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April 27, 2017

Courageous or reckless?

Emmanuel Macron went to a Whirlpool plant in Amiens that is threatened to be closed. He confronted workers in talks lasted one hour. And he dared to say what François Hollande did not at Florange in 2012, that the state cannot promise anything and that he will not forbid the closure of the plant. But he did talk with them about finding solutions.

Whilst he was with the workers' union at a chamber of commerce building away from the plant, Marine Le Pen made a surprise visit to the protesters on the site and took selfies with them, saying that with her the plant will not close. After 10 minutes she was gone. This is clear flash populism. It is also clear that workers at Whirlpool are unlikely to vote for Macron. The images from Amiens are all over twitter and other social media. They make it look like Le Pen scored one more point. 

But what Macron showed is that he has the guts to get back into the ring, enter Le Pen territory and propose to solve the problems his way. He has to convince all those voters that think of abstaining or voting blank to come out for him instead. Nicolas Sarkozy said he will, as did some of Melenchon’s supporters. But on social media the tenor suggested momentum away from him.

In theory voting for Macron in the second round after he won in the first should be strait forward. But it is not. Many, especially in the big cities, gave Macron their useful vote already in the first round, to lend maximum strength to a candidate who the polls suggest could beat Marine Le Pen. Now, after his uninspiring speech on Sunday and his misplaced victory celebration after the elections, they wonder whether this telegenic political upstart is lacking in substance and understanding of the gravity of the country's situation. Some feel betrayed of their heartfelt choice in the first round, and resent that Macron was pushed up by the media. Some Mélenchon supporters think that the Le Pen voters should be listened to. Catholic voters who backed François Fillon have a problem with Macron's liberal family values. There is a lot of criticism about his lack of rhetorical prowess, and his seeking to please everybody. The voters' discontent can not only be expressed by voting for Le Pen. Blank votes and abstention could also melt the advantage the polls give Macron in the second round. The fact that he came first last Sunday was hailed as a major victory. But if one adds up the first-round tallies of all the candidates who either wished to quit the EU or had serious qualms about its "neoliberal" slant, the result is a country split in half, so France 24.

Where are Macron’s negotiations with the right? While big names like Sarkozy, Christian Estrosi and Jean-Pierre Raffarin already said they will vote Macron, none of the parliamentarians did. For them the choice is a difficult one. Macron’s movement En Marche! sets the condition that MPs who rally for Macron will also have to give up their standing with theit current party and campaign under En Marche! for the legislative elections in June. For many MPs this is not only a political choice but a financial headache. Many members have already started their campaign, in many cases since January. Financed by the Republicans or the centre-right UDI, they received logistical assistance or even a loan from their party. Changing stables in the midst of the campaign is tricky. Negotiations will continue today, according to Journal du Dimanche.

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April 27, 2017

Softer, softer, soft

We see Brexit progressing on a relatively smooth path - a formal exit in April or July 2019, followed by a transitional arrangement, what Theresa May calls implementation phase lasting two or three years, during which the UK will for all practical purposes remain a member of the EU, to be followed by a transition to a new regime outside the customs union, governed by a free trade agreement. 

The Daily Telegraph now reports that the UK is considering dropping one of the potentially contentious issues in the Article 50 negotiations - the insistence to end contributions to the EU budget on Brexit itself, while the EU is banking on British contribution until the end of the multi-annual financial framework in 2020. The paper has been told by Whitehall officials that May's government is ready for payments to continue until the end of the period. That will significantly reduce the gap between the EU and UK positions on the costs of Brexit. What's left will then be largely a technical issue. 

The Telegraph's sources said that payments up to the end of the MFF constitute a realistic concession, in exchange for an EU offer of a transitional deal and speedy talks on an FTA. That seems an entirely plausible negotiating outcome as it suits both sides. The Brexit process will, of course, remain accident-prone, but this is a situation where both sides gain through an orderly agreement, and both sides lose if the UK were to leave without a deal. 

What also conspires in favour of a positive agreement is the prospect of a large Tory majority in Westminster, and an attendant shift among Tory MPs towards the moderate Brexit position of Theresa May (as opposed to Brexit hardliners and anti-Brexit MPs). Her approval ratings are the highest for any leader since the 1970s. 61% say she is the better leader, while Jeremy Corbyn has the support of 23%. Approval is measured on different metrics - they are all equally disastrous for the Labour leader. A YouGov poll has a favourability rating of minus 42% for him, an all-time low for a Labour leader. However, he is not the most unpopular politician in the country. That prize goes to Paul Nuttall, the UKIP leader.

The decision to call an election seems to have worked out for May - for now. What we thought was interesting was that Brexit is the top issue for the electorate in a way that favours May.

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