The (Serious) French Connection

What do you do when your boss announced plans for a layoff?

Emmanuel Macron. Source: Wikipedia

That’s what Emmanuel Macron did a couple days ago, in a powerful speech to both houses of the French Parliament. The assembly has 925 seats, and Macron announced plans to cut its number by a third. If the houses don’t agree, he said, he will bring his initiative to the voters directly. He also told the lawmakers that they need to legislate less, that France can’t keep up with a rapidly transforming society if it is always enacting laws on the basis of obsolete economics.

The 39-year old leader stunned the establishment by winning decisively over anti-immigrant populist leader Marine LePen. He consolidated his gains by taking a majority of the seats in the National Assembly. His one-year old political party, En Marche and its centrist ally won 350 out of 577 seats in the recent election, giving his government a clear mandate to pursue significant reforms.

He’s been criticized as a neo-monarchist, he’ll be resisted by labor leaders, but the political newcomer is upending the tables in a system that is often corrupt, ineffective, and irrelevant to everyday life. The French have lately seen terrorism and economic stagnation that deeply threaten their way of life. Government debt is nearly 100% of GDP, and their economic growth potential is quite weak.

Macron promised a “renaissance,” where France can lead the world towards healthy, sustainable growth—but only if the public embraces the necessary changes. In our all-Trump all-the-time political news-cycle, it’s easy to forget that the rest of the world is changing. I looked at the speech and had one, big conclusion: this man is serious.

Douglas R. Tengdin, CFA

By |2017-07-17T16:47:38-04:00July 6th, 2017|Global Market Update|Comments Off on The (Serious) French Connection

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