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March 17, 2017

Le Pen fishes for Sarkozy voters

Next Monday the five candidates for the French presidency are to have their first televised debate. For some, this marks finally the start of the campaign, where candidates can be compared by their programmes, character and style. But most of the important stuff is already happening behind the scenes. 

Marine Le Pen now actively woos the electorate of François Fillon, to get their backing for the second round, writes Marianne. This is first about getting their vote in case she runs against Macron in the second round. But it also serves to divide the Republican electorate. Her calculation is that, if it comes to the final round, Republicans would vote for her rather than Macron. Just recently she was disregarding him as wanting an "uberisation" of the French economy. For Fillon voters she takes extra care not to be seen as too crazy. No more mentions of euro exit or pension at the age of 60. Instead Le Pen attacks Fillon’s morals, saying that he leaves his family behind in ruins. Not that Le Pen is free of judicial troubles. But the family aspect might just be the way in. Also, her endorsement of Henri Guiano, the former adviser of Nicolas Sarkozy, was a strategic stunt of its own kind. Portraying Fillon as a candidate representing the rich, she is now fishing for the popular right, those who voted for Sarkozy. The magistrates, meanwhile, have enlarged their formal enquiry to include those expensive suits that François Fillon received from generous friends.

Cécile Cornudet wonders what happens to the centre. Benoît Hamon and François Fillon are more to the left and right, respectively, than their predecessors were. Who takes care of voters of the centre? Are they going to abstain or vote for Emmanuel Macron? 

Hamon presented his programme yesterday. It is more left wing than that of François Hollande five years ago, picking up on the "Made in France" approach of Arnaud Montebourg. A poll suggests that only 48% of the Socialists support Hamon, while 58% of Republicans support François Fillon, while 80% of the Left Front party support Jean-Luc Mélenchon. 

Macron, meanwhile, got himself a meeting with Angela Merkel, a privilege that François Hollande was not granted before he was elected. The context is different today. The threat of the Front National is more real, as is the loss of popularity of François Fillon. Unlike Hollande at that time, Macron supports fiscal discipline and tells the Germans that reforms are the top priority in France, a message they all like to hear there. But the more interesting question is whether he can deliver. Can this help him with the electorate at home? The last thing Macron wants is an overly enthusiastic German reaction that will force him to mark his differences.

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March 17, 2017

Catalonia is nothing like Scotland... Oh, wait!

It used to be easy to argue that Scottish and Catalan independence were qualitatively very different. But the rhetoric coming out of the British Isles since Nicola Sturgeon announced her intention to seek a second independence referendum has a different character than before, and it recalls the arguments one hears as nationalists in Madrid or Barcelona shout past each other. The FT writes, for example, that Theresa May's rejection of Scottish referendum was greeted by Sturgeon as a democratic outrage. And then this: 

"Mrs May’s tough line will fuel calls from some Scottish independence supporters for other routes to separation to be explored, such as an unauthorised referendum or a unilateral declaration."

This has all the ingredients of a divorce made in Spain, especially the implication that the central government's refusal to even negotiate on a referendum at least for the next two years would justify a unilateral referendum - or even an unilateral declaration of independence. The reference to voters opposed to independence, but who believe Scotland should decide on constitutional issues, echoes the Catalan separatists' "right to decide" battle cry. In Catalonia the majority in favour of holding a referendum is overwhelming, as Podemos ally En Comú takes the position of opposing independence but favouring a referendum.

On Monday, an FT editorial argued Scots have the right to an informed choice in a second vote. 

"there has been a material change in political circumstances since the Scottish referendum in 2014 ... Brexit changes everything"

Now, the FT argues that the economic case against Scottish independence is strong because of the weight of trade within the UK in the Scottish economy. But we have argued since at least a year before the referendum on Brexit that the case for or against Brexit should never have been economic, but emotional and political. The EU is a political union and British lack of emotional attachment to the European project must be considered an important factor in the course of events leading to Brexit. In the Scottish case, if Brexit is perceived as an English nationalist project that would surely be a factor. This tirade by Fintan O'Toole after the referendum remains current. The FT above also quoted the Scottish Greens on the choice to leave "an isolated, angry Brexit Britain". Displeasure with PP rule from Madrid is also partially a factor in support for Catalan independence.

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March 17, 2017

Sinn’s Europe

Hans-Werner Sinn has published an article that in our view describes the conservative German thinking about the EU and Brexit better than anything else we have read so far. He urges Germany to take a soft line on Brexit, and to resist the French desire to penalise the UK. He said Germany should remember that the UK is Germany’s third largest export market, only one of two EU countries with nuclear weapons, and is becoming geo-strategically more important given the shift in US politics. 

More important for Sinn is that Brexit has destroyed the balance of power within the EU. He notes that, after Brexit, the liberal northern states will lose their blocking minority (he goes through the numbers in detail). Sinn wants Germany to threaten an Article 50 process, not in order to leave, but to force a treaty change - at least this is how we understand his term "Änderungskündigung" - giving notice of change. And it is important that Germany does so in lockstep with the Brexit negotiations and not afterwards, because this could produce a wider package deal.

This is, of course, not going to happen, but the article is a good reflection of the frustration felt by German ordo-liberals at the direction the EU is taking. With its Target2 surplus close to €1tn, Germany is hardly in a position to blackmail others. Nor would such strong-arm tactics work politically. It is inconceivable that a treaty change, thus initiated, would win the support of all EU 27 member states, and be endorsed in several referendums including in France. The EU, with 27 members, is pretty much stuck where it is. Change will come, but most likely as a result of economic shocks like a debt default or another eurozone crisis.

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