France's Fiasco In One Fine Chart

Tyler Durden's picture

Scanning the world, France ranks at or near the top in government transfers to households, vacation times and labor market rigidity, and at or near the bottom in hours worked per week, labor force participation rates and retirement age as a % of life expectancy. As JPMorgan's Michael Cembalest notes, France is a workers's utopia - which is expensive to maintain - and sure enough four out of four of its main economic indicators are accelerating lower since Hollande's 'Deluge' began.



JPMorgan's Michael Cembalest's full Eye-On-The-Market PDF Here.

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lineskis's picture

As for why France is doomed, here is a visual explanation:

If unclear, the charts show the hoops an entrepreneur has to jump into to sell a company he created in several european countries.

Zero Govt's picture

bloody shocking that French chart

when i opened a biz in France I was lucky enough to appoint a local MD capable of dealing with the mind-numbing red tape you get weekly, monthly and annually there. He said France was the last enclave in Europe of the Soviet bureaucracy and he wasn't kidding

CPL's picture

Try Brusells.  Easier getting tooth paste back in a tube.

Monedas's picture

The Socialist Souffle is collapsing into a cheesy goo !   

Zero Govt's picture

well the chartology doesn't blame Hollande to be accurate/fair, the ski-slope decline began while that clucking cock Sarkozy was flapping about in office

but uprate 'decline' to terminal decline now the Marxist is in office

bye bye France

lineskis's picture

Oh that's for sure. France did not wait for Hollande to dig the hole it's currently in.

Ratscam's picture

"rien ne vaz plus" as they say in the casino

Zola's picture

In France both UMP and PS are actually two socialist parties, not much difference.

Nothing To See Here's picture

Yup. You know how fucked into socialism a country is when a big statist like Sarkozy is considered a free market guy from the extreme right of the political spectrum...

OpenThePodBayDoorHAL's picture

Hey maybe a little counterpoint is in order. France has:

Less debt to GDP than the US;

Net trade surplus (versus US huge net trade deficits);

Same worker productivity per capita as the US;

The best health care system in the world, actually available and affordable;

University costs about $1500 bucks per year;

Retire at 60 (versus never in the US)

Fabulous quality of life & shorter work week.

In the US the socialist monies flow to the Military Welfare Complex, the Corporate Welfare Complex, the Prison Welfare Complex, the Banking Welfare France at least some of it flows to the People's Welfare Complex.

Ask GE, Microsoft, ATT, Verizon, Exxon why they paid little or no taxes despite huge profits and you'll understand the difference.


lineskis's picture

Ask Total how much taxes they pay in France... The French tax code is pretty much as bad as the IRS and corporations happily jump into all taxes loopholes...

JimBowie1958's picture

OTPBDH is also using static analysis.

Wonder what his statistics for France will look like in 2020 or even 2015.

ultraticum's picture

I hear the birth rates are doing real well in France too - but not of the formerly predominant race/creed.  Coming soon to La Republique: mandatory prayers to Allah 5X per day, and your women being treated like dogs.

ilovefreedom's picture

So what you're saying is in France, it's more better to become a CPA than a banker?

bank guy in Brussels's picture

The French 'social model' has indeed provided a wonderful life in France (and, by inspiration, much of the rest of Europe, including Belgium) for decades ...

But I wonder sometimes if François Hollande is not a 'Trojan horse' to try to finally destroy the French and European positive welfare system, in a way that Sarkozy never could

By being a man to talk Left and then sabotage everything with policies anticipated to greatly damage and ruin the French economy ... So perhaps to bankrupt France and destroy the 'social model' all in a stroke from the Left instead of from the Right

Ultimately what the banksters hate the most, is our good life here in north-west Continental Europe ... essentially zero poverty among legal residents, because we mix a decent quasi-market economy with a rational, sustainable social-benefit system

We have proven this works, it is the best system in the world, we have lived in paradise, effectively, for decades here

But the oligarchs want to crash our system ... excessive, un-necessary debt loads, often expanded quickly to bail out banks ... our long history of sloppy immigration policies, to over-burden the social system ... and now, Leftist policies that are so extremist they may bring down the system quickly

OpenThePodBayDoorHAL's picture

So Hollande is kind of like Obama then. If the guy from the "Left" is the one expanding the domestic spying, bailing out the bankers, ramping up drone bombing, protecting financial fraud criminals from jailtime...then the "Left" can't complain about it

rosethorn's picture

Time to take those French language tapes seriously.

disabledvet's picture

Thank God America invented the euro then...

