer people don't live up to that age.
liquoriceclitoris | 9 hours ago
80-90 year olds existing is an absurd mislocation of resources
IvoryTowerResident | 17 hours ago
would love to get a house in Nice on sale
WolfsBaneViking | 19 hours ago
Sounds like a solid FAFO situation. The old folks just reached the find out phase of their bad financial decisions. As also stated by others, they didn't have to lend money. Sending the debt to the next generation is a dick move.
akade19961 | 15 hours ago
Except that not even the French protesters are demanding that the French pensioners reap the Find Out portion of the timeline after all their decades of Fucking Around.
The economically literate French protesters are saying that the ECB will inflate the euro to save France while Germany bails it out, while the economically illiterate protesters are just demanding more money for everyone
Tierbook96 | 10 hours ago
So the economically literate protesters are the ones saying 'someone else will deal with so we don't have to worry about our spending'?
Impressive_Archer401 | 9 hours ago
The economically illiterate protesters are saying 'gib me dat moneys'
uschwell | 4 hours ago
You can be economically literate and still be politically, socially, or culturally captured. Or just plain wrong.
The only difference is in what they speak about how the process could work- not if that process might actually happen.
Example: If my plane gets deboarded/delayed because of a maintenance issue. The passengers all call friends and family, and explain the situation (quite annoyed I'm sure). The vast majority will call and say "my planes broken". The mechanics/engineers in the crowd might call and say "the engine is broken" or "looks like a compressor blew out".
All three are correct. Some are more accurate than others. All know that a technician will need to fix it before they can fly.
None of them can control if the airline will say "lol, nope. No budget for repairs, figure out how to put them on other flights"
And if this theoretical "plane broken" issue occurs mid-flight. It doesn't matter how literately you scream at the pilot what he needs to fix, your plane is still falling out of the sky.......
aimgorge | 5 hours ago
>The economically literate French protesters are saying that the ECB will inflate the euro to save France while Germany bails it out, while the economically illiterate protesters are just demanding more money for everyone
You just made that whole paragraph out of fantasy, didnt you
P_Firpo | 19 hours ago
On average. What about the median?
Dest123 | 18 hours ago
> French pensioners make more than working age employees - on average
What's your source for that? Everything I can find says that that's not true.
Their standard of living is effectively the same as working age people though. So like, total house hold disposable income divided by the number of people in the household using that income is the same for workers and pensioners, which is pretty unique. Pensioners still make less money though, but they also spend less since they own their homes and don't have dependents.
MarseySheepdog | 18 hours ago
Disposable income is about what you make after taxes, not what you make after you pay your rent and dependents’ needs.
You’re thinking of discretionary income.
Dest123 | 17 hours ago
Ah good call, I should have just said that instead of Disposable income divided by people in the household.
Call_Me_Hurr1cane | 18 hours ago
https://fortune.com/2025/09/16/france-retirees-higher-income-workers-american-pensioners-cost-of-living-crisis/
Dest123 | 17 hours ago
Ah so Fortune's definition of "make more" isn't gross or net income, it's discretionary income. That's pretty misleading imo. I think most people would read "make more" as actually making more money, not just having more money left over after all of their expenses. Lines like "they’re even out-earning those with jobs" are just outright lies unless there's some way to twist that to fit discretionary income.
kerouacrimbaud | 14 hours ago
I feel like that sort of misleading blabbering is pretty typical for this subreddit. Which is a bummer because this is also supposed to be more of a rigorous subreddit.
zb0t1 | 4 hours ago
It's been at least 10 years that people who actually graduated in this field or a mixture of econ with other fields requested better moderation or a better subreddit because of the obvious pseudo economics takes you find daily here.
Nothing has changed. People are literally making shit up here.
CauliflowerDaffodil | 17 hours ago
>French pensioners make more than working age employees - on average.
Patently false. Average monthly salary is mid-2000 euros. Average monthly pension is below 2000 and ranges between 1500-1800 euros. If you have numbers showing what you're falsely claiming, I'd love to see them.
collin-h | 20 hours ago
older generation can stop buying lattes and avocado toast...and start applying to jobs again I guess.
Codex_Dev | 18 hours ago
They can go flip burgers like they condescending tell everyone else to do
Miserable-Rooster-46 | 20 hours ago
Older generation can't afford to live or the older generation will need to make significant changes to their life style if the pension is lowered?
TropicalKing | 11 hours ago
> or the older generation will need to make significant changes to their life style if the pension is lowered?
Yes. A lot of older people can make significant changes to their lifestyle. If they have a house, they can rent out a room to someone else who isn't as fortunate. A lot of people can and should live more interdependent lifestyles, not independent lifestyles.
Pooling resources mathematically saves a lot of resources compared to dividing them. 7 people living in one house saves tremendous resources such as time, money, energy, space, and environmental resources compared to 7 people renting their own apartments.
Did the French even practice the extended family historically? The extended family was very important to Spanish, Portuguese, and Italian culture. A lot of people are going to have to get more used to extended family lifestyles instead of independent lifestyles funded by the government.
morbie5 | 20 hours ago
Probably a mix of both, so the smart thing to do would be to make higher cuts at the top end and lessen them as you go down the income spectrum
Miserable-Rooster-46 | 19 hours ago
Agreed. I was mostly posing this to clarify the broader generalization made above.
avaslash | 20 hours ago
For what its worth, at certain age "significant changes to one's lifestyle" can be a death sentence.
Then again, maybe this is morbid but that would ultimately work towards resolving the problem (not that I'm suggesting that strategy, I SAID IT IN JEST YOUR HONOR)
Miserable-Rooster-46 | 19 hours ago
I would specify it more to certain income levels vs age. As another commentator stated, we could lower the highest pensions and have little or no changes to pensions below "x" amount.
psyspin13 | 19 hours ago
But thats exactly what Europeans, including French, imposed on Greek pensioners: cutting overnight their pe sions about 40-50%.
akade19961 | 15 hours ago
And the Germans have basically already done that over the last 18 years without it needing to be imposed from outside, and they are still having some moderate budget issues. The French will need it done to them as well
Berofaforaftor | 20 hours ago
I think it's a false choice to imply that all older people would need to be fucked over, you can make reductions quite progressive and accomplish some kind of compromise, so that low wealth older people aren't affected.
czarczm | 15 hours ago
Whenever that gets brought up as a reformed for Social Security in the US people freak the fuck out. It just feels like an impossible conversation to have.
Jaredlong | 14 hours ago
It's inevitably a no-win situation. Everyone who paid into social security has a very real legal right to disbursements, but also a lot of retirees are straight up millionaires and do not need SS benefits to survive. It's true that those type of people don't need it, but also true that they're entitled to it. Our political culture doesn't know what to do when opposing sides have fair and reasonable points.
Lonely-Entry-7206 | 5 hours ago
USA government can change it without their permission, but the vote system basically makes it impossible for them to do something like that without next term basically voting them out. Touching their wallets is basically one way trip to getting voted out.
SkiingAway | 18 minutes ago
Eh, the changes requires for Social Security to survive more or less as-is in terms of the function it serves/level of benefits provided aren't really all that dramatic. (although they are more dramatic than they would have been if we'd addressed the problem 20 years ago).
gimpwiz | 20 hours ago
This is true as far as I have seen. They don't bother saving because they're promised generous-enough pensions, and investing is seen as a "rich fucker" activity, not something for normal people to do, other than maybe home ownership (flat, condo, apartment, whatever, generally, not specifically SFH.)
AvocadoAlternative | 20 hours ago
> the problem is that any policy making that impacts current pensioners is going to result in a lot of old folks who genuinely can’t afford to live, while any system that preserves the current system at further expense of the youth is going to cause political chaos.
You’ve identified the key issue. What is needed is for politicians to bite the bullet and say “yes, some old folks are going to suffer because they didn’t save for retirement. They will probably die without care or live in poverty without a robust pension system if they didn’t self-fund. The alternative is to continue funding the current pension system and cripple future generations”. And say it with your chest. If forced to choose between two unappealing choices, choosing to prioritize younger generations is a completely understandable position.
eek04 | 5 hours ago
Self funding vs public funding doesn't make a fundamental difference. The real question is what percentage of production goes to real capital vs the young/working vs old/retired, and how productive society is. It is not obvious that self funding is better for productivity - it comes with an incentive towards the FIRE movement, and taking those that may be most productive out of working early, which is bad. It also comes with an incentive to putting money in the stock market which increases real capital and is good. There probably exists data on the various effects here, but I'm not familiar with it
jojotortoise | 17 hours ago
> but the problem is that any policy making that impacts current pensioners is going to result in a lot of old folks who genuinely can’t afford to live
Yeah, but they can raise the retirement age so that there are fewer pensioners. This is fair, since life expectancy keeps going up.
But when they tried to do that....
eek04 | 5 hours ago
A uniform increase is not as fair as it seems at first glance. Per some quick research, the increase in life expectancy is not evenly distributed. At least since the 1970s, it is concentrated towards the top economic end. As of the last published measurements from Insee, France's statistical agency, in December 2025, the bottom 25% economically even had decreased life expectancy over the last 8 years.
There is also a difference in how much of retirement gets consumed by an increase in retirement age. At French retirement age, the richest 5% of men have 8 years longer life expectancy than the poorest 5%. Over 40% extra. And it gets worse if you look at healthy life expectancy. The poorest typically does physical work, and only expect non-disability life up until mid 60s. Increasing retirement age eats very heavily into non-disability retirement time for them, and not for the rich.
I think increasing retirement age is still going to be necessary. The cost will be uneven, so it's not going to be "fair", but it will be necessary. The only escape is if a technical revolution increases productivity a lot and the younger generation stands for their standard of living being kept constant to pay for the retirees. So far the numbers don't point at that much of an increase from AI/robots.
janethefish | 19 hours ago
They could means test the reduction.
Uncle_Bill | 20 hours ago
The moral hazard of telling someone the state will take care of them. They believe you and act accordingly.
6158675309 | 20 hours ago
Is that uniquely French? Il asking cause I’m American and I’m 60. I’ve never considered Social Security, the US version of a state pension, to be guaranteed in any way. In fact the opposite. All my planning assumes it does not exist for me. If it is there, great! If not, I’m prepared.
All of my peers here do the same.
Maybe cause it’s been drilled into us Social Security won’t exist. Maybe the French view it differently?
AlexanderNigma | 20 hours ago
Dude, mix with low income Americans and realize their grandpaps and grandmas are all only on social security to survive
MagicWishMonkey | 17 hours ago
That’s because lots of people never had excess money to invest in the first place.
GPfive | 20 hours ago
You and your peers are likely more privileged than most. Many retirees are counting on social security for survival.
Uncle_Bill | 19 hours ago
My older sister depends on social security and has shit for savings. My wife and I have spent $150k+ keeping her afloat and now building a small home on her daughter’s property.
She was a PA and made good money, and spent it.
pigvwu | 19 hours ago
This is the most common attitude I've heard, but the truth is that if you're financially on track to retire without counting on SS, then you are in the minority. So, even if everyone doubts its availability, ultimately most people are hoping SS will pay out for them, because they haven't prepared for the alternative.
pacman2081 | 20 hours ago
a lot of Americans count on the guarantee of Social Security. Of course, I do not
akade19961 | 20 hours ago
Assuming you retire at 68 or so, I’d bet you’ll get social security for at least the first 10-12 years of your retirement. Maybe even as many as 17-20. I could see, on the longest possible end, social security lasting for another 30 years or so. But for people who are younger than 50, planning on social security being there for more than a few years of your retirement at best is beyond foolish.
For those under 35 they should just expect it to be gone by the time they get to 70
thewimsey | 18 hours ago
> But for people who are younger than 50, planning on social security being there for more than a few years of your retirement at best is beyond foolish.
This is nonsense.
A lot of people ignorantly believe that SS will be gone. It won't be, and you need to stop making shit up.
akade19961 | 17 hours ago
What exactly are you basing your arrogant proclamations on the basis of? What reason do you have to think social security will still be making payouts in any way comparable to what it does now in 30+ years? I’m seriously asking
If you are instead saying that an agency known as the social security administration will still exist in the 2050’s, sure, I agree with that. I just don’t think it will have anything close to the massive impact per retirement age person that it does now
illmatico | 20 hours ago
Should we just give up on elderly pensions altogether then? Go back to how things were in the 1800s?
Crew_1996 | 20 hours ago
State pensions should probably be just enough to keep the pensioner out of poverty. Guarantee survival but it’s increasingly obvious, that generous pensions will damage society in ways that aren’t desirable.
No_Aesthetic | 20 hours ago
They will have to be reduced and / or retirement age will have to increase substantially.
A lot of people will probably have to go to work or live with family.
State-Approved-Radio | 19 hours ago
The issue there is that the children typically became primary caretakers of the elderly back then. People have much fewer children now and they often move out of state when they come of age.
akade19961 | 15 hours ago
The whole problem at every step is that there are fewer children being born. That’s literally the entire issue
illmatico | 19 hours ago
Pensions actually alleviate pressure on working age people in that way, was one of the primary arguments for social security when it was first designed
HeparinBridge | an hour ago
The fewer children thing is why the pension system will inevitably fail. You need a high dependency ratio to provide any real quality of living to the dependents.
Fr1toBand1to | 20 hours ago
I love how the articles title implies it's the voter rebelling against "fiscal reality" and not the fact that french politicians have been ignoring "fiscal reality" in favor of short term personal benefits.
VTKajin | 19 hours ago
Pension reform is unpopular with French voters. They want their hell.
morbie5 | 20 hours ago
> and not the fact that french politicians have been ignoring "fiscal reality" in favor of short term personal benefits.
You aren't wrong but those politicians got voted in by the voters, they didn't just appear out of nowhere
OrangeJr36 | 20 hours ago
Right, the biggest factions for the Presidential elections are pushing to either; Raise taxes even more (Far-Left) or lower the pension age and increase payouts (Far-Right.)
The people are actively choosing between these two when other options exist, it's entirely on them to stop supporting the politicians who are pushing them towards bankruptcy.
Solitare_HS | 5 hours ago
In case you haven't seen it, the left 'manifesto' is also lowering the pension age.
This isn't left vs right. It's populism vs pragmatism/realism. The next French election might/is likelty to have two versions of populism battling it out.
Marquis_de_Dustbin | 5 hours ago
But like hasn't the centre been the one in power and been the one to get everyone into this mess? Surely from a political economy perspective the popularity of the far left and far right is symptomatic of a centre that has failed at their technocratic ideological goals?
HeparinBridge | an hour ago
The public demands populist policies that reality cannot deliver. The Centre cannot deliver because reality cannot deliver. The Right and The Left don’t have magic answers for how to bypass the limitations of material reality, they just plan to ignore reality in ways that will likely destroy the French Fifth Republic.
CharmingAd3549 | 17 hours ago
If “raise benefits” and “lower taxes” were put to a vote, they’d both pass.
Jon_ofAllTrades | 19 hours ago
Right. A lot of blaming politicians is just shifting the blame from the constituents that voted them in.
Unctuous_Robot | 19 hours ago
They made those plans knowing they’d exploit the youth. The youth deserve to afford to live. Appeasing the old will be wishing for chaos indeed as it isn’t long till they’re dead anyway and you’re left with the screwed over youth.
