Transcription
Hello Nicolas Bavrez. Hello. Thank you for being live with us on the Point de Vue set. You are an economist and historian, and we want to hear your opinion, your point of view, your perspective on what we are currently experiencing.
What we are experiencing first is the draft state budget for 2026, what is called the finance bill, which is currently being examined, and has been since Monday in the Finance Committee. It will be in the hemicycle on Thursday, uh, it will be on Friday, and the deputies will depart from the government's initial draft. Already, over these, uh, 3 days, or rather the first two days of committee debate in the Finance Committee, what do you take away from it? What did you think of these first two days?
Listen, two things. First, uh, it's proceeding in a falsely reasonable way, meaning that for now, we have the impression that, even compared to what happened last year with 34 billion euros in additional taxes, there is a certain restraint, and notably the tax on, has been postponed, but it will actually return in session. But what strikes me most is the announcement of the Prime Minister's rectifying letter regarding the suspension of the pension reform, which is a procedure that has practically never been used and which highlights how much this budget is completely out of the ordinary.
On the procedural level, we are now talking, which is completely contradictory. The Prime Minister, in my opinion, wrongly announced that he was renouncing Article 49.3, which empties the constitution of part of its content. But on the other hand, we are now starting to say that if there is no vote on the finance bill and the social security financing bill, they will be passed by ordinance. Now, honestly, your jaw literally drops. On the one hand, we are returning to the system of...
You mean that it's a denial of democracy. Is that what you are saying, that one of two things is true: either we explain that we are returning to a parliamentary system, and in that case, well, it's the parliament, where ordinances are completely incompatible with what was announced. And the other thing that I find is little emphasized is that since '58, this is the first budget that is proceeding truly under the overhang of the financial crisis. Today, this is the complete denial of reality, that all these discussions are taking place as if there were no financial problem.
So, we saw, well, on the one hand, there was the suspension of pensions, which will actually be an abrogation. On the other hand, regarding the famous, the famous provision on the 10% professional expenses for retirees, which was to be capped at 2,000 euros, the committee voted against it. So, overall, we see that the only consensus today is to continue to have much more spending, more taxes, more deficit, and more debt.
However, I would like to remind you that the S&P agency, at the end of last week, downgraded France's rating, and this is an exceptional procedure because it is not the usual calendar; it is what was used for Brexit for the United Kingdom or for the shutdown for the United States. And it's not just a sign; it has concrete consequences. That is to say, when you go from a rating of AA- to A, there is a whole series of institutions that can no longer... Yes. But the moment you are A, that you no longer have double A, there is a whole series of institutions in the world that can no longer buy debt. So, it's really very... it doesn't mean that we won't be able to place it, but by reducing those who can buy it, by definition, the prices of this debt will rise. And I remind you that we are already more expensive today than Italy, Spain, Portugal, or Greece. So, what is truly staggering is the unreality of this budget debate.
Indeed, and the agency Standard & Poor's, this lowering of the rating, invoking, I quote, a high uncertainty regarding public financing. This denial of reality, well, is it understood, this comment from the agency by the deputies, by the political staff, or is it totally, is it totally ignored? And so, what is very shocking is that the implicit bet behind this is that the French political class will not address the problem of public finances, which is directly linked to the problem of the economic model, the halt in growth, investment, innovation, and employment. That the IMF, the ECB, and European partners will not descend upon Paris to restore order in this country. Is that what you see? The only thing is capitulation.
Capitulation, that's the only way out. Public finances will only find a correct path with the arrival on the tarmac, if I may say so, of the IMF, is that it? Not otherwise. Yes, because moreover, if you want, what is happening and what is serious is that around this budget and this false stability, because in reality, we always have the sword of Damocles of censure, especially if ordinances are to be used, I don't see how there won't be censure behind it. So, we have false stability, and we have public finances that continue to deteriorate, and an economy that continues to collapse, because behind all these signals that are sent, obviously, there is no more investment, there is no more job creation, many people are leaving. Today, the entire French Tech is questioning whether to stay, given the proliferation of taxes planned on companies and their assets. And we see that there is no awareness. Not only is there no action, but there is not even awareness.
