Monday, October 04, 2010

Us and Them

François Fillon
With the weather raging outside wild and woolly, it's an appropriate setting for the raging that's going on in the finances of the French state. If you can believe what was being said on tele last night, M6's Capital with special guest the Prime Minister François Fillon...

The French believe very strongly in democracy with one proviso, they must be allowed to demonstrate (and win) against arguments which attack their levels of comfort, and complain when others exercise that right and disrupt the lives of everyone else. French governments in the past have been very lilly-livered about doing the right thing and have caved in to demands which made no economic sense.

The result is that the national debt is soaring at stratospherically high levels and the country is living way beyond its means, and has been since the end of the 'trente glorieuses' when economic growth kept the coffers full and everyone happy.

So, belt-tightening all round is the order of the day. What does that mean? For the state: more taxes, reductions in spending, rationalisation of pensions.

According to François Fillon, it's only now that the off-shore tax-havens are being tackled. Previous socialist governments did nothing and in fact, one wonders why. They are such a potentially marvellous source of tax revenue it seems strange that such public spending enthusiasts didn't try and get their grubby paws on all that lovely lolly before. Of course, those in power have friends in high places and sometimes it doesn't do to bite the hand that feeds you, so maybe a convenient blind eye was turned in favour of party donations and political support... A well-known strategy.

Desperate situations however have the effect of concentrating the mind, something which is happening all over Europe. The state is going after tax cheats, and the programme last night showed us how. Unfortunately, those with financial means can afford the best evasive measures and pursuing the rich is a costly business, so, who does the state go after? Yes, got it in one, the little people. Anyone on a salary would be nuts to lie to the fisc nowadays as all income paid is declared by banks, employers, uncle Tom Cobbley and all. In fact all we have to do now with our tax returns is sign on the dotted line because the fisc has already filled everything in for us.

The self-employed are targets because of the opportunities of cheating the fisc by not declaring all cash transactions. Tax inspectors search for anomalies in income/spending and slam you with an inspection if something doesn't add up.

Elsewhere, the public sector is being trimmed down, with one out of two jobs not being filled upon retirement. Education is a particular target because its cost is higher than any other department. It seems that while the number of children has stabilised, the number of teachers being employed has shot up by a third. The government wants to bring back teacher numbers to the level of 2005. This means that specialists such as language teachers at primary level have not had their contracts renewed, and these subjects have been added to the primary teachers' workload.

Class numbers are closely monitored to rationalise teacher/pupil ratios, and supply teachers are having their schedules better organised. They are paid for 18hrs work a week, but often don't do more than 14. M Fillon doesn't consider this a rational use of their time and wants them to work the full 18, unsurprisingly. All it takes, he said, is organisation.Where there's a will...

The thorny pensions report made scary watching, and anyone with half a brain should see that a rise in retirement age is essential if pensions are to be sustainable. The trouble is though that certain sectors feel that they should not be included in the reforms and should keep their avantages acquis intact. These include people who start work at 18 or before, people who have physically strenuous jobs, train drivers, people with freckles, people with children, people without children, and everyone else. Hence the demonstrations this weekend. No one can count, no one can add up, and no one thinks any of it applies to them. Frankly, I'd rather be able to work longer and maintain a decent standard of living than be forced to live out of a plastic bag beneath the Pont du Gard.

I thought François Fillon did a good job explaining the situation. The journalist, as usual, was a pain in the butt interrupting and not letting him finish so it was sometimes difficult working out what was being said. The message was straightforward enough though. Things cannot continue as they have been; it will be tough, but it'll be worth it. If nothing is done, the country will simply go bankrupt and Greek-style disturbances, even civil war could break out.

The message from rational people is also pretty straightforward: we accept the cuts, but only if they apply to everyone, including the guys at the top. I'm not sure it's quite what Sarkozy has in mind, and it's that which will lose him the next election. Let's all suffer together, or no one suffer, but don't pick on us without picking on them too!


  1. Looks like Fillon is marking out his territory post Sarkozy.

    And have you seen Sarkozy's proposals to align French and German taxation practices? Bang goes the bouclier fiscal...we shall have Mme Bettencourt in the streets with a placard shortly.

    One measure which might be popular is to remove fiscal protection from donations to political parties...but that's unthinkable.

  2. Yes, I saw that. He also said that he has to make France an attractive place for the rich to stay living in cos they could just move elsewhere and then bang goes all their tax revenue.


  3. What tax revenue?

    Sorry, slap hand for being cynical...

  4. LOL, the (tiny) bit they don't send off-shore!!

  5. Great. I'm going to get double taxed, aren't I? The funny thing is, while everything spins out of control, only a few people can afford France. It's the same in the US. Real estate goes up, but salaries do not. The rise in retirement age is, IMHO, a long time coming - isn't the age in the US 64? Are Greece and Portugal the only problem? BAH. Anyways. don't mind me today. I'm cranky.

    even my word ver, fowlyph, sounds like foul lipped when said aloud.

  6. As far as I can make out, the whole of western Europe is in the debt doldrums.

    What happens down my way is that people retire from Paris with loadsa money from the sale of their house and push up the prices way beyond what people (like me) can afford on a salary. Same old same old.

    Then the village where I live got concerned that village life would die cos only old people could afford to live there, so the school would close, etc. so they built small cheaper houses which were partly snapped up by poorer folk from Paris retiring south. And I STILL can't afford to buy.

    Yer can't win!

    Funny how the wv is sometimes so apt.

  7. Exactly what happened to my husband's home town – La Ciotat. Once a small ship building port, now its residents can barely afford it b/c home prices were driven up by wealthy Northerners.

  8. I'm not surprised they want to come south. Heavens, I came south, but not with so much dosh I displaced the locals, not with tuppence ha'penny anyway... lol

  9. Well this is what happens when governments continue to spend more than they earn.
    The EUs budget is increasing next year if you can believe it.
    There are far too many layers of government at the centre that we do not want, need or can afford.

    France wants to remove more power from the local people and that is going the wrong way.
    Long live the Mayor.( if he/she is s good one)

  10. Johnny, many mayors worry about the lack of support from above because they are legally liable for a load of shit and can be sued personally when things go wrong.

    I think a balance is what's needed to give enough freedom to suit the good, but not enough to be abused by the bad.

    States should refuse to fuel the EU with more money at this time of penury. Do they not understand the concept of ENOUGH ALREADY!! :)


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