Yesterday's post pointed out the parallel promises of Francios Hollande and those made by a 2008 U.S. candidate for President who also won. As the children sing on the school bus, "Same song, second verse; a little louder, a little worse."
From The Wall Street Journal:
Mr. Hollande will have a honeymoon but he should not expect it to be long. It will be that much shorter if he believes he can revive the economy based on his campaign promises.
There won't be enough French millionaires to tax at his proposed 75% rate to finance a government that already controls 56% of French GDP. [Hint for Hollande: call for fairness] Unlike Americans, French citizens can escape their national tax rates if they move elsewhere, so expect another wave of French tax migrants to London. [Hint for Hollande: blame Sarkozy]
France already has one of the highest overall tax burdens but continues to bleed red ink. Debt is 90% of GDP. [Hint for Hollande: claim that new programs will reduce debt, bu you can't let anyone read the details until they are implemented] Trillions in unfunded pension and retiree health-care obligations loom in the not-distant future. [Hint for Hollande: wait three years and say it is still Sarkozy's fault]
Mr. Hollande will also meet his match in German Chancellor Angela Merkel if he tries to follow through on his desire to rewrite Europe's fiscal pact. Mr. Hollande won in part because he stressed a "growth" agenda over "austerity." The problem is that he equates growth with greater government spending. [Hint for Hollande: claim it is working in the U.S. and repeat it until you get enough people to believe you] The real growth drivers would be labor, tax, pension and regulatory reform and a smaller French state. Mr. Hollande will not find the Germans any more willing to write eurobond blank checks to Europe's southern tier or to tolerate an inflationary European Central Bank simply because he won an election. [Hint for Hollande: hope that Obama is re-elected and has the "flexibility" to bail out a political soul mate]As written in The Economist:
Now for the hard part