A vote against France’s budget policy could drag the entire eurozone into a serious economic crisis. The ghost that many experts evoke is that of Greece about ten years ago, which caused serious shocks in the old continent. At the moment everything depends on Marine Le Pen, the leader of the French far right determined to reject the budget proposed by Prime Minister Michel Barnier. The domino effect, with a fall of the Paris government, would frighten the markets, already alarmed by the German crisis and the possible implications of Donald Trump’s election on companies in the EU bloc.
Le Pen decisive in the vote on the French budget
All in the hands of the Rassemblement National. As the loser of the legislative elections, the party of Marine Le Pen and Jordan Bardella finds itself with the upper hand. The two are threatening to pull the plug on the government led by Prime Minister Michel Barnier. Having been in office for just three months, approval of the budget is essential for Barnier. France has generated a debt equal to around 6% of its GDP, double what the EU admits and is in tight negotiations with Brussels to understand how to spread it in the face of profound reforms.
Spending cuts are essential, but it is where to apply them that the government comes up against resistance from other political parties. Ruled by a very fragile majority, Barnier is struggling to convince both the radical left of the New Popular Front (NFP) and the far right of the Rassemblement National. The confusion that reigns under the Eiffel Tower goes beyond the transalpine borders, potentially dragging other countries in the EU area with it.
Because everyone wants to bring down the Barnier government
The meeting on 25 November between Barnier and Le Pen at the Elysée was of no avail. “My position has not changed. No more than, apparently, that of the prime minister has evolved”, declared Le Pen all exit from Palazzo Matignon. The RN leader considers the increase in electricity taxes “unacceptable” and the “de-indexation of pensions”. His party instead calls for cuts in immigration matters, especially denouncing the burden of medical assistance offered to migrants, and on state bureaucracy. While former Macronist prime minister Gabriel Attal speaks of an “irresponsible” position on Le Pen’s part, she rejects the accusation of wanting to sow “chaos” in the country, downplaying the significance of the negative vote.
He has already placed the responsibility for a political crisis on President Emmanuel Macron, accused of having created a de facto government without a real majority. Doubts about the budget drawn by Barnier’s staff have extended to most of the country’s political actors, including his Macronist allies. The goal of saving 60 billion euros is a mission that dissatisfies everyone. According to an Ipsos survey published on The Tribune53% of French people would like to see the government fall. But if it really were to happen, what would the consequences be for the country and the rest of Europe? Government spokeswoman Maud Bregeon warned the other parties, speaking of “a Greek scenario”. Translated: there is a risk of a serious financial crisis.
The ghost of a new Greek crisis
Ten years ago Greece was overwhelmed by an unprecedented crisis, showing the fragility of the entire eurozone. The earthquake from Athens spread to the banking systems of Portugal, Ireland and Spain. France and Italy were also wavering. However, it was still the era of the German locomotive, led by the stainless Angela Merkel. Today the European situation is much more chaotic. Berlin itself is grappling with various issues, from industrial impoverishment as demonstrated by the layoffs at Volkswagen and Thyssenkrupp, to political stalemate, with the increasingly concrete threat of the far right in power. There are too many jobs threatened by a guillotine for Germany to once again deal with “saving” the European economy. The situation in Brussels is equally delicate, with Ursula von der Leyen’s executive struggling to find a consolidated majority.
“Party employees paid with EP money”: the accusation that gets Marine Le Pen in trouble
The alarm has already been raised by the European Central Bank: the eurozone debt crisis is around the corner, driven by too little growth and widespread political instability. The negative vote on the French budget would deal another very severe blow to the stability and credibility of the EU economy. Le Pen is ready to unleash it, while she awaits the outcome of a delicate trial, in which she is accused together with 26 other people of having embezzled funds from the European Parliament to pay party employees. Whether or not it is worth bringing down a government that, in its own way, it has in its grip remains the main question.