CapitalElk1169 | 19 hours ago
All they need to do is income-test the recipients and this should be easy to fix
CardiologistPrize712 | 4 hours ago
Then they die? We can't keep choking the forest to keep propping up a few old trees that are going to be gone in a few years anyways
Euiop741852 | 20 hours ago
If thats the case, given the French have been in deficit for decades, and their taxes are sky high, one wonders where the money has gone, couldn't have been pensions since this issue has been on-going for decades and the pensions issue is a recent issue.
Bullboah | 19 hours ago
France has the 3rd highest public social spending as % of GDP in the OECD
Solitare_HS | 5 hours ago
It can be pensions, and other welfare, if the situation is getting worse over decades, which it has, it's death by a thousand choices over a long time.
bljujemvatrupecemleb | 20 hours ago
the answer would be to start adequately raising (real) wages so that parts of those would go to elder care within families. certainly a comfortable degree of per capita real productivity is achievable both within france and europe, even if profit margins as an incentive would inevitably get squeezed for the moment, before an episode of intersectoral profit reallocation and a final normalisation due to the decoupling+reindustrialisational shock to the trade profile. i find that this would be not just well-sitting but concomitant with intraeuropean reindustrialisation, given that beijing's walmarting of the continent has at this point become a security issue as well. a deficit of 1B euro per diem just means that europe is only left exporting ownership over its own assets sooner or later. disinflatory trade keeps taking precedence as the line of least resistance over actually making things for ourselves again, which means that this is a problem squarely originating with the political classes who are dependent on beijing for their careers and hence too gormless to tear off the bandage. of course, there's no doubt that restarting domestic european production where it's needed the most would come with an initial inflatory shock, as profits are de rigeur the main economic incentive, but it would be quickly welcome for the fact alone that it would relocate pretty serious amounts of clout away from bureacratic desk-jockeys and political party top echelons who are already showing signs of, to quote dj khaled, suffering from success, and seem to have an increasingly strained relationship with factual reality
pacman2081 | 20 hours ago
"the answer would be to start adequately raising (real) wages so that parts of those would go to elder care within families."
raising wages without raising productivity is a recipe for inflation
gimpwiz | 19 hours ago
The guy said _real_ wages, not nominal wages.
pacman2081 | 17 hours ago
I know -- real wages cannot increase without increases in productivity. Otherwise real wages is at expense of capital. that does not lead to a better outcome in the long run
bljujemvatrupecemleb | 20 hours ago
have you ever in your life read something past its twitter character limit?
pacman2081 | 20 hours ago
This is not rocket science. This has been done before. The results speak for themselves
ballofplasmaupthesky | 17 hours ago
Around this system, yet with zero effort to leave a robust economy - and, frankly - a robust workforce.
tampix77 | 7 hours ago
In France, average saving rate of 70+ years old is ~25%.
They definitely could cut pensions, starting from the top.
Competitive-Hair7499 | 4 hours ago
That's not financial planning, they should have foreseen this. They can sell their property and move to more rural location for one, scale down everything.
Vrulth | 19 hours ago
> I certainly think it’s overly generous
A rate of return a little bit more above 3% for money tied up for 40 years is not overy generous.
Yes I am aware that my rate of return is scheduled to be 0.8% by the always over-optimistic retirement planning agency.
CapitalEgg8826 | 18 hours ago
lol in the US social security has an actively negative return by a huge margin
obligateobstetrician | 19 hours ago
Well the very old already got theirs by mortgaging the future so it seems only fitting that the bill fall on their aging and decrepit shoulders.
Oddisredit | 14 hours ago
This, I say this all the time, but this is much better written.
UnknownBreadd | 19 hours ago
This is a completely false paradigm that is breaking in real time. In the future, everyone is going to look back at this ridiculous panic over public debt and think we were cruel idiots.
“We just haven’t appeased the billionaires and the markets enough yet!” Give me a break.
JC_Hysteria | 20 hours ago
What people want is often popular, what people need is often unpopular. Austerity is nobody’s goal, but it becomes everybody’s obligation.
Being realistic about human nature can tell us a lot about the economy we can expect.
Doggleganger | 20 hours ago
The problem is that you need to reign things in and make unpopular choices before the need for austerity, but those problems seem so far away that it's a hard sell politically.
OrangeJr36 | 20 hours ago
That's why Macron was elected to begin with, but every time he proposed a reform that would prevent fiscal doom there was an instant massive revolt. In the end everything got watered down to the point that they've gotten the worst of both worlds, people aren't getting their benefits cut but they are getting their services cut with no actual fiscal relief is sight.
No_Tree_8144 | 20 hours ago
I feel like at some point the French drank their own kool aid. like they think it's cool to revolt and that's what they're known for internationally and almost seem to have this level of pride for protesting.
I think protesting is great but the French are good example of how it backfires. you cant keep blaming politicians forever, to a certain extent it's obviously the populations fault if they keep stopping any fix
Legitimate_Hunt_5802 | 10 hours ago
Pretty much yeah, the French aren't willing to accept hard realities anymore and think populism combined with spending money that they dont have will somehow prevent a fiscal crises. I dont know what they want or what Future french leader(either from the left or right) will do to appease such an, at times, ungrateful population
Niagr | an hour ago
Don't forget the classic get out of jail free card that everyone is always salivating over - taxing the rich even more.
JC_Hysteria | 20 hours ago
It’s a conflict of interest for politicians to make tough choices on behalf of people who may have different priorities or timelines in mind.
The US has consistently acted fiscally irresponsibly in a similar way- so much so that our sustainability bet is almost wholly riding on AI + supply chain automation.
The government will not be able to slow its spending while automation takes hold…but that’s what will likely be needed.
SkiingAway | 16 minutes ago
The US has had much higher economic growth than France, even before the AI boom/bubble. That gives a lot more fiscal leeway.
Hodgkisl | 20 hours ago
The sad part is looking at this as solely a fiscal problem and ignoring many of the regulatory issues that got them to slow GDP growth, high youth unemployment, etc.... This problem could be far less if they fixed many of their labor regulations so hiring people wasn't such a massive risk.
The major issue is the entire French economy ended up formed to protect those with a seat at the table in every way possible, but in doing so it reduced the number of seats for others to join.
Un-resigned | 17 hours ago
This is the core of France's problem. France has had high FDI, high R&D outlays, an outsized representation among Fortune 500 companies, strong global demand for its brands, and a healthy tourism sector. It was one of the first European countries to exist the 2000 fiscal crisis.
So why is it stagnating? Because its regulatory environment is so restrictive, French businesses would rather invest in England's mess of an economy than at home. If it relaxed its burdensome employment rules even a little to support the small to medium sized businesses that drive service economies, and trimmed its pensions to something sustainable it wouldn't be having these problems.
France seems to have forgotten that it's a service economy that relies on a strong domestic labor market. It's trying to have Scandinavian style socialist policies without the industrial and primary sectors to support them.
liquoriceclitoris | 9 hours ago
Yeah why hire a french worker when they can basically not show up to work and it takes a year to fire them
mparks37 | 20 hours ago
True, but I think they consider it unthinkable to change. Of course, they think everything else is also unthinkable to change, also.
Hodgkisl | 20 hours ago
True, a likely real solution will be a mix of improving the areas that slow economic growth while also cutting certain costs, taking a bit from every group.
mparks37 | 19 hours ago
Politicians rarely see such nuance lol
liquoriceclitoris | 9 hours ago
classic incumbents digging a moat
oulipo | 20 hours ago
Except austerity never worked, except twice in very particular conditions (high-growth economies and exchange treaties around the country that implemented austerity). In ALL other cases, austerity made things worse, not better
[OP] laxnut90 | 20 hours ago
That's why France needs to start fixing these problems now.
Countries can only spend more than their tax revenue if someone will loan the difference.
Bond investors are increasingly unwilling to lend France more money.
If France does not somehow restore faith in its fiscal situation, the lending will stop and France will be forced to balance their budget immediately by default.
Bullboah | 19 hours ago
This analysis of austerity has always struck me a bit similar to saying chemo is really terrible for people.
Countries only implement austerity when they’re at the end of their rope and are about to run out of the ability to keep debt financing public spending. The status quo isn’t the alternative option - Zimbabwe is.
krastem91 | 20 hours ago
Well, austerity is supposed to makes things worse in the short run no ?
maladii | 20 hours ago
The problem is that people don’t live in the short run. Growing up in poverty is something people never recover from, we know that brains develop differently under the stress and absence of opportunity. So while it looks like it’s making up for the past,austerity actually borrows from the future. Better to improve conditions through borrowing and redistribution than fuck your society’s future.
krastem91 | 16 hours ago
Agreed …. And the short run tends to be ill defined temporally …
The logical thing to do is to invest resources in the young at the expense of the old .
Flayum | 19 hours ago
Then it sounds like we know who needs to go: those at the end of their lives. They voted for this, so perhaps it's time to let them ride off into the sunset.
(Specifically: fuck those self-enriching retirees that are cutting down the very forest that would house their children)
oulipo | 19 hours ago
Yes. But economists have ALSO shown that it almost always make things worse in the long run too
DarkElation | 18 hours ago
I’m interested in this data. Something tells me wavering conviction is what harmed the long run. Austerity isn’t pause for a while so we can reload. It’s supposed to be pause now, reengineer for the future. My guess is it’s the second part that doesn’t gain traction.
Quick-Quail-1683 | 18 hours ago
“Austerity” isn’t the problem.
The problem is that systems that don’t provide economic value shouldn’t be invested in, in the first place unless you can guarantee long term solvency.
You’re correct that many traditional high investment projects like universal healthcare and universal education are not the problem.
Those systems create economic value, that is theoretically worth more than they cost. Because they’re designed to help working age/productive people.
Social security and the Pension system by their very nature don’t. They’re money pits that go to people who have no hope of generating the value that they’re currently costing.
These systems do need to be cut, and to be honest they need to be removed completely. And we need to accept the consequences of that.
oulipo | 6 hours ago
Social security and pensions absolutely aren't "money pits".
Things that don't provide economic value (proven over, and over, and over, and over, and over, and over again) include "trickle down economics", and yet neoliberal governments are trying to make you think that's the only way to grow
Helkafen1 | 16 hours ago
You want to stop providing healthcare to retired folks?
Quick-Quail-1683 | 15 hours ago
I don’t want to.
I think the government needs to stop putting direct cash in their wallets.
But your comment illustrates why it’s so hard to have this discussion, you can’t talk about taking away benefits for the elderly without seeming like a monster.
At the end of the day France only has a few realistic options to deal with this(as long as their economy doesn’t magically grow to unreasonable rates)
They either need to raise the retirement age to a point where it’s fiscally responsible to provide pensions.
Or they need to cut it off completely, and tell families that you need to take care of your elderly relatives, and if families refuse then cheap state run elder care facilities need to be constructed.
Helkafen1 | 15 hours ago
I would be in favour of reducing pensions significantly, cutting into other expenses, and raising the retirement age. Anything to avoid a default. So I think we agree in general. It's just that you phrased it in a way that sounded extreme, and I wanted to clarify that point.
Zestyclose-Carry-171 | 15 hours ago
I think we could also look at how spending is done in healthcare. There is no point in spending 1500€ for a pair of glasses. Hospital often overcharge with useless acts to gain money. Dermatologists use social security and health insurance to fund changing facial feature with public money
busyHighwayFred | 18 hours ago
Out of countries that have taken the IMF doompill (Austerity) which had any other choice? Countries are dragged screaming and crying to austerity and you talk about it like they have alternatives.
oulipo | 6 hours ago
There are alternatives. Like restructuring the debt, and doing good investment choices to get back on track. Instead of just refusing to increase taxes on billionaire and keep increasing debt to give them fiscal presents, it's not hard to understand
Morlaak | 4 hours ago
Restructuring the debt is the long storied tradition of Argentina. Look where that has gotten them historically. No one can seriously think that's a good idea. It just makes it so that the next time you need to take debt, it's at a higher premium because they think you are not going to pay it, which just takes you into a vicious spiral that's impossible to get out of.
Interesting-Cod6486 | 19 hours ago
It was always going to get worse of course living within a budget is worse than spending what ever you want. This just limits slide
PaulyglotTV | 20 hours ago
why not inflict austerity on the wealthy few instead of the broke many?
Jack_osaurus | 19 hours ago
If France would confiscate all the wealth of the top 0.01% , the country could fund its spending for about 3 to 6 months. That's not that long.
Nukemind | 19 hours ago
I did similar math recently for America including seizing all wealth not only of the top .1%, but the top 1%. It would get us about 25% of our debt paid off, obviously cut our taxes significantly, and even if taxes stayed exactly the same we would still be nearly 1T in the hole deficit wise.
Simply put for America the only way out is inflating or taxing everyone, for France it's likely cutting taxes.
Vaphell | 12 hours ago
Pray tell, who do you sell all that confiscated wealth to? Because you need cash to pay off debts, which means turning all these assets into money aka a sale.
So who's the counterparty to the massive selloff of assets in the ballpark of 30% of American GDP? Santa Claus?
Deep-Internet1316 | 13 hours ago
It's quite amazing to see someone talking about state debt as if the goal is to pay it off. And this after 40 years of western Reaganomics. The Neapolitans have a saying, that at each low one stoops to, there's always another knock from below.
Modern economics is obsessed with the concept of state debt and never goes far enough to question: who owns that debt?
The answer is: the rich, usually of that very country.
Imagine if these rich people no longer had the capacity to own the country they live in, because the state owned itself.
Isosceles_Kramer79 | 19 hours ago
Because they are few? Especially when "progressive" politicians only want to soak the handful of billionaires and not those who make/have as themselves.
Have you noticed how Bernie, when he joined the millionaire rank, stopped ranting about "millionaires and billionaires" and switched to just "billionaires"?
InquisitorMeow | 18 hours ago
You do understand any standard family with a house and a car are probably "millionaires" right?
Frosty_Dimension4026 | 19 hours ago
The EU rules make it VERY easy for capital to move across EU borders. Austerity in Greece just means capital moves their official country of residence to Germany, France, or Romania rather than Greece. The EU really needs to federalize or capital will continue to have more power than democracy.
Affectionate-Egg7566 | 20 hours ago
Great way to kill supply. Nominal currency is not a real good or service. The only way to effectively enact austerity is to allow for competition. Remove barriers.
You also need to give workers incentives. Without those, economies crumble. Also retirement should be at 67.
JC_Hysteria | 20 hours ago
It would be ideal if the wealthy few and the broke many could work together…but the outcome of that scenario might create a new enemy
nutella-man | 19 hours ago
You can only tax so far. And the French are at their limits. They are the most heavily taxed nation on earth.
Where do u tax when corporations can simply setup shop in Germany or any other eu country? When your rich citizens can just live in Belgium and Luxembourg because u want to take 90% of their income?
The French are past the time for cuts. In everything. Including their crappy bureaucracy
KryssCom | 20 hours ago
What, like a bunch of COMMIES?!?!? 😱😱😱
illmatico | 20 hours ago
Who determines what people need?
