France 2017 elections in perspective Episode 2: The left wing primaries, the true kick-off of the Presidential campaign

January 30, 2017 There is no turning back. Now with a designated champion for the , the five major Benoit Hamon, the radical Growing populism outsider of the left wing candidates running primaries, has surprised has not been left unscathed by the profound anti-establishment for the Presidency everyone by defeating Manuel movements that have hit the UK and USA are in the starting Valls, former Prime Minister, – and which threaten other European and Arnaud Montebourg, countries like Italy, the Netherlands or blocks. Only three of former Minister of Economy. A even Germany. Hamon’s anti-austerity them – Le Pen (far - repeat of what François Fillon stance has probably been fed by this trend in the left primaries but, moving right), Fillon (right) did two months ago when forward in the Presidential campaign, defeating and other truly populist candidates will draw and Macron (center Alain Juppé. more benefits from it: Jean-Luc left), seem capable of The right-wing primaries Mélenchonon the far-left or Marine Le making it to the gathered over 4 million voters Pen on the far-right. but only 2 million voters two-person showed up for the left-wing Macron, the real winner second round. primaries, calling into question of a primary that wasn’t the real legitimacy of the The wild card his own Mélenchon (far-left) designated candidate of the Socialist Party. While the left’s primary debate was should however not mired in idealist proposals, Emmanuel be forgotten, as well The decline of the Macron, former Minister of Economy who refused to be part of that process, as veteran Bayrou Socialist Party has continued to generate strong enthusiasm, gathering thousands at each (center-right), who Similar to Bernie Sanders in the USA or of his meetings. With a liberal- has not decided yet Jeremy Corbyn in the UK, Benoit Hamon conservative candidate on his right and a has radicalized the debate within the radical-utopian-socialist on his left, not to whether he will run. Socialist Party: his utopian vision has mention the extremists of both sides, Both recent prevailed over a pragmatic social Macron has a wide space to occupy in the democratic approach. The unsuccessful center. Over the past weeks, he has been primaries have policies of the past years, both to extremely smart at successfully filling decrease unemployment or to encourage that gap. There is one question shown that in France, business, has fed resentment towards remaining though: will François Bayrou, as elsewhere, the this approach and has materialized in the the historic representative of the center- very low turnout for the left wing right run for the Presidency himself or unexpected is likely primaries. It could well be that announce his support for Fillon, or for to become the Hollande’s disastrously unpopular Macron? The coming weeks, revealing presidency has not only been fatal to his the final details of the main candidates’ routine. own political career but could also be programs, will be critical, and the French fatal to the Socialist Party. roller coaster is not over yet. © Brunswick 2017 | 2 Brunswick Group France 2017 elections in perspective

Left to right, the contenders

FAR-LEFT CENTER FAR-RIGHT

Jean-Luc Yannick Benoit Emmanuel François François Marine Mélenchon Jadot Hamon Macron Bayrou* Fillon Le Pen

(*): unclear if he will run himself or support one of the other candidates Brunswick Group France 2017 elections in perspective

The 5 main contenders Hamon, the socialist utopian

A rugby fan, Hamon, 49, began immigration into Europe. his political career in the 1980s He also strongly advocates a greener economy, making the energy transition as a student activist. towards renewable energies the highest He got involved in the Socialist Party priority. through the Young Socialist Hamon also wants to reshuffle the Movement of which he became French institutions in order to narrow President. Throughout his career, he the gap between politicians and citizens has dealt with three parallel political and involve the people in the decision lives: Within the Socialist Party (being making process, creating de facto a 6th one of the leaders of its left wing with Republic in France. Arnaud Montebourg – “les frondeurs”, the rebellious leading the socialist His challenge in the campaign opposition to Hollande’s policy in the will be to avoid a complete disaster for second term of his mandate), as an the Socialist Party, after Hollande’s elected official (member of the withdrawal. He desperately needs to reunite the left if he wants to avoid a European Parliament, member of a th local authority in the Greater Paris humiliating 4 position in the first round Region, and currently a member of but so far he has received a blunt “no” the Lower House of the French from Jean-Luc Mélenchon. Parliament) and as an active part of the Government (as a member of ’s staff when she was Minister of Labor and a Minister himself at the beginning of Hollande’s mandate, in charge of Social Economy, and later on – although briefly – in charge of Education). More spending, more State interventionism and a new Constitution His program outlines radical ideas such as a monthly universal basic income of about €750 per person, the recruitment of thousands of new civil servants (including teachers and policemen), an increase of civil servants’ wages and of the legal minimum wage for all employees by 10%, and a 32-hour working week. Very unclear when it comes to the financing of those measures, he proposes to tax industrial robots, to fight against tax evasion by large multinational companies, to strengthen constraints on stock options and to reinforce taxation on households’ assets. He also proposes to legalize marijuana, to RATHER LOW cancel the inter-EU debts of Member Likelihood of States, to create a “humanitarian visa” for reaching the refugees, aimed at facilitating second round: Brunswick Group France 2017 elections in perspective

