Six Takeaway Lessons for Americans From Socialist Candidate Francois Hollande’s Victory in Sunday’s Election in France

Among them: What happens in Europe affects us, America's influence is on the decline

Growth beats austerity. “Austerity isn’t inevitable. My mission now is to give European construction a growth dimension,” Mr. Hollandesaid on election night. As other commentators have observed, the definition of austerity in Europe has become somewhat muddled. It has been taken to mean everything from an increase in the income tax rate to 50% (the not-so-genius idea of Britain’s Conservative Party prime minister, David Cameron) to genuinely needed trims in benefits for public employees and welfare beneficiaries. But the lesson for American politicians is nonetheless clear. Voters need to be able to hear a message about economic growth, not only about pain and burden-sharing and budget-cutting and entitlement reform.

You can’t tax and spend and divide your way to growth. Monday’s slump in French stock prices, rise in French bond yields, and drop in the Euro as measured against the dollar are all signs that the market has no confidence in either Mr. Hollande’s proposals or his tone. The proposals — hire 60,000 more government-employed teachers, raise taxes to 75% on anyone earning more than 1 million Euros a year, or about $1.3 million — amount to taxing and spending. They stem from an ideology that, for all the hopeful chatter in the press about Mr. Hollande’s supposed moderation, is a career politician’s hostility to private sector success. Frédéric Filloux wrote, “the new president claimed ‘[he] doesn’t like rich people’ (a few years ago, he assigned a threshold of wealth to the equivalent of $60,000 a year).” Good luck constructing a “growth dimension” with that attitude.

Voters punish conservatives who don’t deliver. As the Wall Street Journal put it in an editorial, “Mr. Sarkozy and his government responded by raising sales and capital-gains taxes, demonizing successful French businessmen, complaining that Germans work too hard, urging an international financial-transactions tax and trying to pin much of the blame for economic troubles on immigrants.” Bloomberg Businessweek reports on a survey it said “showed that 73 percent of Hollande voters supported him because they wanted to punish Sarkozy. Only 44 percent said they agreed with the Socialist candidate’s ideas.” George H.W. Bush must be hoping that Sarkozy replaces him as every conservative columnist’s go-to example of a tax-raising, election-losing, supposedly right-of-center politician.

America’s influence is diminished. There was a moment, not all that long ago, when a Europe facing a financial crisis would look to America for leadership, or even a rescue. For better or worse, those days are past, as America’s own resources are sufficiently stretched or depleted that any serious effort by America to assist — not to bail out, but to assist — Europe would face formidable practical and political hurdles.

Europe affects us. Any American celebrating Europe’s woes on the grounds that it makes it less likely that that continent would emerge as a global rival to America is misguided. A Europe mired in socialism is likely to be a less healthy market for American exports, and a weak Europe drags down everything from America’s tourist economy to America’s retirement savings accounts. It’s an interconnected global economy we are part of, not a zero-sum competition. A lot of Americans are now employed by European companies, or by American companies that sell things to European consumers.

Culture and nationhood matter. For all the talk of how interconnected the global economy is and how the world is “flat,” France is still France, not some generic “Europe” or the West. For all the talk from Mitt Romney about how President Obama wants to turn America into a European-style social welfare state, America would never elect a self-proclaimed socialist who wants to increase taxes on the “rich” to 75% and who left the mother of his four children to go live with a twice-divorced journalist ten years his junior.

Right?

Ira Stoll is editor of FutureOfCapitalism.com and author of Samuel Adams: A Life.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • hk||

    Europe is fucked.

  • Aresen||

    Seriously.

    France may be in the running with Italy to be first to show that there is such a thing as "Too Big To Be Saved."

  • ||

    I notice the Quebecois have retained their Frog cousins' propensity for bucketfuckingly high tax rates.

  • Bucky||

    Mr. Hollande's re-opus

  • Fatty Bolger||

    Yes, that's my takeaway lesson.

  • R C Dean||

    OT:

    Reason, put an intern on this one, stat:

    Sen. Rand Paul (R-KY) and Rep. Paul Broun (R-GA) introduce The Freedom from Over-Criminalization and Unjust Seizures Act of 2012, S. 2062 and H.R. 417.

  • SIV||

    Those TEAM RED Fundamentalist Christian Anarchists want to disarm the brave bureaucrats of the National Oceanic and Atmospheric Administration!

  • cryptarchy||

    Germany better reintroduce the Deutschmark soon then

  • Paul.||

    You know what else Germany should reintroduce?

  • Bucky||

    a new wall...
    around the whole country...

  • cryptarchy||

    A kinder gentler way of mass extermination?

  • WWNGD?||

    The Shamwow?

  • ||

    You know what's better than Shamwow? It's the new sensation sweeping the Middle East: Shamkhwow!

  • Death Rock and Skull||

    The Dyke Chancellery would be a good name for a skinhead lesbian club. Just an observation.

  • Aresen||

    OK. Betting on France to be begging the US to help bail them out in 2 years (outlier range.)

  • ||

    Nonsense. California (America's Greece) will get first dibs on that. France doesn't elect the POTUS, you know.