AvocadoAlternative | 20 hours ago
This is the fundamental question of democracy. Are politicians meant to be trustees or delegates? If the population votes to drive the country off a cliff, do the leaders have an obligation to listen to the will of the people?
No_Aesthetic | 20 hours ago
Economic realities in this case. France does not have high enough GDP growth to maintain their constantly growing social safety net. Deficits skyrocket. Eventually, they will struggle to pay the interest on their own debts. Cuts will be absolutely necessary. A French default is literally unthinkable and any bailout will be wildly expensive to the point everyone who puts in is going to demand cuts regardless.
illmatico | 20 hours ago
Okay but cuts where? How do you decide what should be cut and what gets maintained? It's not exactly clear and inherently a political question about priorities, which explains the upheaval happening currently
Tom__mm | 20 hours ago
France would receive considerable fiscal benefits from making spending cuts in the low single digits. Modest pension reform is the obvious solution. If France can’t manage something like this, the ultimate reckoning will be substantially worse. Melenchon on the far left and Le Pen on the far right are both promising magical solutions, default on one hand and doubling down with reckless spending on the other. The streets are saying they will burn the place down if the politicians don’t deliver the impossible.
Imaginary_Zone_4319 | 20 hours ago
They are so up to their eyeballs in pension obligations across all public sector workforces that it’s likely going to be pensions that are cut. Additionally you need to increase how long you tax productive years and decrease how much they collect in retirement, so expect retirement age to increase.
No_Aesthetic | 20 hours ago
Pensions are the obvious suspect since they're making up €300 billion a year in obligations. Cutting the €150 billion business subsidies would probably worsen the problem since France needs economic growth very badly.
ThroawayJimilyJones | 20 hours ago
Easy. You do it based on economic return
Pension is the obvious one. They are a direct spending, doesn’t save you money, isn’t invested. They help consumption but you don’t want an economy based on consumption
Healthcare for rare stuff or old age stuff is another one. The cost is high, for a gain of productivity null anyway
Culture? It goes out
Education has interest. But only if it makes people more productive. So you could limit the place based on results.
For prison, Singapore replaced a few of them by corporal punishment. It’s dissuassive and cost almost nothing
With the money saved you give fiscal benefit to retirement private fund, companies and investment in general
liquoriceclitoris | 9 hours ago
Spending money on the elderly is literally one of the worst ways to spend it. Spend it on the youth first and work your way up. If there is not enough for the elderly, that's their fault more than anyone else's. They had their turn. If they didn't leave enough for everyone, that's because they were too greedy or too lazy when times were good
invisible_shrek | 6 hours ago
Letting elderly literally die/starve? Corporal punishment? Not wanting a consumption based economy?
You’re trolling, right?
Difficult-Bag3173 | 13 hours ago
They can reform now and have some control over the situation, or they can wait and basically have none.
DramaticSimple4315 | 20 hours ago
The social safety net is not growing, that is a crass and gross mischaracterization of the issue at hand here. Problem is, population is getting older and putting strain on the system. And just as the previous center-left government had done some work to at least put the deficit back into tolerable margins, 10 years of supply side economics from Macron wrecked all remains of fiscal discipline.
As usual, corporate handouts do not beget growth.
No_Aesthetic | 20 hours ago
>The social safety net is not growing
Source?
us1549 | 20 hours ago
Simple Math. People want more spending. The numbers say there is no money to be had
oulipo | 20 hours ago
There is plenty of money in the rich people (and companies) pockets
us1549 | 20 hours ago
Frances already has some of the highest taxes in the EU
oulipo | 19 hours ago
The issue is not the level of tax. The issue is what people get with the money they spend. In France, you pay about 50% taxes (all taxes combined). In exchange, you've got FREE education, free healthcare, etc.
Now, in the US, you have lower taxes. And you can get bankrupt by getting sick
pigvwu | 19 hours ago
All the billionaires in France have about $600B total. Divide that among 70M people in France and you have a one time payment of $8500. Everyone gets to retire in comfort, then?
Sure pretty much every country could stand to tax the rich more, but the problem is bigger than that.
oulipo | 6 hours ago
First it's a yearly tax (min 2%), second we're talking about taxing companies more too
mparks37 | 20 hours ago
If you drive them all out, their money, jobs, the taxes they pay leaves with them. France has a spending problem, not low taxes on anyone. Too many taxes strangles an economy, whoch is part of the problem, already.
oulipo | 19 hours ago
That's absolutely untrue. There's something called exit tax. And the best example of this is... the USA! When you're a US citizen, you can move anywhere you want, you will still owe the tax
We can do exactly the same
mparks37 | 19 hours ago
US is also much more business focused. Too much stick and not enough carrot hurts everyone. Can't just take every penalizing idea from around the world and expect a vibrant economy.
oulipo | 19 hours ago
No it's not. It's billionaire focused. You guys are a laughing stock to the rest of the world with your 10 days of holidays per year.
We don't want that
No wonder all rich american people's dream is to buy a house in France when they retire.
Because we are building the correct way of life
mparks37 | 18 hours ago
Well, you can't afford what you have, so you better figure it out in a realistic way. You can grow your economy, which means being more business friendly, or cut services and social welfare, or prefferably both. That's your options. Like it or move to Spain or Germany, I guess. Of course many people have more than 10 days vacation in the US. The US is not the hellscape you've been led to believe lol. You people really believe every bit of propaganda you hear, don't you?
oulipo | 6 hours ago
Spain has had a leftwing economical policy under Sanchez and grew much faster than the rest of the EU.
You're doing the fallacy of "black or white" thinking.
And, yes, most people (low-wage people) in the US not only don't have 10 days vacation (or even if they had, wouldn't be able to spend to go on holidays), but have to do multiple jobs just to try to have ends meet. I think you're confusing "upper-class people you grew up with" with "most of the country"
Paradoxjjw | 20 hours ago
The goods and services they sell are still going to be in demand. If bezos throws a fit and shuts down amazon people will still want online shopping, people will still need cloud hosting and consumers will still seek the goods and services they bought on amazon. The datacenters, warehouses and other infarstructure doesn't just vanish.
mparks37 | 19 hours ago
No, not everything will vanish in a week, but over time people will go to neighboring countries or farther with their companies and wealth. This lessens jobs and tax base. Do you think people don't leave if things get worse for them. Business owners are humans, too. It's part of why Frances economy is so bad, to begin with.
State-Approved-Radio | 20 hours ago
In this case, mathematics
illmatico | 19 hours ago
"mathematics" is not an actual answer
Keeltoodeep | 20 hours ago
In France’s case it’s math
Difficult-Bag3173 | 13 hours ago
Well, eventually the fiscal reality is going to force the issue one way or another. If they dont voluntarily reform now voluntarily with some control over the situation, they will eventually go broke and have little to no choice in how reforms take place.
JC_Hysteria | 20 hours ago
42
LikesPez | 20 hours ago
Nature. We need food, shelter, clothing, and reproduction. Everything else is wants.
Caracalla81 | 18 hours ago
What are we short of?
40_Thousand_Hammers | 20 hours ago
The UK had 50 years of Austerity and know they have a Hitler party with 30% of voting intentions when FDR in the 1930's realized that the best direct way of fighting both economic downfall and rise of fascism is for government to do stuff, warfare systems and nation building.
Meanwhile I'm still waiting for a country to become a super power like the US with Austerity when the US did it with Keynesianism.
DreadPiratePete | 20 hours ago
Problem is that wellfare then was feeding and educating kids, keeping a roof over the head of families temporarily out of work, and building roads and bridges to connect cities.
The welfare increasing now is palliative care for old people and pensions for people who dont work and didn't save.
One increases productivity the more you spend on it, and the other just increases costs the more you spend on it.
TheYoungCPA | 15 hours ago
The harsh and terrible truth.
People need to save. Lifespan and healthspan increasing are great but it needs to come with increased responsibility.
Some of which includes making positive nutritional and exercise choices and not expecting others to shoulder the weight of a lifetime of poor health choices through health spending.
DreadPiratePete | 15 hours ago
The problem is of course that we can't just dump grandma on the street and tell her she should have started saving in an index fund back in 1986.
KazTheMerc | 19 hours ago
Nah, see - This is the kind of misleading title that pisses me off!
You don't get to go fiat, spend and borrow irresponsibly (as others like the US are encouraging you to do) and then piss on people for being mad at 'fiscal reality'.
That shit was optional. You didn't HAVE to kick-the-can down the road until it all landed on the later generations.
That was a choice. A choice that has consequences.
They are rallying against the consequences of irresponsible actions taken by previous generations, shouldered disproportionately. SO OF COURSE they're burning things - that's what angry humans with little or no hope do.
MagnificentCat | 19 hours ago
Every time the government tried to have rational policies (adapt pension age to life expectancy) you got millions of Frenchmen protesting on the streets
Mean_Conference6910 | 19 hours ago
Because many of them did not negotiate the reality they now find themselves in, dealing with the consequences of choices made before their time. Why wouldn’t they revolt if they feel this is unjust, combined with feelings of housing insecurity?
m4sl0ub | 18 hours ago
So instead of fixing the problem they do the same as the generation before them push it to the next generation. This is peak "double it and give it to the next person".
They have no leg to stand on being mad at previous generations while burning the country down for a chance to do the same to the next generation.
anewbys83 | 18 hours ago
They want what the olds have been given. Seems understandable to me. The young have paid for the old. They deserve their turn when they're old. Managing it all is the problem. Old need to get less at this point...
m4sl0ub | 17 hours ago
If France keeps spending like it does they are getting shit when they are old. They should be demonstrating for spending cuts not against it if they want to save their own future.
h310dOr | 16 hours ago
To be fair, we are spending on the old... Cutting on the pensions would help everyone under 55 right now. But you would be horrified to see how many students protested against the last retirement reforms.
m4sl0ub | 16 hours ago
Generally as a German I really respect the French fighting spirit and willingness to go on the street to advocate for what they want. We are far to tame and orderly to do that here in Germany.
Unfortunately it seems like the french youth has been fighting to actively harm themselves lately. I really don't understand where this idea comes from that excessive government spending is good for the populace, especially when you already have sky high taxes and barely any economic growth.
Zestyclose-Carry-171 | 15 hours ago
Well at the same time, for every young people right now, cutting down on pensions would probably mean that young people would also have to pay for their parents, so they mostly won't be better off either
TJZ24129 | 14 hours ago
Right now the average pensioner makes more per month, from the government, than the average French worker. They can cut some pensions and be ok.
Zestyclose-Carry-171 | 9 hours ago
It isn't true. Not from pensions, it works if you add other resources (rents) and because they reintegrate the money they don't have to spend as rent as revenue because most pensioneers are home owners. On average retired earn 1700€. Average salary is 2700€+
Median pension is 1400€. Median salary us 2190.
Informal_Weather1655 | an hour ago
Non le retraité , ne reçoit pas de la part du gouvernement , c’est pas un cadeau , ils ont cotisé pour .
KazTheMerc | 18 hours ago
Do those buildings burning down LOOK like 'passing it off to the next generations'...?
That's happening now, my dude. Looks pretty immediate to me.
And yes, they'll clean up afterwards. Yes, that has costs.
But. This. Is. What. Humans. Do.
Without advocating - You shouldn't be surprised when a population of humans breaks shit when they're pushed too-far.
It's what we've ALWAYS done.
m4sl0ub | 18 hours ago
I understand why they are doing it and maybe even sympathize with them a little. That does not change the fact that it is highly egoistical and moronic behavior. But that's human nature.
And the people protesting are very young, kicking the can down the road isn't going to work long enough for them to hope to be dead when it all blows up. So they are fucking up both future generations and their future selves.
laosurv3y | 18 hours ago
Because it doesn't help? It's like being angry at a plumbers repair bill so you burn the house down.
Not every response to anger or injustice is helpful.
KazTheMerc | 18 hours ago
The time for 'helpful' was 10 years ago when France was mostly protesting peacefully.
anewbys83 | 18 hours ago
Plumber's bill from before you were born, that your grandfather initiated but now you're the one responsible for?
CharmingAd3549 | 17 hours ago
At some point, someone had to bite the bullet and be an adult. This whole situation is a good argument against ever increasing social services, because they are impossible to dial back in such a climate.
KazTheMerc | 18 hours ago
^ Exactly this
If a previous generated 'decided' it was 'reasonable'... and then it turns out the consequences weren't...?
You get this.
LaToile | 13 hours ago
A rational policy would be to have a ceiling on pension spending per individual. Adapt pension age to life expectancy is deeply unfair to those working physical or tiring jobs, which already have the lowest pensions.
People weren't protesting cutting spending, they were protesting doing it unfarily.
Penki- | 5 hours ago
> Adapt pension age to life expectancy is deeply unfair to those working physical or tiring jobs, which already have the lowest pensions.
so fairness is that lowest paying jobs should get more pensions?
aimgorge | 5 hours ago
>Every time the government tried to have rational policies (adapt pension age to life expectancy) you got millions of Frenchmen protesting on the streets
They still enforced the policies and it didnt help whatsoever.
KazTheMerc | 19 hours ago
... does it involve cutting benefits every single time...?
Calling it 'rational' to hide the fact that it's always a reason to CUT benefits is (yet again) intentionally misleading.
You sound like a Used Car Salesman.
Jon_ofAllTrades | 19 hours ago
Benefits had to be cut. The existing level of benefits is and was not financially sustainable.
MagnificentCat | 19 hours ago
France has the highest government spending to GDP of any OECD country (57% of GDP). With 120% debt to GDP.
Maybe you can raise taxes more but any reasonable French plan needs to look at expenses
Neat-Heron-4994 | 19 hours ago
You obviously didn't read the article mate. It very clearly gives multiple cases where benefits were increased beginning with Mitterand, including a reduction in working hours to 35 hours per week and the retirement age from 64 to 62.75.
Please read the article before talking drivel.
KazTheMerc | 18 hours ago
...I really did...
This is an Economics discussion. Macroeconomics, specifically. The issue as a whole, not its symptoms.
Not snapshot lending rates. Not pension benefits increasing or decreasing. Not even the burning and looting. Those are ALL symptoms, downstream of the previous choices that lead you there.
The French farmers were blowing shit straight into the Capitol grounds, and have been for... a decade now? Probably longer. Nonstop upheaval, and escalating violence.
That's what HUMANS DO. This is NOT NEW. This is NOT SURPRISING.
There's nothing about market fluctuations that is going to STOP a movements like this when it has maintained critical pressure for a decade, or decades.
Put another way - The only metric that matters is you Citizens Contentment.
If you don't have that... they will EVENTUALLY not be your Citizens anymore, by hook or by crook.
"Oh shit! The Economy!!" says T-Rex, as the Asteroid crashes into Earth
Macro-problems.
esto20 | 18 hours ago
Jesus thank you
KazTheMerc | 18 hours ago
...it's easy to forget, when you've got your head so stuck in the numbers and fluctuations...
"can't see the forest for the trees"
FloReaver | 18 hours ago
They simply look at this from their ideology and forget what's the point of all this. They are so in their heads they don't see that every thread is repeating the same thing about pensions. There are many other problems in France, many more pressing. But they've been told it's pensions and that's it
KazTheMerc | 18 hours ago
Humans ALSO have a sort of... idealism to them, and we actively imagine being able to do all these things without the cycles of violence.
