July 07, 2017
Is Emmanuel Macron just another Matteo Renzi?
We note some eerie parallels between the way Emmanuel Macron is prioritising his reform agenda with that of Matteo Renzi. Renzi also started off with ambitious and comprehensive plans for structural reform, but burned his political capital by focusing his efforts on the constitutional and political reforms rather than on economic reforms. Since Macron's grand speech in Versailles, we now detect the first voices daring to criticise the president and his team. Institutional reforms make sense from within the government, but may not be a priority for the rest of the country. Is Macron a control freak, like Renzi, whose main priority has become to consolidate his own power? We all know where that ended in Italy. Is the reform agenda which brought Macron to power more or less likely to succeed with a technocratic government, total newbies in parliament, and hardly any opposition except for Jean-Luc Mélenchon?
There are already the first disappointments. Liberalists were underwhelmed by Édouard Philippe's reform roadmap. Too hesitant and too slow, and not worthy of being called a revolution as evoked by Emmanuel Macron, says Gaspard Koenig in Libération. The economist Nicolas Bouzou puts it this way: we go into the right direction, but at 1.5km/hour. Philippe Aghion and Philippe Martin, who helped to design Macron's economic programme, disappeared from the inner circle, as did Jean Pisani-Ferry. The roadmap is a hodgepodge of incremental reforms that any of the two previous governments could have presented. Koenig bemoans the lack of structured ambition, details, or a real project, so this is far from being called a revolution. The major structural reforms - solidarity wealth tax (ISF), capital taxation, and the competitive and employment tax credit (CICE) - were pushed back. The autonomy Macron promised universities on the campaign trail no longer appears in the programme. The same is true of the reform of unemployment insurance. And old patterns still persist, like the €10bn investment fund for new technologies, with the state as strategic investor. Koenig says the fear is that the economists in Macron’s team will be replaced by technocrats and the lack of ambition that goes with that.
The only reform the government remains serious about is labour reform. We see that choosing a prime minister from the the Republicans has helped to win the legislative elections and weaken the opposition, but it may well turn out to be the achilles heel of Macron’s ambition to transform the country.