President Barack Hussein Obama and our friends on the left want to address our economic problems with ever higher taxes and yet more government spending. House Minority Leader Representative Nancy Pelosi (D-CA) said that “It is almost a false argument to say we have a spending problem,” a statement so looney that even the White House disagreed with it.
However, our friends across the Atlanitc have been good enough to provide us with an example of what policies like those the Democrats favor would do.
By William Horobin
PARIS—President François Hollande laid the groundwork Tuesday for lowering France’s growth forecasts as the state auditor warned the country will likely miss this year’s deficit targets, leaving the Socialist with a policy dilemma as he battles to rein in public finances.
France, the second-largest economy in the euro zone after Germany, has so far escaped recession and the depths of crisis seen in Southern Europe. But the country has posted little to no growth since April 2011. Unemployment is above 10% and rising.
“It’s pointless to present targets if they can’t be met,” Mr. Hollande said after a meeting with Luxembourg Prime Minister Jean-Claude Juncker. The French president said the government will “change [the growth forecasts] in the coming days if necessary.”
Mr. Hollande’s comments follow the publication of a report by France’s state auditor, the Cour des Comptes, that said the deficit-reduction targets were at significant risk because of the slowdown. The auditor said the government has depended too much on raising taxes in trying to balance its budget and needed to focus more on spending cuts. Taxes currently account for over 75% of the effort to bring the deficit down this year, the auditor said.
“After three years of using tax-revenue increases massively, the absolute priority can only be to increase efforts already begun to control spending,” said Didier Migaud, the head of the audit body.
More at the link. But the numbers are plain: France is on a path to not even achieve the paltry 0.8% growth rate which had been projected previously, with 0.3% growth the number which seems currently probable. Monsieur Hollande campaigned for office promising to bring the eurozone a new emphasis on what he saw as pro-growth policies and a rejection of austerity to get nations’ fiscal houses in order. Once in office, he and his Socialist Party jacked up taxes on the most productive Frenchmen, and snubbed the austerity policies that more sensible nations were putting in place, and then, thud! those policies have failed.
If they are failing in the Fifth Republic, why should we believe that higher-tax/ higher-spending policies would work any better in the United States? The answer, of course, is that they won’t, and the recently released figures showing that the United States’ economy actually contracted slightly during the fourth quarter of 2012,1 and total growth for 2012 was a paltry 1.5%. The policies of President Obama and the Democrats have never yielded anything anywhere close to the results the Democrats promised, and France has just shown us that going further in the socialist direction will not help, but will actually hurt.
- The preliminary figures stated that the economy contracted by 0.1%, but there are stories that the revised figures will indicate a small growth. ↩