It's a fantastic dream to have.
... but somethingsomething history somethingsomething repeat it...
It's not like we weren't warned. It's not like the data wasn't out there. It's not like the French Government wasn't AWARE.
No-Nose7409 | 17 hours ago
Im constantly amazed to see the many ways europeans can blame the USA for their problems.
laosurv3y | 18 hours ago
Yeah! Vote the bums out from 40 years ago! I hate those guys.
OnitsukaTigerOGNike | 13 hours ago
Little or no hope? In one of the richest countries on the planet with one of the best social security program and pro worker labour laws. and I’m just sitting here in my country where the monthly wage is less than half of France’s daily wage.
Most of these protests (the economic ones)in advanced economies doesn’t stem from desperation, It’s stem from entitlement. I’ve lived in Europe, Australia and It always the same, the working class are always living very comfortable lives, but always use “bills” and “food on the table” that they can actually afford as excuses (of course there are some cases of actual poverty).
The economic issue isnt actually the rich vs working class, It’s that Western countries need to face the fiscal reality that their industrial might doesnt have the same share of the pie as they did before. Emerging economies are slowly starting to have more share of the pie and are still 100 years away from having the quality of life of those in the west.
KiryuBatman | 10 hours ago
I'm from the Philippines, visited Paris recently and the idea that anyone in France could complain about the state of things is super funny to me. Come visit the Philippines some time and you will see what not being able to put food on the table and the government not caring about you actually looks like
Last_Suggestion_8647 | 9 hours ago
Race to the bottom mentality.
liquoriceclitoris | 9 hours ago
As opposed to climb to the top via colonial extraction?
AbilitySpecial8129 | 6 hours ago
OK and your solution is deepthroating billionaires while they get richer taking apart public services and workers rights? Who's the good spiteful little slave? Here's your clown nose and shoes, man.
[OP] laxnut90 | 19 hours ago
Consequences for whom?
A country can only spend more than its tax revenue if lenders exist to loan them the difference.
France's bond market is showing that lenders are increasingly unwilling to lend France the money.
So, France either needs to grow their tax revenue/economy somehow and/or cut spending somewhere.
KazTheMerc | 19 hours ago
See? That's the nonsense viewpoint. "You need to toughen up" mentality.
This is not a Profit Calculation.
If lenders aren't lending, it's because IT'S NOT SAFE, and if they can't meet existing obligations THEY SHOULD NOT HAVE TAKEN THE DEBT AT ALL.
Don't get so distracted by percentage-point-ratios that you forget there's real people under there.
To answer your questions -
Generation X takes out debt, passes it to Y, who passes it to Z. They're dying off more every year, so why the fuck do they care? They don't.
Consequences for everyone EXCEPT those who took out the debt in the first place.
[OP] laxnut90 | 19 hours ago
The math doesn't care.
If lenders stop lending, France will be immediately forced to cut their spending to whatever tax revenue they bring in.
You can not spend more than you earn if no one will loan you the difference.
Nukemind | 19 hours ago
The point is there is no solution at this point other than actually tightning the belt. It's not fair- and I won't say it is. A lot of my life hasn't been fair to be quiet honest, and I doubt I will get the retirement I am paying into. But if no one will lend them money, then at the end of the day there *have* to be cuts and/or there *have* to be tax rate increase- something hard to do in France with the existing tax rates as they are.
And unlike the USA France can't unilaterally print away because they are in the Euro (which is a good thing- but does give a bit of hardship in this case).
KazTheMerc | 19 hours ago
No possible solution?
None at all?
.... compared to the cost of repairing all the fire and riot damage...?
Are you POSITIVE there's ABSOLUTELY nothing else that could be done...?
Because the collateral damage will continue until morale improves.
... so I hope you're wrong...
Let's try it a different way - Who profited off that money lending in the first place? The original round of debt that went out... and money exchanged hands...? Because they got paid.
Could we talk to them? Maybe discuss their moral obligations while the city burns in the background?
bfhurricane | 19 hours ago
What’s your solution?
[OP] laxnut90 | 19 hours ago
France needs to drastically cut any spending that does not grow the economy faster than its current debt interest rates.
Infrastructure spending, education spending and help for newfound businesses should continue if not increase.
Less productive spending should be scrutinized and halted wherever possible.
KazTheMerc | 19 hours ago
The burning IS the solution. Have you not opened up a History book in a while..?
This is what Humans under Pressure do. They break things until the pressure and shrapnel destroys the problem... and a lot of other collateral nearby.
And then we rebuild. Again, and again, and again.
Fighting against a multi-thousand-year species-wide pattern like that is NOT something you do lightly.
"Compound Interest is a Bitch of a Mistress"
But the problem WILL get resolved. Voluntarily or involuntarily.
Cereal_Grapeist | 17 hours ago
>The burning IS the solution.
Thanks for confirming for everyone that you're just a mentally ill person wanting to watch the world burn because your own life sucks.
KazTheMerc | 17 hours ago
You misunderstand :
It's the Traditional French Grieving Process -
https://reddit.com/link/19seau4evecx0/video/ilcpezde1o0i1/player
They just need some time.
bfhurricane | 19 hours ago
The problem is a higher cost of borrowing and an economy that can’t handle its social spending, particularly pensions.
Put your “burning IS the solution” into practical, economic terms. How does this address the situation?
Do the masses rob the rich to pay? Does the system collapse and millions of pensioners suddenly have zero income? Do they get what they want in the short term and pass the buck to the next generation?
Chaos is easy, but what comes after is always unpredictable. As a commenter on an economics sub, put your solution into economic terms. Because burning isn’t a “solution.” It’s a means to an undefined end.
KazTheMerc | 18 hours ago
The same way humans ALWAYS address problems like this.
You keep talking about borrowing and money - What's the cost of a Content Population that isn't going to burn your city to the ground?
...what's the cost of NOT having a Content Population, and them burning your city to the ground?
We're at THAT stage of the discussion... not the tea, biscuits, and fluctuating-interest-rates part. That discussion died a decade ago.
If you didn't notice the fires - this the destructions part of the solution. Your idealism is uplifting... but you aren't describing humans. Maybe some fantasy future homo supremis ...?
You're losing sight of the forest for all of the trees.
bfhurricane | 18 hours ago
Yes, I get your point. What I’m asking is what do you suggest or think is the next logical step?
At some point, the burning stops. What does France’s economic and financial situation look like, in that scenario?
[OP] laxnut90 | 19 hours ago
Unfortunately, it is a matter of math, not morality.
A country can only spend more than its tax income if lenders will loan them the difference.
Lenders are increasingly unwilling to lend to France.
If they stop lending money altogether, France will be forced, by default, to immediately balance their budget because there is no more money to keep spending.
KazTheMerc | 19 hours ago
Correct.
Keep going.
... what happens after that...?
.... they stop being able to debt-finance afterwards, don't they...?
That's how you know it's Working.
YOU COULD EITHER -
Not take out irresponsible debt
or
You can Default after taking out irresponsible debt... and lose the ability to take out irresponsible debt.
Since the previous Generation couldn't handle sticking to the first... their Children are forced to do the second.
But don't FOR A SECOND forget that they HAD the choice previously.
[OP] laxnut90 | 19 hours ago
Default is basically the situation I described above.
France becomes unwilling or incapable of paying debt. Therefore lenders stop lending.
The result is France being immediately forced to cut its spending to current tax revenues.
guhd_mode | 19 hours ago
We were never really given that choice as voters. The current incentive structure for politicians in a democracy is to overspend.
If they don't, the citizens will revolt, as is the case in france and therefore they always choose to kick the can down the road.
Personally, I think that debt should be constitutionally illegal, forcing politicians to compete on policies rather than who can promise more free stuff that we cannot afford.
Nukemind | 19 hours ago
If lenders won't lend, France has no control over their banks, they can't cut costs, and they can't raise taxes (which, frankly, they are at the end of)... tell me what possibly could be done.
Because a national default is far worse than riots. France and Germany have both had to do it before and it is never pretty. Like this is springtime compared to a nation which defaults (which ends up with services cut anyways as there is literally no money coming in).
KazTheMerc | 19 hours ago
... but Defaulting break the cycle.
You want the cycle to continue.
Sometimes the only way to win is not the play at all.
Nukemind | 19 hours ago
You would never get the social services because no one will lend to France for decades, and people who need help starve? Like I don't know what to tell you that's fiscal reality. Why would any nation or individual loan to a nation that doesn't pay back it's loans and defaulted?
Probably a brain drain of the best and brightest French to other Eurozone nations as well a la East Germany and West Germany? Infrastructure crumbling?
KazTheMerc | 19 hours ago
Hold on to that very thought -
Now go open up a History book and just... start going backwards.
... you can't possibly miss the pattern...
Nukemind | 19 hours ago
Yes I have a degree in history, and I can tell you defaulting on debt literally often leads to death. Like. That's been true since ancient times. Whether early modern- France in the 1790s. Whether modern- Greece. Whether ancient empires running out of cash and shaving coins.
All that happens is it leads to death and destruction... and then the same system keeps going.
CincyAnarchy | 19 hours ago
Going back to most of history the state provided little to no social services and that meant the poor, disabled, and aged died when nobody was able to take care of them.
I am not sure France, or anyone, wants to return to that past.
[OP] laxnut90 | 19 hours ago
True.
But lenders can also choose to stop playing. Many already are.
If a country can't borrow money, then spending is immediately limited to the money it earns in tax revenue.
For France, this would immediately trigger a drastic spending cut.
KazTheMerc | 19 hours ago
Same difference, different participant.
The solution was ALWAYS the same. How you achive that solution differs. But people WILL NOT starve. The Default process itself includes provisions to help stabalize the situation.
Soral_Justice_Warrio | 18 hours ago
The problem is that up to a point lenders will simply not lend any money.
Debt is rolling and the French Treasury like other states issues bonds every two weeks to fund itself.
If France has a deficit and no one is willing to lend money to them, France will either have to implement a 0% deficit budget or face default that will result in that 0% deficit budget.
The reasoning is quite simple, why would any financial institution loan money to an entity that defaulted recently and didn’t make any adjustment because it was “unfair” ?
For the reference, I’m French myself.
KazTheMerc | 18 hours ago
And I'm agreeing with you - They won't.
And I'm agreeing with you - It's not fair.
And I assure you - I don't like it. BUT~!!
The burning IS the solution. It's what Humans do. It's destructive, and painful, and people are going to get hurt. It's going to get worse before it gets better. BUT THIS IS WHAT HUMANS DO when pushed beyond their means.
It's what we've always done.
...and it USUALLY works remarkably well, once the fighting stops...
Let me put it another way - There's no amount of money in the world that would 'fix' it now. The only way to win was not to play... and almost every Western Country has played the Debt Game.
Now just imagine how the United States is going to look when we finally get our comeuppance.
janethefish | 18 hours ago
I propose cutting pensions by the cost of debt service. Make the cuts a ceiling on payments. The debt is largely due to pensioners, so they can pay for it.
Additionally, I propose taxing Elon Musk. Lure him to France with a big bowl of special-K, and then spring the taxes on him.
Flashmode2 | 18 hours ago
Now they’re protesting and support of the same thing that are screwing them over. If they were so concerned, they would’ve been fine with raising the retirement age and then they would’ve had a cut back pensions amongst other things. They want more cake while not being able to afford it and then allowing a huge amount of. Refugees that had no intention of going home in.
KazTheMerc | 18 hours ago
Okay, but... see that fire?
That's your actual problem now. Because everything you just said was horseshit 10 years ago, and still is... so now it's escalated to burning.
SO UNLESS your Tautology is going to put out that fire...? The time for tricking wording has long passed.
(read: There's no talking your way out of this one)
QuestioninglySecret | 14 hours ago
Exactly these economists act like these equations they or those before them came up with are some kind of natural laws, hinged on people being perfectly rational, in a vacuum, without the context of the choices, political, social and otherwise that enable this "fiscal reality".
It's bullshit and as many people in this sub espouse intellectual superiority and "this subs going to hell, there are barely any economists here. They're more likely to buy this nonsense whole cloth. It's hysterical.
KazTheMerc | 14 hours ago
We forgot.
...yeah... it really is that simple...
We forgot it was a Theory that we were still testing to see if it worked.
Now we taught our kids to confidently declare it Fact.
Alive-Big-838 | 15 hours ago
I obviously am not French or can't speak on their economic reality but from an uneducated outside glance it almost feels like the French voter got exactly what they wanted. Like they wanted massive services and safety nets and obviously this would necessitate high taxes + extreme stimulus. It seems like many in France are rioting over this simply because as much as we don't like to hear it, there's no such thing as a "Free lunch" when it comes to even government financing of programs. If the Government finances this off stimulus we get inflation like we did with covid, and tax the rich seems to only be a lemon that's oh-so-squeezable at time.
Am I off on anything?
Tha_Sly_Fox | 15 hours ago
Bloomberg just had a good video on this which was interesting, they basically broke down French spending and then at some point compared it to Nordic countries (also with high welfare spending) and made the point countries like Sweden and Finland spend a good percentage of their funds on defense and welfare, but their welfare distribution is more equally broken down by age group whereas France concentrates a majority of its welfare into the elderly including with one of the earliest pension/retirement ages in the developed world.
Alive-Big-838 | 15 hours ago
I actually swear i read something today that made the argument the "Swedish and Finnish" dream are dead and their economies also aren't doing particularly well. I think anyone who's honest realizes that safety nets have to be funded from somewhere and this usually means via high tax.
Swekyde | 14 hours ago
Sweden is to my knowledge above average for economic growth in the EU and has low public debt. Personally my measure of economic success is having low/no debt and providing strong social services to your citizens.
Now I think a lot of economists will disagree because they don't care about the economy as an engine to provide for people but rather an engine to make profit. Maybe those people think Sweden's economy isn't doing particularly well.
Alive-Big-838 | 13 hours ago
I think ultimately social services need a base in which they can be financed. If sweden is able to get that through taxation and a relatively stable economy I can see it being viable.
johnknockout | 12 hours ago
Nordic countries are largely Petro states benefiting from the conflicts in Ukraine and the Middle East.
DontDrinkBongWater | 7 hours ago
Sweden petro state? Finally somebody sees the Swedes for who they really are.
huojtkef | 9 hours ago
You miss the millions of poor inmigrants (using the services and paying low taxes) and the low competitivity of the companies due to high taxes.
Deep-Internet1316 | 14 hours ago
You're off on pretty much everything that an uninformed outsider can be off on.
France HAD good public services and social welfare. They voted for someone to maintain that. And the centre-left government they voted for then transformed itself into a centre-right government and cut the taxes funding social services while giving no-strings-attached financial gifts to the richest companies. Trickle up economics. Look at a graph of government finances and you'll see 2 things: tax revenue as % of GDP going down while the deficit goes up.
This is a self-inflicted debt crisis so the neo-liberal establishment can point to the debt and go, "Socialism is not realistic!", and continue the capital flight to the rich from the impoverishment of the working class.
Example: stop the financial gifts to the rich tomorrow and the budget deficit disappears.
