Melenchon s 300 billion euro plan could work but direct financing of government expenditure by French central bank would be far better and also lawful

Jean Luc Melenchon s plan to shift money flows around the French economy in such a way as to stimulate demand, by reshuffling taxes, in order to stimulate supply and, so, grow the economy and, thereby, create a bigger tax base, could theoretically work.

The result could well be the government revenue from the bigger tax base would be greater than the expenditure. The surplus could then be used to start a virtuous upward cycle.

However, the plan is based on outdated economic indicators, which may no longer be applicable to the economy in 2024 especially with inflation and interest rates set to rise. Even a tiny miscalculation per euro could accumulate to a gigantic sum of extra debt.

By taking control of the Bank of France and printing money to fund government expenditure directly as China s People Central Bank does, Melenchon  and his coalition of parties have more policy tools available to stimulate demand, grow the economy and freeze prices using price controls.

Moreover, money printing is lawful.

Its prohibition under the Lisbon Treaty is unlawful and illegal.

This,because the ECB is bound to act to increase jobs and control inflation.

This goal is impossible to achieve when the ECB gives private banks de facto right to print money always as debt with interest in a never ending infinite cycle of ever growing debt and interest, resulting in economic collapse and inflation.

From Telegraph

The Left intends to finance the programme by bolstering a wealth tax, abolishing a current 30 per cent flat tax and creating a windfall tax on large groups. In short, “we will ensure that we finance this very ambitious project by taking it out of the pockets of those who can afford it”, said Mr Faure.

...
Ms Bersinger told Le Figaro: “It seems clear that the expenditure or shortfall… exceeds the proposed revenue by several tens of billions of euros, at the very least, which is mainly based on raising taxes on the wealthiest.”

Patrick Martin, the president of Medef, the French employers’ federation, warned that it would “lead to an explosion in deficits and debt and a loss of confidence in the future”.

Meanwhile, Bruno Le Maire, the finance minister, said its application ran the risk of sparking a “financial crisis” and “the economic decline of France”. “This project is exorbitant, ineffective and dated. Its legitimacy is weak and circumstantial. It should not be applied,” he warned.


https://www.telegraph.co.uk/world-news/2024/07/08/profile-jean-luc-mlenchon-france-jeremy-corbyn/