The 5 main contenders Fillon, the conservative marathon-runner

François Fillon, 62, is a career corporate tax rate (10bn€) from its  Gathering large support for politician, with four decades of current level –33.3% –to around 25%, a implementing his radical reforms and rate that is much closer to the EU demonstrating that these are experience. Elected the average. In addition, the French “ISF”, or financially realistic will be critical. youngest MP at age 27 in 1981, “Solidarity Tax on Wealth,” would be Since his victory at the right-wing he has held offices at all levels of scrapped in order to encourage primaries last November, Fillon has the political landscape, several investments in SMEs. He is betting that been violently attacked by many due times as Minister (incl. Labor he will boost the economy in the first two to his “ultra-conservatism”, “putting years of his mandate by focusing on the French social welfare system at and Education) until his businesses rather than households and stake”. appointment as Sarkozy’s pushing through corporate tax relief.  The rise of is a real Prime Minister (2007-2012). In order to restore France’s public threat for Fillon as they are both finances and structural growth, Fillon’s fighting to attract centrist voters. A right-wing centrist, he holds free- ambition is to complete a deep and market and pro-business ideas and  Fillon, who has always promoted high radical state reform. To do so, he ethical standards, is facing a scandal has built a reputation for being a proposes a cut of 100 billion euros in cautious but determined reformer following revelations by the satirical public expenditures over the next 5 weekly Le Canard Enchaîné that his (he carried out two pension reforms). years. His flagship proposal is to cut Claiming his catholic faith and wife might have been employed as his 500,000 public jobs within 5 years parliamentary assistant without doing culture, he is a moderate European (roughly a 10% cut). In the same vein, he (he voted against the Maastricht any proper work. Those allegations also wishes to align the pension status of have prompted France's financial Treaty) and embraces a traditional public sector workers with that of private stance on social issues. Discreet and prosecutor to open a preliminary sector workers by pushing back the investigation. May be a fatal blow to scandal-free, at least until this recent retirement age from 62 to 65. month (see below), Fillon has a style his candidacy. which contrasts with that of the A pragmatic foreign affairs extrovert and buoyant Sarkozy. policy François Fillon advocates a shock Fillon has not been very forthcoming on therapy program for the French foreign policy so far. Defending a “Europe economy and a pragmatic stance on of nations to ensure sovereignty”: Fillon foreign affairs. The vision behind this does not want more integration at large program is his alarmist diagnosis of the in Europe and believes that the powers French economy, which he described of the European Council should be back in 2007 as being “bankrupt”. With increased vs. the European Commission. “liberation of the economy” at the top of He believes that the revival of the his program, Fillon advocates a profound Franco-German relationship depends on change of the business environment, France’s ability to reform itself and based on increased flexibility of the labor therefore to regain economic credibility market and significant tax breaks for in the eyes of its German partner. Fillon companies. advocates dialogue with Russia which he believes is the only way to put an end to In-depth reform of the French the war in Syria and defeat ISIS. For him, State and pro-business isolating Russia could be damaging not measures only for French interests but also puts global balance at risk. In contrast, Fillon His key measure to trigger a “shock of has a much stronger stance against competitiveness” is to end France’s China: he believes there should be emblematic 35-hour workweek. From a clearer rules of reciprocity between tax perspective, Fillon has committed to a China and Europe on trade. RATHER HIGH reduction of business taxation by as Likelihood of much as €50bn starting in January 2018. His challenges will be to overcome reaching the This includes cuts in corporate charges three key obstacles: Perception of his second round: on wages (40bn €) and a lowering of the program, Macron and ethics. Brunswick Group France 2017 elections in perspective

