Sunday, December 29, 2013

New French 75% Tax... a disincentive to employees, or a strengthening of state power? Or both?

It was about a year ago... Francois Hollande's socialists were taken to court. The French Constitutional Council angrily struck down a law that would tax individuals 75% of their income above a certain amount. Hollande's Marxist core took a brief step back and puzzled on how to attack the wealthy. Not the wealthy independently this time, but employees.If a company paid their employees above a certain amount, Hollande would have the company taxed the 75%. His ingenious scheme has no parallel other than the Collins v Minister of Interior 1957 (1) SA 552 (A), which heralded apartheid by a similar such moving of semantics and maintenance of substance. The French Constitutional Council has validated this slightly different move that largely keeps substance.

The question must be asked then: won't such a move disincentivise French employees from working all the more to achieve a higher salary beyond a certain point? Will not the skills exodus from France increase by this taxing of those who work hard enough to earn that amount? How will something which contributes such a small amount to Gross Domestic Product but causes those wealthy enough and skilled enough to earn such an amount to leave France really benefit the people?

The simple answer is it won't by in large benefit the French people, but there are many examples in history of grand utilization to rely on.

When Apartheid came to dominate South African politics, Catholic schools lost their government funding. As a powerful force against disintegration, it was inevitable the church would be targeted. Communist China had university professors and the wealthy targeted and humiliated or dealt with in her early days. Stalinism took a similar approach.

The ancient Spartans ruled over a slave population. If a slave became too good at harvesting or too skilled, the Spartans would end the life of that slave with a knife in the night. It was an effective mechanism of control. A government or slave master who takes on the hardest working, most effective people, destroys the desire to be exceptional, and along with it most grand cultures in which competition to authoritarianism might covertly fester in an intelligent, or clandestine manner.

Zheng who would build the great wall of China and the Terracotta army, moved all the aristocratic families away from their fiefdoms into his capital in his Qin dynasty. It would fare him well as he taxed the Chinese to near extinction before his dynasty disappeared.

What better way to enforce socialism and the power of government than to disincentivise those who work the hardest for their companies, and cause them to either be taken down significantly, or move countries as many French entrepreneurial future leaders have?

People who make a lot of money are admired by others, listened to by others, unless they are demonised as many modern authoritarian regimes attempt to.

So why did the Spartans murder the best of their slaves? Mediocre workers are better than free workers to a slave-master. A mediocre worker does not challenge the slave-master. Even if one does, he is a mediocre worker, what does he know?

But, a successful hard working individual, a super-ultra-talent who warrants a massive salary... if they challenge the government? Well, the socialists demonise such a person, and when that is not enough they punish them for being exceptional, for not being the mediocre same that socialism requires of her adherents. When that is not enough, the socialist regime tries to take away the exceptional in the person by stealing their fruits of success. Driven by envy, others might relish in this taking down of the great. Others might believe the lies that those who work hard to etch out a future are the devil himself. The people on social welfare might be compared to angels... as they are in the modern world: the chief concern of the state.

Perhaps if instead of punishing ingenuity and expertise, governments such as in France were to incentivise such, the poor might be drawn out of poverty.

Unfortunately marxism creates the concept of inequality... that if the rich get richer it is a bad evil thing. Perhaps if rather than fighting inequality and making it in the best interest of exceptional individuals not to play the game, governments were to fight the real enemy of poverty with the aid of the exceptional... well then... perhaps there would be no place for Hollande's socialists to get votes...

Indeed, Hollande, France's least popular president has found a way to romanticise poverty... all as his economic incompetence insures all the more that France's poverty lines excel in expansion. Meanwhile those employees who are targeted for fulfilling expert work, shall likely find somewhere else to grace with the fruits of their labour, somewhere that values hard work, and those who conduct it and then spend their money from it in such a place.

This article originally appeared in the publication: Marc Evan Aupiais Professional, under the title: 'New French 75% Tax... a disincentive to employees, or a strengthening of state power?'.

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