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Macron has had 3 prime ministers this year. How long with this one last?

Background

The crisis revolves around Eurozone fiscal rules. The EU never enforced its Growth and Stability Pact or Maastricht Treaty rules. But now it wants to.

French President Emmanuel Macron is struggling to find a Prime Minister who can lead a three-way fractured political environment in which no group has a majority.

In France, the prime minister is appointed by the president and is responsible for leading domestic legislation, including the budget.

On September 8, I noted French Government Collapses in No-Confidence Vote, What’s Next?

Bye Bye Bayrou [Macron’s last Prime Minister]. An amusing “Let’s block everything movement” takes hold.

On September 9, Macron appointed Prime Minister Sébastien Lecornu as his third prime minister in a year.

It’s not going well.

Strikes Roil France

The AP reports Strikes and protests roil France, pitting the streets against Macron and his new prime minister

The day of upheaval for the European Union’s second-largest economy aimed to turn up the heat on new Prime Minister Sébastien Lecornu and his boss, Macron. They’re engaged in an intensifying battle both in parliament and on the streets about how to plug holes in France’s finances, with opponents fighting proposals to cut spending on public services that underpin the French way of life.

Protesters’ anger at budget cuts

Macron’s opponents complain that taxpayer-funded public services — free schools and public hospitals, subsidized health care, unemployment benefits and other safety nets that are cherished in France — are being eroded by his governments that have lurched from crisis to crisis since he dissolved parliament in 2024, triggering a legislative election that stacked Parliament’s lower house with critics of the president.

Placards at the Paris demonstration read: “Tax the rich.”

“We need to find money where there’s money,” said Pierre Courois, a 65-year-old retired civil servant. “France’s deficit is an issue, but it’s not by cutting on public services that you fix it.”

“Our pay is stuck, colleagues are leaving, and wards are closing beds,” said 34-year-old public hospital nurse Stephane Lambert. “For us it’s the same story: less money in our pockets, fewer hands to help, more pressure every day.”

Lecornu’s baptism of fire

As he seeks support for belt-tightening, Lecornu has trimmed lifetime benefits for former government ministers — a largely symbolic first step that won’t generate huge savings — and scrapped wildly unpopular proposals to eliminate two public holidays, a measure intended to spur revenue. He has been meeting opposition leaders and labor unions to try to build consensus for a budget, but his close relationship with Macron puts him in the firing line, too.

“Bringing in Lecornu doesn’t change anything — he’s just another man in a suit who will follow Macron’s line,” said 22-year-old student Juliette Martin.

On his first day in office last week, anti-government protests saw streets choked with smoke, barricades in flames and volleys of tear gas as demonstrators denounced budget cuts and political turmoil. That “Block Everything” campaign became a prelude for Thursday’s even larger demonstrations.

Scattered violence

The first whiffs of police tear gas came before daybreak, with scuffles between riot officers and protesters in Paris. The collapse of successive governments — brought down by votes in parliament — that sought to push through savings has given Macron’s critics a sense of momentum. The “Block Everything” campaign that developed online before taking to the streets also added to the climate of crisis.

As it did last week, the government said it was again deploying police in exceptionally large numbers — about 80,000 in all — to keep order on Thursday. Police were ordered to break up blockades and other efforts to prevent people who weren’t protesting from going about their business.

The Interior Ministry reported 181 arrests nationwide as the afternoon ended and more than 450,000 demonstrators outside Paris, with protests in big cities and small towns. Paris police said that another 55,000 people marched in the capital. Participation estimates from the CGT, among unions that called the strikes and demonstrations, were double those of police, reporting more than 1 million strikers and protesters nationwide.

French Unions Pressure Macron

Reuters reports French unions strike against austerity, pressuring Macron

Hundreds of thousands took part in anti-austerity protests across France on Thursday, urging President Emmanuel Macron and his new Prime Minister Sebastien Lecornu to acknowledge their anger and scrap looming budget cuts.
Teachers, train drivers, pharmacists and hospital staff were among those who went on strike as part of the day of protests, while teenagers blocked dozens of high schools for hours.

