Michael Roberts: France’s pouvoir d’achat crisis

France’s pouvoir d’achat crisis

by Michael Roberts

The recent high school and student protests in France have a simple objective: to get more resources for education.  France’s education crisis is defined by severe teacher shortages, deteriorating student outcomes, and massive funding deficits spanning primary schools to public universities. State education in France is among the most unequal in the developed world: schools in poorer areas are so under-resourced that the education system is cementing inequality. Students from the poorest neighbourhoods are disproportionately hard hit by staff shortages.

French students have experienced a catastrophic and unprecedented 20% drop in the education budget per student since 2017.  As French leftist economist Thomas Piketty put it: “The government, in bad faith, sometimes boasts that the nominal budget for higher education rose from €13.3 billion to €15.5 billion between 2017 and 2026 (+17%). That is true, except that inflation over the same period was 22%, meaning the budget actually fell by 5% in real terms. Add to this that the number of students rose from 2.6 million to over 3 million, an increase of 15%. The result is that the budget per student dropped by about 20%”. https://lucaschancel.com/etudiants/.

Research by the economist Asma Benhenda, based on payroll data from the French national education system, shows that the proportion of contract or beginning teachers in privileged areas like Paris or Hauts-de-Seine is just 10%. That figure rises to 50% in poorer departments, like Seine-Saint-Denis and Val-de-Marne, around the capital. The average salary per secondary school teacher is about 20% lower in the poorest areas than in the wealthiest, even after taking into account the (meager) bonuses awarded for priority education.

French teachers’ salaries consistently fall below the average for advanced economies (OECD). A French teacher with 15 years’ experience earns less than €40,000, 20% below average. Early-career teachers in Germany earn twice as much as their French counterparts. Yet French teachers have to cope with longer hours of teaching and some of the worst pupil-teacher ratios in Europe. As a result, record numbers are leaving the profession.

To plug staffing gaps, the government launched a scheme in 2022 to recruit “contract” teachers (as opposed to the standard tenure system, under which they count as fonctionnaires or civil servants). They were given four days’ training, despite often having no previous teaching experience. Predictably many quit within six months, owing to lack of adequate training or supervision.

It is not just teachers who are leaving. With a dearth of supervisors, careers advisers, school doctors and nurses, among others, it is virtually impossible to deliver the school support services pupils need. The independent defender of rights for France, Claire Hédon, warned last year that the shortage of qualified staff and suitable facilities meant that almost a quarter of all disabled children never go to school at all.

No wonder then that, as state schools slowly disintegrate, more prosperous families are turning to private education. Few government ministers have any direct experience of the state school system as many go to posh private schools. Yet these fee-paying schools also receive public funding.  Meanwhile French public universities are grappling with with an estimated €8 billion shortfall, which has pushed nearly all 75 public institutions into deficit budgets.

Christine Renon, the head of an infant school in Seine-Saint-Denis, died by suicide at her workplace in 2019. According to a letter she had sent to the school management board, she was “exhausted”. She went on to detail the deficiencies and inadequate resources of an organisation that had been left to rot. This tragedy should have shocked the authorities into a profound reappraisal. Macron pledged to make education a priority for his second presidential term.  But nothing has changed for the better, only for the worse.

It’s education that primarily worries students and teachers (and parents) in France,  But education is just one aspect of the deterioration of basic public services in France. France used to have a healthcare system that was the envy of the world, let alone Europe.  Spending was high at 11.5% of annual GDP. As a result, life expectancy was much higher than the EU average.  But over the last few decades, government healthcare spending has been cut back well below the increased demand for health service as French people get older and subsuequently need health support. Before 2008, health spending was rising at 0.3% of GDP a year.  Since 2009, the rate of health spending growth has halved to just 0.17% of GDP a year.  And yet the share of over 65s in France has risen 40% over the same period, or more than ten times the rise in health spending.  As a result, life expectancy has virtually stopped rising. (at the bottom in figure below).

