Economic Proposals (2/6)

PENSIONS
Balancing the books is an adequate goal, but the population thresholds that have been fixed (legal pensionable age of 62, a minimum of 41.5 years of contributions) are not rigorous enough to be effective.
Nevertheless, one should set up safeguards taking into account long careers and arduous working conditions to ensure the acceptability of the reform by all:
1. To take long careers into account, one could put a ceiling of a 45-year contribution requirement, for example: just as 67 years would be the maximum legal retirement age, 45 years would be the maximum contribution requirement for a full pension.
2. To take arduous working conditions into account, one could use a life expectancy of 67 years (the maximum legal age) as a starting point. For example, if a 67-year-old executive can hope for another 15 years’ life expectancy, the maximum legal retirement age must be reduced for the category of threatened workers in such a way that they will have statistically the same amount of pensionable time left (i.e., 15 years in this example). The maximum thus defined will be evaluated according to category/type of worker/employee and reviewed regularly (for instance, every year or every 3 years).

NO TAX/ FIXED CHARGE ON SALARIES
In this country, we need to ease conditions for companies to help them create jobs without giving up their contribution to the country’s burden.
I suggest a drastic simplification of company tax, namely replacing all taxes/fixed charges on salaries (pension, health, unemployment contributions, etc.) by a single corporation tax contribution = variable charge for the companies. Hence, the contribution asked of one company will be considerable when business is good and much reduced when there are serious problems; the salaries paid to those members of staff still in place will advantageously replace the unemployment insurance, since the company will be less likely to go bankrupt.
The idea would be to calculate the new company tax rate in such a way as to garner the same resources as brought by the old company tax + the fixed charge on salaries. Then, one should round off to a meaningful figure for entrepreneurs and shareholders: 1/3 (33%) or ½ (50%).

LEAVING THE EURO?
The main flaw of the Euro is well known: the currency-unified economic zones are not aligned in their economic operations (industry, services). This has led to regular imbalance over time, of the type that monetary devaluations or revaluations used to compensate for, in particular in the monetary snake. Past efforts to achieve monetary unification without economic governance (the industrial and budget policy of the states) have all failed (c.f. the franc zone of the Latin Union 1865-1927 – it lasted 60 years with 32 signatory countries).
The instigators were well aware of this flaw. The policy of monetary union constituted a bold attempt to force member states to adopt budget moderation policies, thus reaching harmonious rigor without (federal) coordination efforts. The question is: Can one survive on an illusion? Should one be loyal to Germany, a country that has shared so little of the economy cake (in terms of both economic development and the power brought by directing the currency)? It could well be that the sole solution to bring down our country’s debt easily and quickly involves leaving the Euro and creating inflation by printing money.
As in all revolutions, some will win and others lose. In this case, pensioners whose capital is already constituted and whose resources barely grow will lose. Winners will be the workforce, the young people in particular, and export businesses and tourism. Raw materials will be more expensive, and so will Chinese junk, which will lead to some relocating.
The fall of the Euro will bring that of the Dollar, affected by the excessive American debt, of the Yen, and of the Yuan since Chinese financial assets are involved in the Dollar. Countries will have to offer the Chinese government political or even economic support to prevent the economic shock wave from degenerating into riots, then civil war, in a country possessing nuclear weapons. In other words, one should do nothing to bolster the desire for freedom in the faltering country; abandoning the communist dictatorship can take place only within the sense of equanimity brought by a flourishing economy.
Let’s not kid ourselves, however: leaving the Euro will signal the country’s prolonged inability to achieve the necessary administrative and political reforms and a whining people, forever expecting increased state allocations but with fewer obligations towards the state and enterprises. Leaving the Euro will also represent the failure of the policies of austerity that were initiated in 1983, the failure of 30 years of public policies, including the fight in favor of the Maastricht referendum. What the French people urgently need is a rousing vision of the 21st century future perils, just as in other places and other times, Americans rallied in the face of the “Red peril”, the Russians in the face of American imperialism, and the Chinese in the face of foreign interference. What are the perils coming to us? We can cite climate crises (global warming due to the release of carbon dioxide), ecology crises (rising sea levels), unbalanced global demography (falling for us, but showing exponential growth in Africa and India, thus leading to famines and migrations more or less well tolerated), a third World War that would start in the nuclear powder keg of China/India/Pakistan or a regional war against Iran. All these events will require solid public finances so that one can address them with a winning spirit.

