(Bloomberg) -- France’s lower house of parliament toppled the government for the first time in more than 60 years in early December, forcing President Emmanuel Macron to cast around for a prime minister who could navigate the country’s bitterly divided political landscape.
Macron opted for centrist figure Francois Bayrou, a veteran lawmaker with a track record of striking alliances and forging compromises with both Socialists and conservatives.
Bayrou may struggle to avoid the same fate as predecessor Michel Barnier, who ended up as the shortest-serving prime minister of France’s Fifth Republic after Marine Le Pen’s far-right National Rally joined forces with the left to oust his government over a budget dispute.
The 73-year-old Bayrou must deal with the same financial and political constraints that sank Barnier’s administration. And until there are fresh legislative elections — which can’t happen before July at the earliest — it will be a challenge to get laws through a fractious parliament in which Macron’s party lacks a majority.
Why did Barnier’s government fall?
In June, Macron dissolved the lower house of parliament in what he said was an effort to bring clarity to French politics after the National Rally triumphed in European elections. The gamble backfired, delivering a National Assembly split into three irreconcilable blocs — a leftist alliance, a shrunken center backing Macron, and a strengthened far-right party led by Le Pen.
Macron took two months to appoint Barnier following the legislative elections, hoping the man who led the Brexit negotiations on behalf of the European Union could narrow the deep divisions. But the negotiations around the 2025 budget bill exacerbated tensions, and when the premier used a constitutional tool to bypass a vote on a related bill, Le Pen joined forces with the left to support a no-confidence motion that brought down the government.
Le Pen’s party had demanded concessions from Barnier over his plans for €60 billion ($63.4 billion) in tax hikes and spending cuts to bring the budget deficit to 5% of economic output from 6.1%, closer in line with EU rules.
Barnier made multiple concessions until the eleventh hour in response to far-right demands to shelter households from the belt-tightening. But Le Pen said it was insufficient and accused the premier of lacking respect for her voters.
What could Bayrou do differently?
Bayrou’s new cabinet is filled with heavyweights and veteran figures. The premier brought two former prime ministers back to government and tapped Eric Lombard, a seasoned investment professional with ties to the left, to run the finance ministry.
Crafting a budget bill for 2025 that can win parliamentary support is Bayrou’s most urgent task, and also the most challenging. The state will rely from Jan. 1 on emergency legislation that permits only vital spending and does nothing to address a ballooning budget deficit.
Both the far left and far right rejected Barnier’s formula of spending cuts and tax hikes as an unbearable burden for citizens and businesses. Bayrou has also vowed to sharply narrow the deficit, but signaled a slight change of approach that could do more to protect companies. Lombard said the government must reduce the deficit “without killing growth.”
Can Bayrou succeed where Barnier failed?
Bayrou will lean on the deep experience of his new cabinet members. But the composition of his government is similar to that of his predecessor, comprising mostly centrists and conservatives.
Opposition forces have thus far shown little desire for compromise even as political turmoil drove up France’s borrowing costs in financial markets in recent months. There was little sign of goodwill among lawmakers toward Bayrou’s freshly appointed government, with key parties immediately signaling displeasure with his roster of ministers.
Jordan Bardella, president of the National Rally, called the new administration a “coalition of failure.” On the left, Socialist Party leader Olivier Faure called the casting of the new government a “provocation.”
Ecologist party leader Marine Tondelier said the new government was “imbalanced,” with too much influence given to the right.
Bayrou could seek support from more moderate opposition groups, such as the Socialists. He could also aim to secure Le Pen’s backing for his policy agenda, though he would be taking a risk. Barnier made a string of concessions to win Le Pen’s support for his budget bill, but she stepped back at the last minute, forcing the collapse of his administration.
The move suggests her ultimate goal may be to force an end to Macron’s presidency before 2027, when the next presidential election is set to be held. Macron cannot run again because of a two-term limit for presidents. Opinion polls show Le Pen remains a favorite to win the next presidential vote.
What is behind Macron’s decline?
Seven years ago, Macron’s promise of economic reforms to free France from a straitjacket of regulation and taxation resonated with voters who’d lost patience with traditional parties. But his governments’ policies, from energy taxes to raising the retirement age, angered a swathe of the electorate.
As his star faded, Le Pen exploited grass-roots resentment of policies seen as favoring the rich at the expense of workers and the middle class. The sharpest inflation surge in a generation alienated voters further.
In the current political impasse, some opposition parties have called on Macron to resign. But the president has insisted he will see out his second term.
“We have 30 months left of the mandate you have given me,” Macron said in an address to the nation on the evening of Dec. 5. “Thirty months for the government to be able to act to make France a fairer and stronger country.”
--With assistance from Samy Adghirni and Ania Nussbaum.
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