Annual growth in health expenditure per capita (real terms), 2014‑2019 and 2019‑2024 – source OECD

Just as in all the major capitalist economies, The cost of living for the average French household has risen sharply, especially since the end of the pandemic slump that saw a significant inflation spike, and now more recently compounded by the energy shortages from the ongoing Iran war. Price levels for average French households are now some 18-20% higher than just four years ago and are beginning to rise again from the Iran war. Real wages (after inflation) are up only 2.4% from five years ago and wage levels are still below where they were after the pandemic. Pouvoir d’achat is continually falling.

After taking into account tax and benefits, the growth in average disposable income (GDI) for French households has been on downward trend in the first three decades of this century, slowing to under 1% a year under the Macron presidency.

In 2024, 9.8 million people living in ordinary housing in metropolitan France were living below the monetary poverty threshold (1,337 euros per month). The poverty rate is at its highest level (15.4%) since 1996, the year the series began. The unemployed and single-parent families remained the groups most affected by poverty. 

Although inequalities of income and wealth in France are not nearly so extreme as in the United States, they are still grotesque. Indeed, inequality has worsened in the last 40 years. In 1983, the top 1% of income earners took 7.5% of all personal income, 10% took 30%, and the bottom 50% received just 21.4%. By 2022, the top 1% took 12.7% (an over 60% increase), while the top 10% share rose to 34.8% and the bottom 50% share fell to 20.3%. Inequality of wealth (net personal wealth) is, as usual in all major economies, much worse. In 1983, the top 1% of wealth holders owned 15.9% of all personal wealth in France, the top 10% had 50%, and the bottom 50% held just 8.9%. By 2022, those inequalities got even worse. The top 1% of wealth holders now had 24% (over a 60% increase), the top 10% now owned 57.7%, and the bottom 50% saw their share of personal wealth fall to just 5.1% (a 48% decline).

Retirement and pensions are key issues for working people.  Pensions are not ‘welfare’ benefits, but ‘deferred’ wages deducted in contributions from current wages in order to provide a decent life in old age.  French workers have fought over many decades to achieve pensions at a reasonable retirement age.  France allocates around 14% of its GDP to pensions, one of the highest rates in Europe and significantly higher than countries like the UK, which spends around 5% of its GDP and so delivers the lowest state pension in the advanced capital world.  But contribution rates (deferred wages), from workers and their employers, are correspondingly high at  28 per cent.

French businesses and successive governments have spent much energy over the last few decades trying to reverse these pension rights by a combination of increased contributions, reduced pensions in real terms and by extending the retirement age. The argument of governments including the Macron administration is that an ageing society can no longer afford these ‘generous’ pensions.  They argue that the pension system faces ‘structural deficits’ ie the payouts are now regularly exceeding the contributions.

When Emmanuel Macron ran for re-election in 2022, he told voters that the retirement age would have to rise to ensure the continued viability of the country’s pensions system. He forced through a change in the retirement age from 62 to 64 years. But raising the retirement age and cutting pensions in real terms will significantly hit French people’s living standards when they retire. 

Again, as in many other countries in Europe, France is experiencing a deepening housing crisis. There are 2 million requests for social housing pending; they will never see their needs met.  Rising rent prices, inflation, and economic pressure are pushing families to the edge like never before. From overcrowded cities to skyrocketing living costs, the situation is becoming impossible for millions. Millions of French citizens are now being forced to live in their cars as the housing crisis across France continues to spiral out of control.

In sum, France’s public services: social care, roads, transport, youth facilities, garbage collections, sewage and water supply etc have been deterorating for decades.  Government after government responds by saying that these services are no longer ‘affordable’.  And their mainstream economist apologists argue that the huge rise in public sector debt and continual annual budget deficits must be ended. Over the past 15 years, the public debt ratio (debt to GDP) has risen significantly. French public debt reached 119% of GDP in mid-2026 and is expected to increase to 121.7% in 2027.

Austerity is the message of the Macron government: there is no alternative, the public is told. The draft budget aims to reduce the public deficit to 5% of GDP in 2027, after 5.4% in 2026 and 5.1% in 2025. This requires €43bn of new measures. Without them, the government estimates that the deficit would reach around 6.5% next year.  The ‘new measures’ would be the elimination of 3,000 civil service jobs by 2027 without replacement; a cap on government healthcare spending at €5 billion; reductions in unemployment insurance and pension schemes; the elimination of two national holidays (Victory Day and Easter Monday) to increase productivity; and yet again further reductions in regional and local expenditures. 