NO, PROGRESS IS NOT LINEAR!
We’re still living under what is left of the late 19th century positivist philosophy which, in essence, posits that progress increases from generation to generation and will soon reach the sky.
For instance, Westerners increasingly receive better medical care, live in greater comfort, in particular energy-driven comfort (abundant and cheap oil, electricity), travel increasingly faster and further and further, eat better; in addition, there are fewer wars (though they are more lethal and devastating), etc.
Yet, this ascending straight line of progress was the result of huge efforts from each generation, sacrifices, and massive breakdowns (two world wars). The concept of steady progress is a dangerous delusion that blinds us and makes us doze in the comfort of our declining social democracy, in opposition to the nations that consent to considerable efforts, the pioneers or those who wish to catch up with them (United States, China, India). I cannot envision any other path for our leaders than to re-mobilize us in a realistic project for the 21st century, something that would highlight the future hardships our generation needs to face and overcome.

MAKING LABOR LAW A BACK-UP SOLUTION ONLY
Our current labor law is implicitly based on the assumption that employees are “weak” and must be protected in their relationship with the “strong”, i.e., employers. This means leaving out the notion that employers do not hire in order to lay off automatically and quickly. Recruiting employees costs time and money (unfulfilled contracts, financing the time human resources directors and managers spend interviewing, provisioning the anticipated costs of breaching work contracts). Then, there are also the costs of training / further training and of accepting the inefficiency of the first months of work.
In addition, the work contract, as it is currently planned, protects those individuals who have succeeded in getting hired, but also keeps unemployed those who would bring a lesser benefit to companies, precisely because of the hiring and potential firing costs that keep entrepreneurs from hiring.
Finally, our society is based on the principle of individual accountability. It would be advisable to re-establish it at the level of the work contract. Companies are the only ones to know their business opportunities and what is needed to address them. Then, it would be up to the employees to accept the constraints or not!
Thus, I suggest giving labor law a back-up role, that is, it would be applicable only if contractual terms have not been entered into.
Perhaps one could consider giving this back-up role to other fields of law. It is time we called a stop to the glorified nursery that replaces individual initiative with never quenched thirst for state benefits!

FISCAL RESOURCES
Here are a few leads to obtain extra fiscal resources:
• Why should we treat as taboo the figure of a 10% reduction of the tax havens deductions? Perhaps one should consider the more significant figure of ½ (50%) or even 90% if one considers tax havens as unproductive, almost useless but, nevertheless, highly symbolic. These flat rates would, of course, not exclude and in fact add to the study of the current usefulness of each tax haven.
• Modify VAT rates to 5% and 20% (1/5) to simplify the mental calculations of business people and consumers.
• Keep the same VAT rate in the fast food and traditional domains, either 5% or 20%, so as not to skew the competition.
• Eliminate all the aids to companies regarding the limits of a 35-hour workweek. Surely, a properly managed company will have carried out the organizational change from 39 to 35 hours several years ago!

FISCAL PRESSURE LIMITS
In our open environment, we compete with countries in the same category as ours: Great Britain, Germany, Italy, or even Japan and the United States. Our taxation limits must be in the same range as they are in these countries, namely between 40% and 45% of the GDP (unless I am mistaken). This proportion will change over time; there are “fashionable” practices in the management of both public and private affairs. Why should we not use part of our influence to help change those practices towards modes that suit us?
We should not think that France will be right in the face of opposition from the rest of the world. We boast like self-satisfied, arrogant roosters – the old image is still prevalent… We need to note that not only does the rest of the world not adopt our social model, it is also secretly happy to see us stray outside the flock: we are disqualifying ourselves in a field where being right only works from inside the group. In this domain, solo racing brings nothing except rejection.

SIMPLIFYING INCOME TAX
We need to make taxation more readable, understood and accepted, and defended by governments. Hence, the mode of taxation determining must be easy to understand and the rates easy to calculate. We should not aim to optimize the rates for the revenue of one particular year, which would only increase confusion and bring the rejection of this instability.