The 5 main contenders Macron, the trans-partisan meteor

Former advisor to President business candidate and has gained reinforce security, complete the Hollande (2012-2014) and support from a number of French monetary union, boost foreign trade, business leaders. accelerate the ecological transition and former Minister of Economy Macron has not yet presented a proper join the digital economy. In particular, and Finance (2014-2016), electoral program. However he has Macron insists on reinforcing Europe’s Emmanuel Macron, 39, is the unveiled a range of key proposals during security shield to protect its borders. fresh young face in the campaign speeches, as well as in his book “Revolution” published in November His challenge in the campaign Presidential election race. will be to translate his popularity into A graduate of the elite French school 2016. Macron’s central idea is the urgency to « unblock France » by dealing actual votes and for that he would need ENA (Ecole Nationale to: d’Administration), Macron joined the with the root causes of the situation and political game three years ago, after tackling them at the core.  Build and showcase a clear and strong program, demonstrating that he has having worked as an investment Unblocking the labor market, banker at Rothschild in Paris. As broad enough shoulders to become Minister of Economy, Macron fostering innovation and President, attracted mainstream attention with entrepreneurship, and  Prove that he has the nation-wide base the “Loi Macron”, a bill aiming at reinforcing sovereignty at to win the legislative elections, as reviving the French economy by European level having a majority in Parliament is key shaking up an over-regulated to being able to conduct reforms, economy, fighting corporatism and Reaffirming « labor value »: allowing all  Preserve his trans-partisan approach promoting targeted business-friendly French citizens to « live by their work » by carefully managing his supporters policies. Key measures include (vs. a culture of assistance) is one of from the Socialist Party. loosening Sunday-trading rules, Macron’s major ambitions. So far, he deregulating certain professions such showcased only one key reform, which is as notaries and liberalizing the to decrease wages’ taxation for the French inter-city coach industry to lowest-paid workers. foster competition with trains. Reforming the labor market for more Since he stepped down from the « flexicurity » – a combination of government in August 2016, Macron flexibility for businesses and security for has taken a clear anti-system stance, workers: Macron wants to put an end to refusing the traditional logic of the 35-hour workweek which he parties, and running independently considers a brake to French businesses’ by founding « En Marche ! » (« Moving competitiveness. He proposes to on! ») – his own party, which is modulate the number of working hours « neither on the right, nor on the left ». through negotiations at corporate level. At the same time, he advocates a At the core of « En Marche ! », is Macron’s profound reform of continuous learning pledge to regenerate the political so as to reinforce workers’ rights and landscape: the belief that politics should give them adaptability to new jobs not be a profession per se but a limited- throughout their work life. in-time commitment which could be Macron also wants to foster embraced by any French citizen at some entrepreneurship through further point in time in their life. Macron’s fresh administrative simplification – a huge trans-partisan approach to politics potential task he has not clarified yet. combined with great communication Reshaping the French education system, skills have electrified the campaign: he which fails to provide equal has unexpectedly raised great opportunities for success is also an enthusiasm – first in Paris and then objective for him. Reforming the system throughout the country– becoming the includes giving more autonomy to third man of the election. Macron is a RATHER HIGH schools and promoting apprenticeship. Likelihood of center-left candidate and a social-liberal Finally, he proposes to rebuild Europe’s reformist. He is perceived as a pro- reaching the sovereignty, focusing on five priorities: second round: Brunswick Group France 2017 elections in perspective

The 5 main contenders Le Pen, the established far- right populist

Marine Le Pen’s National Front lines on major social issues while openly Her main challenge lies within the is France’s leading party by chasing LGBT support, although a vast mechanics of the French electoral system votes with the highest score in majority of the Party’s core supporters itself. Indeed, one cannot forget that are still strongly pro-life and anti-same more than 50% of the national votes are two of the last national sex marriage. needed to be elected President, given the elections, in 2014 (European This vast process of transformation, two-round system for the elections. This elections) and again in 2015 which many argue has been more remains a very high bar for Marine Le (local regional elections). cosmetic than a deep reboot, comes at a Pen. Opposition and detestation of her This year, nearly all the recent polls – huge cost. From the inside, the National ideas remain deeply rooted in the nation for what they are worth – place her Front is torn in two. Tensions are high and so far all parties left and right have ahead in the Presidential election between Marine’s core team and the always maneuvered together to isolate race and systematically qualified for conservative old guard, led by Marine’s the National Front in the final round. Last the second round. She finished third young niece, Marion Maréchal Le Pen. year during the regional elections, her in the previous Presidential elections, Party came out on top in the first round in 2012, with 18% of the vote. She is Anti-immigration, in many regions, sometimes by scores convinced 2017 will be a different protectionism and soft Frexit averaging 40%, but was defeated in all story. The turning point in her fast regions in the second round. Marine Le track political career came when she Three months away from the first round, Pen’s program has been embellished and became the leader of the National is preparing for the final window dressed on many fundamental Front in 2011. Since then, she has battle. A formidable speaker, media issues but it remains extreme on many been consistently working on further savvy, she is not intimidated by any points and economically unrealistic. Can broadening her electoral base, by opponent and remains in full control of the great communicator sell it to the reaching out to the middle classes, the her image. She is weak and uneducated French this time? jobless and those forgotten by the on economic issues but unshakable on elite and opposed to the fast train of those issues in debates. Her detailed liberalism and globalization. Way electoral program will be revealed on th before Trump and the Brexiters, she February 4 but no real surprise is has promoted populist themes which expected: the main focus will be on social resonate with a vast spectrum of issues in favor of middle classes, voters, riding on their fears of a pensioners and SMEs, with an increase of gloomy future or their contempt for the minimal wage and a pension age the “European bureaucracy.” White- threshold at 60 years. She claims the tax collar voters, left or right, today system will be reviewed for fairness and openly express support, something to prefer French nationals for jobs and they would not have dared to even social benefits. Marine also cleverly whisper years ago. Marine Le Pen has wraps her anti-globalization mantra up worked hard to distance herself from in a more moderate protectionism but the outrageous discourse and radical maintains that the Schengen agreement xenophobic stances of the “old” (no border control between the EU National Front. The climax of this Member States but the UK and Ireland) sanitization campaign was reached in should be torpedoed and that taxation of 2015 when she excluded her own imports should be increased. Finally, her father, Jean-Marie Le Pen, founder claims of abandoning the Euro have also and Honorary President of the party, been rephrased into a strange dual from the Party’s executive bureau. approach, where both a new domestic currency should coexist with the Euro, Marine Le Pen today coasts on this the latter being confined for the export populist rhetoric and polished tone. She business of major companies. for instance denies being anti-Muslim and chooses to speak about French HIGH identity and Christian roots, even if at the Likelihood of core, her stances on Islam, immigration reaching the and integration of foreigners remain as second round: tough as her father’s. She also blurs the Brunswick Group France 2017 elections in perspective

