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Lessons for Americans (and the World) from France and Le Pen

Kurt Davis Jr.


The article was originally published in “The Musings Of A Politics Junkie & Closet Economist.” To read more, please visit the website.

Taxing wages, capital, and…consumption?

The French recently re-elected Emmanuel Macron for a second term as president. It is not clear that most French like Macron but we do know that a majority of French favored Macron over his 2nd round runoff opponent, Marine Le Pen.

The election itself garnered more attention than many French probably could have expected. Portuguese, Spanish, and German leaders (Antonio Costa, Pedro Sanchez and Olaf Scholz respectively) thought it necessary to pen a letter in support of Macron.

The Macron victory should not overshadow the economic realities underpinning the relative success of the Le Pen campaign.

The anger is real…

The National Front was not always this strong (similarly the American Republican Party was not always this populist).

The voting was not always this extreme…Marine Le Pen, Jean-Luc Mélenchon, and Éric Zemmour captured more than 50% of the French vote. More than 28% of eligible French voters did not vote in the first round.

Why? The common response is “anger” or “anxiety”. For Americans (and Brits), President Emmanuel Macron is not Donald Trump or Boris Johnson. He is the pro-European (and pro-NATO) president that has enhanced France’s leadership on the global stage and is articulating structural reforms to fix a stalled economy…and, by the way, led the country through the covid-19 pandemic. Yet, people remain frustrated.

To say bigotry explains the National Front popularity would completely ignore the greater (socio)economic discussion. Many French (and Americans) feel that economic mobility has become a myth. As they see it, their children’s lives will not be better in the future because the system does not necessarily offer them a chance to improve their lives. Jobs have disappeared. Purchasing power has declined. Inflation (even before the war in Ukraine) was a problem. And public services have declined from health care to police services yet taxes remain the same (or higher).

The OECD now estimates that it takes six generations for a descendant of a French family in the bottom 10% of the income scale to reach the national average. For comparisons, it takes two generations in Denmark or Finland. That is a stat…not a fixation of one’s imagination.

The “elite” are comfortable…and protected from the many “kitchen table” conversation

Turnout for the French election continues to decline with the lowest turnout in the north of Paris and central Paris (where the more well-off live). The “elite” (or, for the sake of understanding, the broadly defined group of middle class citizens) do not necessarily feel inspired by the election.

Macron pitched his usual pro-business reforms, which included an increase in the retirement age, to strengthen the French economy and create more jobs. Marine Le Pen, on the other hand, attacked the economic issues with aggressive (populist?) suggestions, such as lowering the retirement age below the current minimum age of 62 and cutting taxes on both energy and income.

Critics argue Le Pen’s strategy was to deflect from the salient reputation of her party as being more focused on social issues, such as immigration and what constitutes a French citizen, and less focused on the more important national issues of the country, such as the economy.

First, immigration is an economic issue. There is a question of how many jobs are available and who can fill them. Sadly, the conversation can go way off topic but that does not negate immigration’s relationship to economics and the economy. Secondly, the peddling of economic candy — i.e., one tax cut here and there — is not equivalent to addressing the greater problem of socioeconomic mobility.

Furthermore, strengthening European sovereignty and elevating French prominence on a global stage does not create economic opportunity, at least, in the eyes of the average French person. For those of us who believe in the importance of NATO, we must also confront the reality that NATO’s importance (and a war in Ukraine) does not exactly supersede economic progression and security for many people, especially as it relates to their kids.

Fearmongering is not a strategy

What happens if the Far Right wins? What happens if populism wins?

Some will say Trump won and the U.S. was okay. Those same “some” will say the U.S. is struggling since he lost the 2020 election. Are France’s political systems and structures not strong enough to withstand a few Far Right whims of Marine Le Pen? This piece purposely WILL NOT address this question.

Markets initially panicked when Trump won in 2016 but then reality set in and everyone effectively went back to their daily obsessions and occupations. Better yet, markets performed quite well under Trump as the covid-19 pandemic endured throughout the U.S. and the world. That reality highlights how the middle class fared better during the pandemic (with retirement portfolios growing) while the poor suffered with less ‘work from home’ situations and more deaths (due to poorer healthcare). It also highlights how the stock market (and a significant portion of the country) quickly got over its Far Right concerns.

The fear mongering on how the world will fall apart with the Far Right winning will not work long-term in France and in general on a global stage. The fight will have to be more about economic policy mixed with a little social policy.

Fear of how bad it could get simply becomes a weaker argument by the day.

For many French (and Americans), the economic situation is already bad…thus many will ask again so what is the risk?

The article was originally published in “The Musings Of A Politics Junkie & Closet Economist.” To read more, please visit the website.



Kurt Davis Jr.

Investor, Advisor, Writer / Speaker, Council on Foreign Relations, Chicago Booth MBA, UVA JD, Avid Traveler, Foodie, Politics Junkie & Closet Economist…