Hence, as far as income tax is concerned, one would end up with the following:
Tax bracket Rate
€0-10,000 0%
€10,000-20,000 10%
€20,000-30,000 20%
€30,000-40,000 30%
€40,000-50,000 40%
€50,000+ 50%
And for VAT:
Reduced rate 5%
Full rate 20% or 25% (1/5 or ¼)

ALLOWING LOCAL AND TERRITORIAL AUTHORITIES TO RAISE THEIR OWN TAXES
We need to speed up decentralization and deconcentration to promote efficiency through proximity, as local stakeholders are best placed to negotiate among themselves what they believe will be best for them. Paris is too far away, online information channels lose something, answers are late; in other words, from a regional perspective, nobody is happy with the State.
As a corollary, the resources of local/territorial/regional authorities need to grow, but these entities must be responsible for raising their own taxes (mode and rates of taxation). The mode should be coordinated by the associations of mayors, elected representatives, region presidents. Rates should be determined by local representatives. Easy mobility on the national territory and voter patronage ensure relatively moderate rates.

Finally, if determining a particular type of tax for a specific level of local authority is not considered possible, one should not forget to send households an annual summary of the taxes paid for each level of authority. The computer specialists in the Ministry of Budget have all the data, the process is easily done by computers but tedious for private individuals who do not do it systematically. This summary would represent a guarantee of proper local management since everyone would know who receives the monies from the local taxes and who the local person determining the rates is, and would be in a position to see excesses from year to year.

Equalization mechanisms between regions and departments are necessary but must remain limited so as to avoid skewed arguments of the type “I raise taxes for others”. As a baseline for discussions, I suggest that a rate of 10% of the raised taxes be allocated to the equalization processes between local authorities at the same level. This rate is quite low (1/10°). In addition, the figure is significant and allows taxpayers to carry out mental calculations easily; this is essential as taxation readability is a necessary condition to acceptance by the population at large. We’ve had enough of these silly figures (19.6 or 5.5 and why not 12.02?) that result from a compromise, power struggle, optimization, barstool psychology (designed to hide the required financial effort) – all those arguments which are at best valid the year the tax is being created and downright crippling afterwards. As for the redistribution criteria used by the equalization fund, they need to be negotiated (to reach consensus on the part of the region presidents/representatives regarding their respective level) and subject to change with electoral changes (agreement would need to be reached within 6 months, otherwise the government would have the final say).

BREAKDOWN OF THE BENEFITS MADE BY COMPANIES
What we need:
• To finance our public debt
• Equal footing with our European and global competitors in the context of mobility of capital, companies, entrepreneurs
• GDP growth arising out of investments and companies’ economic good health
• Promoting entrepreneurial capitalism rather than financial capitalism
• National social cohesion (equitable benefit sharing) at a time when fashionable management theories promote hard squeezing / squeezing to death / draining the last drop / milking dry which only makes employees lose their motivation or even their health
• Readable taxation that brings acceptability.

What I suggest regarding corporate taxation:
• ¼ (25%) of the companies’ benefits go to the State (this is in line with European practice)
• ¼ (25%) go to the shareholders (return on capital risk)
• ¼ (25%) go to self-financing (to promote companies’ growth)
• ¼ (25%) go to the employees (with a distribution key equal for all employees rather than proportional to the salaries earned)

Mme Parisot has objected that certain companies would like to grow faster; fair enough – in which case, shareholders give up their share (thus brought to 0%), which goes to self-financing (which becomes 50% of the benefits, more than enough to achieve self-funded growth).
Another distribution system, much more innovating and worthwhile, I believe, is desirable if my previous suggestion (see relevant article) concerning a single corporate tax is accepted. This tax on benefits (with variable charge) would substitute for the fixed charges on salaries (URSSAF, pensions, unemployment, health funds, etc.) + the former variable charge (IS). As a reminder, this shift from fixed to variable charges was suggested because fixed charges constitute the major cause of bankruptcy when the revenue drops; similarly, the level of fixed charges on the salaries is the main brake on employment.

