Thursday, May 4, 2017

EUROPE STILL ON EDGE

After the results of the first round of voting in the long anticipated French election became known, mainstream EU politicians breathed a sigh of relief, and expressed cautious optimism about the eventual outcome of another nationalist-populist attack on the eventual viability of the European Union. Out of a field of eleven candidates, Emmanuel Macron, the centrist leader of "En Marche!" (On the move), came in first, 2.2% ahead of second place finisher Marine Le Pen, long-time euroskeptic leader of the far-right National Front.

Headlines throughout the west proclaimed: "French Vote Calms EU Fears," (Wall Styreet Journal); "The Right Knocked Out," (Le Figaro); "Presidentielle: One Step Away," (Liberation). The Euro surged to a six month high as the markets shook off fears of two anti-European candidates, Marine Le Pen and hard-left Communist endorsed Jean-Luc Melenchon, making the run-off. Pro European diplomats rushed to congratulate Mr. Macron, who never held elected office, but who was Economic Minister in France's Socialist government. European Union foreign policy chief Frederick Mogherini praised Mr. Macron, calling him "the hope of a generation.." And former UK Chancellor George Osborne congratulated Mr. Macron, expressing his belief that, at last,  France "may acquire the leadership it needs." Ms. Le Pen received supporting comments from other European populists like Geert Wilders, the Dutch politician who lost his race back in January, and Nigel Farage, architect of the UK Brexit movement.

The nervously anticipated run-off, scheduled for May 7, could not be between more contrasting candidates. Marine Le Pen, far-right candidate with a populist economic agenda, is a known quantity in French politics. She wants to see legal immigration reduced from 200,000 to 10,000, and access to public services significantly limited. She believes in political isolationism, and is adamantly opposed to "Anglo-Saxon multiculturalism" and politically correct liberalism. Being anti-EU and anti-Euro, she favors return to the French Franc currency and proposes to hold a Brexit-like referendum (Frexit) on remaining in the EU. She wants closer ties with Russia, and has received millions in financial support from Russian banks.

Socially liberal centrist and pro-business candidate Emmanuel Macron, a former member of the Socialist Party, is strongly pro EU, pro Euro,, and believes the EU needs more integration, not less. However, he does want to initiate some changes to make it stronger, and proposes to strengthen the EU's external borders, while believing that France's security policies have unfairly targeted Muslims. He strongly identifies with the business community, and supports reducing the corporate tax rate from 35% to 25%. Macron also favors increasing defense spending to 2% of GDP, and encourages intervention in Syria.

Where in other European elections in which populists threatened mainstream positions, establishment parties survived by co-opting populist positions and moving further to the right, this French election has exposed a contrasting strategy. Macron campaigns from the center, strongly supporting the EU and what it stands for. Le Pen may be softening her positions on some aspects of her well documented anti-EU platform, if not fully co-opting a more centrist position - at least for the duration of the campaign. The rhetoric is shifting from "France or Europe"
to "France in Europe."

Polling preceding the May 7 run-off gives Mr. Macron a 59% to 41% edge over Ms. Le Pen. While these numbers ought to be comforting for EU leaders, all remember the polls leading up to the Brexit referendum results in the UK and Donald Trump's surprise victory in the US. Another imponderable comes from supporters of Jean-Luc Melenchon, whose candidacy led to a relatively strong 4th place finish in the first round, winning 19.6% of the vote, only 4% behind Macron and 2% behind Le Pen. While most mainstream losin g candidates endorsed Macron immediately following announcement of the results of the vote, Mr. Melanchon, whose positions substantially reflect those of the National Front, be it from the political left, has refused to do so. In the US significant numbers of Bernie Sanders supporters voted for Donald Trump, suggesting that populists on the right and the left share many policy positions. Something similar could happen in France and lead to a surprise outcome. It is not entirely surprising why many in Europe are still on edge.

No comments:

Post a Comment