- Mar 27, 2012
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For you folks who think Europe and its social democracy/democratic socialism is the way to go, you need to start paying attention.
Why? Because somebody is feeding you a line of bullshit. If you are naive enough to believe that Europe's democratic socialism is working, then you're naive enough to think it can work here, too.
The biggest exception to the 'rule' is Germany. And a couple of things..... Angela Merkel is ANYTHING but liberal and, well..... They're Germans. They almost made communism work fer chrissakes.
The article's link won't work. You'll run into a subscription wall. Go to the WSJ and C&P the headline into google and you should be able to pick it up without a problem.
The Wall Street Journal - Breaking News, Business, Financial and Economic News, World News & Video - Wall Street Journal - Wsj.com
S&P Cuts France's Credit Rating
PARISStandard & Poor's Ratings Services on Friday cut France's credit rating by one notch to AA, sharply criticizing President François Hollande's strategy for repairing the country's economy and saying he has little room for maneuver to fix its finances.
Protesters wearing red caps,
the symbol of protest in Brittany,
and with their regional flag,
watch as wooden crates burn at
a barricade held by French riot police,
during a demonstration to maintain jobs
in Quimper, France, on Nov. 2.
"We believe the French government's reforms to taxation, as well as to product, services, and labor markets, will not substantially raise France's medium-term growth prospects," S&P said. "Furthermore, we believe lower economic growth is constraining the government's ability to consolidate public finances."
S&P, which lowered France from double-A-plus, shifted its outlook for the rating to stable from negative. This implies the probability of an upgrade or a downgrade is below one in three.
S&P's decision comes as broader doubts take hold in France about Mr. Hollande's approach to rekindling economic growth through a series of incremental steps, instead of bold moves, to avoid sparking popular backlash. Recent unrest in the rural region of Brittany and widespread fatigue with higher taxes among both corporations and households, as well as a number of clashes between the president and members of his fragile majority in parliament, have exposed the limitations of his go-slow strategy.
S&P's action is the third downgrade of France by a major ratings agency since Mr. Hollande was elected in May 2012, and follows its decision to strip France's coveted triple-A rating in January 2012.
The downgrade comes at a critical juncture for Mr. Hollande as his government seeks to push a difficult budget through parliament.
The government says it has shifted to spending cuts for next year's budget in a battle to reduce the crisis-swollen deficit, but Paris is still relying on tax increases, building on the almost 30 billion ($40.26 billion) of hikes voted in the six months after Mr. Hollande took office in May 2012.
Government officials argued that taxation drags less on growth in the short term, but the economy failed to grow at all in 2012 and dropped into recession at the turn of the year before recovering in the second quarter. The tax-heavy policy hasn't delivered the results Mr. Hollande initially sought and the target of getting the deficit below 3% of economic output has already slipped from this year to 2015. Without further measures, the European Commission warned earlier this week that France will also miss that target with a deficit at 3.7% in 2015
Now even small tax increases slated for the 2014 budget have met with protest and pushed the government into a series of U-turns.
Combined with stubbornly high unemployment near 11%, the to-and-fro on taxation has deeply harmed the Socialist's president's popularity with a few months to go before local and European elections in the spring. Only 25% of French people are confident Mr. Hollande has what it takes to deal with the country's problems, according to a poll of 1,006 people by CSA this week. That marks the lowest score for a French president since the creation of CSA's monthly poll 20 years ago.
The political situation leaves the government with little room to raise taxes, S&P said. On the spending side, the agency said the government's current steps and future plans to cut spending will only have a modest impact, leaving the country with limited levers to reduce its deficit.
Why? Because somebody is feeding you a line of bullshit. If you are naive enough to believe that Europe's democratic socialism is working, then you're naive enough to think it can work here, too.
The biggest exception to the 'rule' is Germany. And a couple of things..... Angela Merkel is ANYTHING but liberal and, well..... They're Germans. They almost made communism work fer chrissakes.
The article's link won't work. You'll run into a subscription wall. Go to the WSJ and C&P the headline into google and you should be able to pick it up without a problem.
The Wall Street Journal - Breaking News, Business, Financial and Economic News, World News & Video - Wall Street Journal - Wsj.com
S&P Cuts France's Credit Rating
PARISStandard & Poor's Ratings Services on Friday cut France's credit rating by one notch to AA, sharply criticizing President François Hollande's strategy for repairing the country's economy and saying he has little room for maneuver to fix its finances.
Protesters wearing red caps,
the symbol of protest in Brittany,
and with their regional flag,
watch as wooden crates burn at
a barricade held by French riot police,
during a demonstration to maintain jobs
in Quimper, France, on Nov. 2.
"We believe the French government's reforms to taxation, as well as to product, services, and labor markets, will not substantially raise France's medium-term growth prospects," S&P said. "Furthermore, we believe lower economic growth is constraining the government's ability to consolidate public finances."
S&P, which lowered France from double-A-plus, shifted its outlook for the rating to stable from negative. This implies the probability of an upgrade or a downgrade is below one in three.
S&P's decision comes as broader doubts take hold in France about Mr. Hollande's approach to rekindling economic growth through a series of incremental steps, instead of bold moves, to avoid sparking popular backlash. Recent unrest in the rural region of Brittany and widespread fatigue with higher taxes among both corporations and households, as well as a number of clashes between the president and members of his fragile majority in parliament, have exposed the limitations of his go-slow strategy.
S&P's action is the third downgrade of France by a major ratings agency since Mr. Hollande was elected in May 2012, and follows its decision to strip France's coveted triple-A rating in January 2012.
The downgrade comes at a critical juncture for Mr. Hollande as his government seeks to push a difficult budget through parliament.
The government says it has shifted to spending cuts for next year's budget in a battle to reduce the crisis-swollen deficit, but Paris is still relying on tax increases, building on the almost 30 billion ($40.26 billion) of hikes voted in the six months after Mr. Hollande took office in May 2012.
Government officials argued that taxation drags less on growth in the short term, but the economy failed to grow at all in 2012 and dropped into recession at the turn of the year before recovering in the second quarter. The tax-heavy policy hasn't delivered the results Mr. Hollande initially sought and the target of getting the deficit below 3% of economic output has already slipped from this year to 2015. Without further measures, the European Commission warned earlier this week that France will also miss that target with a deficit at 3.7% in 2015
Now even small tax increases slated for the 2014 budget have met with protest and pushed the government into a series of U-turns.
Combined with stubbornly high unemployment near 11%, the to-and-fro on taxation has deeply harmed the Socialist's president's popularity with a few months to go before local and European elections in the spring. Only 25% of French people are confident Mr. Hollande has what it takes to deal with the country's problems, according to a poll of 1,006 people by CSA this week. That marks the lowest score for a French president since the creation of CSA's monthly poll 20 years ago.
The political situation leaves the government with little room to raise taxes, S&P said. On the spending side, the agency said the government's current steps and future plans to cut spending will only have a modest impact, leaving the country with limited levers to reduce its deficit.