The distribution now becomes:
• ½ (50%) of the companies’ benefits go to the State
• 1/6 go to the shareholders (maximum figure)
• 1/6 go to self-financing (minimum figure)
• 1/6 go to the employees.

Should the shareholders want faster growth, their share could drop to 0% and self-financing rise to 1/3 (33%); variations are all possible between the minimum level of self-financing (1/6) and the maximum level for shareholders (1/6). At first, this type of taxation benefits employees and management; then, it also benefits shareholders (healthy companies + dynamic companies and fully motivated employees).

SIMPLIFYING THE RED TAPE
Filling in administrative forms constitutes endless bureaucratic red tape, time wasted in needless repetition of information already collected by the various administrations!
I suggest setting up a centrally managed administrative Web site where users willingly enter oft requested basic information: surname, name, birth date, birth place, marriage place and date, name of spouse, civil status, INSEE number, vehicle registration number, driver’s license number, number of children and their names, birth dates, etc. Users authorize the requesting service access to the information by email. The information is then used to “pre-populate” administrative forms, so that users can concentrate on the really useful areas.
In any event, it is unacceptable to find the same administration requesting the same information in different forms, once the information has been collected. This only serves to demonstrate the chronic inability of their IT specialists to set up simple databases.

WORKING ON THE TAXATION SYSTEM
Contrary to what the head of State explained during his televised performance, as it was understood by commentators, it is not only asset taxation that has to be reviewed in France.
What needs to be worked on:
- Assets (fiscal shield, ISF, high incomes, stock options, severance agreements - the so-called golden handshakes)
- Local authorities (dedicated tax according to the level of local authority with 10% equalization mechanism)
- The corporate business tax, replaced by VAT on each company’s production (variable charge)
- Rates and share of taxes on companies’ benefits: benefits to be shared equally between the State, self-financing, shareholders, employee profit-sharing measures
- Simplification of the individuals’ income tax brackets to promote acceptance of this tax through greater readability. Rates should not be optimized in line with the year’s specific needs!
- Increasing VAT from 20% to 25% but maintaining the low rate at 5%
- Modifying labor taxation (fixed charge in terms of the revenue) into a variable charge through integration into benefit taxation.

THE RIGHT TO HOTEL ACCOMMODATION FOR HOLIDAYS???
Yet another alarmist report from the INSEE signals that 1 out of 4 French people has been in a situation of “poverty” in the last 5 years. One of the comfort criteria that came into use is the right to spend one’s holidays out of one’s home, not in a family member’s home, but rather in a hotel in weekly or monthly rentals.
We are now sinking into INSEE-managed feelings of misery, whereas the only real poverty indicator is the absolute poverty rate (basket of essential goods, housing). Continuing on the road of relative poverty indicators would lead a cash-strapped country into a dead end, create artificial frustration in a country full of depressed people (who hold the record of psychotropic drug use).
PS_1. I cannot afford to go into a hotel, but I live well and do not complain because of this … This does not make me poor, or unhappy, or unhappy and poor!
PS_2. I’ve heard of a poverty threshold of less than €1,000 a month; but is this per individual, adult, or household? It does make a difference.

AN INDUSTRIAL POLICY FOR FRANCE
Through an incentive plan, the State needs to coordinate 3 types of industrial and commercial companies that overlap partly:
- VSEs and SMEs destined to do business on the national territory. They create jobs and generate fiscal revenue.
- Innovative start-ups designed to shelter France from international competition by being several steps ahead, as chess players say. These days, those lean-structured companies like start-ups are more innovative than the big companies (because they focus on innovation rather than on a financial casino, the monopoly of corporate takeovers, or gaining the upper hand via advertising and overwhelming and expensive marketing).
- Export businesses, the mature and performing ones, such as the large groups and the large medium enterprises that bring in currency, prestige, and some influence abroad.
Clearly defined companies pursuing different goals are now emerging. All have a role to play; all deserve public support in the country’s own best interest through a clear incentive plan both administrations and the companies understand and through well-adapted taxation (most notably by limiting the fixed charges that cripple companies during an economic downturn and so terrify entrepreneurs that they do not hire in good times in a country where it is so difficult to lay people off in bad times).

