A Swiss war game with a bitter French flavor

A Swiss war game with a bitter French flavor

Relations between France and Switzerland have been strained by serious differences on the subject of taxation. Accused of being a tax haven by Europe’s tax hell, Switzerland is fighting back. 

Swiss military exercises never used to attract much media attention. With its dramatic storyline of the fall of the euro and the influx of EU refugees into the Alpine country, the 2012 war game received worldwide press coverage. The scenario of Operation Stabilo Due was derided by peeved Eurocrats but it was far more realistic than say, an alien invasion. A year later whether the euro has been saved remains a moot point. 

The French public discovered that this year the threat had come from France. Operation Duplex-Barbara simulated the military response to an attack by a bankrupt republic split into warring factions.
Spearheading the attack from the territory of Saônia (Jura region) featured the Dijon Free Brigade, a terrorist group based in the town of Dijon where presumably the trade of mustard had collapsed like much of the economy.

That France would disintegrate into “warring factions” in the military sense is far-fetched but as a metaphor for deepening divisions in society, it is not far off the mark. Everyone is angry at the hapless Socialist government.

The anger of entrepreneurs is reaching critical levels. The new president of the MEDEF, the largest employers’ union, Pierre Gattaz, hit the nail on the head in his inaugural speech. Enterprises are being “asphyxiated” by 147 taxes, “bound and terrorized” by the application of an opaque inflexible regulatory framework. Recent statistics supported his desperate appeal to “free” businesses. Since the beginning of the year alone, 62,000 companies have gone bankrupt. 

Jobs continue to be lost. The situation, in other words, is catastrophic.

In the Swiss war game, the objective of the Dijon terrorists was to “take back stolen money” kept in Geneva’s banks. In real life, the political objective of the French state is to intrude into every aspect of a citizen’s life, including their bank accounts and savings, wherever they happen to be. The idea that one can legally choose to pay taxes in more competitive tax regimes is now considered a heresy. In the great march toward the egalitarian utopia, tax fundamentalists view bank secrecy and tax competition as “evil” concepts to be eradicated. 

The sad truth is that the principle of private property is constantly being undermined across the political board. This mentality has inevitably brought prosperous Switzerland into the “firing line.”

For decades, the French political class has chosen to create new taxes rather than reform the obese nanny state. Socialists have just added an ideological dimension to the taxation folly. But the country has become a case in point of the “Laffer curve” principle: too much tax kills tax revenue. The political elite are in panic mode. How will they buy votes, oops, get elected if the state can no longer distribute generous public funds handouts?! 

Experts have warned that the tax hike is detrimental to competitiveness and, pushes people and companies into fraud and/or to leave if they can. These effects are materializing. In the past year, there has been, for example, a 500 percent increase in the number of seizures by French customs of cash (105 million euros) smuggled out of the country.

The republic has been likened to a pressure cooker about to explode. Can the Swiss military and French citizens be blamed for protecting their interests by preparing for the worst?

Sophie Quintin Adalı is an analyst for www.libreafrique.org, the francophone project of the Atlas Economic Research Foundation.