Le Pen’s newfound appetite for balancing the budget. Krugman: ’too big to save’.

 

Marine Le Pen, the leader of the hard-Right populist party National Rally. 

Tuesday she was miles from the streets. Instead, she was briefing journalists on how, as president, she would cut €140bn from the French budget and halve the country’s colossal debt pile.

But Le Pen’s newfound appetite for balancing the budget is not shared by the electorate, who will choose a new president next April. 

The “spread” between French and German bond yields to levels that have prompted fears of a wider eurozone crisis.

“If France fails, the whole of Europe fails,” says Desmond Lachman, of the American Enterprise Institute. 

Some big Japanese holders of French bonds have already headed for the exit. If the exodus can’t be stopped, the ECB may have to start buying French bonds to stem the soaring yields and head off a bloc-wide crisis.

“We’re not talking about Greece. We’re talking about a big country that’s got a huge amount of debt. So it means that the ECB is going to have to come in pretty big. And they’re going to have to do it with the Germans kicking and screaming,” Lachman says.

Le Pen, however, seems to be making a belated and unexpected conversion to fiscal rectitude, as she imagines herself moving into the Élysée presidential palace on May 3 next year.

“She has understood that the bond market is her Achilles heel, and that if she doesn’t want the presidency to be engulfed in crisis on May 3, she’s going to have to start talking in a much more coherent fashion about her economic platform,” Mujtaba Rahman, of the Eurasia Group,says.

Hans van Leeuwen Telegraph  International Economics Editor  8 October 2026

https://www.telegraph.co.uk/business/2026/10/08/france-debt-bomb-could-set-the-eurozone-on-fire/


Paul Krugman skrev under torsdagen i ett blogginlägg att Frankrike är på en ”ekonomiskt ohållbar väg” med stigande räntekostnader på statsskulden samtidigt som skuldsättningen i förhållandet till bnp ökar på grund av ett växande budgetunderskott.

Enligt ekonomen kan landet ha korsat en gräns där det skulle bli för dyrt för Europeiska Centralbanken att rädda det, och hänvisar till sloganen som användes under bankkrisen 2008.

”Frankrike kan ha korsat gränsen från att vara ’too big to fail’ till ’too big to save’. 

Kort sagt är det allt för lätt att beskriva ett riktigt fult scenario för en fransk kris som skulle skapa djup splittring inom Europa”, skriver Krugman.

DI 9 oktober 2026

https://www.di.se/live/krugman-om-franska-skulden-kan-ha-korsat-en-grans/




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