JOB RELOCATION FROM PARIS TO THE PROVINCES
At issue here is relocation to the large regional centers, the prefectures and sub-prefectures.
- Under normal conditions, we have reached saturation point in road transport, so now, what will happen in snowy conditions …
- Local air pollution is already a major concern (allergies, asthma)
- The cost of housing for individuals is much too high 1. in terms of salaries and 2. in terms of provincial standards
- The salary levels are 1. high in terms of provincial standards (hence a cost increase for the companies) and 2. low for employees in terms of the housing costs.
It is high time entrepreneurs realized that a skilled or unskilled labor force exists in the provinces, that the cost of living is much lower, that all employees, including the executives, live well, that there is no shortage of information networks (the Internet, newspapers, books + DVDs through Amazon.fr and local bookshops, teleconferencing, the TGV train, airplanes), that open-air leisure activities are pleasant, etc.
So now, where is the initial State support? Could we have an update on the government’s vision regarding land use planning?

THE TARGET: ZERO ACCUMULATED DEBT
The time always comes when individuals, companies, and states have to settle their debt because the latter has become counter-productive. This is the situation in France today. Which target can we fix for our debt settlement? Surely, the zero level is the one that will give us maximum leeway in a century filled with numerous and definite threats, though one cannot set a date for them: a climate crisis (rising sea levels, rainfall floods brought by local climate changes), pollution ->depollution, the end of cheap oil, pressure upon raw materials (agriculture, energy), more or less serious wars, etc.
Stop and Go Keynesian policies cannot be used, given the current state of indebtedness: in order to stimulate the economy, one needs money! So we need to forget the myth of revenue-producing growth, as this myth has not worked for the last 30 years. In other words, we need to make do with a 0% growth, as long as we repay our debt. An annual 3% growth based on an annual 3% extra debt is nothing but a misleading delusion destined to an economically immature electorate.
Clearing our debt requires using at least 3 tools:
• Increasing taxation (which signals the capacity of a state to make citizens understand the seriousness of a situation)
• Reducing costs: operational costs (salaries, status, pension calculations for the civil servants of the 3 public services + costs of transactions, flow and storage of information, infrastructures, and procurement policies), social policy costs (lowering the retirement pensions beyond a certain minimum, increasing people’s financial participation to remaining in good health). Nevertheless, the objective should also be to reduce by half the number of people living in absolute poverty.
• Selling the family jewels that are not essential to the sovereign functions of the State: selling buildings and land (SNCF, the army, town halls, etc.), privatizing state-owned companies and public enterprises (EDF, GDF-Suez, SNCF, etc.) whenever possible, reducing and eliminating the non-strategic participations of the Caisse des Dépôts et Consignations [a French financial organization designed to safeguard public funds], stopping investments in expensive economic development projects (freeways, expensive military weapons programs).

JOINT REGULATION OF WORKING TIME AND LABOR COSTS
I’ve read an interesting proposition in the Juppé/Rocard interview book: a four-fold reduction of the hourly rates below 32 hours/week, and a four-fold increase beyond. It seems to me that the figure of “4” is debatable; why not “2”?
Note 1: in the fields of mathematical optimization, automatic control, and economy, when it is not easy to regulate through bans/authorizations (in other words, all or nothing) according to a rigid threshold to be defined, it is worth defining an incentive cost function while letting those in charge (in this case, the company managers, the payers) make the decisions.
Note 2: the link thus established between the working time and the labor costs enables a double regulation: that of working time and that of the costs of salaried labor.

A SAVINGS BOOK TO BENEFIT VSE/SME FINANCING
M. President Sarkozy, how far have got with the idea from the CGT, which you accepted in 2 broadcasted speeches, and that deals with the launch of savings books designed to help finance French VSEs and SMEs? This is both urgent and essential:
1. Commercial banks no longer finance the “real economy,” as they choose, instead, to speculate on financial securities and to finance large companies, which are less risky in the long term. However, when considered collectively, VSEs and SMEs are worth investing in and solid.
2. VSEs and SMEs have the highest hiring rate in proportion to the invested capital. Their leaders have not fallen prey to the by now well-known management style of “hiring less for a higher rate of return.” VSEs and SMEs believe in the future, they invest, they hire.
3. Neither start-ups nor export companies should be supported or financed via these funds. I could be mistaken, of course, but I believe that there are other financing channels for these 2 categories (e.g., business angels, banks, Coface) that are attractive to commercial banks (? To be confirmed)