Hedgetard55's picture

"University costs about $1500 bucks per year;'


     That statement right there tells me you are a shit for brains moron left turd cocksucker who knows shit about real costs.

QQQBall's picture

My son (Merikan) went to B-school in France for grad skool. $8000 Euros after partial scholarship

OpenThePodBayDoorHAL's picture

Sorry pal, I went to university in France so I happen to know. Did you? And I guess your point is that US university is so much cheaper than France?

And sorry, I have never ever had a glans penis anywhere near my mouth

piliage's picture

>Same worker productivity per capita as the US

Given the insane labour costs (for every one euro you put in someone's pocket in wages, you need to pay two to the government) AND the fact when you want to get rid of someone you need to pay them, in many cases, years of net salary, the absolute last thing you do in France is hire a human being. You will employ every last machine, computer, supply chain trick you can. I'm amazed that the US is a productive as it is given the fleet of people you see working at a Starbucks at minimum wage. In addition, roughly 20% of France's 'productivity' is actually off the books to avoid VAT, so much of the economic activity that does occur is credited to official labour pools boosting 'official' productivity.

>University costs about $1500 bucks per year

Less the 55% in taxes you pay to support it, right? It costs you $1500 at the time you use the university, but then you pay for it the rest of your life in taxes. In fact, you are seeing France's university slide backward in international rankings, and with the exception of INSEAD, they are not competing well. France's universities, just like everything else, are dictated by Paris politics, and this is grinding university reform to a halt. You don't have innovation driven by universities like you do in the US, UK, Sweden, Belgium (Flanders actually) and Switzerland. Plus the new law that increases capital gains to 66% is seeing an exodus of VC money that had grown under Chirac and Sarkozy to support growth in biotech. Essentially, Hollande has just killed the future golden goose for 'class warfare'

>Ask GE, Microsoft, ATT, Verizon, Exxon why they paid little or no taxes

They didn't pay taxes in the US, as they already paid taxes in the regions where they operated. Microsoft alone is sitting on $50 Billion, and if they bring that money back to the US, Uncle Sam slams them with a 39% corporate tax on it. Siemens pays once on its income internationally and German corporate taxes are only 15%. So, before you spout off on US corporations evil tax strategy, perhaps you should consider the brain-numbingly stoopid US policies that cause companies to act in such a way.  Do you think MS wants to sit on $50 billion outside the US that is doing nothing but losing long term value? Hell no. That is why they spent 7 billion on Skype in Luxembourg, to use the cash on something that could drive a return away from US corporate taxes.

Hollande is fucking French investors and entrepreneurs with his shiny new 66% capital gains rate and 75% 'rich' tax. Good luck with that long term, as they are all picking up stakes and moving to Switzerland, Singapore, Belgium (no capital gains - ironically given personal taxes), and London. The French government is taxing future productivity and innovation, which was already swirling the drain in France, completely out of existence. Have fun with that pal, and viva la France...


Abraxas's picture

And free-market fascists are naturally good guys, right? Boy, did they manage to confuse the hell out of us, that we fight against what's good for us, and embrace what's sucking our blood. And, all should know by now who THEY are. Francis Soyer here (sorry if misspelled) knows it, for one. So, if you were indoctrinated under "Milton is a god" mantra, it's not too late to wake up. Read Naomi Klein's "Shock Doctrine" and things will start hitting home.

akak's picture

I wonder if you can see the irony, and the fundamental contradiction, in your label of "free market fascists".

Abraxas's picture

No contradiction. Read the book and we'll talk.

By the way, I agree with most of your comments here akak; obviously, not when it comes to this ideology of robbing the poor in order to enrich the rich.

Monedas's picture

France .... some of the best Chinese food outside of China !

Zero Govt's picture

Abraxas  -   Naomi Klein's "Shock Doctrine" is garbage. She comes out with none-stop crap like Tianamon Square was protest against the Chinese Commies opening up to market economics. 

She's so wrong she must be a prodige/student of Prof. '100% Wrong 100% of the Time' Krugman

Abraxas's picture

And to think that I +1 you for your earlier comment... I'm going immediately to reverse it to junk!

Just kidding!

You have the right to your own opinion, of course, but I wouldn't call Naomi's work garbage, as she's done some good research there and exposed how Chicago Boyz use crises to rape and pillage. Do you disagree with the rest of the book, Chile, Indonesia, Peru, Russia, etc?

