Why Rich People Make the French Squirm

My family was once invited to lunch at a chateau owned by a friend of a friend. As we drove our rental car up to the giant castle, my kids gasped and said, “They must be rich!”

“Whatever you do, don’t mention money,” I warned them.

An hour later, I found my 6-year-old walking in circles on the lawn, talking to himself. Up close, I realized that he was muttering “money, money, money, money” over and over.

With Paris now competing to become Europe’s post-Brexit financial capital, France’s fraught relationship with wealth is under global scrutiny. There are more than 700,000 finance and related jobs in London alone, including the bulk of foreign-exchange trading, European hedge funds and private-equity firms. While some of these companies might now be looking to Paris, a recurring negative on the pro-and-con lists is France’s conflicted attitude toward business and wealth. The country’s reputation is dogged by the short-lived 75 percent tax on incomes over a million euros.

Can the French overcome their ambivalence about money to lure bankers from London? Should they?

This ambivalence goes back centuries. Aristocrats were guillotined during the French Revolution, and new taxes were based on how wealthy people appeared — measured in part by the number of doors and windows in their homes. The well-off learned to be discreet.

There are still plenty of rich people in Paris, of course. One draw for finance companies is that the city is teeming with high-end restaurants and grand apartments, and that it already has a large business district, La Défense, just west of town. Whole neighborhoods of the capital empty out each summer, as residents retreat to their second homes.

But there are still rules against showing it off. Parisiennes rarely walk around wearing the giant diamonds that are de rigueur in certain New York neighborhoods. “It’s more in a private dinner that you see the wealth,” a French friend explained.

It’s fine to discuss money in France, as long as you’re complaining that you don’t have enough, or boasting about getting a bargain. No one here appreciates the American thrill I get from overspending, any more than they understand why we have a national holiday (Thanksgiving) during which you’re practically obliged to overeat.

And they’re revolted when money seems to trump all. Last summer, locals made a stink when the Saudi king and his entourage were allowed to cordon off a public beach on the Riviera. “The point we wish to make is that not everything can be bought,” a politician leading the protest explained.

The typical “French dream” (or at least the one people admit to) isn’t of great wealth, it’s of great security, including a steady income and pension. When you apply for a mortgage here, banks don’t care what stocks you own, because stocks can go down; they want to see a monthly salary and a permanent work contract.

The French don’t think everyone should have the same bank balance, but they’re offended by extremes of inequality. Noting that the chairman and chief executive of Renault (who doubles as the chairman and chief executive of Nissan) earned 764 times France’s minimum wage last year, Le Monde added that “in the context of an economy at half-mast and mass unemployment, it’s a difficult pill to swallow.”

I see this principle in daily life. When I told a Paris official that a group of parents was willing to buy a new security camera for our children’s school (the city had been dragging its feet on our request), he was aghast, saying, “What about the other schools where parents can’t afford to buy new cameras?”

All of this is playing out in the post-Brexit debate. On one hand, France is avidly courting London’s financial industry. On Wednesday, Prime Minister Manuel Valls announced new tax breaks for people and companies willing to relocate here, including French expatriates returning home. In September, the government will open centers to help them get visas, apartments, office space and spots in bilingual schools. “We want Paris to be the premier financial market of Europe,” he said.

Mr. Valls urged executives here to remind their British counterparts that the infamous 75 percent tax is gone: “If some among you can be patriotic and explain to the British media that it doesn’t exist anymore, I’d be thankful.”

But the welcome is not without reservations. Jean-Louis Missika, Paris’s deputy mayor for urban planning and economic development, told me in an interview this week that Brexit also offers a cautionary tale about what happens when the superrich dominate a city, pricing out practically everyone else. In London recently, I visited friends at the peak of middle-class careers who are living crammed with their children in a one-bedroom rental. There are people in northern England — many of them voted for Brexit — who can barely afford a coffee in the capital. Paris isn’t cheap, but it’s more affordable.

Mr. Missika said that France still faced “complicated and difficult, but urgent questions” about how much it was willing to cut taxes to attract financial companies. “I say yes to finance, but to an ethical one that respects fiscal rules” and the environment, the mayor of Paris, Anne Hidalgo, said on Wednesday.

“I think we have to roll out the red carpet,” said Mr. Missika, who worked in private equity himself. “But if rolling out the red carpet means aligning French taxes and finances with what was practiced in London or Jersey, I don’t think it’s serious. It’s not possible. And I hope that neither Germany nor the Netherlands nor any of the other cities that are competing with Paris will make that big mistake.” He predicted that sectors of the financial industry will cluster in different cities.

Paris is meanwhile stepping up its efforts to attract technology companies, start-ups and so-called creative-economy jobs, which Mr. Missika said are more connected to the rest of the city and will help develop it over the long term. Paris will no doubt get some finance jobs, too, but I doubt it will ever become the next London. It doesn’t really want to be that. And it’s probably right.

Pamela Druckerman is the author of Bringing Up Bébé: One American Mother Discovers the Wisdom of French Parenting and a contributing opinion writer.

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