Can Macron’s “Fire and Fury” Lead a Renaissance for Europe?

Over the past decade, France as Europe’s third largest economy has not pursued an ambitious agenda as a member of the European Union. Likewise, resistance to political reforms has led to tepid economic growth hovering around 1 percent with only a few countries faring worse. President Emmanuel Macron, rejecting nationalism and embracing the potential of the European Union, may revitalize the French role. “Macron has moved to a dual strategy,” explains François Godement, a senior policy fellow with the European Council on Foreign Relations. “Use European needling to push domestic reforms, leverage these reforms to lobby the entire European Union for deeper integration, and needle Germany in the direction of federal economic governance for Europe.” Moving swiftly, Macron offers numerous policy proposals, pointedly avoiding treaty changes or mutualizing members’ past debts. Critics grumble about a jumble of policies, and Godement concludes that careful diplomacy is required in convincing other EU members, including Germany, that sticking with the status quo, avoiding reforms, will lead to Europe’s failure. – YaleGlobal

Can Macron’s "Fire and Fury" Lead a Renaissance for Europe?

Macron, avoiding treaty changes, moves swiftly in proposing reforms to revitalize the European Union and France’s role
François Godement
Thursday, October 5, 2017

Urgency of now: French President Emmanuel Macron rushes into reforming the economy, and labor unions are not happy

PARIS: La furia francese – France’s fire and fury – was how Italians saw France’s repeated military campaigns after 1495, and these words have come to encapsulate a recurring French ambition and, sometimes, overextension inside Europe. Emmanuel Macron is giving the phrase new life.

For decades, France’s role inside Europe has been dwindling. Nicolas Sarkozy’s brilliant but tactical handling of the 2007 financial crisis was probably France’s leading contribution to Europe in recent decades, and it was not followed through. This is in part due to the political blockade against domestic reforms, making France a laggard among European economies and also due to three successive presidents – Jacques Chirac, Sarkozy and François Hollande – who shied away from making significant proposals for the European Union. Managing public anxiety and shielding France from direct impact of a global crisis turned France into a follower.

During that same interval, no other member state led Europe, not even Germany, unless one imports the Japanese notion of “leading from behind.” This could be a fit with Germany’s historically based reluctance to put itself in the firing line as well as Chancellor Angela Merkel’s well-known aversion to quick and high-risk decisions. Yet in a Europe that is not federal, not much can happen without a strong push by one or several core member states. Germany under Merkel has been unambiguously committed to Europe, but seldom shown the way forward, instead preferring to debate and move under the cover of European consensus. Only on the refugee issue did Merkel take a quick and decisive step – one that proved controversial inside Germany and with European neighbors.

 

Macron’s victory at the polls therefore came at a critical juncture for Europe. He has pushed back two decades of rising nationalist sentiment while embodying a sense of renewal as French politicians of the baby-boom generation exit a stage which they have monopolized longer than elsewhere in Europe. Two political camps have fought each other for decades over whom to subsidize and whom to tax in order to pay for continuing subsidies. The two are now in disarray. Macron broke with what had become France’s prevailing tactics – use its weight inside Europe and Germany’s need of a French proxy to delay major reforms: “Encore un instant, Monsieur le Bourreau,” or “Just a moment, Monsieur Executioner.”

Instead, Macron has moved to a dual strategy: Use European needling to push domestic reforms, leverage these reforms to lobby the entire European Union for deeper integration, and needle Germany in the direction of federal economic governance for Europe.

This last goal may seem trivial, given that it has often been German politicians rather than the more defensive French who advocated moving towards a federal Europe, starting with the notion of an elected European president. But Germany’s federalism has always stopped at the door of budgetary federalism. The euro – an extension of the former D-mark zone – was one step forward under Helmut Kohl–François Mitterrand leadership during the confident era of German reunification. A common currency without a common treasury may well be an oddity full of market risks. But a common treasury is a political risk – especially for the savers of the richest member state, who fear a run on their savings.  Macron has summed up the dilemma: “the German unthinkable is a financial transfer union, the French unthinkable is a treaty change.”

There are hints in his landmark September 26 speech and its bevy of proposals that Merkel and Germany are acknowledged as the key to change: “Everyone is used to not saying what he thinks or wants and to say that this is tactical,” but also, “I know that, as has been the case when [Merkel’s] country was confronted with historical challenges, she will react with audacity and a sense of history.” The pulling and tugging are apparent.

But Macron’s furia francese, as some conservative Germans and Europeans may be tempted to see him, is not without a strong sense of political expediency. After all, this is the man who since June seems to have disarmed a domestic uprising supposed to kill proposed labor and social reforms. Months of quiet bartering with unions and, for the most part, a careful balance of proposed changes, may have had their effect. His offer to Germany and Europe follows the pattern.

First, there is no unconditional ask – except democracy and the rule of law, a message to those tempted by authoritarian models – and instead, a deluge of proposals within which there is some give and take for partners. Indeed, Macron pulls back on a key issue:  mutualizing past member state debts.

Race for growth: Among the EU's largest economies, France lags in economic growth for the second quarter of 2017 - along with Britain and Italy (Source: Eurostat)

Second, policy proposals are often for specific stand-alone European agencies that do not require treaty changes. His suggestions for common budget resources involve new resources such as a digital tax and carbon taxes, including at Europe’s external borders.

In France, Macron’s adversaries have begun describing this as a mishmash of proposals, rather than as the incremental federalism that they should see. And within these proposals, realism prevails, apparent in the strengthening of Europe’s borders against uncontrolled migrant flows and also in the proposal for a European Defense Advanced Research Projects Agency that sustains the call for a common defense strategy. To the central and eastern European countries where it is difficult to advocate a downscaling of the European posted worker rule, Macron holds out an ingenious incentive: posted jobs for workers in other EU countries would be subject to the host country’s social contributions, but these will be turned over to the country of origin for these workers. Macron strides the line between a renaissance of the European ideal and realist steering of Europe in a dangerous world – a line Merkel has found hard to navigate with the public opinion of her own constituents.

A president who just received a five-year mandate including a parliamentary majority should have the gift of time. Instead, Macron seems driven by a sense of urgency, as is the case for domestic reforms. Asking for a new deal, a new Élysée Treaty, between France and Germany by January seems like a tall order, absent a stable coalition in Germany. Calling for transnational party lists for the next European Parliament election that would compete for the United Kingdom’s former 73 seats is daring, since these elections will take place in May 2019, at most two months after the delay expires for Britain’s departure from the Union. All other reform proposals are timed to 2024 and the next European election cycle.

All of this has a chance of happening under two conditions. France’s economy must get a lift from the intended changes and therefore support renewal of France’s influence within Europe. And en même temps – “at the same time,” as Macron may say too often – French public diplomacy inside Europe must continuously manage the expectations of other member states as well as Germany’s. How to do so without ceding to hackneyed euro-south coalition politics against Germany, a sure proposition for failure?  How to help persuade German politics and society that sticking to the status quo will lead to a failure of Europe? That is Macron’s tall agenda.  

François Godement is the director of the European Council on Foreign Relations’ Asia & China program and a senior policy fellow. He is a non-resident senior associate of the Carnegie Endowment for International Peace in Washington, DC, and an outside consultant for the Policy Planning Staff of the French Ministry of Foreign Affairs. His last published book is Contemporary China: Between Mao and Market, Rowman & Littlefield, 2015.

Copyright © 2017 YaleGlobal and the MacMillan Center

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