Of course, there is one part of public spending that will not be cut: defence. At Bastille Day 2025, Macron announced that France’s military budget will reach €64 billion by 2027, three years ahead of schedule. Specifically, €3.5 billion will be added this year, and another €3 billion in 2027; all to meet the NATO pledge to increase national member defence spending  to 5% of GDP by 2035 (3.5% for military expenses and 1.5% for infrastructure). As a key NATO member perceiving the ‘Russian threat’ as acute, Macron has committed to meeting this target.

Le Monde, the French mainstream news source, reckons that France’s “top priority must be to reassure investors of its ability to repair its finances.” So the financial markets rule. But all this talk of profligate public spending and debt is a false flag by French governments and the ‘bond vigilantes’ in financial markets who are selling French government bonds and increasing the cost of borrowing for governments and households alike.

What is always ignored is that France’s non-financial private-sector debt is actually much larger than public sector debt. The former reached 134.2% of GDP in 2026, more than 30% higher than the average in the euro area It is the private sector (with real estate and financial speculative borrowing) that is most vulnerable, And when a financial crash occurs in the capitalist system, it is the public sector that must bail out the private banks or major lenders.  And in capitalist slumps, the government must spend more on unemployment benefits and take in less in taxes, so government deficits spiral.

The history of France’s public debt shows that it is in periods of capitalist slumps and financial crises, that public debt rises the most and then afterwards bond holders demand that the rest of us reduce this debt by cutting services and pensions and raising taxes. After the 1980-82 slump, faster economic growth and austerity measures stopped the debt ratio rising by 1987. Then the next slump of 1991-3 accelerated the rise in debt again before economic recovery (and more austerity measures) eventually led to a fall in the debt ratio.  Then the global financial crash and the ensuing Great Recession led to a 20% rise in the debt ratio.  Severe austerity measures during the slow growth Long Depression of the 2010s eventually stopped any further rise in the debt ratio before the pandemic slump drove it up again.  What this shows is that without the impact of several crises in capitalism, the government debt to GDP ratio would have hardly risen.  Each batch of austerity measures aims to reduce the public debt ratio originally caused by busts in the private sector, where the debt goes on rising. 

Source: IMF, author

The real cause of France’s affordability crisis is its signficant economic slowdown. In the 21st century, France has experienced low real GDP growth: steadily falling over the last forty years. And now in the 2020s, it has virtually ground to a halt.

France: average annual real GDP growth (percent). Source: IMF

Take pensions, If France’s economic growth was only 1% pt a year higher than the current average of 1.5%, that would raise E30bn a year in government revenues, rising to E40bn by 2035.  At current contribution rates, that would raise an extra E10bn a year from pension contributions, easily reversing the projected deficits. “The basic problem is that the economy hasn’t grown fast enough,” says Rupert Watson, global head of economics at Mercer. “It’s not what pensioners get that is causing the problem — it’s the lack of economic growth.”

As in the other G7 economies, this slowdown arises from weak investment growth. Falling productive investment growth generally leads to stagnating labour productivity, and France is no exception. Indeed, total factor productivity (a measure of the impact of “innovation”) is now falling absolutely.

France: average annual growth in fixed investment (percent). Source: AMECO; author’s calculations

Behind any relative stagnation in investment and productivity growth lies falling profitability of French capital. French capital’s profitability started to decline sharply at the beginning of the 21st century (on the advent of the euro) and gathered pace after the Great Recession. Average profitability is now near an all-time low after a fall during the pandemic slump.