The 5 main contenders Mélenchon, the extreme leftist rabble-rouser

Jean-Luc Mélenchon, 65, Mélenchon has launched a large His main challenge will be to unite candidate of the far-left, is a participative consultation to build his a wide left spectrum to qualify for the veteran politician with over program which is so far largely inspired second round. He benefits from the by his 2012 program. support of the Communist Party, but will four decades of political also have to rally the votes of the smaller experience. A new participative Republic, an far-left candidates (Nathalie Artaud and anti-European stance and the He has held offices as Senator, Philippe Poutou) as well as of the green Minister of Professional Education in reinforcement of the Welfare candidate (Yannick Jadot). With Lionel Jospin’s socialist government, State Hamon’s program very close to his, Mélenchonwill also need to accelerate and has been a Member of the The key proposals he has unveiled so far European Parliament since 2009. A the tone and format of his campaign to are: differentiate himself and ultimately member of the Socialist Party for th more than 30 years, where he  Establishment of a 6 Republic which defeat the Socialist Party’s candidate. embodied the extreme left-wing of the would be more « participative » party, he broke free in 2008 and including setting up of the right for founded his own leftist party, called citizens to dismiss an elected “Parti de Gauche”, inspired by the representative, German “Die Linke” movement.  Democratic refunding of the European Having already run in the 2012 treaties, which could ultimately lead to presidential election, in which he exiting France from European treaties, ended up in 4th place with 11% of the and potentially from NATO, votes, he is running for the second  Cancellation of free trade agreements time, with a newly created political (TAFTA, CETA), movement called “La France  More wealth redistribution with insoumise” (“The rebellious France”), increase of the net minimum wage at also supported by the Communist €1,300/month and increase of the Party. public sector wage, He embodies the anti-business and anti-  Rescindment of the recently adopted capitalist left and appeals to the “left of « Labor Law », creation of a 32-hour the left” electorate. He has been one of working week, retirement age at 60, the fiercest opponents of Hollande’s  Investment in energy transition with a presidency as well as a strong detractor progressive exit of nuclear energy and of Le Pen, whom he nevertheless failed to establishment of a « green rule » to beat in the 2012 general election, when protect natural resources even if this they faced each other in the same results in a higher deficit, constituency. Since he voted against the  Separation between retail banks and European Lisbon treaty in the 2005 investment banks. referendum, he has been tirelessly fighting the mechanics of the European Union, and pleading for a reinforcement of national sovereignty, especially on currency issues. He has in particular been a staunch critic of Angela Merkel’s conservative policies. He recently converted to ecologist ideas. Described as a « populist » by his opponents, he is famous for his fiery rhetoric. RATHER LOW Likelihood of reaching the second round: Brunswick Group France 2017 elections in perspective

Upcoming electoral milestones

Getting a majority in Parliament will be the first headache for the End of February: Beginning of the Parliament recess newly elected President. It needs remembering that immediately after the Presidential April 23, 2017 and Presidential election May 7, 2017: (two rounds) election (two rounds on April 23rd and May 7th), the elections for the Lower House of the Parliament (Assemblée nationale) will be Mid May 2017: Appointment of the Government organized (two more rounds on June 11th and 18th). These will either confirm a true mandate General elections for the newly elected June 11 and 18, 2017: (members of the Lower House of President by giving him Parliament) a full majority or restricting his power with a narrow majority, or, worst case scenario, September 24, 2017: Renewal of half of the Senate no majority at all. (Upper House of Parliament) Brunswick Group France 2017 elections in perspective

Brunswick Group

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