The Corner

National Security & Defense

A Vote For ‘Europe’?

Macron’s impressive win (now looking like 65.8/34.2)  in the French presidential election was, I suspect, more than anything else a vote against Le Pen. Predictably enough, however, the usual suspects are claiming that it was a vote for ’Europe’ (by which they mean even deeper integration within the EU).

Not really.

That said, I have no doubt that Le Pen made an uphill struggle (her party is not, to put it mildly, without its baggage) even more difficult by her talk of quitting both the EU and the euro. The French may not love the EU, but that’s not the same as saying that they want to leave it. They don’t. The same is true of the euro. The single currency has trashed French sovereignty and badly damaged its economy. France should abandon it. But a problem (I imagine) for quite a few otherwise potentially sympathetic voters may well have been the likelihood that any resurrected Franc would almost certainly fall sharply against the euro, thus cutting the real value of their income and their savings. As we have seen in Greece or, for that matter, Argentina (which had to contend with an unsustainable dollar/peso peg at the turn of the century) that’s not something that people tend to support, regardless of the broader longer-term advantages that might come from ditching a monetary arrangement unsuited to their country’s economy. 

Worse still, the fact that Marine Le Pen had already announced that withdrawal from the euro was (despite some later hedging)  on her agenda would have meant that bank runs (and other calamities) would have been on the cards as money began to pour out of France within minutes of a Le Pen victory. That thought too might well, I reckon, have dissuaded quite a few voters from voting for her.

In that context, this Reuters report from early las month makes interesting reading. The key takeaway:

While one in two voters agree with Le Pen’s stance that there are too many immigrants in France, only 22 percent want to ditch the euro, a Kantar Sofres poll showed.

And yes, there’s an irony here: The burden that the euro has placed on the French economy is one of the reasons that Marine Le Pen has got as far as she has, and yet fear of the consequences of walking away from the vampire currency is probably one of the reasons she has just lost.