It's the same infiltration that the Reagan administration has made in essentially every NATO country. And the same regime that suppresses every communist regime since WWII. So it's zero surprise that you've been brainwashed by the same imperialist propaganda.
The fact that this subreddit is called "Economics" tells you everything: the only narrative pushed here is the accepted capitalist neo-liberalist agenda. The propaganda is inherent to the system.
Edit: I thought the stats on this comment were very interesting:
Make of that what you will. If any Americans are interested in economics deconversion material, allow me to recommend Polanyi and Zucman.
ImRightImRight | 13 hours ago
Just skip to the end of the comment where they admit they don't believe in economics, or anything that would put a damper on their cLaSs WaR
Psycholama972 | 13 hours ago
God I hope you are a bot.
Serious-Football-323 | 12 hours ago
No this is France, they've always been overly idealistic idiots they're just continuing the trend. They think they're entitled to everything they want and anyone pointing out it's not possible is to them either a bourgeois or class traitor, and the only ones opposing this are RN who have their own problems.
Fast_Astronomer814 | 12 hours ago
like how hard is it to understand you can't have 1.5 worker supporting one pensioner it just isn't sustainable it was managable when it was 6 worker for 1 but the demographic has changed
Kiralalalere | 11 hours ago
No I'm french and I downvoted too.
"Tax the rich" won't make the deficit disapears, you are delu AF, stop this LFI copium.
We have been living on the free lunch mojo since decades, far before Hollande. Heck, we could already see we were off the track and reforms were mandatory since Mitterrand.
While you are right about some parts were richs become richer and poors become poorer, that doesn't change the balance of our economy is broken.
Comfortable-Bread249 | 12 hours ago
Ah. The USA playbook. I know it well.
Alive-Big-838 | 13 hours ago
lol ok
YourFuture2000 | 12 hours ago
> The fact that this subreddit is called "Economics"
This sub is about news and nothing to do with economics.
WillingnessReal525 | 3 hours ago
Reddit is filled with neolib propagandists, most of them are bots, don't bother arguing with them.
Zestyclose-Carry-171 | 15 hours ago
Well kinda, but at the same time the underlying problem is that rich companies don't pay taxes, and we allow foreign competition to kill our homegrown competitors, for free
Alive-Big-838 | 15 hours ago
Sounds like one of those "Get in line things". Canada just released its budget and the usual gasp was more payments directly to private companies.
Zestyclose-Carry-171 | 9 hours ago
Well companies in the EU base their HQ in Ireland like Apple or Microsoft. So we are looking at dozen of billions of unpaid tax each yearr
Alive-Big-838 | 3 hours ago
I just feel like i've lived long enough to see that these taxes will never get collected. Seriously. Politicians and companies would clean us out and let us fight each other before they'd ever let any of us get even slightly ahead.
Zestyclose-Carry-171 | 2 hours ago
That is for sure but that is also kind of the problem. Those politicians (and company heads) think they can just cheat tax and not feel the public services breakdown it generates
Alive-Big-838 | an hour ago
You're right. only thing i'd counter is "think" is more like "know" lol
Zestyclose-Carry-171 | an hour ago
Well no they don't. I mean for now they can yes. But with the world we will see, there is nothing stopping any country to seize wealth pertaining to foreigners Without tax yes we won't be able to defend them either
Alive-Big-838 | an hour ago
I'm just jaded from Canadian politics. We keep having "Scandals" where we find out that the government hired a close family friend who mismanaged a ton of money and there's never even a fine handed out. I see no reason why if it's happening here it's not happening everywhere.
Zestyclose-Carry-171 | an hour ago
I mean, yes it happens here too. But what I meant is those people still live in the country, and they will face the problem of the country when the country goes forward
AdditionalSupport893 | 8 hours ago
What kind of taxes? Sales/VAT? Tariffs? That's the only tax you can subject them to. These companies are not French and their profit is calculated against global expenses in their headquarters in the US.
Zestyclose-Carry-171 | 6 hours ago
Sales tax. That is kind of the problem really. They base their profits on avoiding tax on the benefits they make in France, by basing it on a HQ in Ireland.
Successful-Cut-5772 | 8 hours ago
french voters are furious that the bill for decades of nice promises finally showed up and nobody wants to sign for it. everybody loves the benefits until the tax hike or cut lands on their own block and then its a moral crisis. the realistic fix is boring and unpopular which is exactly why politicians keep kicking it down the road.
SnooOpinions8790 | 5 hours ago
Most of Europe has been kicking the debt can down the street to pay for benefits today all of my adult life - and the debt can just keeps getting heavier. Everyone screaming about what the current government did or did not do is entirely missing the point, the has been coming for decades as government after government shoved the debt onto the next generation.
Greece was the first country to break their toe on the can when the debt crisis hit. Its only a matter of time before then next country breaks its toe and if its France then its probably too big to rescue.
The only way out of it is significant hits to living standards or massive deregulation to generate growth. Either would cause riots in France. The French people have been lied to over their free lunch for so long they get angry when anyone tries to tell them the truth - they are not alone in this I think most of Europe is in a similar situation.
-Astrobadger | 19 hours ago
Being a member of the EZ makes it a little more complicated but people who pen articles like these always forget/ignore the fact that the money system is closed system. The government debt they decry is also the money in the private sector. Their argument becomes these protesters have too much money, which is weird because the protesters are saying they don’t have enough money (for schools and such, god forbid). All sovereign debt “problems” are just an untaxed wealth problem and today that manifests as a small number of individuals have a lot of that wealth (government debt) while the other 99% are told there’s no more money (too much debt). Acknowledging that might change one’s policy prescriptions, methinks.
liquoriceclitoris | 9 hours ago
yeah france should just expropriate the wealth of all the citizens willing to buy it's debt. that'll just reduce the debt. great idea
MrAlexius | 4 hours ago
This is what happens when someone starts with an ideological conclusion and then cherry-picks economic statistics to support it. France has genuine fiscal problems, but this article is full of misleading comparisons, accounting confusion and unsupported causal claims.
Only if you compare nominal GDP in dollars and conveniently ignore purchasing power parity (PPP).
World Bank figures for 2025:
That's a 41% difference, not 100%.
More importantly, GDP per capita is NOT labor productivity. It also reflects hours worked, employment rates and demographics.
According to OECD data, France produced $87.30 per hour worked in 2023 versus $97.05 in the US (PPP-adjusted). That's an 11% American advantage, not remotely the enormous productivity gap the author implies.
Conflating GDP per capita with productivity is a rather embarrassing mistake in an article written by someone holding a PhD in economics.
Here's what the French government's actual 2027 budget proposal says:
Yes, you read that correctly. Public spending is projected to INCREASE by €40 billion in nominal terms.
The €54 billion refers to fiscal adjustment relative to a baseline, not €54 billion of actual expenditure cuts. It includes revenue measures.
Likewise, comparing a hypothetical 6.4% deficit with a projected 5% deficit without explaining the baseline is misleading.
This distinction is fundamental in public finance. Apparently, not fundamental enough for this article.
French government debt has an average remaining maturity of approximately 8.4 years, according to Agence France Trésor.
Most existing fixed-rate bonds retain their original coupons. Higher market rates progressively affect debt servicing as bonds mature and new borrowing takes place.
Debt sustainability depends primarily on the relationship between effective interest rates, nominal GDP growth, the existing debt stock and the primary fiscal balance.
The standard debt-dynamics equation is approximately:
Change in debt/GDP = (interest rate - GDP growth rate) × debt/GDP - primary surplus/GDP.
The author discusses rising borrowing rates as though these distinctions barely matter.
They matter enormously.
And a widening France-Germany bond spread isn't exclusively a measure of default probability. It also reflects liquidity, uncertainty and other risk premia.
First, he confuses central government spending with general government expenditure, which includes local authorities and social-security institutions.
Second, government spending includes transfers, pensions, healthcare reimbursements and other payments that subsequently finance private consumption.
A pension transfer isn't equivalent to the government consuming an equivalent quantity of real resources.
The spending-to-GDP ratio alone tells us virtually nothing about expenditure efficiency, economic returns or fiscal sustainability.
What matters is WHAT money finances, how efficiently, and what the alternatives would cost.
Yes, French public pension expenditure is approximately 13-14% of GDP, well above the OECD average.
But France finances pensions predominantly through public schemes, whereas countries such as Australia, Switzerland and the US rely much more heavily on occupational and private pensions.
The OECD explicitly distinguishes public from total public-plus-private pension spending.
Moving pension expenditure from a public institution to private pension funds doesn't magically eliminate the economic cost of retirement.
Comparing public expenditure without accounting for institutional differences is a poor international comparison.
France's statutory 35-hour week is principally the threshold for overtime calculations, not a maximum number of hours employees are allowed to work.
Full-time French employees routinely work more than 35 hours.
And here's the irony: the author complains about French people working fewer hours immediately after using GDP PER CAPITA as evidence of inferior productivity.
If Americans work more hours annually, that increases their output per person without necessarily making their output per hour proportionally higher.
He is effectively using differences in working time to prove differences in productivity.
OECD estimates for total healthcare expenditure in 2025:
The American system consumes roughly 54% more of GDP proportionally, despite relying much more heavily on private financing.
And the French enjoy substantially higher life expectancy.
Whether healthcare is financed through taxation, insurance premiums or out-of-pocket payments, it still consumes real economic resources.
Apparently, expenditure becomes economically virtuous the moment it disappears from the government's balance sheet.
That's ideology, not economics.
He praises French nuclear energy, high-speed trains, aerospace and technological innovation, then suggests state intervention destroyed French economic dynamism.
Who developed those projects?
France's nuclear expansion was driven by the state-led Messmer Plan.
The TGV was developed by the publicly owned SNCF.
Ariane emerged from European publicly funded industrial cooperation.
These are almost textbook examples of successful industrial policy and public investment.
That doesn't prove state intervention always works. It proves the author's simplistic "government bad, private sector good" narrative cannot explain the very successes he celebrates.
This is classic selection bias.
Fiscal consolidations depend on monetary policy, exchange rates, global demand, initial economic conditions and the composition of reforms.
Canada and Sweden benefited from macroeconomic circumstances France cannot simply reproduce.
France cannot independently depreciate its currency or set its own monetary policy.
Moreover, IMF research has found that fiscal consolidations generally reduce economic output and increase unemployment in the short run.
Austerity can improve fiscal sustainability under appropriate conditions. It can also damage growth and worsen debt dynamics if implemented badly.
Listing three successful historical episodes establishes neither universal causation nor an appropriate policy prescription for contemporary France.
According to the IMF's October 2026 forecasts:
The US has different monetary and financial advantages, of course. But presenting France as the unique warning sign for an American audience while largely overlooking America's own fiscal trajectory is an interesting editorial choice.
The actual economic problem:
France needs to improve its fiscal balance, productivity, employment and the efficiency of public expenditure. Nobody serious disputes that.
But none of these objectives demonstrates that reducing public services, shrinking pensions and deregulating labor markets are automatically the optimal solutions.
Those are policy preferences, not conclusions derived from the evidence provided.
A serious analysis would distinguish nominal from PPP-adjusted GDP, output per worker from output per hour, marginal borrowing yields from average debt costs, public expenditure from total economic costs, and historical correlations from causal evidence.
This article repeatedly fails to make those distinctions.
The author has every right to advocate smaller government. But dressing that preference up as an unavoidable conclusion of economic science doesn't make it one.
Sources:
Alarming-Cry-1576 | 3 hours ago
A lot of words that still don‘t explain why the situation of France would be anything but very serious. They have neither a grande privilige as to being able to generate money on their own, nor do they have military power or capital assets to back such debt levels.
recently-deleted | 3 hours ago
That’s AI generated research and text with no references btw.
MrAlexius | 2 hours ago
The references are literally at the bottom of the comment. But since apparently scrolling is harder than dismissing something as AI-generated, here are the primary sources with the actual figures:
https://data.worldbank.org/indicator/NY.GDP.PCAP.PP.CD?locations=FR-US
https://www.oecd.org/en/data/indicators/gdp-per-hour-worked.html
https://www.assemblee-nationale.fr/dyn/opendata/RAPPANR5L17B3291-tII-v1.html
https://data-explorer.oecd.org/
These aren't opinions. They're statistics published by the World Bank, OECD and French Parliament.
You're welcome to challenge the figures, the methodology or my interpretation of them. That's how economic debate works.
Greyhand13 | 2 hours ago
Do you not see the references linked?
MrAlexius | 2 hours ago
That's all you got? If you want a debate I'm happy too, but at least read the article not only the title, and at least look at the data I presented it would take 1 minute.
yuhugo | 58 minutes ago
It's AI generated but you asked it to draw the wrong conclusions. You showed that France has LESS productivity than the US (it used to have higher productivity), you showed that its GDP per capita is 40% (!) lower than the US. Add to that that the share of the country's GDP derived from public expenditures is one of the highest in the world. Additionally the country is lagging behind in terms of high-tech companies, and looking at the trend (GDP, expenditures...), its future doesn't look good. France does benefit from the Euro which allows it to borrow at a low(er) rate than if it was having the Franc.
MidnightSensitive996 | 50 minutes ago
Yeah cannot believe ppl are falling for AI slop like that
iannoyyou101 | 3 hours ago
Yes here in France we love to pay for old people who had to work less and benefited from debt and money printing while we (millennial and gen x) will get fucked in the ass
Greyhand13 | 2 hours ago
If not them ,not you either.
iannoyyou101 | 2 hours ago
I make 200k a year
Greyhand13 | 18 minutes ago
And you're mad about what?
Union_Jack_1 | 4 hours ago
This is an incredible comment. Thank you for all the effort and the factual layout.
MidnightSensitive996 | 41 minutes ago
Gotta prompt your AI better to make sense. Abstract points about GDP measurements aren't super relevant if you look at trends over time. In 2000, France had the same per capita GDP as the US. Now France is way poorer than the US, it runs a deficit every year to pay for its welfare state, and that's before you factor in that France now has to resume defense spending and staff its military due to the geopolitical threat posed by Russia. So whatever PPP adjustment you use, France's system is unsustainable by its own metrics and the system is being strained in 4 directions - an aging population means fewer taxpayers paying for more takers, defense spending now competes for welfare spending and staffing takes productive ppl out of the civilian economy, mass unskilled immigration creates another growing group of ppl who will never be net tax contributors, and the European energy crisis. The left's response to this polycrisis will cause hyperinflation like it did in Argentina
Trawling_ | an hour ago
Sure, I think you made some good points. But it does seem like their public finances do need to be addressed.
Most of what you said is that you disagree with their conclusion or how they have presented things in a negative light. But nothing you shared seems to “bring them above” the pile of criticisms.
I agree they are preferences, but it feels disingenuous to try and say there is no credence to the arguments they’ve provided to support their preference.
What are the alternatives you alluded to?
espressocycle | an hour ago
Look at the GDP per capita of Ireland, which is a tax shelter for the world. Well what other countries have low corporate taxes? The USA, for one. Our GDP is inflated.
MrAlexius | 57 minutes ago
Please read the article , my comment, read your comment and try to make a logical conclusion.
thedylanackerman | 11 hours ago
I think you guys at r/economics are buying a bit too much into this article which only sees France through its difficulty to borrow debt and not on its economy itself. The lense is also officialy supporting "the principles of free enterprise, limited government, and individual liberty".
