With a call for an income cap on society’s richest, a longshot presidential campaign has thrown a giant scare into the French political elite.
By Sam Pizzigati
Would your life be better or worse if our highways and byways had no speed limits? Easy question. We all see value in speed limits, even those of us with an occasional lead foot.
But what about limits on income? Would your life be better or worse if we limited how much any one individual could pocket in a year?
Jean-Luc Mélenchon has championed what amounts to a “maximum wage.” He pulled 19.64 percent in the first round of France’s presidential voting. The winner of the first round, Emmanuel Macron, pulled 23.75 percent.
Jean-Luc Mélenchon, the most surprising candidate in the French presidential election’s April 23 first-round, ran a campaign that put that question before French voters. The 65-year-old former French lawmaker wants individual income over 400,000 euros, about $430,000, subject to a 100 percent tax.
At the outset of this year’s French presidential campaign, no one “in the know” saw Mélenchon finishing much above a distant fifth. But the veteran activist’s candidacy electrified a much wider swatch of the French public than expected. He finished in a tight horserace for third, just a few percentage points behind the race’s frontrunner.
What made that finish all the more remarkable: the withering torrent of abuse all the leading candidates — and France’s top 1 percent overall — leveled against Mélenchon in the campaign’s final weeks as polls showed him rapidly gaining ground.
One conservative daily, Le Figaro, hammered Mélenchon as “the apostle of revolutionary South American dictators.” The campaign frontrunner mocked Mélenchon as a “communist revolutionary.” The leader of France’s top business group, Pierre Gattaz, labeled Mélenchon an “economic disaster.” His taxes, the business group added, will “crush” France.
Noticeably absent from these verbal assaults: any attempt to engage Mélenchon in real debate on his bold policy prescriptions.
Mélenchon’s rivals never bothered to spell out just why they support limitless individual income over limited individual income. They never made the effort to explain why they feel letting individuals essentially keep as much income as they can grab will leave France and the French better off.
Mélenchon, for his part, took the time to explain why he felt that capping income would leave even the capped better off.
“Being a billionaire does nothing for personal happiness,” he pointed out. “It’s just an accumulation of worries that we’d want to take away.”
‘Being a billionaire does nothing for personal happiness.’
Mélenchon’s advocacy for what amounts to a maximum wage is tapping into a deep egalitarian current in French political life. In 2013, for instance, one public opinion poll found the French supporting a “maximum wage” for corporate chief execs by an 83 to 16 percent margin.
American fans of grand fortune might feel tempted to dismiss this support for income limits as just a “French thing.” But we have our own maximum wage tradition in the United States.
In 1942, President Franklin Roosevelt proposed a cap on individual income at $25,000, about $375,000 in today’s dollars. Subsequent Gallup polling found that a plurality of the American people supporting FDR’s cap notion.
Roosevelt in the end didn’t get the 100 percent top tax rate he sought. But he did get a 94 percent top rate on income over $200,000 — and that rate would help launch the United States on to the best quarter-century of shared prosperity the American people had ever known.
What will the French people end up getting from Jean-Luc Mélenchon’s efforts? We’ll see.
Institute for Policy Studies associate fellow Sam Pizzigati co-edits Inequality.org. His most recent book: The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900–1970. Follow him on Twitter @Too_Much_Online.
The Mariana Trench is 6.6 miles deep, about a mile deeper than Everest is high. The Harvard Business Review awarded best article of the year to William Lazonick whose study showed that over the ten years 2001 to 2011, 91% of the corporate profits from the 450 largest U.S. corporations (on the S&P 500 for the entire 10 years) were distributed as dividends or used to buy back company stock, thus boosting the value of the stock. This is how Corporate America is serving the country: paying the lowest possible wages, neglecting research and development and pocketing the profits. Perhaps they used some money for more mergers and acquisitions. But basically, corporate America throws all its profits into the Mariana Trench for all the good it does society. There should also be a tax on wealth, say at above $100 million, at which point a 5% to 10% tax per year could basically fund all government for ever. Melanchon has the right approach and I think most citizens will get the picture: workers are being robbed more ways than one. Thirty percent of U.S. workers earn each year less than $15,000 a year (from the Social Security Administration report on wages), half earn less than $29,930. The average income per worker (national income divided by 160 million who work) is $90,650. The after-tax (disposable income) is $44,000 per human being, says the Bureau of Economic Analysis. That comes to an average post-tax household income of $114,000, and that’s about $140,000 before taxes. I’d guess about only 10% of U.S. households are average or above. It’s like that figure that 125,000 (which is 0.1% of all households) own a bit more than 97,500,000 households, the lower-owning 90% of U.S. I want to take a submersible to the lowest spot and dig up the loot.