If the following is true, then the Eurozone is doomed:
President Hollande’s proposal would restore the retirement age to 60 for individuals who have contributed to the pension system for 41 years. Mothers with three or more children would also be able to retire at 60, as would the elderly unemployed. Proposals to lower the pension age for other categories of workers are said to be under consideration. The first step alone will cost E1.1 billion in 2013, rising to E3 billion a year by 2017.
The government proposes to cover the expense by raising payroll taxes for employers and employees.
This is completely ridiculous. There is no way France’s economy will withstand something like this.
As it is, I find the idea of a payroll tax to be incomprehensible (I mean the one that is paid by the employer, not the pay-as-you-earn witholdings from salaries.) My sister, for example, has her own business. She is employing several people. In a difficult economy, she keeps creating new jobs for people. And for some completely incomprehensible reason, she has to give a significant portion of her profit as payment for providing this important social service and letting people earn their livings*. Is this meant to be a discouragement for job creation or what? I honestly have no idea how this makes sense. I’m all in favor of paying taxes on what I earn. But why do employers pay twice, both from their profit and for each employee, is a mystery. Is the goal to ensure that the employers saddle their existing employees with more and more work to avoid hiring new people? Is it an incentive to outsource jobs? At least, small businesses should get some relief here, don’t you think?
I’m also bothered by “mothers with three or more children”, if that’s what the proposal actually says, as opposed to “people with three or more children.” What about single fathers? How are they less entitled to the same consideration? Besides, it would seem to me like people with children really need help when the children are small or in college, not when they are 60. Wouldn’t abundant and free daycare facilities and free college education be more helpful to such people?
The entire proposal looks like a populist gesture with no meaning.
* My sister also will be deprived of her right to a maternity leave that all Quebecois women who are not small business owners enjoy. In spite of getting her profits taxed so heavily, she isn’t entitled to getting something back in exchange because she creates jobs. The only people that the government of Quebec hates more than small business owners are professional, successful women.