France; Markets are betting that almost none of it will ever happen

The stated intent of the new Front Populaire is to soak the rich with wealth and capital taxes, reverse Mr Macron’s free market reforms, impose price controls on food, fuel and energy, and return France to the wonderland of retirement at 60.

It is as radical as its forebear under Léon Blum in 1936, which led to the ejection of France from the fixed-exchange Gold Standard in short order. 

It openly calls for a violation of EU budget rules, sorely testing German political consent for the euro.
France already faces an excessive deficit procedure as Brussels reactivates the EU Stability Pact.

“The message of the vote is categorical. The president must accept his defeat, and not try to twist the outcome in any way. The new Front Populaire will implement all of its programme, and nothing but its programme,” said Jean-Luc Melenchon, Jacobin chief of the hard-Left France Unbowed.

The Rassemblement is today the biggest single party in the National Assembly

It would have won even more seats had it not been for the gaming of the electoral system – mostly for purposes of political self-interest, though dressed up with much moral humbug.

Two outcomes are now likely.

 Either Mr Macron ignores the visceral repudiation of the French people, succeeds in preserving the status quo with another stitch-up until the volcano erupts;

or he accepts the verdict of his own rigged electioneering and agrees to share real power with the Left, gutting his own reforms, and putting France on a collision course with Brussels, bond vigilantes, and economic reality.

Would it really have been worse to let democracy run its course?

Ambrose Evans-Pritchard Telegraph 10 July 2024


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