Macron needs new clothes

The French technocrats fail to grasp that liberalism has long gone down the drain

Photo: AP A man wearing yellow vest holds French flag on the Champs Elysees, 8 December 2018.

The election of former investment banker Emmanuel Macron as President of France in 2017 resulted from the wish of the greater part of French society to see a real change in the country, a strive for higher morals in politics, a revival of economy and a safer life. But it was also the impact of fear that the far-right forces represented by their leader Marine Le Pen - who reached the runoff - might win, as well as of weakness and inadequacy of the traditional political parties. The economic press in Europe lauded him as talented reformer and a new face of the European liberalism.

"The Macron approach is the new Third Way, an equilibrium between technocracy and populism", they trumpeted. Similar assessments appeared until June 2018 when after six months of reforms by the new French government, consisting mostly in the change of labour legislation and tax privileges for the wealthiest, accompanied by strikes and demands for just distribution of the reforms' burden, the credit rating of France's youngest president collapsed to the catastrophic 25%.

Nevertheless, the pedantic alumni of Sciences Po and Ecole Nationale d'Administration (the hatcher of the French political elite) already labelled “president of the rich”, failed to orient himself and see which way the wind is blowing. Although there were numerous indications which prompted that the reforms he planned to implement at the expense of the middle and lower classes in France may result in a social eruption. Instead, this September he promised a new portion of reforms. Among them, tax relief for business as of 2019 and the ill-famed increase of excise duties on fuels which was the final stroke for the public's patience and brought to the streets of the biggest cities hundreds of thousands of indignant citizens clad in yellow vests. And in France - the cradle of social revolutions in Europe - one can never say how far it can go.

Macron's party Republic on the Move really was something totally new, staffed with people of the new generation who gathered around the election winner. Many of them are technocrats, which actually is their problem. They distance themselves from common people and are not capable of social thinking. Their rhetoric, claiming that the country is in a phase of difficult “ecological transition” (a wisely chosen term caught up by the media), turned out to be the last straw for the people who have to earn their crust every day. Because in actuality these measures once again shift the financial burden of the transition to cleaner energy sources onto the shoulders of ordinary taxpayers, while being very sparing for big corporations.

Macron showed arrogance and the country was flooded with protests unprecedented in the last decade. The protests escalated into clashes with police, burned cars, broken windows, the troublemakers who mixed with the protesters vandalised national monuments of culture. Years of insecure life are behind these riots. Because, according to "Le Monde" newspaper, too many people living outside the big cities in France are convinced that they are “misunderstood, deserted or even despised” by the urban ruling elites.

The reasons for disaffection and anger are now multiple: from hard life and low incomes of the 'working poor', to overproportioned salaries of company directors and top-heavy dividends for stockholders. Among other reasons are high prices of such staple commodities as gas, electricity, water, as well as incessant harassment at work. “Under Macron everyone has to make great efforts except the rich,” read the placards the protesters carry.

Amidst the chaos, the president tries to find a way out of the situation. In a 13-minute-long address to the nation, broadcast by the most popular TV channels in France, he vowed to take urgent measures that will take France out of the crisis. At first sight they looked acceptable to the protesters: the increase of the minimum wage by €100 as of 2019, extra workhours exempt from taxes, and year-end tax-exempt bonus for all employed. To those who earn less than €2,000 a month, he promised to cancel the increase of the tax on pensions introduced this year. All these measures will complement the decision of the government not to increase the excise duties on gas and diesel. The economic measures announced by the president will cost the state about €8-10bn, calculated roughly Olivier Dussopt who is in charge of the budget policy.

The rich must work for the benefit of France, the president added in his address and promised to ask the biggest corporations and the wealthiest citizens for their willingness to contribute to the development of the country.

“The big companies and the wealthiest French citizens must help the nation to achieve success. I will convene them and will take a decision on this issue this week,” said he. “We won't go ahead as if nothing has happened,” he said emotionally.

France Info, however, broke the idyll very quickly. The TV viewers who watched absent-mindedly Macron's address maybe understood that the minimum wage will be increased by €100 per month as of 1 January, the media commented. This was the phrasing the head of state used and it led to misunderstanding. In reality, though, it will not be increased but will be an adjusted “activity bonus” that will be a little more than the envisaged increase and will be made a little faster than it was declared before the “yellow vest” crisis. The media outlet also noted that the head of state omitted this “detail” but to the people who took to the streets to defend their right for work, it is not all the same from where these €100 will come. At least due to the fact that pension contributions are not paid on bonuses, and they will not be taken into consideration when the pension size is calculated.

But is there anyone who would believe that the measures proposed by Macron are viable? “The president of the Republic did not understand a thing. He does not want to understand the anger which is gaining strength in recent weeks. This is serious,” said, immediately after the president's address, the head of one of the leading syndicates, the General Confederation of Labour, Philippe Martinez, who called for a joint protest with yellow vests until 14 December. However, the syndicates have not headed the protest and this poses the greatest risk for the French ruling political class. Because they have nobody with whom they can negotiate.

“President of France Emmanuel Macron recognises his mistakes in tax policy but refuses to admit his failed course,” wrote on Twitter the leader of the National Front, Marine Le Pen, commenting on the president's address. “Facing the protests, Macron gave up on some of his taxing errors and this is good, but he doesn't want to admit that his managerial model is challenged,” she said. According to Le Pen, this model includes excessive globalisation, disloyal competition, as well as mass immigration with all its social and cultural impacts. Jean-Luc Melenchon, leader of France Unbowed (La France Insoumise) - the main left-wing opposition party, who qualified the yellow vest movement as popular unrest, said that all things that the president promised will again be paid by the common people, while the rich will pay nothing. However, the 'status quo' Left, which supposedly had to be most active in this situation, remained silent. From as early as the 1980s, they were increasingly less responsive to the workers' problems and resembled their adversaries of centre-right technocrats. They replaced talks about “exploitation and resistance” with current cliches, such as “modernisation and reform”. The discussion about unequal opportunities gave way to meritocratic rhetoric about “individual responsibility”.

One thing is very indicative though - the public opinion's support for the yellow vest rebellion is about 80%. No one dares insulting the protesters, everyone makes a clear difference between the young people from the suburbs, without any future, who pour out their hopelessness through violence, and the common people who stand for their rights and future. The institutions have quickly calculated the damages to businesses - they amount to over one billion, but they do not care what the losses of the hundreds of thousands of protesters are. They are out in the streets since 17 November to defend their right to work.

Actually, Macron does not have many useful moves at hand. France has long stopped to be the welfare state admired by many, which was a role model for many Europeans, with its strict rules and respect for human values. Because the much hyped liberalism, which the indoctrinated technocrats love to worship, has now ruined this model. But liberalism has long gone down the drain, and no one buys its misleading postulates any longer. Economists have long ago declared so. The irresponsibility of the political elites is transparent in everything they do, and the bubbles of their own making keep bursting one after the other. But what new clothes will they put on now? That remains to be seen.

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