Full Macron cave: Wage increases, tax relief

Last week, as protests in the streets of Paris continued to grow, French President Emmanuel Macron attempted to sooth the waters by agreeing to roll back his new gasoline tax. But as we’ve discussed here previously, that wasn’t the only thing the Yellow Vest brigade was angry about. Macron’s policies have steadily eroded consumer purchasing power, increased the cost of living and left many working-class French families unable to even put food on the table some days.

In response to his announcement, not only did the protesters fail to go home, but the size of the demonstrations increased. Macron must have sensed something very dark on the horizon, because in an address last night, he completely caved and announced new policies to satisfy his angry citizens. These include higher wages and rolling back more of his proposed tax hikes. (BBC)

Speaking in a televised address, Mr Macron condemned the violence but said the protesters’ anger was “deep, and in many ways legitimate”.

The minimum wage would increase by €100 per month from 2019, he said.

A planned tax increase for low-income pensioners would be cancelled, overtime pay would no longer be taxed, and employers would be encouraged to pay a tax-free end of year bonus to employees, he added.

However, he refused to reinstate a tax on the wealthy, saying “this would weaken us, we need to create jobs”.

The one item where he’s standing firm (refusing to reinstate a tax on the wealthy) is actually the only sensible one on the table. You can’t fight your way back to prosperity on a platform of “eat the rich.” Unfortunately, for some of the younger protesters out in the streets this weekend, that was one of their largest, symbolic complaints. Macron has been called “the President of the Rich” by demonstrators and the media. Some sort of symbolic nod in that direction – perhaps an insignificant “luxury tax” on yachts or something – might have won him a bit more ground.

But what brought about this change of heart? Perhaps it was because the tone of the protests had taken a decidedly darker turn. In case you missed it, some of the Paris demonstrators actually showed up with a guillotine this weekend. (Daily Mail)

Yellow Vest protesters in Paris erected a guillotine bearing the name of Emmanuel Macron’s political party in a direct threat to the under-fire French President.

The move came as the country’s finance minister warned the violent protests sweeping the country are a ‘catastrophe’ for the nation’s economy.

Seeing a guillotine out in the streets would be enough to put most politicians anywhere in the world off their feed. But in France, it has a particular resonance. When there are literally more than 130,000 of your citizens shutting down traffic and commerce while displaying one of the most enduring images of the French Revolution, perhaps it’s time to make some concessions.

The story arc of these protests isn’t entirely over, but I’d expect things to slow down a bit from here. The tax cuts and minimum wage hikes should be enough to satisfy the hoi polloi that they have Macron’s attention. And the young president has probably learned a valuable lesson in French politics.