(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)
By Pierre Briancon
LONDON, July 8 (Reuters Breakingviews) – French judges had already made a convicted felon out of a former president. They have now slapped a detention sentence on a potential future one, far-right leader Marine le Pen. Unlike Nicolas Sarkozy, who did spend some time in prison, the worst the Rassemblement National figurehead can expect is home detention with an electronic ankle bracelet — conditions she hopes to be rid of on appeal.
In any case, Le Pen will run in the presidential election due in April 2027, she said on Tuesday. This time around, she has a chance to make it to the Élysée Palace. Bond investors don’t seem too worried about the populist policies her party is putting forward, or her ability to manage the economy and state finances. They should be.
Any successor to President Emmanuel Macron will inherit a country in serious financial straits, whose recent governments have been unable or unwilling to control runaway budget deficits. The resulting public debt now stands at €3.6 trillion, a 60% increase since Macron became president more than nine years ago. It’s on track to reach 120% of GDP next year, according to the IMF. Budget deficits have topped 5% of output for three consecutive years and will not decline much this year and next. And the 2027 budget discussion promises to be contentious, in a divided parliament and ahead of an election year with nearly 20 presidential declared candidates — so far.
Le Pen has in recent years rowed back on some of her outlandish earlier proposals. She no longer wants to leave the euro, has toned down her Russia-friendly statements on Ukraine, and even criticised U.S. President Donald Trump for his “erratic” war on Iran. Yet some basic tenets of her economic programme have remained. She has opposed the government’s proposals to lift the retirement age to help fund the pension system. And her basic idea that curbing immigration will help fund tax cuts for households and businesses is fanciful at best.
Le Pen and her protégé Jordan Bardella, the 30-year old she installed as her party chief during her legal travails, have courted business of late. In April they even sent a letter to business leaders professing they wanted to “listen” to them to identify obstacles to growth. That has raised expectations that she might model herself on Giorgia Meloni, the right-wing Italian prime minister who surprised Europe with her prudent management of the country’s economy in the last four years, in spite of a 140% of GDP debt load. Rome’s borrowing costs have converged in recent years with France’s. Both countries’ 10-year debt yields are within a percentage point of Germany’s.
Nothing can be ruled out, but Le Pen remains so far committed to an interventionist economic policy of public handouts, geared toward her electoral base in the French struggling industrial heartlands. There would be a lot of listening to do before she can present a credible plan to tackle France’s challenges.
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CONTEXT NEWS
A French appeals court on July 7 upheld Marine Le Pen’s conviction for misusing European funds but shortened her ban on running for elected office, potentially reopening a path for the far-right leader to run in the 2027 presidential race.
However, the court ruled that Le Pen would serve a three-year jail term. Although the court said two years would be suspended, it ordered her to wear an electronic ankle tag for one year, making a presidential campaign politically and logistically difficult.
(Editing by Liam Proud; Production by Streisand Neto)