France: rate of profit on net fixed assets (percent). Source: EPWT 7.0 series, AMECO; author’s calculations

What is to be done?  In April-May 2027 France holds elections for the presidency and parliament.  Current opinion polls suggest that the anti-immigrant, racist National Rally led by the veteran Marine Le Pen is well ahead and will win the first round for the presidency.  But what is the main plank of Marine Le Pen’s economic programme if she wins the presidency next April?  Fiscal austerity!  She is promising €136bn cuts in public spending as well as the privatisation and closure of various state assets in order to bring government expenditure below 50% of GDP by 2032.  National Rally claims that reducing immigration and stopping payments to the European Union will solve the debt crisis.

The leftist La France Insoumise (LFI) party and its candidate, Jean-Luc Mélenchon, could well finish second In the first round of the presidential election and thus enter a straight fight with Le Pen. Melenchon’s answer to the so-called government debt crisis is to cancel that part of the debt held by the central bank ( as the central bank is part of the government) to allow for more public spending.  But that would still leave the bulk of the government debt (82%) at the mercy of the bond vigilantes and they would sell French government paper at the first opportunity if Melenchon were to win. Melenchon proposes to increase taxes on capital and on the wealthiest households so that spending on public services can rise. Naturally, this is anathema to big business, the bond vigilantes and the European Central Bank. 

In a future post closer to next year’s election I shall discuss what the socialist alternative to France’s affordability crisis should be. 

France: towards an authoritarian regime

Reprinted from the UK Socialist Website Left Horizons

1 October 2026

By Greg Oxley

The reactionary trap of the “citizens’ initiative referendum”

If the party of Marine Le Pen, Rassemblement National, wins the next presidential election and obtains, alone or with other parties, a parliamentary majority, France will find itself under the heel of its most reactionary regime since that of Marshal Pétain under the Nazi Occupation.

The program of Rassemblement National (RN) poses a very serious threat to all workers — including those who will have brought it to power — on the social, economic, democratic and environmental levels.

The RN’s xenophobic policies are aimed at scapegoating “foreigners”, a category which seems to include, in addition to migrants, all French citizens of Muslim faith or culture. Once in power, the RN will wield the power of the state apparatus to sow division and impose draconian austerity policies. With the guaranteed support of major media outlets, the RN will heap blame on “foreigners” for falling living standards and a range of social problems, to justify repressive and discriminatory measures against them.

Tragically, the left will find it difficult to prevent the RN from coming to power, given its own historical record. Brought to power time after time, on the basis of commitments to the needs of working people, it systematically betrayed the trust of its supporters. Once in government, the Socialist and Communist Party leaders carried out policies in line with the interests of the ruling class on all essential issues. We are still paying the price of these betrayals today.

General rise of nationalism across Europe

The failure of the left in the past does not alone explain the RN’s progress. It is also part of a general rise of nationalist and protectionist tendencies throughout Europe, fuelled by the social and economic consequences of capitalist “globalisation”. But by repeatedly letting down their own social base, the left parties have greatly facilitated the far right’s march to power.

Today, the policy of the Socialist Party (PS) is quite similar to that of Emmanuel Macron. For their part, the parties of Jean-Luc Mélenchon, La France Insoumise (LFI) and the Communist Party (PCF), put forward a wide range of relatively audacious social reforms, and even speak of the need to break with capitalism, without, however, having any serious strategy to achieve this.

If the leaders of these parties had prioritised the struggle against the RN and the right before their mutual rivalry, they would be waging a common campaign around a single candidate, making it easier to mobilise the left-wing electorate. An electoral alliance of this type would not have prevented the expression of political differences between the left parties, where they exist.

As it is, the left will go into the 2027 elections weakened and divided. All is not lost, however. The presidential election and the following legislative elections will only be stages in what must necessarily be a broader and longer struggle.

Even if the elections bring Marine Le Pen to the presidency and give her a viable parliamentary majority, she will face strong popular protest movements, in the streets, in neighbourhoods and in the workplaces. The policies of discrimination and persecution in the RN’s program will lead to very serious consequences, opening up a period of intense social instability and turbulence. 

Social security reserved for the ‘French’

Can we stand aside while state authorities introduce discrimination in hiring, social benefits or the attribution of council houses according to origin, skin colour or religion? Le Pen wants to reserve social security for the ‘French’, to make access to benefits conditional on five years of work in France, and give priority to the French in employment opportunities. She also wants to put an end to processing of asylum applications in France and to withdraw the residence permit of any foreigner who has not worked for a year.

