Refractory Gauls, or the French politics thread

[Sheilbh]

Both extremes are Kremlin assets. Everyone is a possible asset when your objective is destabilization.

Which is the strategic risk of a political project of consolidating the centre v the extremes, at the expense of political choice and contestation within the mainstream.

This is where I disagree with Pisani-Ferry, and also the more "policy" focused/technocratic strands of our politics.

[Sheilbh]

Looks like we have a French Liz Truss.

https://www.bbc.com/news/articles/cewn9k0w9rxo

So...finally give people the socialist they voted for?

In addition to Zoups points the big problem here is the budget.

Eurzone budgetary rules were significantly tightened following the Eurozone crisis. Macron's big achievement in his first term was getting France within those rules, plus structural reforms which he hoped would be rewarded by a big leap forward in European integration - it wasn't. The rules were then suspended following covid and extended a bit further because of Ukraine.

The suspension ended in 2024. France's budget is in breach and it's the first big country going through the "excessive deficit procedure" which requires their deficit to be cut to no more than 3% by 2029. And the Commission considers it essential to properly police this given the perception that rules were waived under the Growth and Stability Pact contributed to the Eurozone crisis (as Jean-Claude Juncker put it when asked why budget rules weren't being enforced, "because it's France" ).

With the National Assembly split in three, the budget is the core problem for Macron. Last year they couldn't pass a budget and so there are provisions in the French constitution that basically allow for an emergency automatic extension - I think France already had this for its 2025 budget so might need it again.

In that context it is really difficult for Macron to work with the NPF who reject Macron's pension reforms and want windfall taxes on excess profits plus wealth taxes. I think the RN now also want to abolish Macron's pension reforms (they've previously accepted the reforms but wanted higher rates) and basically want some taxes reduced, others increased plus "DOGE" like audits of finances in the (almost certainly imaginary) search for cuts that can be made. So for Macron and his bloc to work with either of these parties means compromising on one of his big projects but also doesn't necessarily seem to actually present a path to escaping the excessive deficit procedure. There is no way to a majority that will not also involve the humbling of a President by two wings of politics that loath him. And Macron wants to preserve his legacy through a more balanced program of austerity (while increasing defence spending).

I'd add that there is the possibility of ECB intervention if they consider that France's bonds are coming under "unfair" attack by bond markets (spreads are already at the highest since 2012). I think given the context there's no chance at this point of the ECB considering this the sort of situation they should intervene in. Even if the did, intervention comes with strict conditionality - it wouldn't be the Troika but Troika-esque policies.

The parliamentary math and budget situation are both pretty impossible. It's very, very difficult to see a path out, at least until the next Presidential election and the hope of a new President acquiring a legislative majority. And if the EDP is already a bit of a humiliation for the most European leader - and a country like France - none of the alternatives are much better. I've said in the UK thread but I think France and the UK are in a bit of a race for who hits crisis point first.