What the american reader will miss from this read, as many of my fellow french pointed out to some people, is that our successive government did not in fact do nothing, reducing the size of the french government has been the constant policy for more than 20 years now.
Some thoughts :
This general discourse that french people are entitled to their benefits is used at home to justify what are harmful policies which will only worsen the fiscal situation (again, cuts in fiscal revenue, worsening the debt, are used to justify cuts in spending, not the other way around).
And I will remind everyone that most of public debt in the west cannot only been explained by structural issues, which do exist, but are also the result of the State willing to save the economy during crises. In France it rose by 20 points of GDP just in one year in 2008, it rose by another 10 points because of covid, as it was stabilizing before.
The financial markets uses instances of the State saving the whole economy as quantitative indicators of the State's lack of responsibility.
spottiesvirus | 10 hours ago
>The strategy has clearly been about starving the beast, by reducing fiscal revenue to justifiy cutting social and public services
second (or first depending on the year) highest public expenditure as % of GDP in the whole OECD
This beat might be bulimic or something idk
>just because social security is public multiplies this ratio by two compared to the US
do you think social security is private in the US (???)
>The financial markets uses instances of the State saving the whole economy as quantitative indicators of the State's lack of responsibility.
the whole point of a market correction is to adapt prices to properly incorporate new information
The State stepping-in is exactly an indicator it will try to hide reality and try to push the river uphill for as long as it's allowed to
COVID is the perfect example, if everything is locked down, you can't pretend it's business as usual just because you pump liquidity in people's pockets
For prices to be a good signal in a market economy, they need to reflect and rapresent the actual reality of an economy. There is no way out of that
Mackadamma | 7 hours ago
Starving the beast isn't about expenditure, it's about limiting revenue.
https://www.latribune.fr/article/idees/48655412148769/opinion-929-milliards-de-pertes-de-recettes-annuelles-cumulees-entre-2018-et-2025
thedylanackerman | 7 hours ago
>second (or first depending on the year) highest public expenditure as % of GDP in the whole OECD
Most of it is money passong through the State, it's not spending in the sense that the public sector weights that much.
For Example, the US might have a small tax for something, while in France it will have a big tax but it will give back some or more money in fiscal assistance. I might pay a tax for owning a house, but I get a bonus from the state because I have a limited time contract. I will pay a higher income tax than in the US, but I will get money back because I have a child.
You could say that's innefficient or whatever, but this kind of redistribution explains most of the share of public expenditure relative to GDP, not the size of actual public services.
>do you think social security is private in the US (???)
You guys pay high cost insurance to pay for private healthcare in situation where in France I would pay close to nothing because it has been paid by taxes. My situation inflates the share of public spending to GDP but yours doesn't. I'm only explaining this. In the end however, the american individual (and medicaid) will pay more for the same result.
Is it really in r/economics that I have to explain that actually the single payer system is more efficient than what the US has ?
>For prices to be a good signal in a market economy, they need to reflect and rapresent the actual reality of an economy. There is no way out of that
I do agree, but if you're just into laissez-faire, you will just let people starve and die of illness before the market adjusts itself. The way you see the covid crisis is interesting, it shows a political choice that actually it's okay if every business dies for two years if that's what the market leads to. But like, do you think doing nothing would have been the right solution ?
I'm too much of a keynesian about this
Cultural-Weight512 | 20 hours ago
Not any mention of some of the other factors that have pushed French borrowing higher, most importantly Germany's move to issue more of its own debt. France was the "Safe" option for the Eurozone because Germany wouldn't issue debt, now that they have started to, French debt becomes less desirable. Pursuing blind austerity is a great way to worsen the situation at this point.
Lorry_Al | 19 hours ago
Government spending is 60% of GDP and the average pensioner in France "earns" more than an average worker. Austerity is definitely needed at this point. It has all got to stop.
OccupyRiverdale | 15 hours ago
Just to put this into context - French government spending is a higher percent of their gdp than the Soviet Union which typically fluctuated between 47-50% in the decades following the Second World War. That is bat shit insane and totally unsustainable for a country like France.
kirime | 15 hours ago
Third highest in the world among major countries, behind only Libya (where private sector was obliterated by war and most of the economy is oil exports) and Ukraine (where private sector was obliterated by war and most of the economy is foreign donations). There's just no way to continue spending this much without a major external source of income.
OccupyRiverdale | 14 hours ago
Wow I didn’t know that. It’s not like France is a country that is tremendously rich in natural resources. The Soviet Union could keep it up as long as they did because state run industries could stick shovels in the dirt all over to exploit vast natural resources. I don’t know what the end game is here for France but it looks bleak.
Docteur_Lulu_ | 13 hours ago
You did not know that because it is simply not true. Source: https://www.imf.org/external/datamapper/exp@FPP/USA/FRA/JPN/GBR/SWE/ESP/ITA/ZAF/IND
France is high, but not third. And Finland spends more.
liquoriceclitoris | 9 hours ago
maybe they can go to war?
Reagalan | 13 hours ago
Soviets wasted a huge chunk of that on military spending, though.
Fast_Astronomer814 | 12 hours ago
and the french is wasting it on pensioner, it used to be 6 worker for 1 now it's 1.5 worker for 1 the math ain't mathing
OccupyRiverdale | 8 hours ago
The Soviet Union at least did some cool shit like land a spacecraft on Venus, create Tetris, and develop the worlds first nuclear power plant. The French just have a generous pension system and substantial welfare state.
liquoriceclitoris | 9 hours ago
need to start thinning the herd
Fast_Astronomer814 | 38 minutes ago
ummm they vote
Equivalent-Sherbet52 | 16 hours ago
But I can bet that the austerity will never hit the pensioners, but the young and the workers. Because the current governments of France only get elected by pensioners.
Lorry_Al | 16 hours ago
Arguing about where the austerity should hit is a waste of time. It just needs doing now.
Psycholama972 | 13 hours ago
No that’s just wrong, austerity is inherently done for the future of the country, and its only right that the future generations are less impacted than the boomers.
liquoriceclitoris | 9 hours ago
ah the problem with democracy. if there's more boomers who vote to be parasites what can you do?
Psycholama972 | 8 hours ago
Vote I guess
Alive-Big-838 | 15 hours ago
How does it even happen that someone makes more in retirement then working the average job? Like what voodoo magic happens? Is this literally the voter voted for more free money or is it a little more dense then that?
Grintock | 8 hours ago
I think that happens through accumulating debt
Alive-Big-838 | 3 hours ago
Sorry i meant like how does a retirement system get that bad? like what's the math that gets done to make it come out like that. Are average wages so insanely low now or are the boomers such a significant block that they turned retirement into a form of free income?
Competitive-Hair7499 | 50 minutes ago
The secret ingredient is debt.
Alive-Big-838 | 35 minutes ago
So like inflationary pressure caused by that debt or people voting to bump retirement considerably from that? Not trying to be obtuse or anything just a little overly eager to understand/learn.
DwarfFart | 16 hours ago
Whaaaat? That’s sounds crazy. Is a pensioner the equivalent to someone in the U.S on social security?
psyspin13 | 19 hours ago
Austerity is literally the only solution at this ooint. The recipe is ready
oulipo | 19 hours ago
Austerity never worked, and is not going to work. Please take an Econ 101 before writing
0WatcherintheWater0 | 19 hours ago
Austerity works to fix a budget crisis when you are massively overspending, this is absolutely true what are you talking about?
oulipo | 6 hours ago
It's not. Check Greece, they were many other possible solutions, and austerity just created chaos and had the effect of selling all the productive assets of Greece for penny on the dollar to international funds
Competitive-Hair7499 | 4 hours ago
Greece is a perfect example of how monetary policy cannot fix a corrupt political culture.
No one would go through that a second time. We should have let Greece default, save the European banks and let Greece exit the EU and the eurozone.
psyspin13 | 4 hours ago
No. The fact that the austerity has not been reversed but enforced with extreme vigilance shows that the EU is commiteted to austerity. Time for France to taste their own medicine.
oulipo | an hour ago
The main issue with Greece wasn't the actual debt. It was the fact that the "elites" of that country put lipstick on a pig by pushing fake reports aided by international consulting groups. That's what led to the loss of trust. And then it was asked of the poor people to pay for it through austerity. You have it backwards
Competitive-Hair7499 | an hour ago
The elites are a reflection of the society. Unless you are saying Greece is not a democracy?
oulipo | 49 minutes ago
Absolutely not. The government cooking up the books is not a reflection of society.
Or are you US and admitting to be as stupid as the "ministry of war" and co?
Competitive-Hair7499 | 32 minutes ago
And countries that don't have these problems, how did they avoid being screwed over by the "elites"?
fish_economist | 18 hours ago
Please elaborate on your proposal for France to regain fiscal stability given that the average wage earner is already taxed at an effective rate of 55% [1].
Competitive-Hair7499 | 19 hours ago
Well, they don't really have any other options. You can't spend more than you earn and suffocate the private sector at the same time.
oulipo | 6 hours ago
Nobody "suffocates the private sector". Total, LVMH, and others are among the richest companies on the planet
CommunistsAreCancer | 18 hours ago
What part of econ 101 says that cutting spending and/or increasing taxes to pay down your debt and ensure your fiscal security doesn't fall apart is a bad thing?
oulipo | 6 hours ago
The issue here is precisely this: the demonstrations in the streets ARE about increasing taxes on the wealthy people and big companies in order to lower the debt.
Except everybody seems to pretend that the "only possible way out" is to use austerity. It's not. Austerity only make things worse
In 10 years, we want better educated and healthy kids in order to grow our country. We don't want "even wealthier" billionaires who just buy media to instill their hate everywhere
CommunistsAreCancer | 3 hours ago
Show me the demonstrations that are advocating for cutting pensions:
Hoffmann161 | 19 hours ago
Worked for Greece.
psyspin13 | 18 hours ago
Actually it didnt work for Greece not even a little bit, but they (Europeans) keep imposing it. France has zero excuses at this point. They need to start living within their means by lowering their standards of living
Hoffmann161 | 18 hours ago
That's simply not true. Greece went from massive budget deficits to running surpluses, regained access to financial markets, restored its investment-grade credit rating, and significantly reduced its debt-to-GDP ratio. Unemployment dropped from a peak of 27.5% to below 9%, its banking system became much healthier, and its GDP growth is outperforming both the EU and eurozone averages.
CommunistsAreCancer | 18 hours ago
I love how lefties just refuse to contend with the reality that a massive welfare state is unsustainable and never will be.
psyspin13 | 17 hours ago
You are answering about an invented argument. I nowhere said that a welfare state should ne sustainable, on the contrary. But calling these barbaric austerity measures imposed to Greece a "sucess" is pure fking hubris. One does not negate the other.
CommunistsAreCancer | 17 hours ago
How were they a failure, please enlighten us.
Pretend_Handle_7639 | 17 hours ago
Only because democracies don't make reforms before it's necessary. Politicians can read the writing on the wall, and see that fiscal responsibility is punished by voters and candy for everyone is rewarded.
oulipo | 6 hours ago
"Fiscal responsibility is punished by voters", except that in literally ALL the "fiscally responsible" Republicans governments in the US the debt grew (to give money to the ultra wealthy), and in literally ALL the "free candy" Democrat governments, the debt was kept under control and people got more
You should understand that when laypeople get more, they spend more. Thus suddenly your Mom & Pop stores make more sells, and get better, etc. Giving back to low-wage people helps everybody
Competitive-Hair7499 | 3 hours ago
Why the hell are you talking about US politics? This is about EU politics and the eurozone. It's a totally different system.
France will not have any money to give in a few years, the interest rates are going to skyrocket. No one is going to lend France money, unless they get extortionary interest rates for it.
oulipo | 2 hours ago
What would really fuck a country up (like it happened in the US) is to stop educating people. Then they vote for MAGA, and your whole country gets fucked by Putin.
Another question?
Competitive-Hair7499 | an hour ago
Yeah, I have a question. Wtf does that have to do with anything?
damNSon189 | 19 hours ago
I’m curious: France has so much debt, and rates don’t seem to lower significantly for a long time in the future. If austerity won’t help, then what will get them out of this rut?
Neat-Heron-4994 | 19 hours ago
People don't care. They just want more of that sweet government money so they can go to bali and get a new phone.
clocks212 | 13 hours ago
“A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury.”
liquoriceclitoris | 9 hours ago
you're quoting yourself?
damNSon189 | 3 hours ago
Asking the right questions, LiquoriceClitoris
Books_and_Cleverness | 16 hours ago
I mean “blind austerity” doesn’t sound good but they need a healthy dose of austerity, certainly.
I’m not sure France even has the ability to raise enough tax revenue to fund its current programs. Like they’re already collecting ~45% of GDP in tax revenue and are probably not that far from revenue-maximizing rates. Especially over a longer time horizon.
clintstorres | 12 hours ago
The pro growth changes France needs to make that will lower the need for Austerity are some of the same policies the French have already rejected.
libertycoder | 11 hours ago
45% of GDP is almost certainly past the Laffer curve revenue-maximizing rate.
Books_and_Cleverness | 10 hours ago
AFAIK it’s more like 55-65% but it probably depends on a lot of factors like what alternative investments are out there.
libertycoder | 10 hours ago
Can you name a country that has ever collected 50%+ revenue relative to GDP? You may be confusing that ratio with statutory tax rates.
CurrencyDesperate286 | 17 hours ago
Except the spread on French bonds over Bunds has increased far more than other Eurozone countries. Like you’re not seeing that sort of divergence for government bonds from places like Austria, the Netherlands or Ireland. The increased risk associated with France is definitely the primary factor.
Latter-Entrance288 | 18 hours ago
I don't understand why the French can't have all the vacation time they want, retire at 55 with bloated pensions. Just ask Grandpa Bernie Sanders, everything is free.
bladex1234 | 14 hours ago
It’s almost as if public funding should go toward the ones who contribute the most to the economy.
Apary | 7 hours ago
No. There is no "fiscal reality" and we’re not protesting against it.
The economic right-wing just has a strategy wherein they call themselves the "realistic" ones and "down to earth" politicians, even though their analysis is usually whimsical at best. And politicians therefore now pretend we’re protesting reality.
No, we aren’t. We are protesting the people in power, and the kind of people who wrote this title, because they are the problem.
There are dozens of ways that things could have done better without this neoliberal ideology nonsense. It perfectly possible to fix the issue. Some people simply don’t want to. Because these people want more failure, more fear, and the ability to keep pretending they’re "realistic" for political gains.
Mackadamma | 7 hours ago
First of all, media could talk about the fact that our deficit would be 4 times smaller without Macron's tax gifts. God knows why, this isn't mentioned anywhere (or almost anywhere). « 929 milliards de pertes de recettes annuelles cumulées entre 2018 et 2025 »
Not everything is about spendings.
Guilty-Hope1336 | 7 hours ago
The Laffer curve is a thing. The French oppressive system of taxes is basically maxed out on taxes.