EscapeKey's picture

chile? she starts off by talking about "pinochet's hyperinflation" conveniently ignoring that he was the one who tackled the hyperinflation which started under allende.

Nothing To See Here's picture

According to France's ideological stance, owners should work for their employees... That should work no??

Whoa Dammit's picture

Beats the hell out of our bankers utopia-which is also expensive to maintain.

Rainman's picture

heh...California unions of overpaid/overpensioned public employees could put these Frenchies to shame. It's expensive for Moonbeam to maintain them.....and Cali's business confidence chart looks as above.

jeff314's picture

Dans le cul la France...

et va chier Bernanke

Haus-Targaryen's picture


Monedas's picture

You know how fucked Europe is when Hitler was considered a right winger !  Fascism is right wing Socialism !

EscapeKey's picture

fascism is corporatism.

having said that, the german economics under hitletrr was best described as keynesian.

Bossuet's picture

Et de quelle utopie, les USA sont-elles le nom ?

Question subsidiaire : comment cela va-t-il chez vous ?

Monedas's picture

Go "Atendre" yourself !

Arthur's picture

No one starves.  Most have access to decent medical care

Very few are truely homeless unless the have mental issues.

But no one is getting a six week vacation nor retiring at 55 on a nice pension with the exception of government workers who put in their thirty years.

One of the best countries to be rich.

The best country if you want to become rich and keep your wealth.

A stellar country to be an immigrant entrepenuer.

Unlike France, when most Americans see a rich guy with a nice house on a hill we think either that will be mine one day or my kids.  In France, I seemed to think that most folks wanted to see the guy on the hill brought down.  Different mindset.

But your cheese still beats ours hands down and I prefer your wine, though those in Napa would disagree.


Sorry - my French sucks.

Nul ne crève de faim. La plupart ont accès à de bons soins médicaux très peu sont vraiment sans-abri à moins que les problèmes mentaux.

Mais il n'y a plus de six semaines de vacances ni leur retraite à 55 ans sur une belle pension à l'exception des travailleurs du gouvernement qui mettent dans leur trente ans. L'un des meilleurs pays de riches.

Le meilleur pays si vous voulez devenir riche et garder votre richesse. UN stellar pays d'être un immigrant entrepenuer.


Segestan's picture

Don't worry...France will bloom under multi-cult. Just have hope.   You'll see!!!!!

Monedas's picture

Socialism/Fascism (gov > 60% GDP)..................................Libertarianism (gov < 10% GDP) !

Peterus's picture

Government size is also what completely prohibits any chance of reform. Forget debt and unfunded liabilities, as huge problems as they are. Even with our current technology, high capital investment, great infrastructure putting a 60% hump of a burden on shrinking French private producers already pushes them to the limit. Now if you go in debt there is just no room to steal even more. How much will they take - 80%?

And all the social spending is almost never going to be lowered. It is guaranteed electoral defeat. Political suicide that no party will commit.

BTW your brackets work for our technological advancement. General rule would be for extreme Statism "gov > as much as humanly possible". In late Roman Empire it probably wasn't 60% and yet it was unsustainable high.

Monedas's picture

I'd rather have down arrows than no arrows .... no arrows means no one understood you !

neutrinoman's picture

What' coming for France isn't going to be pretty. Right now, with Belgium, it's treated as a "core" eurozone country, not too different from Germany. If Hollande keeps up what he's doing, France in a year or less will be more like Italy and facing much higher interest rates. In the later Chirac and Sarkozy years, the French had some relatively good growth. But its competitiveness is gone, which is why it's headed toward Italy.

itstippy's picture

France refused to join the Coallition Of The Willing, and thus missed out on all the lucrative Iraqi rebuilding contracts. 

brunoaa's picture

The Bond markets seems to think that France is a small Germany. In fact it is a big Italy!

gatorontheloose's picture

not sure how many can read french but the chart is actually not that complex.  this is about selling shares of your company.

retiring or håave retired?  startup co-owner?  share holder of 8+ years AND you re-invest 80% of your gains "in Europe" within 3 years?   You are excused from the table.  

Everyone else gets bent over it. 15% flat + 50-65% taxable as income tax.

luckylongshot's picture

The European Titanic long ago hit its iceberg and is sinking and the French are being this news?

Element's picture

Can't the frogs and the ECB just CONcoct a really big emergency carpet and sweep all that squiggly stuff under it?

It worked until now in the US, Japan and China.