An Economic View of France From Hollande
NEW YORK ( TheStreet) -- With the first round of French presidential elections slated this weekend, investors have speculated what a potential François Hollande victory would do to the global economy in his first year.
Hollande's proposal to increase taxes on France's highest income earners and his suggestion that the European Central Bank lend directly to states instead of banks have left investors unclear of how the Socialist Party candidate would govern.
|French Socialist Party candidate François Hollande|
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As French polls give Hollande a wide lead, 57% to 43%, over Sarkozy, we took a peek at what he's outlined for the French economy in his first year. The platforms (pulled from Hollande's Web site) are based on the assumption that the Socialist candidate would hold his lead and become president of France.
Hollande hopes to reduce his presidential pay and that of his cabinet members by 30%, which he would sign at their first meeting.
The prospective new president has also promised to lock in fuel prices for three months, and he has guaranteed above-inflation interest rates on tax-free savings accounts. Hollande's platform said he would enact these new policies to provide French consumers with more purchasing power.
France would withdraw its NATO troops from Afghanistan by late 2012. It would also repeal the circular Guéant on foreign students, which passed in January and made it more difficult for foreigners who had recently completed French university degrees to get jobs in the country.
Hollande has promised to return the retirement age to 60, down from 62. This stipulation would apply, at least in the first year, to those who started work early and paid all their annuities, according to the candidate's Web site.
Under a section labeled "Redresser le pays dans la justice," or, "rehabilitate the country in justice," the candidate wrote that he would submit by July or August a plan to parliament that would balance the budget by 2017. Also part of this section is the promise to eliminate tax loopholes, curb taxes on small- and medium-sized businesses, raise the solidarity tax on wealth to its previous level, and to create a 75% tax bracket on those who earn more than €1 million a year. Finally, Hollande has determined he would remove Sarkozy's value-added sales tax.