Mackadamma | 7 hours ago
If the laffer curve theory was right and France was at it's too in 2017, those 929 billions would automatically have generated an explosion of the french economy.
dfgdgregregre | 6 hours ago
>The Laffer curve is a thing
No, pretty much every serious economist agree that it's not.
GoranjeWasHere | 6 hours ago
there hasnt been a nation that didnt fallow it. you are questioning reality
HalfLoose7669 | 3 hours ago
And you’re doing the same thing as the article, calling your ideology “reality” doesn’t make it so.
Even IF the Laffer curve was a thing (it’s not, given there has been no empirical demonstration of it and models vary widely), given that all tax cuts have resulted in lower tax revenues, we’re clearly not at the peak and could increase tax rates, especially on the wealthy.
snowman-6 | 5 hours ago
Who is saying that it’s not a thing?
Fatality4Gaming | 6 hours ago
You mean the shitty curve that was drawn on a napkin in a restaurant, used as a justification for the Reagan administration, that is disproved by pretty much every economic studies on the matter for 40 years now?
Best-Protection8267 | 13 minutes ago
Didn’t you know, if you draw something on a napkin that makes it real! It’s a secret that Econ genies didn’t want you to find out
Apary | 4 hours ago
The French tax system is not oppressive. No empirical data supports the Laffer curve currently. Rich people very rarely move simply for economic reasons.
Again, you’re pretending to be "realists", and it’s pure ideology. There is actual data on fiscal exile. If the Laffer curve exists, every single country is miles away from its optimal and we could literally triple taxes on the ultra-ruch. If it doesn’t, it’s irrelevant.
DotBugs | 5 hours ago
Neoliberal ideology? How exactly does France practice neoliberalism? This comment seems to indicate you don’t understand the problem with France’s finances after all.
Apary | 4 hours ago
I’m literally French. France has been moving right economically for well over a decade, and that is specifically why its finances are not doing well.
Neoliberalism is the art of taking a functional mixed economy, breaking it, then going "see? I told you it didn’t work".
France sold tons of its holdings for pennies to the private sector. It then borrowed money on a market that was simply luring States in with low interest rates to make them dependent. It then changed Laws to make the rich pay less. Finally, it hired people to "save money", and these people are now paid with our taxes to enshittify the public sector and save less than they cost for it.
All of these were neoliberal decisions : privatize infrastructure, privatize sovereign debt, give incentives to work hard, cut needless spending. This is how this nonsense was sold.
France also had opportunities by the gallon. It’s arguably the best weapons manufacturer in the world in 2026, filled with talent, and very productive per hour worked. The fact that it even has issues instead of swimming in money is pure neoliberal incompetence. Gaullists would have resovereigned debt and invested massively in defense years ago, and they’re right-wing. You need intense levels of neoliberal delusion to turn this winning hand into this situation.
johnJanez | 4 hours ago
Explain to me where french government is supposed to get enough money from to pay for all those public companies and services? It seems to me there is literally not enough money for what the french public demands. Can't have cake and also eat it too.
Apary | 3 hours ago
You don’t understand money, then. Saying "there’s not enough money" is a purely ideological stance. Monetary policy is a choice.
Money is just a tool we use to keep track of various economic factors in a decentralized way. Money helps us keep track of who contributed to society, helps us make barter much easier, helps us keep track of supply for various resources. It’s a tool, nothing more. It’s a complex tool, and you need to wield it intelligently, but "there’s not enough money" is a neoliberal copout.
There are enough resources for what the french public wants. There is also enough motivation, and enough expertise. We know how to do everything the public wants to do, we have the means to do it, it is morally sound and creates no victims. There is no problem from a material or human standpoint.
If money is the problem, it’s a poorly calibrated tool and needs recalibration.
If you want to code a piece of software, have the expertise to do so, the time to do so and the computer to do so, but your windows manager causes an issue when you try to do it, it is not a hardware issue, nor a human issue. It’s a bug.
Proper-Couple-5053 | 3 hours ago
Good try but wasting your time here my fellow French citizen. The way the French see the economy and politics is completely absurd for most other countries. Most countries are still completely enslaved to capitalism and can’t comprehend that, actually, you can enjoy life, have rights, not work 60h a week and have a decent situation. Fighting for your rights and quality of life? Heck what the fuck is that, we must be glad and thankful for the mighty billionaires and corps for giving us sugar and minimum living wages.
johnJanez | an hour ago
>There are enough resources for what the french public wants.
Replace my money question with resources. Where are these resources? To provide social benefits and pensions for people who don't produce, those that produce need to produce enough in excess. Do they? The math doesn't seem to math, thats the core issue i am asking you about. This is not a vibes thing, it's purely math when you strip it down.
Apary | 17 minutes ago
I don’t think you truly understand how much excess there is.
First of all, your notion that work is production is pure ideology. Work includes a lot of non-productive activity, and non-work includes a lot of productive activity. "Production" is a neoliberal copout. If by production you include goods and services that help people survive and thrive, which is the main definition meaningful here, volunteer paramedics (the standard in France) produce more helpful services than telemarketers, who are actually a net detriment to society. Yet only the latter "works" in the neoliberal sense. People who receive pensions and don’t work often produce more than the workers who pay their pensions. So, already, you have demonstrated the ideological axioms that underpin everything you think of.
Anyway, this put aside, we do overproduce food and have an excess of shelters in France. We do also overproduce energy. And we did overproduce health with the best health system according to the WHO before neoliberalism gutted it and made it more expensive. In fact, we:
In short, we have the resources necessary to house, feed, supply energy to and equip everyone, and more, without any further strain on our logistics.
There is enough production and enough wealth. We have so much we waste it, sometimes purposely.
The idea that there’s "not enough money" is pure, unadulterated ideology. Neoliberals would simply rather leave a dwelling vacant because it’s practical for London City traders to have liquidity on the French real estate market than to let older people have a roof over their heads without breaking their backs. This is an ideological decision. It’s a preference. There is no "realism".
Shaunur | 5 hours ago
I'm so fed up with the "realist" argument. Any politician using it should automatically be ignored and discarded. It's basically saying that the political power is powerless against the economical power. I don't understand how anyone can vote to give political responsibilities to someone who thinks that politics are powerless.
And I'd have no problem with them having different economic ideas from my own, if they'd use sound arguments to defend them. But no, it's always the same shit about "realism", "pragmatism" and "there is no alternative".
Far-Telephone-7432 | 5 hours ago
The centrist "pragmatism" is all about bending over for the private lenders. It's financial enslavement through debt accumulation. The total opposite of politics.
doubagilga | 3 hours ago
“I’m so fed up with what’s real”
Yes, we know. Some of us still choose to live in the reality you reject.
Shaunur | 2 hours ago
You seem to have understanding issues. I'm fed up with politicians acting like they have no power over the economy and that the way things are right now that only benefit a very small minority is the only "reasonable" way. They are entitled to their opinion, I just want them to defend it without saying "I'm the voice of reason and everyone who disagrees is a fool". Especially in a domain such as the economy where different schools exist and there is no scientific consensus. Which is exactly what you're doing here, by the way.
Jaded-Ad-960 | 6 hours ago
Lmao, it's the same in Germany. The government reduces taxes on the rich and businesses, then there is less money in the budget and the media discusses it as if one didn't have to do with the other and call for reduced spending.
Limp_Classroom_2645 | 5 hours ago
Nice framing in the title lol, but ignorant at best and straight up misleading at worst, especially for someone who actually lives in France.
The neoliberal president gutting this country at the behest of western capital and large corporations, destroying the public services to privatize everything without offering anything in return to the middle class, in fact putting even more burden on them instead is the actual reality.
Energy prices that already very high keep increasing, basic necessities are not affordable, public services are dead, social safety nets are removed, no job good opportunities, young people are struggling to even get an interview let alone find a job, public education and health services in the shitter, taxes on taxes, people struggling to make the ends meet living paycheck to paycheck, this is the actual reality.
Quintus_Cicero | 5 hours ago
Don’t bother, this sub is more used to eating outdated orthodox neolib bullshit than listening to what’s actually happening
HalfLoose7669 | 4 hours ago
You know, when the title starts this oriented, the propagande is really not subtle.
The left is coming with a real plan and the right doesn’t like it. Tale as old as capitalism.
Interesting-Cod6486 | 19 hours ago
I propose a annual elder kumate where at 75 we place them in weight categorys and have them each fight one other to the death. Do this annually should take care of the problem while increasing the physical health of the subjects. I know I would workout if that was coming up in a few years
ireliawantelo | 9 hours ago
I can do one even better.
Line up the entire adult population of France and kill 1% of the poorest every year. The 99% will see this, work their ass off to be not in that 1%.
Boom. Problem fixed. No more poors.
pallialli | 16 hours ago
That's just incredibly cruel and ridiculous. A much better system would be like Inuit culture, where, when people reach a certain age they are celebrated before then volunteering to take their final journey, alone, by walking out into the vast snowfields.
Interesting-Cod6486 | 15 hours ago
Clearly but it would be a cool movie like the hunger games but more shattered hips
laz10 | 11 hours ago
Yes Macron has passed huge tax cuts for the wealthy, removed wealth tax and lowered company taxes, since he's been in office but the "economic reality" is that your pension has to go. The pension you spend your entire working life paying tax into.
The "reality" is always a choice. Someone chose to make life easier for Arnault and harder for you. And then here come the 'economists' to pretend further inequality is the solution. More spending funneled to the wealthy and less to the worker, that'll fix it.
GawainEnjoyer | 11 hours ago
The pension is pay as you go. There is no saved pension pot. Whilst I agree that Macron is a buffoon, Frances PAYG pension system being unsustainable is solely a matter of demographic reality
viktorixbis | 10 hours ago
Only if you keep a fix pension, then yes an aging population will cause such a system to have a deficit. If you make this pay as you go system to work in a way that the ampunt of money distributed is aqual to the amount of money paid in by workers contributibg then there is no deficit, instead the adjustment is made by reducing the pensions when less money comes in (you could reduce in higher proportion above a certain threshhold to make sure noone ends up starving)
TheMountainWhoDews | 11 hours ago
French wealth tax never worked and that makes your whole comment suspect. You can ignore reality but you cannot ignore the consequences of ignoring reality.
France is actually spending too much on its public sector, thats why theyre in this pickle. Reducing govt spending is the only way out, there is simply no one left to tax for your plans.
Junior_Abalone_8006 | 10 hours ago
Yep. Most of the countries of Europe that instituted a wealth tax retracted it later as it became clear that the government ended up with less money than it would if it had no wealth tax at all.
AncientUnit2249 | 10 hours ago
Because they had tax loopholes and most could simply avoid paying taxes.
This is like getting a medical prescription, never taking the medicine, and complaining that the prescription was bad.
[OP] laxnut90 | 4 hours ago
The "loophole" was usually the wealthy leaving for a different country.
That is very easy to do in the EU.
AncientUnit2249 | 3 hours ago
That's capital flight. It happens, but this is generally not the case because governments deliberately leave loopholes in their tax codes.
MidnightSensitive996 | 47 minutes ago
The French wealth tax was abandoned like Denmark's bc it was causing capital flight and decreased tax revenue and growth. Norway is trying to keep its wealth tax by passing an east-German style exit tax on people leaving but by then the wealthy had mostly already moved.
OliveiraJourney | 9 hours ago
Not really, this is an open claim without any proof. Care to post anything that substantiates your claim?
CluelessExxpat | 7 hours ago
He doesn't have to post anything.
If you levy a tax on something but end up collecting less tax than before, thats the natural conclusion.
AncientUnit2249 | 3 hours ago
In fact, tax loopholes are the only major cause of low tax revenue in developed economies with sufficient evidence. You are welcome to look it up yourself.
Last-Towel1002 | 7 hours ago
Un rapport récent de la Cour des Comptes, organisme officiel de l'administration française qui vérifie les dépenses, a montré que 22B€ prélevé de taxes diverses n'ont JAMAIS reversé à la protection sociale ( Sécurité Sociale) qui est en déficit de 9 à 11B€.
Le système français pourrait être en positif si l'État ne détournait pas les taxes .
En encore un service publique n'est pas censé faire de bénéfices mais plutôt être à l'équilibre. On pourrait théoriquement redistribuer les 11B€ excédentaires ou diminuer les prélèvements.
AbilitySpecial8129 | 6 hours ago
Taxes are being more and more used to pay off the debt, not on public services. Those are being forced to do more with less and less.
kewn-hunter1506 | 9 hours ago
That’s the thing that sucks about European social nets in general… it tends to just be the professional classes getting taxed into the ground to support the working classes…
Meanwhile the wealthy get off Scot free
[OP] laxnut90 | 4 hours ago
The wealthy just move to a different country without the tax.
It is very easy to do, especially in the EU.
augustus331 | 8 hours ago
France’s problem isn’t tax cuts for the rich. It’s the retirement system.
The French people have shown poor judgement on policy where every little necessary inconvenience is met with riots. I wouldn't care if they run their public finances into the ground by letting anyone retire at age 38 but Paris will be looking at Brussels to bail them out when push comes to shove.
And when that happens, I know who will be paying the bill: countries that don’t overspend.
AnyTower224 | 10 hours ago
Thank you
FishAmazing929 | 7 hours ago
Not economists. Medias
AbilitySpecial8129 | 6 hours ago
His predecessors doing the same for years, distributing public subsidies left and right to undeserving private companies (under the unfulfilled promise of economic growth and new jobs) and selling out the very lucrative highways (funded with taxpayer money) to the private sector didn't help.
le_penseur_intuitif | 20 hours ago
Plus d’austérité mènera à plus de récession et ne fera qu’accentuer le problème, c’est un cercle vicieux. Le problème n’est pas une question de dépense publique, c’est une question d’inégalités 👇
Dette publique : pourquoi l’austérité échouera tant que les inégalités persistent https://elucid.media/economie/dette-publique-pourquoi-l-austerite-echouera-tant-que-les-inegalites-persistent
Heavy_Cobbler_8931 | 20 hours ago
But then how is it possible that France already has one of the highest tax revenues per unit of GDP and still faces such a massive fiscal crisis? I get the inequality issues but those go to who pays. Not how much is being paid. There is a problem with the latter
le_penseur_intuitif | 19 hours ago
La France est un des pays où les prélèvements obligatoires sont les plus élevés au monde mais dans les prélèvements obligatoires il y a beaucoup de transferts, c’est de l’argent qui est redistribué, ce ne sont pas réellement des dépenses. La part de la dépense publique dans la valeur ajoutée est autour de 20% du PIB, dans la moyenne européenne. Le fait qu’il y ait plus de transferts qu’ailleurs est dû au modèle social. L’assurance maladie est publique contrairement à d’autres pays. Mais ça ne rend pas le système moins efficace pour autant. Aux Etats Unis la dépense de santé moyenne par habitant est deux fois plus élevée qu’en France et l’espérance de vie est pourtant plus faible ….
Et la France est aussi un des pays qui distribue le plus de dividendes monde…
philthewiz | 18 hours ago
C'est néolibéraux ne feront jamais ce calcul dans leur feuille Excel.
Il ne considèrent pas les services et les transferts dans le calcul.
Juste des chiffres sans humains dans l'équation.
TheYoungCPA | 15 hours ago
Humans can be in the equation all you want.