And on the other hand, the tools, since this Fifth Republic is not liberal as a regime, but it is made to manage crises, but all the instruments we had put in place, including Article 49.3, are systematically disarmed with the supreme paradox that today, those who regret the suppression of Article 49.3, or rather its de facto suppression, are the socialists, because they realize that, well, since the suspension of pensions will have to be in the Social Security Financing Bill, then for them, 49.3 allowed them the comfort of abstaining and letting things pass by abstention. So, this is where we see that by playing tactical games, we have indeed destroyed the Constitution, but we are not even managing to solve our tactical problems regarding the budget, pensions, and the social security financing bill. So, it's really... we are in a nihilistic moment of French politics, as unfortunately we have known a few in our history. It's... if you... we have our new Nobel laureate, Mr. Agon, who is also an exceptional personality and who received the Nobel Prize for his work on creative destruction, and the French political class acts every day in the name of destructive destruction.
But how can this decision by Sébastien de Cornu to do without Article 49.3 to pass the budget, its absence, not hold the deputies accountable? What we see is that, well, the bet was lost from the start, from the moment we have an assembly that has been very chaotic, volcanic at times, bordering on, in any case, verbal violence, sometimes bordering on physical violence, with 11 parliamentary groups tearing each other apart, a common ground that is no longer common ground and is no longer common. How can we believe that by handing over the keys of the Republic to this assembly, an assembly that often resembles a student gathering, how can we believe that we will restore responsibility? And that is truly what is striking today: we are in a regime of unlimited irresponsibility.
How do we get out of this? You, I have read you, Nicolas, and you are in favor of early presidential elections. Yes, because behind all that we have just discussed, the ultimate responsible party is always Emmanuel Macron. Today, when we are in such a state, we are obliged to go before the voters. If we go through dissolution, the deadlines are strict: 3 weeks. And so, we know that the only ones in a state to campaign are the extremes. So, indeed, there is an advantage for the RN, which will therefore win these elections, that is certain, and will undoubtedly have, in any case, a relative majority. So, a dissolution amounts to entrusting the reins of power to the National Rally, about which one can wonder if it is truly equipped or tooled to face such a situation. On the other hand, presidential elections, it is true that if it is an immediate resignation, the constitutional deadlines are also strict. It's 45 days, and we fall back on the same problems.
So, if we have, for that matter, a responsibility of the different actors, that is to say, the President of the Republic explains that he will resign after the municipal elections, that we will therefore have early presidential elections in 2000, in May 2026, that until then, we agree on a budget that allows things to be frozen and to avoid the start, the brutal acceleration of the financial crisis, to have a calm environment that allows the different political forces to reflect on credible plans for France's recovery, to organize ourselves so that we don't have 20 candidates in the presidential election and so that we don't have the same spectacle that the National Assembly is offering today, and therefore that we have the time to establish a democratic debate that is a more or less organized and responsible debate. So, that is why, in my opinion, it is the only solution to get out in a peaceful, organized, and democratic way from the complete impasse in which this five-year term finds itself, and for which the responsibility lies entirely with Emmanuel Macron, who constantly says that it is the fault of others, of the parties, etc., but all these decisions are his.
Wouldn't organizing presidential elections damage the function of the Head of State? I absolutely do not think so, because I remind you that someone who knew institutions quite well, who rather respected the presidential function, and who was called General de Gaulle, in 1969, drew the lessons from the referendum he had lost on the reform of the Senate and regions, and on the very day of his defeat, announced that he would cease to exercise his responsibilities from midnight, ten days later. And then, well, we had a presidential election which led to the election of Georges Pompidou, contrary, moreover, to what everyone said, because I remind you that most analysts and political forces thought that the Fifth Republic would end with General de Gaulle, and we saw that his decision, far from weakening the Fifth Republic, installed it, thanks to the talent of Georges Pompidou, whose presidency, unfortunately interrupted by his death, was an extremely successful presidency, because, unlike, I would say, Guizot or Émile Olivier under the Second Empire, Pompidou is the one who installed the Fifth Republic and who combined political stability and institutional stability with economic development and the regaining of social peace and concord after the terrible shock of May '68. So, this clearly shows that the resignation of the President of the Republic does not at all, it does not necessarily lead to a regime crisis or instability. Quite the contrary.
