"You are stupid."
Translation:Tu es bête.
Yes, they would! Remember that "vous" is used for formality, not necessarily respect. (Those often overlap, but not always!) In other words, you can be very upset with someone you don't know well, and whom you would address formally. An English equivalent is the difference between those we'd address as "Mr./Ms. Surname", and those we call by their first names. Imagine a context where you'd say "You, sir, are an idiot!" High formality, but not necessarily respect. :7
My grandmothers was a native speaker and she used to vousvoyer (use the vous form of verbes) my grandfather or her children whenever she was displeased with them. Like when I called my brother un bête bébe in front of her she just looked at me and said, je pense que vous voulez aller à chambre.... ( I think you want to go to [your] room). As her granddaughter, she normally tutoyé (used the tu form) me.
I assume she's not the only française to speak that way...
As a native-speaker, I never used 'vous' to show someone i was upset at him/her, but I guess that could be something that could have been used a while ago. For me 'vous' is mainly an indication of how well you know the person or of hierarchy (you usually say 'tu' to your colleagues but 'vous' to director of your company :) ).
Nothing stops people in 'authority' from being stupid. Vous is commonly used for such people (teachers, city mayors, bosses, police etc...) Moreover, use of tu would indicate a level of friendly familiarity that you probably don't feel for such people if you are calling them stupid.
"T'es" is a written way to represent what informal (reduced) spoken French sounds like, but it's not an "official contraction." Sort of like "yer" for "your", or "gonna" for "going to" in English.
So really, you can say "t'es", but you probably wouldn't write it, unless you were trying to transcribe dialogue, or writing in a very informal context (like texting, in music or rap lyrics, etc.)
"le" is always made into a elision when it's an article for a noun beginning with a vowel or an H muet. It doesn't change before H aspiré.
Making sense is a pretty iffy commodity when you're discussing language. That contraction, as discussed above, is a representation of casual speech, but is not correct, especially in a language-learning context. As is true in many fields of endeavour, first you learn the rules, then you can break them.
Actually, "t'es" makes sense, if you want to transcribe casual speech. It is not part of "standard written (formal) French", though, the way "c'est" is. An English parallel might be "gotta" (you see it written, to convey how people "really talk," but it's definitely not "standard written English.") But you might see "t'es" in a song or rap lyric, or in dialogue ("between the quotes!")