Can we accept the abolition of the right of nationality by birth and the mass deportation of “foreigners” under various pretexts? Beyond the ballot box, massive mobilisation at grassroots level will be the key to resisting and defeating the authoritarian and xenophobic regime that Le Pen wants to bring about.

The referendum, a classic instrument of authoritarian regimes

One of the subterfuges that Le Pen wants to use to support her regime is a so-called “citizens’ initiative referendum” (RIC). She says she will start with a referendum to validate a set of repressive measures concerning immigration, then a second to ban the wearing of the “Islamic” headscarf  in public spaces, including in the street. It should be noted in passing that during her 2012 campaign, Le Pen targeted both the traditional Muslim veil and the Jewish kippah, but today, she only mentions the “Islamic” headscarf.

Historically, the referendum has often been used as a weapon by dictatorial or authoritarian regimes. France has known this since the time of Louis-Napoleon Bonaparte, who came to power after the defeat of the 1848 revolutionary outbreak. He then proceeded to acquire the status of hereditary emperor through a referendum in 1852! Adolf Hitler, too, used the referendum to consolidate and extend his power, in 1934 and again in 1936.

Presented as the direct expression of “the will of the people”, the result of a referendum is given an almost sacred ‘legitimacy’, but in reality, it is more about how public opinion can be manipulated. A referendum is not a process that allows the dissemination of often complex and nuanced information and informed discussion – that is the basis of real democracy – but one where the establishment and the media mobilise opinion with simple slogans and highly slanted news. A referendum may have the appearance of “democracy” but in reality, it serves to undermine and destroy it.

A more recent example of political manipulation by referendum is the UK referendum on leaving the European Union, which produced an outcome as a result of an agreement between the Tory party right wing and the far right around Farage’s then UK Independence Party. Nothing better summarises the simplistic panaceas of the Brexit campaigners than the message on the side of a bus – “We send the EU £350 million a week, let’s fund our NHS instead“ – a total lie, of course. According to the supporters of Brexit, leaving the EU would stimulate the national economy, free up huge sums for the NHS and improve employment through the expulsion of European workers living in the United Kingdom.

NHS on the verge of collapse

And for what result? Today, the National Health Service (NHS) is on the verge of collapse and Brexit has cut between 6 and 8% off the UK GDP. As for employment, the United Kingdom officially had 1.78 million unemployed in May 2026, an increase of 4.7% in one year. Over the same period, the number of unemployed young people increased by 109,000, according to government statistics. The nationalist claim that the presence of too many “foreigners” was weighing on the economy and the standard of living of the British was nothing but a reactionary lie.

Le Pen is now planning a similar operation on immigration in France. She wants to use referendums to impose a policy of xenophobic harassment against the Muslim population, sanctioned by the “will of the people”. By reducing a cleverly formulated question to a simple “yes” or “no”, the referendum is a political tool perfectly suited to authoritarianism. Le Pen will use it to marginalise the opposition, while adopting the posture of a “democrat”.

We must denounce the populist demagogy of the RN and expose the reactionary trap of referenda. This task is however complicated by the support of Jean-Luc Mélenchon and PCF leader, Fabien Roussel, for so-called “citizens’ initiative” referenda, which they, too, present as a form of “direct democracy”. They probably think that a referendum could impose positive social reforms, without realising that they are a political device that can and will be used against the very interests they seek to defend.

What we expect from the LFI and the PCF is not supposedly “democratic” tricks to validate this or that individual measure or set of measures. In the hands of a reactionaries, this same tool can easily legitimise austerity and the persecution of ethnic or religious minorities. Fabien Roussel and Jean-Luc Mélenchon seem to underestimate this danger.

Asked on BFMTV and RMC in 2019 about the RIC demanded by some of the “yellow vests” (a widespread protest movement in France eight years ago) Fabien Roussel said he was in favour of the organisation of referenda “on all subjects“. Asked about same-sex marriage or the reinstatement of the death penalty, he replied: “But why not? On all subjects, let’s not be afraid! […] Of course, if the French want it! We must not be afraid of debate.”

