Le piège de l'Euro

European countries have to reduce their budgetary deficit to 3 % of their GNP if they want to join to the Euro. France has attempted to reach the 3 % goal by increasing taxes. The consequence of this policy is that slower economic growth with a slower economy fiscal receipts will be insufficient for the 3 % objective to be reached in the future. If it is not, according to the stability pact, penalties will have to be paid. Which would probably lead to further tax increases.

AFTALION, F. (1997). Le piège de l'Euro. Les Echos.