  • Paul.||

    It's not entirely nonsense. There are plenty of international organizations, largely funded by the U.S. which could orchestrate a bailout.

    It's bailout by proxy. But it's still comin' outta your pocket.

  • ||

    I forgot that sarc tags, Paul. Sure the IMF or some other interested third party can cough some ducats, but I am not entirely sure that wouldn't set off the public. This administration will look out for fellow travelers, but which one gets priority is tough to game out.

  • Sevo||

    "Sure the IMF or some other interested third party can cough some ducats, but I am not entirely sure that wouldn't set off the public."

    Money laundering is only illegal if a private party does it.
    Pretty good bet that the IMF or WB could come up with billions that aren't *really* coming out of the US budget. Or at least the actual effect could be delayed long enough that it can blamed on Bush.

  • VG Zaytsev||

    Neither will CA in 2012.

    A republican president and congress are but fuckingly stupid if they bail out CA's government.

    And i say that as a resident of CA.

  • Bardas Phocas||

    People. People.
    We can bailout everyone.
    Ben is firing up the printers and pixelating the dollars as we speak.
    Wheelbarrows for everyone!

  • Jerry||

    Growth in European parlance means hiring government bureaucrats--who will do nothing all day--in order to solve the unemployment problem and make wealth appear automagically. And the GDP stats will show them right, because government production is by definition efficient.

  • Paul.||

  • wareagle||

    so he lacks the self-awareness to realize that most college and universities are creatures of the state, meaning price controls are a bit like the fox putting himself on a low-hen diet. Sure, self-discipline always works with bureaucracies that run on other people's money.

  • Sevo||

    "like the fox putting himself on a low-hen diet"
    I'm thieving that!

  • ||

    They cast their ballots, they knew what they were getting into. I say, let 'em crash.

  • Drake||

    So are the Germans going to get sick of their spendthrift economic allies and pull out of the Euro first? Or will the French, Spanish, and Greeks get sick of "austerity" first - and start printing Francs, Drachma, etc... just as fast as they can?

    This will be a fun staring contest to watch.

  • cryptarchy||

    Agreed, should we start a pool to see who prints what first?

  • R S||

    Dear Mr. Ira Stoll,

    It may be worth remarking upon the ethnic and religious dimensions of the French election. Namely, when we consider the electoral outcome we should bear in mind Sarkozy's Greek-Hungarian Jewish heritage vis-a-vis Hollande. It's not entirely surprising that a non-French Jew was given only a single term in office by the French public. Frankly, we would expect no less from any European country.

  • ||

    complaining that Germans work too hard

    They fought too hard, too.

    to go live with a twice-divorced journalist

    Who slaps colleagues for their perceived sexist remarks.

  • ||

    France elects a downright pinko, and we're supposed to give a fuck about how it all turns out?

    Every Frenchman who voted for this socialist shitstain can go fuck himself. When the shit hits the fan, you'll have nobody but your own dumb ass to blame.

    Congratulations, morons.

  • Registration At Last!||

    More profanity, please. It makes you sooo-ooo interesting and persuasive.

  • granite state destroyer||

    93% of French Muslims voted for Hollande. That vote gave Hollande the victory. Maybe the real lesson here is not to allow uncontrolled immigration of groups of people who don't share your national ideals.

  • Kreel Sarloo||

    In what way does Hollande not represent French national ideals?

  • Moogle||

    Ha! I see what you did there!

  • hk||

    Right only allow people that agree with you? I see what you did.

    But the correct answer is that private property owners determine who works for them, or who rents, or buys their homes, etc.

  • NotSure||

    I don't agree that Europe affects the world that much anymore. There are productive people and economies in Asia and emerging ones in other places as well. If the majority of Europeans want to embrace their sloth as a virtue, the world will go on and easily so as well.

  • mgd||

    Hollande: "I will raise taxes and increase government spending. Also, I don't like the rich."

    Obama: "Don't be like that."

    Hollande: "But but but..."

    Obama: "Do as I say, not as I do."

  • Neil||

    You've slightly slandered David Cameron here. It was his predecessor Gordon Brown (of the Labour Party) who put the top tax rate up to 50%. Cameron opted not to reduce it again in his first budget, because "tax cuts for the rich" just can't be the first thing a Conservative does when he gets into office. In the most recent budget, backed by the established fact that the increase to 50% did not in fact raise any extra revenue (Laffer curve conclusively proven!), he put it back to 45% - and was pilloried by the press anyway.

  • hk||

    He should have lowered everyone's taxes to about 20% at least.

    If not 10. ;)

  • JoshSN||

    The author of this article should look at a 1Y graph of the CAC 40, instead of relying on momentary jitters of the stock market to make a point.

  • Registration At Last!||

    I think what America can learn from France is that there are REAL socialists just as there are REAL Nazis and using those terms as epithets instead of descriptors is a net loss for political discourse.

  • hk||

    Disagree completely, Keynesian economics is Socialism.

    The Socialist Ex-President of Spain is very much like a Democrat.

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