The left confused on the issue of the referendum

Roussel’ position, like that of Jean-Luc Mélenchon, has not changed since then. Therefore, if Marine Le Pen organises, possibly with a prior “popular” petition in hand, a referendum on “national preference” or the criminalisation of the wearing of headscarves (incidentally just for Muslim women, since for non-Muslim women, a headscarf is merely a fashion statement!), must we now expect Fabien Roussel to answer: “Of course! If the French want it, why not?” And if the vote establishes blatant racist discrimination, will he then advocate respect for the “will of the people?”

The “Citizens’ Initiative Referendum” is a reactionary trap that the left must not support. It must be removed from the programs of La France Insoumise and the French Communist Party.

Rather than making concessions to populist demagogy, we need a left with a program of implacable defence of the rights and freedoms of all citizens, a program of social, economic and environmental reforms to improve living conditions.

And above all, these immediate and defensive objectives must be linked to the need to put an end to the economic power of the capitalist class, to the dictatorship of capital. This can only be accomplished by a massive extension of the public sector, by the nationalisation of all large companies to pave the way for democratic planning of the country’s productive and financial resources for the benefit of society. Only the mobilisation of the youth and workers around a program of radical transformation of society will make it possible to defeat the right, the far right and the ruling class they represent.

[Greg Oxley is the editor of the French Marxist website, La Riposte, which can befound here]

 Republished from the UK Socialist Website Left Horizons

Huge day of action shakes France

24 September 2025Posted by Editor

By Greg Oxley

Since the fall of the Bayrou government on the September 8, France has been in turmoil. After the massively supported day of protest on the 10th, the historic attendance of 610 000 at the Fête de l’Humanité (a yearly political and social event organised by the French Communist Party, PCF) from the 12th to the 14th, the day of strikes and demonstrations on the 18th was another outstanding success.

Trade union demonstrations were organised in more than 250 urban centres around the country, with a total attendance of somewhere between 800 000 and a million people.

Besides the official marches, countless rallies and gatherings took place outside workplaces, schools and universities. Workers listed their grievances and declared their hostility to Macron’s vicious cuts in public spending and attacks on workers’ rights.

This movement demonstrated beyond doubt that the most powerful force for organising and mobilising the people is still the trade unions.  Historically, trade union membership in France has been lower in percentage terms than in many other European countries.

Nonetheless, they can call upon enormous social reserves, beyond the card-carrying membership. Besides those who actually took to the streets, millions more supported the movement, showing once again that austerity policies – this time involving close to €44bn of cuts in public expenditure – are profoundly unpopular.

Instability and paralysis

Constitutionally, President Macron can hang onto power until 2027, but the next two years will be fraught with instability and governmental paralysis. Macron does not have a majority in the National Assembly (parliament). He has the power to dissolve the National Assembly, but he is not likely to do that, because it would undoubtedly result in a further weakening of his position.

This is not the first time major demonstrations against government policy have taken place in France. In the past, the strategy of the government was simply to bide its time, allowing the workers to march through the streets, chanting their chants, blowing their horns and waving their banners for a few weeks, and then pass the contested laws once the movement had died down.

In the present circumstances, however, this is not possible, because of the parliamentary impasse. The pro-Macron members of parliament are caught between those of the left parties on one side and the nationalist right on the other, and therefore cannot pass any measures without the support of one of these oppositional blocks.

Abolition of two bank-holidays – dropped

So it was with the Barnier and Bayrou governments, and so it will be with the newly appointed Lecornu government. Lecornu has dropped the abolition of two paid bank holidays, which figured in Bayrou’s budget proposals. But otherwise, his policy is essentially the same, and will most probably suffer a similar fate, with a vote of “no confidence” bringing the government down.

Overall, the situation in France could be characterised by growing social instability at the bottom of society and institutional instability at the top. However, this instability does not, in and of itself, solve anything for either of the contending classes. Even if Macron is prevented from applying this latest raft of austerity measures, this will not ease steadily declining living standards and working conditions.