And I must return to what we are experiencing. We are experiencing an existential crisis for our country, and it is not only a political crisis but a regime crisis. So, it is up to the French people to resolve it, and to resolve it in the spirit of our institutions, because I do not believe at all, contrary to what many people say, that the Fifth Republic is obsolete. I think it has been totally corrupted and distorted, particularly by Emmanuel Macron. And so, we must return to the spirit of the Fifth Republic, which is designed to deal with this kind of problem, this kind of crisis.
Why, Nicolas Bavrez, are we unable to do in France what other European countries have succeeded in re-establishing or getting back on a good public finance trajectory, namely Spain, Italy, Portugal, to name but a few? Well, it's both good and bad news. When we look at Europe today, it is in a state of great vulnerability between Trump's liberal and predatory America, which you will discuss later, the strategic threat from Russia, Chinese dumping, but at the same time, there are quite a few positive things in Europe. Northern Europe is doing very well. We have competitiveness, solidarity, innovation, ecological transition, and real, real rearmament against Russia. Here, there is no real rearmament or real reinvestment in defense. And Southern Europe is also doing much better. Germany is relaunching, and the whole world is interested. The sick man today is France.
So, what we see is that everywhere else, this improvement is the result of considerable work. Take Italy. Mrs. Meloni today has 3 years of stable power, popularity, and moreover, Italy is doing rather well economically. But what should not be forgotten is that this result, Mrs. Meloni, ultimately, has made very few structural reforms. She has made a few on the welfare state, but she benefits from 15 years of work by the Italians and three governments that we have forgotten were decisive in the middle: the Prodi government, the Monti government, the Draghi government, and that today, even today, behind Mrs. Meloni, there is the shadow of Mario Draghi, who is actually still inspiring France. Is that what France is missing, a Mario Draghi?
I think what France is missing, first of all, is that we are paying for the accumulation of decades of demagoguery, the results of which we are seeing today in the political class, but which have nevertheless damaged mentalities considerably, and so the French are also disconnected from some realities, but I think that if we tell them the truth, they can react. Moreover, we have seen it; we are not telling them the truth. Ah, no, when we explain to them, well, look at what is happening, for example, with pensions, everyone knows that we are living much longer, for example, and that yes, but... the suspension of the pension reform, the message is that we, the implicit message that is clearly conveyed is that we can return to the age limit of 62 without any problem. That means a deficit of 15 billion in 2013, in addition to the 15 billion that are already programmed. 30 billion. I remind you that Greece collapsed on pensions; it was 18% of GDP. We are at 145%. This means that we have gone far, and especially if we add to this aging, indeed, which is very happy, the increase in life expectancy, the fact that we have fewer young people, that we have structural unemployment, that we have no more productivity gains, frankly, the explosion is programmed, and all of this is not explained; it is not explained. So, that's why we are in this situation.
So, how can we get out of it? Well, we can get out of it by educating citizens, by stopping denying the problems, by having a debate on solutions, and then by seeking to unite the French people, which we did, ultimately, in '45, and which was done by General de Gaulle in '58, where we had both a real shock therapy, a change, and which was supported by the French people. And I remind you that in the 1950s, we forget it, but during the Thirty Glorious Years, the French were the ones who worked the most, outside of the Japanese, in the developed world. So, there was a commitment to production, modernization, with the obsession, with the double shame of the 1930s and especially of June 1940 and the occupation. So, the French fought to rebuild their country. Today, we need to reinvent a French model in the 21st century, and we need to fight to make France a power again.
Thank you, Nicolas Bavrez, for coming live on the Point de Vue set to give us your point of view.