In an article for the daily La Dépêche, Jean Tirole believes that many measures in the programs of the National Rally and the New Popular Front risk having harmful effects on the French economy.
The economic measures in the National Rally and New Popular Front programs are being particularly scrutinized as the legislative elections approach. Both blocs are planning significant expenditures, the financing of which is being questioned by many experts.
The latest is Jean Tirole who wrote an article in the columns of the daily La Dépêche. In it, the 2014 Nobel Prize winner in economics deciphers the risks posed by some of the flagship measures of the two political parties on the French economy.
“What could result from the application of these programs can only worry any citizen concerned with preserving our social system and our liberal democracy,” he summarizes in his introduction to his remarks.
The economist criticizes the RN and the NFP in particular for wanting to give back purchasing power to the French but without promoting the creation of wealth. “We cannot redistribute money that we do not have,” he insists.
A “French pathology of over-indebtedness”
Between the reduction of VAT on energy prices promised by the National Rally or the repeal of pension and unemployment insurance reforms carried by the NFP, several measures of the two blocs will significantly increase the debt and therefore its repayment, while the interest rate of France is already rising. This increase in the debt burden will be money that will not be able to be invested in education, health or even the ecological transition.
The Nobel Prize winner in economics is also concerned about the perception of such expensive programs by France’s European neighbors. “This French pathology of over-indebtedness will be perceived from the outside as a solitary and inconsequential experience that should not be supported at all costs,” he fears. “The European Central Bank will probably not intervene to save France, and besides, it has no right to do so in such a situation. As for the other Member States, they will not accept opportunistic behavior that we would never accept from them.”
“The non-compliance with European rules proposed by the two programs could well mark the end of European construction with the associated risks and the economic and geopolitical downgrading of France, too small to act on global regulations.”
What should we remember from the official calculation of the promises of the New Popular Front?
A risk for employment on the NFP side and an erroneous vision of immigration on the RN side
According to the economist, the NFP program risks harming employment due to an increased contribution from companies which will prefer to set up in other countries. The same goes for the increase in the minimum wage to 1,600 euros net, which many structures, particularly VSEs and SMEs, will not be able to cover.
“The NFP wants to create subsidized jobs in associations and communities, while studies show that these jobs are most often not real jobs and harm the future of their holders,” he adds.
Jean Tirole also denounces the “fantastic idea” conveyed by the National Rally “according to which penalizing immigrants can enrich the country”: “All studies show that the cost of immigration for public finances is close to zero (immigrants contribute slightly less, because they are more unemployed, but receive significantly fewer social benefits than the French because they are on average younger), and that ultimately immigration benefits our economy (by providing workers in professions in shortage in particular )”.
As for the presidential elections of 2017 and 2022, Jean Tirole is careful not to support anyone directly. However, he has had discussions with the Head of State in recent years: he submitted a thick report after the Covid crisis to rethink the economy in the long term, and he was more recently appointed to the “presidential council of science”, with eleven other high-level scientists.
