December 21, 2018 / 11:26 AM / 2 months ago

Breakingviews - Cox: France’s Macron can’t turn 41 fast enough  

PARIS (Reuters Breakingviews) - Survey the business establishment of France, and it quickly becomes evident that there exists an impossible number of self-described mentors to Emmanuel Macron. Nearly everyone over the age of 50, it seems, claims to have nurtured the French president as he climbed the ranks of the bureaucracy and Parisian banking to eventually win the top job 19 months ago.

French President Emmanuel Macron (L) speaks to an employee during a visit to the STX Les Chantiers de l'Atlantique shipyard site in Saint-Nazaire, France, May 31, 2017. REUTERS/Stephane Mahe

That desire to own a piece of Macron says as much about the persistent hope he can create a more dynamic French economy as it does about his relative youth: Macron celebrates his 41st birthday on Friday. The past year, however, has proven more eventful than the former Rothschild banker probably bargained for. Another year’s experience, if that means getting wiser to what it takes to be a successful politician in France, can’t come soon enough for Macron.

The “gilets jaunes” or yellow vests caught him unawares and hardened the perception of him as an aloof dauphin. His response to the unrest instigated by the movement, which started first on social media and quickly spilled onto the streets of Paris and the roundabouts of the provinces, was slow and tin-eared. Only after cars burned on the Champs-Elysées and windows shattered on the Avenue Kleber did he apologetically address the nation – and add some 10 billion euros to France’s already robust welfare pot.

The business community, from which Macron emerged, still has his back. In his speech last week, the president made clear he has zero intention of reinstating the wealth tax – formerly tallied on worldwide assets over 1.3 million euros – which his government suspended at the start of this year. Reinstating the tax was one of the more concrete demands of the gilets jaunes.

That said, even those who benefited from the abolition of the wealth tax recognise the asymmetry of imposing new levies that hit the working class disproportionately. An increased tax on diesel (6.5 cents more per liter) and petrol (an extra 2.9 cents) slated for next month was a catalyst for the yellow-vested protesters. In recognition of the destructive demonstrations last week, Macron postponed those hikes.

The concessions have temporarily calmed things down. However, the yellow vests are, “like the wasps they resemble, lurking below the surface, maybe hibernating, and waiting for their moment to rise up and sting again”, one of Macron’s former colleagues says. That threat will make it difficult for the government to enact further reforms, such as reductions in welfare and other benefits, without sparking another round of street protests or the sort of industrial action that bedevilled attempts by Macron’s predecessors to tweak the system.

The worry is a return to something like the general strikes that paralysed France in 1995 and slammed its economy. That unrest, the worst since May 1968, put an end to planned reforms like a pay freeze on public sector workers.

There are reasons to believe Macron and his Prime Minister, Edouard Philippe, can avoid a repeat. For one, the gilets jaunes have largely resisted being co-opted by either the labour unions or any political party. On the other hand, the lack of obvious leaders with whom to address grievances and negotiate solutions makes the high-vis crusade potentially more difficult to handle.

It’s also not easy to pin down some of their gripes. While fuel taxes are one element – and an easily fixed one – there is also resentment about an earlier diktat on speed limits. Over the summer, the Macron government cut maximum speeds to 80 kilometers an hour from 90 kmh on secondary highways. Critics perceived that measure as a blow to personal freedom for those who depend on cars for their livelihoods or daily routines, despite the promised reduction in road deaths. The extra speeding tickets which followed, combined with rising gas prices, helped set the stage for the emergence of the yellow vests a few months later.

Macron gained 66 percent of the vote in his election runoff against Marine Le Pen in 2017. Yet his popularity rating, already in decline, had plunged to 23 percent by early December from over 40 percent in July, according to a poll by Ifop-Fiducial for Paris Match and Sud Radio. Arguably, Macron could have gotten away with either the speed-limit cut or the fuel levies, but not both. Reining in people’s driving and charging more for the privilege was too much.

He is learning on the job, argues one financier, who like many described himself as one of the French president’s godfathers. Macron, this executive says, is a quick learner who won’t make the same mistakes twice.

As the president celebrates his birthday and prepares for the holidays, he can take some comfort that the French establishment still supports him. But to make the remainder of his term a success, he maybe needs to spend less time with the rich.

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