French press review 1 August 2012

Our colleagues at right wing paper, Le Figaro, are in high dudgeon this morning. "Seven billion in taxes . . . and few savings", raves the main headline, with the small print explaining that the taxes come into effect this very morning, but the paltry cuts in government spending won't take effect until next year, at the earliest.

It's a gold medal performance, ironises the Le Figaro editorial . . . every level of French society will be hit, according to the right-wing whingers, and many businesses will be forced to close.

There's worse to come, since a total of 33 billion euros has to be collected and/or shaved off public spending in order to get the budget deficit down to the technical European limit of 3% of gross domestic product.

It's a national disgrace fumes Le Figaro, taxing those who have worked hard to put together massive fortunes, while refusing to cut wasteful expenditure on handouts, gifts, support for this, that and the other.

Dossier: Eurozone in crisis

Would France's brilliant olympic swimmers have won gold if they'd been hampered by the lead weight of excessive taxation? could the nation's judo stars have claimed their places on the podium if they'd been obliged to fight with sacks of stones on their backs?

Soon, warns Le Figaro, there'll be nothing left of French society but a few tax-chewed bare bones.

Clearly, somebody at Le Figaro needs to get away for a wee bit of a break.

Communist L'Humanité is, in sharp if not surprising contrast, absolutely chuffed by last night's parliamentary decisions. "Fewer privileges, more justice" trumpets the communist front page, saying that these interim tax laws are an indication of the broad direction of the autumn budget.

The good old days of the Sarkozy regime are well and truly over. Now the rich are going to have to carry their fair share of the social burden. And it serves them right. The fact that the best-off members of French society will pay about one-third of the emergency tax won't reduce any of the well-heeled to the ranks of the bare-footed.

The truth, of course, is somewhere between the flatulence of Le Figaro and the communist codology. The books have got to be balanced, more or less, state spending has to be brought under control, there's a global crisis showing signs of settling in and becoming the new global economic order. We can all expect hard times. And we'd better get used to it.

One thing that won't be increasing, for a short while anyway, is the rent. This is because new rules come into force this very Wednesday, in an effort to slow down the rise and rise of the cost of keeping a roof over your head.

Forty-two per cent of the French live in rented accommodation; the average rent has gone from 13% of family income in the 1980s to nearly 26% today. In Paris, according to left-leaning Libération, rents shot up by 50% in the decade from 2001 and 2011.

The problem is that there's a housing crisis in France, with insufficient building in the big cities, leading to an inevitable increase in rents.

The Hollande government is hoping that the effective freeze on rental income will force more investors into the building sector, at once boosting a key economic driver and giving struggling residents a respite.

The property owners are, not too surprisingly, aghast, in high dudgeon even, warning that this kind of legislation will drive investors away completely, and so be counter-productive in the long run, simply ensuring that rents will rocket once the government brake is let off.