MULTI-CRITERIA SELECTION OF PUBLIC PROCUREMENT
At the moment, public contracts are awarded mainly to the lower bidder, which involves bias towards lower quality and products from low-cost countries.
However, mathematical rational choice/multi-criteria selection theories have been around for at least a couple of decades. These theories combine, for instance, the following issues:
• Costs
• Quality
• Esthetics (if needed)
• Ecological footprints (type of materials, energy savings, carbon value, etc.)
• The nationality of companies (French, European, countries favored by a treaty, WTO, others)
• The strength of companies (balance sheet analysis over several years, type of shareholding, management options +/- in sync with the payer)
• The way employers treat employees (salary policy, human rights, occupational injury rates)
• Etc.
The mathematical technique involves 1) evaluating each criterion numerically (a cutoff threshold can be established), and 2) comparing all the scores for one criterion in pairs, so as to establish a classification for each criterion separately. Finally, 3) in order to determine the overall classification for all criteria, one can establish a score = the sum of all the scores for each criterion, and the winner is the one that has the lowest score.
For instance, the one who is 1st on Criterion 1, 5th on Criterion 2, 2nd on Criterion 3 receives the overall score of 1+5+2=8; the one who is 2nd on Criterion 1, 2nd on Criterion 2, and 3rd on Criterion 3 will have an overall score of 2+2+3=7. So, the second project is chosen over the first; if the second project is also better than the third project, it will be termed “dominant” and will be selected in the end.
Another type of multi-criteria algorithm to be tested involves giving a score between 0 and 10, then multiplying all the scores related to one project. The highest overall score will indicate the best project.
To select one of two multi-criteria algorithms, testing is necessary so as to select the one closest to human cognitive intuition.

STRUCTURAL REFORMS TO BE CARRIED OUT IN THE PUBLIC SERVICES
The February 2011 issue of Capital magazine deserves top priority reading by those interested in reducing public expenditure through the more effective organizational functioning of administrations. And no, it is not yet another ordinary pamphlet against civil servants! The idea is to demonstrate, via examples, that a more effective organization of those (miserable!) basic civil servants would result in a wealth of productivity and … well-being in the workplace. But it is essential that government officials take full ownership of the analyses presented in the magazine, this particular approach, and types of resolutions. So what on earth is the ministry tasked with the modernization of administrations and the General Public Policy Review (RGPP) doing?
PS. I already knew about the multiplicity of statuses that is an important brake on mobility. What I really enjoyed reading about is at the end of the Capital feature: In Canada, civil servants are offered a financial incentive to suggest effective reforms (10% of the savings realized at the end of the first year of the suggested reform).

TEACHING THE FRENCH PEOPLE THE REAL COST OF GOODS AND SERVICES
The French have a deep-rooted aversion to and contempt for money. But I can’t think of a better economic system than capitalism to determine guide the complex transactions that determine behaviors. As we know, Marxism, this community-based utopia, ended dismally in the real world. Bartering is inadequate to manage decentralized transactions. Christian giving/ counter-giving simply does not work to enable progress in a society with diverse individual behaviors. Hence, it is high time the French acquired a positive way of considering the business world.
More specifically: politicians mollycoddled the French society after the reconstruction (around 1960). The real cost of medical care is carefully hidden (100% reimbursement rate, third-party insurance), which the care community (which I know well) cashes in on; most of its members are more interested in making money than in actually helping the sick…

Up till now, petrol costs have been cleverly overtaxed in order to deter wastage of this precious resource, hence reducing costly imports. They’re now talking about setting up a social rebate on pump prices; surely, this goes against the notion of waste reduction. If we are legitimately concerned about the poor, it would be better to reinforce the RSA, which tallies quite accurately with people living in a situation of absolute poverty. Similarly, freezing the price of gas is currently in the news. Problem is, the price of gas results from contracts on the world market. The only thing that can be done is to check that the gas, petrol, electricity, postal, etc. companies do not abuse their oligopolistic situation to gorge themselves. All that’s needed is to carry out a cost analysis and evaluate the cost increases within international competition; this must be done by a management controller paid by the State. Freezing increases in the sectors previously mentioned is done purely for electoral purposes and delays the adaptation of the French people to the reality of costing in the market world where they are going to have to live for a long time.

