On a recent visit to Boston in summer 2018, French Foreign Minister Le Drian described how France was revered for standing up against populism and advocating for a more united world, what has been coined since Macron’s election as the #FrenchMoment.

In the run-up to the US 2020 election, the US are also having a very French moment. Democrats speak up on healthcare for all, and reducing inequalities. There is no question that this is the way, and this is what we should collectively aim for.

It is less clear on what means should we deploy to get there. When asked how to finance these ambitious programs, the answer is a mix of Modern Monetary Theory and “tax the rich”. The latter struggles to define what a “rich” is, albeit safely wooing 95% of the population who think are not. Here is our definition: Being rich means living under your means.

While there is a great deal of social equality lessons to learn from France, and so many other things, it is wrong to assume that anti-capitalism is one of them (We join Oaktree’s Howard Marks on that). Anti-capitalism is the enemy of good, not only for whatever we call “the rich” but also for everyone. Capitalism nurtures free economies, opens up opportunities, and most importantly: feeds people’s hope in a better tomorrow.

Hope is everything about the #FrenchMoment, and the US should be all behind restoring its population’s confidence in the American dream. In that there is certainly an option to give incentives to the higher-paid to re-distribute the proceeds of their luck. But it doesn’t involve blaming them for it.

360 Advisory – Markets