The French election was not a referendum on populism, or on Donald Trump, as the liberal media has claimed. It was instead a resounding rejection of Socialism. Emmanuel Macron, running outside the country’s established parties, captured an astonishing 308 seats in parliament; he and ally Modem will command 350 deputies in all, the most ever in the history of the Fifth Republic. Who lost seats? The Socialists, who ended up with a mere 45, down 283 from the prior session. That is a serious clobbering.
Marine Le Pen’s National Front, for the record, will claim 8 seats in the new legislature, having picked up 2. It is true that during the presidential contest, she came closer to winning a national election than ever before. But voters in France decided her leftist push for more government intervention in the economy, adherence to the 35-hour work week, call for greater social benefits and hiking taxes on the rich was not going to help France climb out of its economic doldrums.
Le Pen did embrace certain nationalist positions, also championed by Donald Trump, including limiting the influx and tolerance of illegal immigrants and trade protectionism, but so did other parties in France. The Republicans, under Francois Fillon, also spoke out against uncontrolled immigration, and Macron too, took a hard line, promising to beef up control of France’s border and greater scrutiny of immigrants. Le Pen took an aggressive stance against radical Islam in the wake of several terror attacks in France, calling to “expel foreigners who preach hatred on our soil"; but that position was also taken at one time by Socialist Prime Minister Manuel Valls and by President Francois Hollande.
French politics does not line up neatly against those in the U.S. Indeed, The New York Times in a recent article lumps Le Pen together with the far-left candidate Jean-Luc Melenchon, describing both as “anti-Europe, anti-globalization, [and] largely suspicious of capitalism.”
What does deserve comparison is voter disenchantment with left-leaning politics-as-usual and those who advocate more of the same. Hillary Clinton was defeated in the U.S.by frustration over a sluggish economy; the Socialists got trounced because they had promised to reform and recharge the economy and failed to do so.
During the 2016 election campaign, I often wondered why Hilary Clinton (or the debate moderators) didn’t press Bernie Sanders to explain why his Socialist agenda would work in the U.S. when it had so clearly failed in France. Unlike Germany or the UK, France has suffered years of skimpy growth, high unemployment, and sizeable budget deficits. The most recent figures confirm an economy barely moving forward, after several years of growth below one percent. The paltry progress is despite (or, some would say, because of) running hefty budget deficits since the mid-1970s; last year the fiscal hole amounted to 3.4 percent of GDP. At the same time, Germany ran a surplus and England’s 2016 deficit was less than 1 percent of GDP.
Meanwhile, unemployment in France is 9.6 percent and has been above 7 percent for decades. In Germany, only 3.4 percent of the population is out of work, the lowest level since 1980; in the UK the figure is at a 42-year low of 4.6 percent.
Why is France doing so poorly? The 35-hour work week, initially adopted in 2000 by Prime Minister Lionel Jospin's Plural Left government, has come to symbolize the country’s problems. A year ago, Socialist President Hollande and his party were hard at work trying to dismantle that rule and other features of France’s burdensome 3,800-page labor code. The objective was to give employers a freer hand in hiring and firing workers, in order to boost employment.
The government’s reforms specifically targeted more flexibility in hiring young people, attempting to reduce youth unemployment stubbornly stuck at above 20 percent for years. But Hollande had been elected in 2012 embracing traditional leftist policies which included higher government spending and a 75 percent super tax on the rich. Half-way through his term in office, responding to a stagnant economy and a 40-year high in unemployment, he adopted a more business-friendly approach. At the end of 2014, the wealth tax was discarded, though not before losing to other countries some high earners like Bernard Arnault, the CEO of luxury group LVMH, and the actor Gérard Depardieu.
Hollande’s volte-face was his undoing. He lost the support of France’s militant labor unions and left-wing students, who took to the streets in widespread demonstrations. Ultimately, with his approval ratings in single digits, he chose not to run again for re-election, the first French president since World War II not to do so.
The irony is that France’s new president won such a commanding majority (though with extremely low voter turnout) while promising to push pro-business reforms very like those that felled his predecessor and Nicholas Sarkozy before him. Macron served in the Hollande government, but clashed with the Socialists over the 75 percent tax, calling France under such a tax regime “Cuba without the sun.”
Like the GOP in the U.S., Macron will sell changing dysfunctional labor regulations as especially helpful to small and medium-sized companies that are crushed under rules designed for huge corporations. For instance, he wants to allow companies to bargain with unions independently, freeing them from the sector-wide inflexible agreements that currently prevail. The new president vows to implement his program swiftly, in part by circumventing Parliamentary debate, no doubt aware that he has a limited amount of time before the unions will balk and his honeymoon ends. The Communist-leaning union CGT has already warned they will not tolerate any such “undemocratic” effort. Unions only include 8 percent of workers in France, but their clout remains significant.
A thriving France is important to Europe and to the United States. We can only hope that Macron succeeds where others have failed and that his agenda does not get snuffed out by the Left’s antipathy towards the very employers so essential to rejuvenating the country.