France’s unbalanced power structures are storing up trouble

The writer is a senior fellow at the German Council on Foreign Relations

Since President Emmanuel Macron’s decision to call snap parliamentary elections, markets have woken up to the economic and political risks that have been brewing in France for years. With France placed this week under an excessive deficit procedure by the European Commission, the pressure is intensifying. The central question now is to grasp how bad economic policy could turn under a government led by the far-right Rassemblement National.

Marine Le Pen, the party’s dominant figure, would most likely leave the premiership to Jordan Bardella, her protégé, in order to run for the presidency in 2027. In this way she would avoid the “Matignon curse”, which posits that no incumbent prime minister stands a chance of winning a presidential election. 

Making sense of the RN’s economic policy is challenging, and assessing how it would evolve under the influence of a coalition partner like the conservative Les Républicains party, or be contained by parliament, is a difficult exercise. Since her presidential election defeat in 2017, Le Pen has sought to normalise the RN’s economic platform. The party has in effect abandoned its call to leave the Eurozone or the EU, presenting a more moderate economic programme in 2022. It contested Macron’s pension reform but retreated this week from the idea of abrogating it.

Its most radical proposal now is to reintroduce a wealth tax, which, depending on how it is designed, might simply return France to the pre-Macron era. Economic policy uncertainty remains very high, given the lack of experience in the RN’s team, and the back and forth on large spending items like VAT cuts or energy price subsidies. But while Macron’s government warns of economic calamity if Le Pen’s party wins the election’s second round on July 7, the biggest threat lies elsewhere.

A comparison with Italy is instructive. The coming to power in 2022 of Giorgia Meloni and her hard-right Brothers of Italy party has not disrupted the economy. Italy is a parliamentary democracy with checks and balances less apparent in France’s presidential system. Besides, Meloni, unlike Le Pen or Bardella, had real experience of government before she became premier.

Meloni has been somewhat constrained by her coalition partners, who have deep ties to Italy’s northern industrial heartlands, and by a political system where local power brokers matter. Last, she understood that maintaining a strong relationship with the EU, the US and Nato was critical to her international standing and survival, and that the Italian business lobby could be her best ambassador if she resisted her most populist impulses.

France, on the other hand, has a profoundly dysfunctional system, marked by the presidency’s wide-ranging executive authority and by the centralisation of power. If Le Pen were to win the presidential election in 2027, she would probably secure a parliamentary majority with her allies and could govern unchecked. Equally, if a state of “cohabitation” prevailed over the next three years — with Macron and a far-right government at odds with each other — then his ability to restrain the RN would be limited, notwithstanding the presidency’s constitutionally enshrined powers.

Macron’s parliamentary group, which he has consistently disregarded, would be too small, weak and isolated to wield much influence. This would push him into open confrontation with his prime minister, using and potentially abusing the presidency’s limited right to veto legislation and challenge government policies. Macron would have every incentive to sabotage his prime minister’s actions, so as to demonstrate the RN’s unfitness to govern. Meanwhile, the RN would draw inspiration from troubling precedents set by Macron himself. It could try to bypass parliamentary debates by invoking emergency procedures, resorting to Article 49.3 of the constitution to pass legislation or even challenging EU decisions and rulings from the European Court of Justice. 

France’s last “cohabitation”, with Jacques Chirac as president and Lionel Jospin as premier, posed no real danger to EU stability. But if Macron and Bardella sat next to other leaders at European summits, each representing France but with diametrically opposed views on the EU, that would not only harm France’s standing but threaten the bloc’s basic policymaking processes.

What is concerning about France’s crisis is less the potential shift in domestic economic policies than the fact that the political system is incapable of generating compromise. The Fifth Republic remains a winner-takes-all system. It can only be tamed in a “cohabitation” if the president and prime minister are ready to choose compromise over chaos. Right now, the prospects for that are not promising.