The new sick man of Europe: France's Prime Minister is trying to prevent his downfall

Frankfurter Rundschau The new sick man of Europe: France's Prime Minister is trying to prevent his downfall Stefan Brändle • 56 million • 3 minutes reading time Chaos in France In France, Prime Minister Bayrou finally wants to get the budget through parliament. According to experts, the state's finances are in a bad state. The budget question shows how desolate France's financial situation is: the EU's second-largest economy has not managed to pass a budget for 2025 since the autumn due to the shaky majority in parliament. On Monday (February 3), Prime Minister François Bayrou promptly put the budget into effect. This was made possible by Article 49-3 of the French Constitution. This institutional crowbar allows the government to push through a project without a vote in the National Assembly. The prerequisite is that the National Assembly then expresses its confidence in the Prime Minister. If not, the Bayrou government would fall, as happened to former Prime Minister Michel Barnier in December. France's Prime Minister must fear another fall - but this time it could work Bayrou has only one goal: to prevent his fall. With the help of social policy budget concessions, including the hiring of 4,000 new teachers, he managed to break up the left front and win over moderate social democrats to his side. On Monday, the Parti Socialiste decided not to withdraw its confidence in Bayrou's government. The Communists, Greens, "Unyielding" and Marine Le Pen's right-wing extremist Rassemblement National (RN) together therefore have too few votes to overthrow Bayrou. The centrist democratic Prime Minister knows that the population is behind him: the French have had enough of the unspeakable power struggle that was triggered last summer by President Emmanuel Macron's calling for new elections. A government fall would mean that no budget would be agreed until spring. This would reduce social benefits and also paralyze economic life; because in France, public spending accounts for the almost real socialist level of 57 percent of gross domestic product. The budget in France can only help the economy to a limited extent: taxes must rise The budget pushed through on Monday under Article 49-3 is, however, far from the cure that France's ailing economy needs. According to economist Marc Touati, public finances are undergoing a "catastrophic development". Under Macron, the national debt has climbed by 800 to 3,200 billion euros due to Covid - but not only because of it. This is also a record in Europe. France, which has not managed a balanced budget for 50 years, recorded the highest deficit in the eurozone last year at 6.1 percent. In 2025, the deficit is expected to be 5.4 percent - more than in all neighboring countries. The numerous concessions with which Bayrou hopes to avoid a government fall are costing billions more. Bayrou's predecessor, Michel Barnier, had planned 60 billion euros in savings; in the budget they fall to 32 billion, almost half. Bayrou is also increasing taxes for large companies and high earners for one year. He is increasing the French tax on airline tickets to a European destination from 2.63 euros to 7.30 euros. Is France the new sick man of Europe? Economy weakening The new budget is based on a growth rate of 1.1 percent. The head of the Banque de France, François Villeroy de Galhau, described it on Monday as "too optimistic". Many experts fear that France could sink into a "technical recession". 66,000 companies have filed for bankruptcy in 2024, and countless others are cutting jobs. Unemployment rose by four percent in the last quarter of 2024. Added to this is US President Donald Trump's threat of higher tariffs on European products. France would be hit less hard than Germany, but individual sectors such as aviation, luxury goods, wine, chemicals and pharmaceuticals would suffer greatly. This would further depress France's growth and automatically increase the budget deficit. Even if a government fall could be avoided for the time being, France is increasingly becoming the sick man of Europe.