Macron – final chance to revive France as we know it

  1. Wybory we Francji

Both finalists of the presidential bid disrupt the French bi-partisan political system but differ substantially in how the political, economic and social changes should be implemented  – E. Macron within the framework of European integration and predictable economic policies while M. Le Pen in total opposition to them. The success of Macron presidency will depend on his ability to implement far reaching and socially recognized economic policies, including labour market one, as well as on avoiding reputational problem experienced by his predecessors. Despite losing the bid, Marine Le Pen has yet again enlarged the electoral base of the National Front; unsuccessful Macron presidency will most likely elevate Le Pen to power in 5 years.

Opinion piece by Wojciech Białożyt, Managing Director, WiseEuropa

Turning point for the 5th Republic

Macron’s successful bid for presidency ends almost 40 years of political supremacy of both the Socialist Party and moderate right (republican right).  French political, economic and social systems are in deadlock as least since Jean-Marie Le Pen unexpectedly burst into the runoff of the presidential elections in 2002 defeated later by Jacques Chirac. It was followed by, among others, massive riots in French cities suburbs and rejection of the European constitution in nationwide referendum in 2005.

Deeply rooted discontent of the French general public over the how the country is being governed is based on two major factors: bad condition on the labor market with the unemployment constantly rising in recent decade (reaching 10% currently) that diminishes purchasing power of less educated and poor households. Also, conservative and poorer part of the society reject constant inflow of migrants, in which they see threat for the French identity as well as the cause of difficulties on the labor market, decrease of living standard and increase in crime.

In 2007, Nicolas Sarkozy was elected president after campaigning to break with previous political and economic routines. He pushed for constitution and economic policy changes but they turned out to be moderate in nature and additionally were halted by the European economic downturn. François Holland after being elected in 2012 as anti-Sarkozy was unwilling to challenge the political and economic deadlock. If E. Macron misses to deliver his promises to revive France economically and socially, M. Le Pen will be very well positioned to become next president of France in 2022.

Who is Macron?

In 2014, F. Holland appointed his little known advisor Emmanuel Macron for the post of Economy Minister elevating him to the first political league. E. Macron is 39, graduated from political science and École nationale d’administration. In 2007-2008, he served as secretary of the bi-partisan group of experts led by Jacques Attali (former advisor to F. Mitterand and former chairman of EBRD) who, charged by president Sarkozy, drafted major strategic document entitled “316 means to liberate the growth in France”.

After the appointment to the government in 2012, Macron attempted to introduce bolder economic agenda but his plans were pushed back by reactionary part of the Socialist Party and hindered by the president’s hesitations. In 2016, Macron stepped down from the government and launched preparations for the presidential bid.

His 2017 electoral success resulted from the general public’ rejection of the traditional political parties system while his pole position after first round of voting on April 23 was partly due to reputational problem of Republican candidate F. Fillon whose moderate supporters have eventually chosen Macron.

Economic situation

Since the beginning of 2000s, France suffers from poor economic growth (1.1% in 2016), public expenditures reach over 55% of GDP while the public debt went beyond 95% of GDP (accelerated after introduction of 35-hour workweek in 2000). It is estimated that the 35-hour regulation impacted most the working class and poorly educated and triggered further the delocalization of the French companies to the new EU Eastern members seeking to diminish labor costs.

French workers produce 35% less than Americans during their professional activity, share of the French export in the global trade is diminishing since 1994. With 3.5 million of unemployed, over 500 thousand of job posts are not filled up. Youth unemployment goes beyond 20%. Only about 50% of kids coming from working class families complete the secondary education while about 20% of children experience problems with reading and writing while leaving primary school.

Attali Commission in which E. Macron was involved between 2007-2008 stated that France is “country for privileged in which the state controls the smallest signs of people’s activity and deepens the climate of social mistrust”. Recommendations of the Commission, despite the fact that were requested by president Sarkozy, have never been implemented.

Attali report has also pointed out strengths of French economy: highest birth rate in Europe, high standard of healthcare (13% of GDP is spent on healthcare), developed infrastructure and dynamic intellectual and social life. Several sectors of French economy are leading ones globally: pharmaceutical, nuclear, telecommunication, tourist.

Rise of the National Front

Economic deadlock has been fueling the National Front in recent decades. In 2017, Marine Le Pen has yet again broadened the electoral base gaining in first round of elections 7.6 million votes, over a million more than on 2012 when she was ranked 3rd and almost 3 million more than her father Jean-Marie in 2002. After taking over the part in 2011, she abandoned negationist agenda of her father and focused on economic, labor market and identity issues.

Macron foreign agenda

Macron’s success will help prevent further disintegration of the European Union that could certainly follow Le Pen election who campaigned for leaving (fully or partly) the euro zone as a burden for economic growth and for substantial change of conditions of the French EU membership. Under Macron, revival of the French-German partnership should be expected (regardless who wins the elections in Germany later in 2017) as well as deepening the integration processes, e.g. in the euro zone. Macron proposed creating the post of finance and economy minister of the euro zone and enhancing the security and defense agenda of the EU. Among top four candidates in the elections, Macron was least enthusiastic towards the president Putin policies. He supported continuation of the sanctions imposed on Russia unless the Minsk agreement is fully implemented while at the same time he saw relevant to continue the political dialogue with Russia. Macron will not change the France commitment to NATO, while under Le Pen France would most likely be about to leave its military structures, which it rejoined in 2009. After Brexit, France will be the only EU member to have the nuclear capacities and to be seated permanently in the UN Security Council.

Parliamentary elections to follow in June

Parliamentary elections scheduled for June are to complete the 2017 election calendar in France and can impact the Macron’s political room for maneuver. While the president has a central position in the French executive system and defines the policies implemented by governments, previous cases of cohabitation of presidents and governments representing different political backgrounds were causing conflicts. It can however be envisaged that on the wave of Macron’s overwhelming success in May, his political movement will gain substantial number of seats in both chambers of the Parliament (partly following expected disintegration of the socialists and weakened right) making the most of the majority voting system, too.