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One of the messages that helped the far-right Rassemblement National party sweep to power in France’s parliamentary elections on Sunday — a move once thought unthinkable — is a common refrain in American politics: It’s all about the economy, you moron.
Both the National Rally and a coalition of left-wing parties called the New Popular Front made big gains, partly by playing on anger over a cost-of-living crisis and a sense that President Emmanuel Macron was out of touch and didn’t understand their problems. Voting takes place in two rounds, with candidates who reach certain thresholds advancing to the next round on Sunday.
With high inflation for two years now, low- and middle-income French families are struggling to pay for basic necessities such as energy, gas and food. In some cases, wages cannot keep up. Polls show that concerns about “purchasing power” were one of voters’ top concerns, along with immigration and security. Workingmen turned out en masse to vote for the National Rally, which promised to help households and curb immigration. The New Popular Front came in second with promises to raise wages and lower the retirement age.
It is unclear how each side will pay for the pledges. Economists say many of the financing proposals lack credibility, posing risks for a heavily indebted France. But the final outcome is hard to predict: If France ends up with a hung Parliament next Sunday, the legislative gridlock could also scare off investors.
What are Rassemblement National’s economic plans?
As part of a Economic policy of ‘France first’the National Rally would reserve first choice for certain jobs and social benefits for French citizens. In a tribute to the working class, people who started working before age 20 could retire at 60 instead of the official retirement age of 64. Pensions would be indexed to inflation. But such changes would require a change to the Constitution.
By foregrounding issues of pocketbooks, Jordan Bardella, the party’s president and a protégé of Marine Le Pen, sought to normalize his party’s long-taboo nationalist and anti-immigrant policies. But the core of his platform links immigration to economic insecurity.
“He talks about improving the purchasing power of the French,” said Lisa Thomas-Darbois, deputy head of research at the Institut Montaigne, an economics think tank in Paris. “In reality, the party’s promises of prosperity are based on fighting immigration, linking immigration to jobs and crime, and deporting illegal immigrants.”
One of Mr. Bardella’s biggest selling points is a promise to put more money in voters’ pockets by cutting taxes on electricity, energy and gas from 20 percent to 5 percent. He promises to be the “prime minister of purchasing power” and would encourage companies to raise wages by 10 percent for people earning less than 5,000 euros a month (about $5,350), with no extra taxes on employers.
He blamed Mr. Macron in a victory speech Sunday night for high inflation and a ballooning government debt and deficit — a legacy of Mr. Macron’s efforts to stabilize the economy during pandemic lockdowns and an energy crisis. Mr. Bardella said he would be fiscally responsible and pledged to “put France’s finances in order.” (The European Union recently reprimanded France for breaking the bloc’s fiscal rules.)
How would the party pay for its programme?
The National Rally platform has few actual budget figures, but Mr Bardella has said he could save billions of euros a year by reducing immigration and cutting benefits for foreigners. Part of those savings would come from denying undocumented migrants access to free medical treatment except in emergencies.
Mr Bardella would also cut €2 billion from France’s annual payments to the European Union — a requirement for countries that are members of the bloc. He said he could save at least €65 billion more by tackling tax evasion and welfare fraud — and would order an audit of France’s finances to find billions of euros in extra “unnecessary” spending that could be redirected to improve the lot of middle- and low-income earners.
Is it realistic?
Not necessarily. Those pledges would cost nearly €38 billion a year, an assessment by the Institut Montaigne found. For example, barring immigrants from health care would save just €700 million a year, but cutting energy taxes would cost more than €11 billion, while indexing pensions to inflation would cost €27 billion.
In recent days, Mr. Bardella has backtracked on some of the most expensive ideas, such as abolishing income tax for workers under 30. According to some estimates, the entire Rassemblement National program would cost almost €100 billion.
He also moved closer to Mr. Macron’s economic platform in a bid to win over centrist voters, promising to make France, already Europe’s biggest supplier of nuclear power, a “paradise” for nuclear energy. He promised lower production taxes for the industry and said he would revise the European Central Bank’s mandate to focus on jobs rather than inflation.
How does the New Popular Front’s economic plan differ?
The left-wing coalition is pushing a tough tax-the-rich, spread-the-wealth agenda inspired by the far-left France Unbowed party. By a Keynesian spending program And by raising wages, the thinking goes, the government can encourage consumers to spend more and thus stimulate the economy as a whole.
The main pillar consists of raising the monthly minimum wage after taxes from €1,398 to €1,600. The New Popular Front would also freeze the prices of food, energy and fuel. The state would pay households all costs related to their children’s education, including meals in cafeterias, transportation and extracurricular activities.
France’s official retirement age, which Mr Macron raised to 64 by decree last year, sparking nationwide protests, would be lowered to 60. On immigration, undocumented workers would be given legal status under certain conditions in sectors facing labour shortages.
How would the party be able to pay for all that?
The program is estimated to cost $125 billion to $187 billion annually. According to the New Popular Front, it could raise $150 billion by taxing wealthy individuals.
That includes bringing back a wealth tax that Mr. Macron had abolished, raising inheritance tax and introducing an exit tax for wealthy people who move their tax residence abroad. The party would 14 new tax bracketswhereby income above a certain level is taxed at higher rates, with the top rate being 90 percent.
French companies will also be given a new tax on profits that are above average. In addition, various tax benefits and credits for companies will be abolished.
Is it realistic?
Some say the program is prohibitively expensive and risks pushing France’s finances to the brink, scaring off international investors who have recently driven up France’s borrowing costs, not to mention multinationals attracted by Macron’s pro-business policies.
“France’s financial situation is already a disaster,” said Nicole Bacharan, a political scientist who teaches at Sciences Po University in Paris. “This will only make matters worse.”
Others, including French economist Thomas Piketty, said the need for investment in health care, training, research and infrastructure would require large resources. “And that means taxing the richest,” he said in an interview with the newspaper La Tribune.
When energy prices skyrocketed after Russia’s invasion of Ukraine, Macron’s government tried to limit electricity bills and rising food prices by negotiating with producers.
“But people think prices have remained high anyway, so he didn’t get much recognition,” said Eric Heyer, chief economist at the French Economic Observatory.
During his campaign, Macron’s Prime Minister, Gabriel Attal, again promises to reduce the cost of living, but he mainly sticks to fiscal conservatism and promises not to increase taxes.
The party wants to reduce electricity bills by 15 percent from February, expand the so-called Macron bonus, which encourages companies to pay employees up to €10,000 per year without additional employer taxes, and increase social security for the poorest households by around €5 billion per year.
How would his Renaissance Party finance his program?
Of all the parties, it has the lowest costs, around €17.6 billion per year, according to estimates by the Institut Montaigne. Before the snap elections, the government wanted to cut spending by up to €20 billion to contain the debt and deficit. Keeping new spending low remains a priority.
What happens now?
If Mr. Bardella’s party wins enough seats in parliament, he could become prime minister, appoint cabinet members and thwart much of Mr. Macron’s domestic agenda. But if France ends up with a hung parliament in which neither the far right nor the united left has a majority, leading to legislative gridlock, economists warn that a debt crisis could erupt if a paralyzed government fails to rein in France’s finances.
