Addressing public anger that has spilled out onto the streets with the “yellow vest” or “gilets jaunes” protesters, French President Emmanuel Macron on Thursday took shelter in grand words and half-measures.
There is no question that decisive action is needed. France’s economy continues its lethargic growth. Although it fell below 3% in 2018, the French budget deficit is likely to rise again above the European Union target limit of 3% in 2019. And while Macron’s limited labor reforms have brought declining unemployment and youth unemployment rates, those levels remain twice as high as in the United States.
This malady requires a grand vision. But Macron offered only a few crumbs of reform. On taxes, Macron pledged a paltry $5.5 billion tax cut package. That’s just not enough. As a percentage of GDP, France extracts the highest tax revenue of any of the Organization for Economic Cooperation and Development’s member states and has the second-highest government spending. Macron should have copied President Trump’s example here, where bold corporate tax cuts have unleashed broadly shared opportunity.
On spending, Macron seems determined to avoid painful but necessary cuts. The young president pledged on Thursday that, absent mayoral consent, no hospitals or schools will be closed before 2022. Macron also shied away from shedding France’s bloated government workforce. Instead, the president said only that he would push to get more government officials away from their desks and onto the front lines. Macron should actually be using his massive parliamentary majority to replicate Margaret Thatcher’s example of waging war on the unions in pursuit of economic efficiency.
This is a great shame. Yes, some of the yellow vest protesters are violent thugs who deserve only prison cells. But common economic anger in France is real, and half-measures won’t make France great again. It only risks the continued rise of divisive morons like Marine Le Pen.
France is a special nation and a loyal and important American ally. Let us hope Macron eventually sees the light.