France can’t print its way out of this. Fiscal policy and taxation have limits.
philthewiz | 15 hours ago
On comprend que tu baisses les bras devant les riches encore.
Designer_Object_9202 | 20 hours ago
As the old saying goes "you can't tax yourself into prosperity" government needs to tighten their belt and get the economy fired up with private capital
AK_Panda | 19 hours ago
I'd argue every economy taxes it's way into prosperity. It's how the productive infrastructure gets built, how investment in human capital is funded, how rule of law is established and maintained etc.
No-Journalist-9036 | 20 hours ago
How should French govt approach this problem? Seems like they're between a rock and hard place
le_penseur_intuitif | 19 hours ago
La Cour des Comptes elle-même affirme que les allègements fiscaux mis en place par Macron et qui ont bénéficié aux ménages les plus aisés ont contribué à creuser la dette.
Il faut d’abord revenir sur ces avantages qui n’ont pas montré leur efficacité. Et ensuite il faut des signaux forts en terme de justice sociale pour apaiser le pays et retrouver la cohésion. C’est la condition nécessaire pour pouvoir entamer d’autres réformes qui permettront d’avoir une trajectoire cohérente sur la dette
mattjouff | 20 hours ago
Tu as raison. Il faut tout taxer à 90%. Plus de tax = plus d’égalité.
le_penseur_intuitif | 19 hours ago
Ce n’est pas une question de niveau de taxe c’est une question de répartition des taxes. D’où le débat sur la taxe Zucman en France car c’est un des pays où les milliardaires sont le moins taxés.
Dobby068 | 19 hours ago
Tax distribution ? Not that I care about billionaires but this narrative is used by the government to punish the people that work hard and are successful and reward the ones at the opposite end of this scale.
When more than half do not pay any income taxes (see below) you need to acknowledge that this system is not sustainable.
Income Tax (L'impôt sur le revenu):
The rich pay most of it. The top 10% of earners in France pay roughly 70% to 74% of all income tax collected. Roughly 55% of French households do not pay any income tax at all, as the system features progressive brackets starting with a tax-free threshold.
le_penseur_intuitif | 19 hours ago
Il n’y a pas que l’impôt sur le revenu. Il y a aussi la TVA, les cotisations sociales, etc. Si on prend en compte tous les prélèvements le 2e décile des revenus est prélevé à 71,5% alors que le 10e décile est prélevé à 58,9% (source INSEE 2023).
Et pour le 1% des plus riches ça tombe encore. On est à 30% environ.
No_Distribution3205 | 4 hours ago
What is the way out for America to escape this reality as well? Let’s face it, we’re only surviving on massive government deficits and debt because we own the world financial system. At some point we will be in the same position unless drastic change is made. Raising taxes, cutting healthcare costs, decreasing defence spending, increasing retirement age are the main levers to rebalance but all will be extremely unpopular and lead political death for those politicians that implement them. Yes l, we have stopped racism but let’s be realistic that the next few decades will be tough.
ftrx | 18 hours ago
Honestly... People revolt because they've been impoverished, but they can't say by what; they don't really know who their enemy is, and they aren't actually asking for anything realistic or sensible. Most people don't even know what money is. Ask the people you know, "Where is money created?" and only a few per cent will say that, for the vast majority of it, it comes from private bank lending. Most think it's something immutable, dating back to the dawn of time, that is merely passed from hand to hand. They don't understand the concept of money being created and destroyed. Even if, by chance, they've read Foucault, the idea of money as a social relation rather than a thing hasn't got into their heads at all.
They don't understand that taxes are theft as long as money isn't legal money, and that taxes therefore destroy stock. You can get them to read Georg Knapp and Stephanie Kelton, and they'll still never understand.
They want prosperity, but don't understand that achieving it requires evolution and, first and foremost, eliminating the Moloch that extracts wealth from the many. If you talk about a New Deal, achievable only by building anew, and therefore by de-urbanising, starting with remote working to make it possible, turning Hayek on his head and rediscovering distributism, they look at you like you're an alien. They can't imagine a different world, just as they can't imagine what work looks like today, as opposed to work in the twentieth-century factory.
It's the middle class that ought to be leading the way, but even though it still exists in terms of income, it no longer exists culturally, so it can't lead. The very few who could do so are too few to make up a mass large enough even to reach that empirical 3.5% said to be sufficient to trigger change.
OrangeJr36 | 17 hours ago
Ah yes, France should use MMT nonsense so they can be as successful as the Chavistas in Venezuela or the Peronists in Argentina.
What's their massive debt compared to the 200% inflation they could be having!
oulipo | 20 hours ago
There's nothing about "fiscal reality". It's about (or rather, not) letting neo-liberalism and "debt notation agencies" rule the lives of people.
If americans want to fuck their own country, let them. We won't allow that in France
EagleNait | 20 hours ago
A third of my salary goes into pensions and pensions alone.
akade19961 | 20 hours ago
Yeah, and even that isn’t enough, you guys have to cover the about 40% of pensions that aren’t covered by taking a third of everyone’s salary by cutting things like education and infrastructure spending and police, plus racking up annual debt
They’d need about 2/3rds of your and everyone else’s annual salary to pay fully for pensions without cutting other spending or taking on debt. And that ratio will get worse with time as France is currently getting older
Last_Suggestion_8647 | 9 hours ago
>They’d need about 2/3rds of your and everyone else’s annual salary to pay fully for pensions without cutting other spending or taking on debt
Then maybe they should cut the pension in half or to a third.
alexanderdegrote | 20 hours ago
Because your system is stupid with a age of retirement that is way to low and with no saving in a retirement fund
Vega3gx | 20 hours ago
How dare the people who's money we want to borrow worry about getting paid back
ThroawayJimilyJones | 20 hours ago
Ok. But you know you still have to pay your debt right?
oulipo | 19 hours ago
States "roll" their debt. Get some education on economics. All states routinely repay their debt by taking on more debt.
The issue is not debt in itself. It's what you're investing in with the debt you're taking
Euiop741852 | 20 hours ago
And what economists are saying is that the French not allowing that is simply becoming a bankrupt state, the next Argentina in waiting, where constant inflation due to government over-spend and firing up the money printer occurs
TheMagicalLawnGnome | 19 hours ago
It's honestly even worse than Argentina, potentially.
Argentina printed its own currency. It could therefore exercise complete control over its monetary policy.
While its usually a brutal process, countries can inflate their currency to mitigate debt obligations. It's far from ideal, but at least it's an option.
France can't even do that — it can't just start pumping out Euros; it's a shared currency, and other Eurozone countries presumably won't allow it, for obvious reasons.
So unlike countries with their own currency, France can, theoretically, run out of money in a literal sense.
That's basically impossible in most other nations; they might experience rampant inflation, but the country can continue printing money as it wishes, they don't actually run out of money, in the technical sense.
This is the inherent problem with the Euro. A common currency can offer many benefits when things are going well, but can become highly problematic during a fiscal crisis.
oulipo | 19 hours ago
Except the level of interests payment in the US is much higher than France. So you're saying US is closer to being the next Argentina than France?
Euiop741852 | 19 hours ago
The US hasn't yet defaulted, which you seem to advocate for France? So when you default like Argentina, you end up with Argentinian rates, which the US won't have, the initial statement is accurate - "First, many countries have defaulted on their debt in the past. That's part of what makes a debt risky, and why investors ask for interest." your comment, not mine
oulipo | 19 hours ago
Neither has France. In state parlance, "defaulting on the debt" is called "debt restructuring". It has happened times and times again in the US
Euiop741852 | 19 hours ago
But for debt restructuring, you have to give lenders faith that you have the ability to repay, which as current situation goes, with your govt running pernicious deficits for decades in a row, that doesn't seem possible
oulipo | 19 hours ago
Name me one country which doesn't have more debt than income? 🤣
Lenders get faith because central banks vouch for the countries
Euiop741852 | 19 hours ago
Most countries don't have debt > income, especially since France seems to be one of the special ones running deficits, name one other country that has run deficits for decades other than France?
But as for your request, simply google for countries with debt < 100% of GDP, see how unique France is in its financial irresponsibility
oulipo | 6 hours ago
Most countries do have debt > income. Cite me a single country that doesn't run a deficit
Euiop741852 | 5 hours ago
|1|Tuvalu|+31.6%|-3.4%| |:-|:-|:-|:-| |2|Kuwait|+28.4%|+26.0%| |3|Norway|+9.3%|+12.8%| |4|United Arab Emirates|+5.2%|+6.4%| |5|Tonga|+4.9%|+3.6%| |6|Samoa|+4.7%|+9.3%| |7|Macao SAR|+4.5%|+7.0%| |8|Singapore|+4.2%|+3.8%| |9|Nauru|+3.5%|+28.9%| |10|Andorra|+3.5%|+2.8%| |11|South Sudan|+3.5%|+11.5%| |12|Lebanon|+3.3%|+0.4%| |13|Antigua and Barbuda|+3.1%|+1.6%| |14|Cyprus|+3.0%|+4.1%| |15|Denmark|+2.9%|+4.5%| |16|Liechtenstein|+2.8%|+3.0%| |17|Azerbaijan|+2.6%|+4.1%| |18|Lesotho|+2.2%|+8.2%| |19|Nicaragua|+2.1%|+2.3%| |20|Aruba|+1.9%|+3.7%|
I'll cite you the list above, 20 countries, how about that?
Euiop741852 | 5 hours ago
In fact, even your EU neighbours do that far better than you
TheMagicalLawnGnome | 19 hours ago
The thing is... it's not up to the French people.
That's the problem when an economy becomes unable to service its debt.
France is borrowing money, to pay for its operating costs.
That money comes from somewhere/someone else.
If people stop lending the French government money, it will simply run out of funds.
And unlike a nation that prints its own currency, France can't try to inflate its way out of debt / otherwise attempt to solve this via monetary policy (which is a difficult path to take, regardless).
So when the French people say "they won't stand for these cuts," that's all well and good, but ultimately doesn't matter.
If France continues to borrow without making significant budget adjustments, it will simply postpone an inevitable shortfall.
If France defaults on its debt, it will run out funds pretty much immediately.
The problem with France is that it has low growth, high debt, and incomplete control over its currency.
You can't have all three of those things, without running into problems.
The US, for example, also has large deficits. But while those deficits are certainly problematic, the United States has much higher growth, and prints its own currency. The high growth generates the revenue needed to service its debt, while monetary policy can provide useful tools in helping to manage its sovereign debt. That doesn't mean the US isn't facing problems — but it's in a much better position to deal with those problems.
France is basically like an airplane that's failed to take off, and is running out of runway.
It can either slam on the brakes now, and cause a lot of passenger discomfort, or it can keep barreling forward until it crashes off the runway and kills most of the people on board.
Neither option is good, but the first one is far better than the second.
I feel for the French people — the situation isn't good for them. But there's a reason most of the world doesn't offer the types of benefits and policies France has; it's very difficult to structure an economy that way.
oulipo | 19 hours ago
France is giving an estimated 210 Billion euros yearly to its companies through various subsidies / grants / helps. The youth in the street is asking for 10 Billion in order to have decent schooling.
The "fiscal presents" made by Macron to the richest people and companies over 10 years are estimated to have "cost" around 900 Billion euros to the state.
So it's absolutely not an issue of "France not being able to repay its debt". It's about what is the target of the funds that have been received through the debt
Please, please, please do some Econ 101 before writing such stupidities as your message
Euiop741852 | 18 hours ago
Econ 101 seems to be anathema to what you're espousing, given you say you want high spending, no need to consider debt, it's just a number
oulipo | 6 hours ago
We want high spending in future-proof investments that are going to grow wealth over time. That's precisely what debt is about
Using debt to avoid increasing taxes and relying on a phantasy "trickle down economics" (what Republicans, Tatcher, Milei or Macron do) was never going to work
Euiop741852 | 6 hours ago
And what were these invaluable investments? I don't recall any beyond the fleet of nuclear reactors in the 70s
oulipo | an hour ago
Good investments are: proper education system (so people don't vote MAGA to give the reins of your country to Russia), good healthcare system (so people having cancer don't get instantly bankrupt), good and ecological transportation system (so prices of moving stuff and people around stay low), ecology (because once you fuck up the planet, what are you going to do? stay in your basement watching Netflix and eating popcorn all alone? the US is the only country where people are stupid enough to think that this is a "good life")
Mlenais | 20 hours ago
France is bankrupt and you cannot riot and loot that fact away.
press_Y | 20 hours ago
We’re doing much better than you, garçon
oulipo | 19 hours ago
Except you can (and many people do) get bankrupt just because you get sick in the US. It's just not possible in France
Steeltank33 | 8 hours ago
France is already F’ed lol
oulipo | 6 hours ago
I'd still rather live in France, with access to culture, healthcare, education, and good food, than in the US where you fight yourselves over $100 rebates for a TV during black Fridays and where the culmination of gastronomy is the hot dog 🤣
intronert | 18 hours ago
Can someone explain how this is not a Class problem? How have the taxes on the wealthy (who have most of the income and wealth) changed over the decades?
In addition, how is this not a Colonialism issue? Is “France in Africa” a net positive for France as a whole, or just the large French extractive companies?
Kaillens | 18 hours ago
- In 2019, corporate tax weighed less in France (2.2% of GDP) than the OECD average (3.3%),
Here are some change :
- In 2017, the wealth tax (ISF) was replaced by a tax on real estate only (IFI), and a single 30% rate was introduced on capital income, the French “flat tax.” France Stratégie estimated the cost of switching to the IFI at about €3.1 billion. In the end, the official evaluation committee found more dividends paid to households and fewer tax exiles, but could not conclude that the reform worked.
- In 2018, the CICE (Housing Taxe) tax credit was turned into a permanent cut in social contributions, so the state budget no longer paid for this tax gift: it was moved onto social security. Removing it for the richest 20% of households cost nearly €8 billion, 45% of the total cost.
- More than €200 billion of VAT comes in, but not all of it goes to the state budget, because part is transferred to social security to partly compensate the huge cuts in social contributions given to large groups.
- Local governments too: their own taxes on production (like the CVAE) were removed and replaced with a share of VAT.
- Macron wanted to remove the exit tax, created by Sarkozy to fight tax evasion. It brought the state €800 million in 2016. In the end it was heavily softened rather than abolished
- Tv licence fee brought in €3.7 billion and was replaced by a share of VAT.
- The governement has : taxes voted in committee that the government would throw out: a higher tax on financial transactions (which would have brought in €11 billion), a targeted universal tax on French citizens wherever they live (as the US does), and the return of the exit tax, plus the taxes on super-dividends and share buybacks, and the transport levy meant to stop public transport passes from going up.
- Give Billions to companies (You can said it's fine or not) but THEY NEVER LOOKED AT WHAT THEY INVESTED, THERE IS NO DOCUMENT, NO FOLLOW UP.
And some of theses companies have cut employee in france.
- Inflation: corporate tax reached €62 billion because some companies made very large profits and margins thanks to inflation.
Note : Modest household spends almost all its income on purchases, so it pays VAT on almost everything it earns. A rich household saves a large part of its income, and that saved part isn’t hit by VAT.