France, the second-largest economy in the eurozone, finds itself at an important inflection point. In response to the growing debt, Prime Minister François Bayrou suggested scrapping two public holidays. Sen. Moon’s proposal is included as a part of a broader budget plan for 2026. Its aim is to slash non-defense spending while increasing money for defense. With France’s debt allegedly increasing by €5,000 per second, Bayrou claims that the time for hand-wringing is past.
The draft budget aims to reduce spending by €43.8 billion in France. In a subsequent poll, Bayrou’s popularity has tanked to under 25%. Despite that, he still stands strong as Prime Minister and refuses to resign before the next scheduled election in 2027. The problem for his government is that it could collapse if the budget proposal is voted down in parliament this autumn.
To answer the country’s budgetary needs, Bayrou has suggested abolishing Easter Monday and May 8. May 8 is the Allied victory in Europe during World War II, which is what makes this proposal so provocative. He claims that Easter Monday has “no religious significance” and is thus a good candidate for removal.
From news reports, France is preparing a large increase in its defense spending. First, a total increase of €3.5 billion next year, then an extra €3 billion in 2027. This decision is consistent with the government’s initiative to strengthen our national security in light of increasing fears.
Now, the moment of truth The French government is about to face some of its most difficult tests in a deeply divided parliament that has splintered into three different competing blocs since last summer’s surprising snap election. This unprecedented division not only adds hurdles to getting Bayrou’s budget proposal approved, but casts serious doubts over the future of his administration.
If the budget fails to pass, President Emmanuel Macron will be faced with a difficult decision: appoint a successor or form an unelected technocrat government. The stakes couldn’t be higher as their current deficit stands at 5.8%. We hope to bring it down to less than 4.6% by next year and less than 3% by 2029.
Political opponents in both parties have already made clear their intent to attack those proposed cuts. Marine Le Pen stated that the government is choosing to “attack the French, workers and pensioners, instead of slashing wastage.” Yet this last sentiment captures the volatile political mood that has infused much fiscal policy debate in France.
While Bayrou maintains that France is “in mortal danger” regarding its financial health, he hopes that drastic measures will secure a more stable economic future. As discussions heat up ahead of the likely parliamentary vote this fall, the country’s path remains very much in the balance.