“The anger is immense, and so is the determination. My message to Mr. Lecornu today is this: it’s the streets that must decide the budget,” said Sophie Binet, head of the CGT union.

Lecornu and Macron are under pressure on one side from protesters and left-wing parties opposed to budget cuts and, on the other, from investors concerned about the deficit in the euro zone’s second-largest economy. Parliament is deeply divided and none of its three main groups has a majority.

Budget Compliance Rules

1. Deficit rule: a country is compliant if (i) the budget balance of general government is equal or larger than -3% of GDP or, (ii) in case the -3% of GDP threshold is breached, the deviation remains small (max 0.5% of GDP) and limited to one year.
2. Debt rule: a country is compliant if the general government debt-to-GDP ratio is below 60% of GDP or if the excess above 60% of GDP has been declining by 1/20 on average over the past three years.

France’s general government gross debt is projected to reach approximately 116.0% of its GDP in 2025.

France Budget Deficit and Debt-to-GDP 2024
 

Debt-to-GDP courtesy of Trading Economics, Deficit insert from https://countryeconomy.com/deficit/france

France and Italy Noncompliance

• France Debt-to-GDP: 113% vs target 60%
• France Budget Deficit: 5.8% vs target 3%
• Italy Debt-to-GDP: 135.3% vs target 60%
• Italy Budget Deficit: 3.4% vs target 3%

France is Ungovernable

There is no chance of any political party addressing the debt and deficit rules.

So, why would anyone want to govern?

The only answer is arrogance, but arrogance will not fix any problems.

Related Posts

March 27, 2024: Expect a Financial Crisis in Europe With France at the Epicenter

What’s the Basic Problem?

Eurointelligence says “Technology is the main cause of the decline. Geopolitics is what accelerated it.”

Technology is not the problem. The Maastricht treaty that created the Eurozone is flawed. And it cannot be fixed without unanimous agreement

The EU Is Dysfunctional

In a single word, the EU is dysfunctional. That’s the problem, not technology. The Maastricht treaty itself is a big part of the reason the EU is dysfunctional. The Euro itself, with one common interest rate, is fundamentally flawed.

 June 21, 2024:  Debt Brakes and Treaty Requirements About to Smash the EU.

The EU has launched an Excessive Debt Proceeding against France. It won’t stop there.

Hoot of the Day

To achieve a government debt-to-GDP ratio of 60 percent, EU countries will have to reduce spending or raise taxes by 2 percent of GDP, on average, every year for 46 years.

Let’s just say it’s not going to happen. But these clowns are likely to try, if for no other reason than punish Le Pen.

Nothing has been solved because nothing can be solved. It’s politically impossible.

The French government is about to collapse again with France nowhere close to meeting debt brake and fiscal compliance rules.

If any party gets a majority in the next election, it will regret winning. No one is willing or able to address the mandatory rules.

January 10, 2025: The Political Crisis in France Is About to Get Much Worse

The entire eurozone is in shambles, and Trump’s demands will accelerate the crisis. One seriously must wonder if that is his real goal.

Well, that was certainly accurate.

August 27, 2025: French Government on Verge of Collapse Over Debt Crisis, What’s Next?

A vote of confidence is scheduled. Expect the government to fall.

By August 27, 2025, everyone was making that call. No credit to latecomers.

The EU Has a Big Problem With Military Spending and Trump’s Definition

In case you missed it, please see my September 4, 2025, post, The EU Has a Big Problem With Military Spending and Trump’s Definition

France currently spends 2.1 percent of its GDP on defense. Italy spends 1.5 percent.

Trump demands 3.5 percent. See the above link for details.

Currency Crisis Awaits

Nothing has been solved because nothing can be solved. It’s politically impossible.

I keep repeating the idea “a currency crisis awaits”.

However, things are so screwed up globally that a crisis can start anywhere. The EU, US, China, and Japan are all possibilities.

There is no fiscal sanity anywhere.

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