Europe’s richest man is whining about a proposed wealth tax for France. But of course, he is not complaining that it would hurt him personally, which would be very selfish, but that it would hurt the entire economy, which makes him a noble crusader and protector of the economic health of the country.

Europe’s richest man, the luxury goods magnate Bernard Arnault, has said that a wealth tax that could cost him more than €1bn (£817m) would be deadly for France’s economy.

The French founder of LVMH Moët Hennessy Louis Vuitton said in a statement to the Sunday Times that calls for a 2% wealth tax on all assets “aims to destroy the liberal economy, the only one that works for the good of all”.

The idea of a wealth tax has steadily gained ground in France because of a political crisis, with the government trying to push through unpopular budget cuts. The idea of a 2% wealth tax on fortunes worth more than €100m has been proposed by Gabriel Zucman, an economics professor who has become a household name in France.
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Zucman is a professor of economics at the Paris School of Economics and the École normale supérieure, and last year wrote a prominent study on the wealth tax for the G20. In June, Zucman wrote in the Guardian: “Unprecedented wealth concentration – and the unbridled power that comes with such wealth – has distorted our democracy and is driving societal and economic tensions.”

But Arnault insists that his motives are pure and that those who are pursuing this tax are doing so because, for some reason, they want to destroy the economy.

“This is clearly not a technical or economic debate, but rather a clearly stated desire to destroy the French economy,” Arnault’s statement said. “I cannot believe that the French political forces that govern or have governed the country in the past could lend any credibility to this offensive, which is deadly for our economy.”

Really? They ‘clearly stated’ that their desire is to destroy the economy? Where and when did they say this?

People like Arnault should continue to speak out like this so that people will increasingly see that what greedy, selfish jerks they are.

The US Federal Reserve has two missions: keep inflation under control and have full employment.

What should be the desired rate of inflation? If it gets too low, that might be due to the economy stagnating and heading towards recession. Too high and people and businesses start hurting and indulging in more short-term spending as a hedge against future price rises. The magic number that the Fed and the economic pundits have settled on seems to be around 2%.

In its Statement on Longer-Run Goals and Monetary Policy Strategy (PDF), the Federal Open Market Committee (FOMC) judges that inflation of 2 percent over the longer run, as measured by the annual change in the price index for personal consumption expenditures, is most consistent with the Federal Reserve’s mandate for maximum employment and price stability. When households and businesses can reasonably expect inflation to remain low and stable, they are able to make sound decisions regarding saving, borrowing, and investment, which contribute to a well-functioning economy and the well-being of all Americans.

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The BLS has released the August job numbers and they continue the dismal trend that started in May where the numbers were well below the required number needed to keep up with population growth. The revised numbers for June even showed a decline in jobs for that month.

You can read the BLS press release here that has a more complete breakdown of the data.

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The US economy is huge and like anything huge, it has a lot of inertia which makes it slow to respond to external forces. Since Trump has come into office, he has made sweeping and reckless economic moves that are not based on reality-based analyses but more on his pet theories, revenge against perceived wrongs, and sheer capriciousness, all designed to satisfy his need to be a bully. The tariffs have been his primary vehicle for the last feature and it has thrown global markets and trade relationships into turmoil. It was inevitable that this would lead to negative impacts on the economy but until this month, those consequences had not manifested themselves.

The July jobs report may be the first indicator. What was alarming was not the numbers for July itself but the steep downward revisions for May and June, which reduced the job growth to almost zero, usually a sign of an impending recession. Trump has responded angrily, as usual denying any fact that shows him in a bad light, claiming that the numbers were rigged against him, and firing Erika McEntarfer, the commissioner of the Bureau of Labor Statistics (BLS).

Needless to say, this has alarmed pretty much everyone outside the Trump cult because whatever crackpot economic theory you may be using, you still need accurate data to make decisions. If you appoint someone who will only give you numbers you want to hear, you enter a very vicious spiral indeed. Trump’s team has fanned out with a media blitz to try and minimize the damage of the jobs report but pretty much everyone in the reality-based world is alarmed by these moves, including some Republicans.
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(Every year at Case Western Reserve University where I used to work, the incoming class of students were assigned a book to read which formed a theme for some of the programs during the year. The first one was a welcoming program at Severance Hall, the performing center of the Cleveland Orchestra. The university president and other officials would give remarks and the program would end with me sharing my reflections on the book. I am posting today (slightly edited) the text of the talk I gave in 2007 about that year’s book, journalist David Shipler’s The Working Poor: Invisible in America. I stumbled across this while going through my computer archives.)
 
Welcome to Case Western Reserve University! The people you will encounter during your four years here , the staff, faculty, and fellow students, are very different from the people described in David Shipler’s book The Working Poor: Invisible in America and I would like to address the question: What has created that difference?
 
Two answers are usually given. One is that we live in a meritocracy, and that we got where we are because of our own virtues, that we are smarter or worked harder or had a better attitude and work ethic than those who didn’t make the cut. I am sure that everyone in this auditorium has been repeatedly told by their family and friends and teachers that they are good and clever, and it is tempting to believe it. What can be more gratifying than to be told that one’s success is due to one’s own ability and efforts? It makes it all seem so well deserved, that there is justice in the world.
 
Another answer is that luck plays an important role in educational success. I suspect that most of us were fortunate enough to be born into families that had most, if not all, of the following attributes: stable homes and families, good schools and teachers, safe environments, good health, and sufficient food and clothing. Others are not so fortunate and this negatively affects their performance in school and later in life.
 
But there is a third possibility that is not often discussed and that is that the educational system has been deliberately designed so that just a small number end up like you and a much larger number of people end up like the people in the book, people who not only have failed but more significantly have learned to think of themselves as failures.
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