“Progress and a brighter future,” for the New Popular Front (NFP). “A wind of hope has risen over France, and it is only just beginning,” for Jordan Bardella. Since the announcement of the dissolution of the National Assembly by the President of the Republic on June 9, the left and far-right blocs have been competing in emphasis to convince voters that they represent an alternative capable of giving the French people the ability to dream again. To do this, they are banking on a very generous social program. The National Rally is proposing a jumble of proposals for reducing VAT on all energy products, repealing the pension reform, guaranteeing remunerative prices for farmers, and eliminating income tax for young people under 30.
While the RN has in the meantime toned down its promises by withdrawing or postponing the proposals deemed the most unrealistic that appeared in its 2022 proposals, the NFP’s “legislative contract”, which notably provides for the freezing of prices of basic necessities and retirement at 60, is a festival of spending: increase in the minimum wage to 1,600 euros net, revaluation of personalized housing assistance (APL) by 10%, guarantee of a floor price for farmers, strengthening of the public budget devoted to art, culture and creation to bring it to 1% of GDP per year, increase in resources for justice, and so on for schools, health, transport, ecology, housing, pensions or public services… A program costed at 125 billion euros by the New Popular Front, and to 233.3 billion by the Ifrap Foundation. Christmas before its time, in short.
The 26 pages of the left-wing program are a declaration of love to state interventionism. The words “plan” and “planning” appear together 27 times; “increase” (spending), 11 times; “aid”, 10 times; “prohibit” and “organize”, 9 times; “repeal”, 8 times; “protect” and “support”, 4 times; “states general”, 3 times; and “regulate”, 2 times.
As for the RN’s economic program, which is less detailed, redistribution and state intervention also occupy a significant place there.
“France in 2024 looks strangely like the United Kingdom in 1979”
Endlessly debating the best ways to fairly distribute wealth while carefully avoiding discussing the economic policies most conducive to prosperity? None of the three main political parties running for the legislative elections seem interested in the issue. The terms “growth”, “wealth” and “prosperity” do not appear once in the New Popular Front’s programme. In the RN’s programme, you will come across “prosperity” twice, and once “growth” and “wealth”.
“The content of the debates worries me, because, in a way, France in 2024 strangely resembles the United Kingdom in 1979… there is the same identity malaise, accompanied by a growth crisis and very high tax rates,” explains economist Vincent Geloso, from George Mason University in the United States. Except: “The problem is that we are very far from having a Margaret Thatcher in the French political landscape.”
Economic freedoms, conditions for prosperity?
To the “shot of Keynesianism” proposed by the two political blocs leading in the polls, the researcher would have preferred a “shock of economic freedoms”. “The reality is that the free market is very effective in creating wealth”, says Vincent Geloso. Since the 1990s, there has been no shortage of studies published in peer-reviewed journals demonstrating a positive link between economic freedoms and prosperity. In 2022, American economist Robert A. Lawson conducted a study for the Fraser Institute meta-analysis (a scientific method that consists of combining the results of several independent studies on the same subject) in which he analyzed the results of 700 economic articles looking at the impact of economic freedoms on growth and living conditions. Among these studies, 50.6% found a positive link, 44.8% did not identify a clear relationship and 4.6% detected a negative link.
For Vincent Geloso, Such results could, however, be below reality. In a article co-authored with Sean P. Alvarez and Macy Scheck, forthcoming in the academic journal European Journal of Political Economy, the economist invites his colleagues to revise upwards their estimates of the impact of economic freedoms on prosperity. The reason? Authoritarian and illiberal states tend to lie about the real state of their economy and the standard of living of their population, thus distorting the results of studies comparing liberal countries to illiberal countries. “To correct these data,” explains Vincent Geloso, “we used satellite images that allow us to measure the light intensity of each country, because we know that the richer a country is, the greater the light intensity.” “Correcting this bias,” write the three economists, “shows that the relationship between economic freedom and economic development is stronger than what is generally described.”
France, a liberal “no man’s land”?
“The French obsession with redistribution, which we have seen during this legislative campaign, occupies a central place in economic debates, to the detriment of questions that are nevertheless basic, such as ‘how do we create wealth’?” regrets Kevin Brookes, a lecturer and researcher in political science. “Since the end of the Second World War, a Keynesian paradigm has dominated in France, around which there is a consensus,” the researcher continues. In other words, economic liberalism has never been in vogue in France, and its political elites, as much as its voters, are loyal to this heritage. But at what price?
In many ways, the central bloc appears to be the least illiberal. In 2017, Emmanuel Macron launched his first term with his “labor ordinances”, reforms aimed at restoring flexibility to businesses and liberalizing the labor market. Between his arrival in power and the end of 2022, 1.773 million jobs have been created. The President of the Republic also wanted to make France a center of attraction for foreign capital. During the seventh edition of the Choose France summit, held in Versailles on May 13, 15 billion euros of investments were collected.
Caught between two political forces engaged in a real battle of generosity, the presidential camp has therefore played the responsibility card. Faced with Jordan Bardella and Manuel Bompard, on TF1Gabriel Attal denounced the demagogy and the unrealism of his opponents’ programs: “The difference between my competitors and me is that I am Prime Minister, I do not want to lie to the French, I do not want to make them believe in the moon, to make them believe that everything could be financed by magic.”
The fact remains that, “at the same time” obliges, Emmanuel Macron has kept one foot in economic interventionism. The measures taken to resolve the yellow vest crisis (cancellation of the fuel tax, increase in the minimum wage, reduction of the CSG, etc.) have, for example, cost the community nearly 17 billion euros. With an increase in debt of 862 billion euros in seven years, it is difficult to imagine that the “shock of economic freedoms” will come from the presidential camp.
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