Even people who hate soccer (especially people who hate soccer) may want to consider how the beautiful game has become a battleground political clash over France’s financial future. Because as TIME’s Michael Schuman demonstrates in his excellent story titled “Marx’s Revenge: How Class Struggle Is Shaping the World,” surging class conflict is increasingly shaping political priorities across the world — and now even staging an unusual pitch invasion in French football.
On April 2, France’s leftist government issued a denial that the country’s soccer elite will be protected from Socialist President François Hollande’s decision to hit the country’s top salaries with a 75% income tax. The previous day, the head of the French Football Federation, Noël Le Graet, played an unintentional April Fools’ gag by telling the daily Le Parisien he’d gotten government assurances that France soccer stars and their clubs would be spared from a revamped 75% income tax scheme Hollande revealed March 28. Unlike the initial proposal applicable to people earning over of $1.28 million annually, Hollande’s new plan will leave large companies paying those salaries on the hook for the 75% tax.
Yet on Monday, Le Graet claimed that pro soccer clubs — which he defined as medium-sized businesses despite their employment of sweaty multimillionaires — would be exempt from the measure. Clearly not amused, the government promptly disabused Le Graet and the public of that idea.
As a result, team owners, pundits and fans alike are asking whether those new costs — coming atop heavy taxes all French businesses and employees already pay — won’t further handicap the nation’s notoriously modest pro clubs struggling to compete with their financially flush English, Spanish and Italian rivals. (The one exception at the moment in France is table-topping Paris St.-Germain, which is bankrolled by investors from Qatar.)
As a lifelong soccer fan and weekend player himself, Hollande had been expected by some observers — Le Graet first among them — to provide French football an umbrella from his soak-the-rich measure. They expected wrong. On Monday it became evident Hollande’s priorities of social “fairness” and “equal treatment” — which detractors decry as class warfare — will apply to any French salary surpassing $1.28 million, even those earned wearing shorts.
That Marx-meets-Maradona clash on France’s pro soccer pitches is only the most recent twist in Hollande’s campaign pledge to force the nation’s underpaying affluent to assume their share in remedying the nation’s troubled finances. Though attacked by critics at home and abroad as self-defeating harassment of the wealthy, the measure thrilled a majority of French voters — and was key to Hollande winning the Élysée last May. Consequentially, the increasingly unpopular President now feels compelled to make good on the popular yet difficult proposal to prevent support from eroding further.
It’s no easy task. After the measure was initially voted into law in December, France’s Constitutional Council struck it down on legal grounds. That forced Hollande to search for ways to make the 75% tax legally viable — a setback France’s footballing establishment cheered alongside the nation’s affluent set. But that applause turned to jeers March 28, when Hollande prepared to bend that policy ball around opposition: rather than hitting individual high earners with the 75% tax, Hollande will require their employers to cough it up.
Despite the angry howls that move provoked from business leaders, it may wind up being scored as Hollande fulfilling an electoral pledge gutted of its financial significance and class-conflict symbolism. The reasons? In taxing companies rather than their millionaire employees, the original “social justice” objective of forcing France’s wealthy to contribute their full share to the common effort is removed from the equation. Meanwhile, instead of paying more on their own, affluent earners will get the new perk of their employers’ shelling out for them — since virtually no one believes shifting the 75% tax burden to businesses will cause executive salaries to be slashed.
Just as bad, the increased cost to companies will consume funds that might have been otherwise used — possibly to create jobs and help lower France’s 10% unemployment level. At the same time, even government officials have long acknowledged the 75% rich tax would only generate from $130 million to $400 million in new resources — a pittance for a state whose 2012 budget deficit exceeded $125 billion. At the end of the day, Hollande voters getting their wish at seeing fat cats be shaken upside down a bit risk finding themselves short-changed on both social justice and windfalls for ailing public finances.
Worse still, they may also see France’s pro football sink further as star players flee to less strapped foreign sides.
“This new tax will cost Ligue 1 clubs €82 million [$105 million], meaning a brutal 30% increase in charges when they’re already in financial difficulty,” France’s Professional Football League fumed in a statement. “With these insane labor costs France will lose its best players, our clubs will see their competitiveness in Europe plunge, and the state will lose its best taxpayers.”
Given the public popularity of Hollande’s 75% tax on the rich — any 75% tax on the rich — the electorate risks him scoring on his own goal by applying the new version of the measure is minimal. Still, it won’t prevent critics on the left and right alike questioning the effectiveness of Hollande’s new offensive push — or from waving a yellow card his way for seeking to score with the ruse of ideological simulation.