France is totally bankrupt. So says French Jobs Minister, Michel Sapin. Bruno Moschetto, professor of economics at the University of Paris added his own take on the French economy. He said: “The ability to tax citizens to death to bail out the state is hardly a reasonable measure of non bankruptcy.” “I suggest having to confiscate the wealth and savings of citizens to bail out the state is proof of bankruptcy.”
President Hollande has established a tax and spend policy, with taxes on the wealthy as much as 75%. He pledges to reduce the country’s deficit by 60 billion Euros and increase taxes by 20 billion Euros. The Euro countries are prohibited from printing money. This leaves the tax program as the only way to keep the economy afloat.
Recent numbers show that 3.35 million are out of work. This is 140,000 more than when President Hollande took office.
France last balanced its budget in 1973. State spending is 57% of GDP. Public debt is 91% of GDP. It is the high level of state spending for social programs that is creating budgetary shortfalls. French workers can retire at age 60, compared to Germany’s age 62.6. Yearly hours worked are 1,679, compared with Germany’s 1,904. French workers have 7 more vacation days per year that neighboring Germany.
Hollande’s policies have prompted wealthy French citizens to leave France, moving to Belgium, the UK and Switzerland to avoid high French taxes. Rumors are that former President Nicola Sarkozy is preparing to move to London. Prime Minister, David Cameron has said that he will “roll out the red carpet” to attract wealthy French people.
Now, here is a list of positives of the French economy. (Wikipedia).
-On a measure of economic freedom, France’s score is 63.5%. It is the 70th on monetary freedom, fiscal freedom and business freedom.
-France is the world’s 5th largest economy and the second biggest exporter in Europe.
-France has 31 of the 500 biggest corporations in the world.
-France is 5th in Fortune’s Global 500, behind USA, China, Japan and the UK.
-It is the most important location in the world for corporate headquarters.
-Here is a list of France’s number one in business:
AXA is one of the world’s largest insurance companies.
Air France is the world’s largest airline.
L’Oreal is the world’s largest cosmetic company.
LVMH and PPR are the world’s largest and second largest luxury products manufacturers.
GDF –Suez is the world’s largest energy company.
EDF is the world’s largest utility company.
Veolia Environmental is the world’s largest environmental service and water manufacturing company.
VINCI, Bouygues and Elffage are numbers 1,2 and 3 as the largest public works companies in the world.
Michelin is the world’s largest pneumatic leader.
LaFarge is the world’s largest cement company.
JC Decaux is the world’s largest outdoor ad company.
BNP Parabas, Credit Agricole and Societe Generale are the 1st, 6th and 8th biggest banks.
France is the second largest agricultural export economy.
French citizens are the least indebted in the world with only 10% of personal debt per household.
Returning to the statement: ”Is France totally bankrupt”, one must weigh all the data to form to a balanced opinion.