Within his first six months in office, French President Hollande managed to raise national capital gains taxes from 34.5% to 62.2%, and now the French people are freaking-out. Juxtapose that with the hatred that American Golfer Phil Mickelson experienced when he acknowledged last month that, between federal and California state income taxes, he’s having “62, or 63%” of his earnings taken away each year, and the reality-check is even more striking. In short, the French apparently now believe that this level of taxation is a dangerous and destructive thing. In America, however, “rich guy” Phil Mickelson is a dangerous and destructive thing.
“People call this the ‘new normal.’ Let me assure you there is nothing normal about this at all. It’s the new ‘abnormal,’ and it won’t last, because as free people we won’t stand for it…”
With those remarks, business magnate and former presidential candidate Steve Forbes drew thunderous applause from his audience.
It was October of 2012, about 2 weeks before our last presidential election. Forbes was speaking to a crowd of 10,000 in the comforts of a beautiful indoor sporting area (the “Idaho Center”). He was headlining the “Power Up!” business and motivational seminar with Sarah Palin, Rudy Giuliani, and Zig Ziglar protégé Krish Dhanam (fyi-we need more native-born Americans to understand American liberty as well as this guy from India named “Krish” understands it).
Forbes had just finished explaining why a confluence of cheap credit, billions of dollars in stimulus spending, lots of new taxes on “rich people,” and a growing-by-the-second government debt have all failed to stimulate our economy. He was confirming with his technical explanation, what many of us instinctively know in our hearts: the reality that no organization- no individual or family, no business, no government – can spend its way out of debt and re-distribute its way to prosperity.
We should all hope that Forbes will be proven right – that, eventually, “as free people, we won’t stand for it.” Because in the election that occurred two weeks after Forbes’ speech, Americans didn’t merely “stand for it” – we asked for more of “it.”
Yet here is our reality: if Americans continue to vote (either blindly or intentionally) for politicians who viciously take expanding portions of wealth away from our society’s producers, and then selfishly redistribute that wealth to the people of their choosing, eventually the producers will stop producing as much wealth, the politicians will run out of other’s people’s money to redistribute, and we will all suffer the consequences.
The social disorder and collapse of Greece and Spain could be our future in the U.S., if, “as free people,” we don’t choose more wisely.
For those who have eyes to see and ears to hear, examples abound in this present day of how not to construct a national economy. Greece and Spain qualify, yes, and so does Venezuela. And within the last few months the news from France, another bureaucratic, debt-laden, and not-so-free-anymore part of the world, should be a wake-up call to Americans, as well.
After five years of service from President Nicolas Sarkozy, a leader who sought to reduce government controls of the economy and to stimulate private enterprise, French voters tossed him aside last May in favor of a presidential candidate who was nominated jointly by both the French Socialist Party, and France’s “Radical Left Party.” Francois Hollande campaigned with a set of 60 propositions – referred to as his “manifesto” – which included raising taxes on corporations; raising taxes on banks; raising taxes on “rich” individuals; lowering the official retirement age back down to age 60 from 62; hiring 60,000 new government school teachers; and establishing government subsidized “youth jobs programs” in regions of high unemployment (does any of this sound familiar?).
Today, many French citizens seem horrified that – shock! – President Hollande is doing precisely what he pledged to do. “The situation is very serious” noted Laurence Parisot, head of France’s largest labor union MEDEF in an interview with the London Telegraph. “Some business leaders are in a state of quasi-panic” he claimed, as the Telegraph reported that “France is sliding into a grave economic crisis and risks a full-blown ‘hurricane’ as investors flee rocketing tax rates.”
Within his first six months in office, French President Hollande managed to raise national capital gains taxes from 34.5% to 62.2%, and now the French people are freaking-out. Juxtapose that with the hatred that American Golfer Phil Mickelson experienced when he acknowledged last month that, between federal and California state income taxes, he’s having “62, or 63%” of his earnings taken away each year, and the reality-check is even more striking.
In short, the French apparently now believe that this level of taxation is a dangerous and destructive thing. In America, however, “rich guy” Phil Mickelson is a dangerous and destructive thing.
And consider this: Laurence Parisot, a major, national labor union leader (arguably a counterpart of Teamsters leader James P. Hoffa here in the U.S.) is upset because a Socialist President is taking more money from “the rich” and re-distributing it to others via government employment programs. Such policies would seem like a dream come true for the AFL-CIO, yet the union leader in France seems to understand that the “rich” in his country play a vital role in other people’s livelihoods, and simply seizing more of their money is harmful for everybody – even unionized workers.
The backlash that the Socialist President is enduring suggests that maybe the citizenry is waking up and facing reality. But are Americans facing economic reality yet?
We observed in the so-called “fiscal cliff negotiations” that President Obama’s political abilities to raise income and capital gains taxes are limited. And the suffering among lower and middle income Americans from the infliction of higher payroll taxes, and Obamacare taxes and penalties is so real that last week, even the New York Times had to report on it.
Let’s hope that Steve Forbes is right – that this is not our “new normal;” that we will reject politicians who are vicious with society’s wealth creators. It may, however, have to get much worse in America, before we embrace reality.