May 23, 2017
Restoring French economic ‘joie de vivre’ was a cornerstone of Emmanuel Macron’s Presidential bid, but Macron’s recent appointment of Edouard Phillippe as France’s Prime Minister has left many questioning whether the new President is actually able to unite the country and forge a viable path forward.
Macron was quick to take the initiative in showing his reformist spirit, appointing a very balanced cabinet, both ideologically, and in terms of gender distribution, as nine of the 18 ministers are women. The ministers hail from all three major political parties, including the left, the right, centrists, the Greens and from Macron’s own movement. Seven have no political affiliation at all, which shows the President’s willingness to embrace diversity of opinion and create a sense of political unity behind a common objective: a rejuvenated France.
Make no mistake, however, as the road ahead will be rocky. The first hurdle is the upcoming June legislative elections. The polls are critical for Macron and his party La Republique en Marche! (REM) to secure a majority in Parliament – otherwise the young President’s wings will be clipped before he has even gotten off the ground. Among Macron’s biggest opponents in the French Parliament are likely to be Les Republicains (LR), who according to polling conducted by Harris Interactive are set to take 22% of the vote on June 11, as will Marine Le Pen’s xenophobic party, the Front National (FN). Although REM is predicted to finish with 26% of the vote in the first round, that number is not nearly enough to secure a majority.
Making matters worse, Macron and his Prime Minister are already suffering from low public confidence, as only 45% of voters have confidence in the President, and even fewer in Edouard Philippe, meaning the new President is starting with the lowest start-of-term lowest ratings in over 20 years. Therefore a “cohabitation” — a two-party coalition — between Macron’s En Marche! and the Republicans, led by Francois Baroin, is the more likely scenario, which could throw even more spanners in Macron’s promises to bridge the ideological gap and bring France together.
Macron’s second hurdle might be even harder to overcome: the streets. Francois Hollande’s economic policies all but shattered the French people’s confidence in their government’s policies, leading to violent protests over a labour law signed in 2016, the crux of which dramatically weakened the positions of French worker unions by reducing their control over hiring-and-firing practices of companies. While Macron’s policies of giving further power to the private sector, taking a sledgehammer to the corporate tax rate, and cutting 120,000 civil service jobs may seem extreme, such reforms are way past their due date. French unemployment is stubbornly hovering in the two digits, growth is anaemic and the deficit is on course to hit 3.1% in 2018.
Despite certain policies that will impact France’s cherished welfare state, Macron’s other economic plans seek to get the country’s lower and middle class moving again. He plans on maintaining the retirement age of 62, raising disability allowances and incentivizing companies hiring people from 200 designated lower-income areas through a €15,000 bonus doled out over three years.
The third and last hurdle Macron has to jump over in order to deliver on his economic promises lies not in Paris, but in Berlin. It’s a well-known fact by now that German ordoliberalism and near-perpetual austerity have played an outsized role in depressing aggregate demand in Europe. German wages have been fairly stagnant in the last decade, going up only incrementally, while its exports have soared. Germany’s unwillingness to boost internal consumption has contributed to the gaping deficits seen across the Eurozone. Such stubbornness runs contrary to Macron’s proposals for Eurozone reforms, which envision a European finance minister and a common budget for the Eurozone. For Berlin, this sounds like giving the key of its treasury to Brussels. Unsurprisingly, the German government is anxious about Macron turning into a rather expensive partner.
Nevertheless, while these obstacles appear daunting, Macron might still pull it off. He remains popular among large swaths of the country, and his centrist views are crucial in striking a balance between the old and new. While some may scoff at Macron’s inexperience, this is part of what made him so popular among the 20 million people who voted for him. He wasn’t affiliated with either of the political parties that had ruled over the country in previous elections, be it the scandal-ridden, disastrously unpopular Socialist party left in tatters by Francois Hollande, or the Front National led by Marine Le Pen.
Again, partially due to his middle-of-the-road programme, Macron’s cabinet selection indicates he has made allies across the political spectrum, meaning that he’s surrounded himself not with ‘yes-people’, but with individuals who bring a wealth of experience and different ideas to the table. Not having a direct political affiliation on either side of the spectrum hints that Macron will be more likely to listen to ideas from both sides and take everything into consideration instead of getting bogged down in constrictive, ideology-infused ideas.
In order to restore France’s economy to prosperity, Macron had to choose a cabinet that rejected the old guard, but that is experienced enough to hit the ground running. This delicate balancing act will be crucial if Macron hopes to deliver on his electoral promises, especially since bipartisanship and compromise has often been in short supply in France’s political system. However, in a presidential election that shattered many of the country’s conventions, maybe the stage is set for another break with the past.