TAXATION FOR THE AUTOENTREPRENEURS
The autoentrepreneur status was created in order to
- facilitate testing the self-employment route
- supplement paid employment
- fight moonlighting
To succeed, what autoentrepreneurs need is administrative simplicity:
- The accounting system required by the banks and the tax authorities must be extremely simple to set up and to verify. I’m thinking of a mandatory professional bank account, which, a posteriori, the tax authorities can verify and the banks are authorized by the account holder to access. This system differs from the accounting records which are required a priori from all other companies. I would also suggest developing business accounting software that would be interfaced with the various administrations (tax authorities, URSSAF, etc.).
- The tax charge must be based on the turnover or the benefits; it must be either proportional or progressive. It should not include any fixed charge (that is, independent of the activity) precisely because autoentrepreneurs’ activity is highly variable, and fixed income and social taxes would doom many activities to failure and, worse, would inhibit the emergence of new autoentrepreneurs, particularly as the start-up phase is crucial for these low volume activities.
After testing, should this system without fixed charges work, it should be extended to include the VSEs (1-10 persons). I repeat that the issue is not that the absolute level of taxation on business activities that matters, as entrepreneurs are happy to pay taxes, like everyone else, provided taxation does not kill their activities, hence their assets and salary. This is the MANTRA: fixed charges linked to administration (income and social taxes) must be brought to zero level. The only fixed charges must be those linked to employee salaries, which will consequently be more manageable, which is turn is better for employment, activities, hence for the State (fewer unemployment benefits, more activity-based revenue, and increased spending resulting from increased purchasing power, hence increases of indirect salaries).

FINDING ECONOMIC GROWTH
Economic growth cannot be imposed by decree. It does not result from some vague and substance-free political will, nor from trust in the capacities of key political leaders; it is no longer derived from adjustments to macroeconomic equilibrium; it comes from attention to microeconomic detail.

Macroeconomic domain:
The European Central Bank (ECB) deliberately maintains high interest rates and low inflation rates to force governments to be virtuous (the debt burden), to sustain the medium-term visibility of prices for consumers, manufacturers, financiers, and to prevent inflation from wiping out the income from annuities in an ageing Europe where the well-off elderly/pensioners hold power. Given the current power dynamics between the ECB + Germany and southern Europe, it is unrealistic to expect any protest-driven shift; all one could hope for is a loosening of the inflation rates from 2% to 4%, as the figure is not cast in stone for the institutions.
As far as the notion of budget deficit-driven Keynesian stimulus is concerned, I have already shown that Go policies are feasible only if budget surplus has been accumulated during the Stop phases, which is evidently not the case. Transferring the stimulus burden to a European budget level would serve only to extend the deadline for massive reimbursement, given the leaking expenses basket. Above Europe, there’s only the IMF, which knows how to get reimbursed the hard way if need be. We would then lose our economic sovereignty, and voters would overwhelmingly choose the extreme parties.

Microeconomic domain:
The prototype (and tool) of the kind of much-needed microeconomic future is the Internet world: everything is dead simple (90% of the time, all that is needed is to click on OK in successive windows, except for special cases), servers are competing to offer something extra (information, services, goods), the consumers are more than willing to use their bank card to pay online (a turnover of billions, and steadily increasing).
As far as administration is concerned, the Internet micro-economy involves legal simplification, the cult of administrative simplicity, interfacing with private industry software, and promoting dedicated social networks of the Facebook type reaching civil servants in a group of administrations who are potentially interacting, senior government officials in all administrations and sectors: law, healthcare, agriculture - water and forestry, sanitation, agribusiness, etc.
As far as the private sector is concerned, it is essential to fight for the maximum innovation at all levels: technical, organizational, service-based, etc. This is necessary to keep ahead of the products from countries with low labor and production costs, in the same way that good chess players will be several moves ahead in a game they want to win. It’s no use whining about French decline: it is not inevitable; let’s rather fight to find solutions!