Modern capitalism is incompatible with the social conquests of the past. Government measures are one thing, but the economic realities of the profit system, constantly eroding  the real value of wages and wearing down the remaining safeguards against poverty and despair for millions of people, are another.

On the demonstrations, it was clear that many workers and young people understand this reality. They can see that they need to fight not only Macron, but also the systemhe represents. This is an idea which is also present in the speeches and publications of the PCF and La France Insoumise.  However, neither of these parties – at leadership level – have been capable of addressing this crucial question in their programme and policy.

Economic problems weighing down working people

If the most pressing social and economic problems weighing down on the working people cannot be resolved under capitalism, then we need a policy that strikes at the root of the power of the capitalist class, and that root is private ownership of industry, of banking and finance, of commerce and technology.

Call it what you will: nationalisation, socialisation, collectivisation, but what needs to be done is to take the control of all the main levers of the economy out of the hands of the capitalists and place them under the democratic control of working people. Only then can the production and distribution of wealth be organised for the public good, rather than for the profit and greed of an all-powerful minority.

Unless the labour movement recognises this necessity, unless it stands clearly and unequivocally for the expropriation of the capitalist class, whether it be in France or any other country, the left parties and the trade unions will be powerless to resolve the problems caused by capitalism. They will effectively confine themselves to fighting a losing struggle against the consequences of the system rather than against the system itself.

That is why, in France, we have a situation that amounts to a stalemate, wherein, despite all of Macron’s difficulties, neither side can inflict a decisive blow to the other. This stalemate is fraught with danger. People want and need change. They need solutions.

If the left cannot provide it, many of them will turn to the nationalist and xenophobic forces on the extreme right. This process is already underway in France, as it is in many other countries in Europe.

Greg Oxley is editor of the French Marxist website La Riposte.

France: Prime Minister declares war on workers’ living standards

 Republished from the UK Socialist website Left Horizons

20 July 2025

From La Riposte

On July 15, during his speech soberly called “the moment of truth“, François Bayrou, French Prime Minister, presented his plan to restore public finances. It is nothing less than a set of measures, each more reactionary than the last: a blank year in 2026, i.e. a freeze on social benefits, pensions, unemployment benefits, a freeze on civil servants’ salaries, the elimination of two public holidays, one in three retirements not replaced in the civil service with the aim of eliminating 3000 jobs, reduction in funding for local authorities and reduction in the coverage of drugs for long-term illnesses. Bayrou hopes to save nearly €44bn through these budget cuts.

The first effect of these measures will be to considerably degrade public services. Working conditions for hospital staff will be even worse, with fewer and fewer staff and, consequently, a decrease in the quality of care. The same will be true in schools.

The vast majority of these measures are a frontal attack on the workers and youth who benefit from these public services. To give the illusion that “the effort is shared”, Bayrou will ask for a “solidarity contribution” from the “wealthiest” households. He also mentioned savings to be made on high incomes, tax evaders, tax loopholes for billionaires and tax optimisation for the wealthy, but all this without announcing anything concrete, whereas for the rest of the plan, the measures are well detailed and quantified. These last words are only a consolation prize that masks emptiness.

Bayrou responds to the imperative of capitalism

And for good reason: Bayrou responds to an imperative, that of capitalist interests. In his speech, he placed a strong priority on the competitiveness of French companies. French capitalism has been in decline for many years, outpaced and overtaken by its economic competitors in Europe and the world.

The objective of making French companies more competitive is a vital necessity in order to, on the one hand, avoid being crushed by the competition and, on the other hand, so that billionaires such as Bernard Arnaud and his ilk continue to amass ever more profits.

If Bayrou wanted to make savings, he could very well have done so in terms of government aid to companies, which amounts to €210bn a year, whereas shortly before Bayrou’s speech, INSEE (the French National Institute of Statistics and Economic Studies) published a report that shows in detail an increase in the number of people living below the poverty line. This is a demonstration that Bayrou is only a lackey of capital, a servant of the capitalist class.

In his speech, Bayrou devoted long minutes to raising the spectre of debt: “For 50 years, all governments combined, the budget has been in deficit“, “there is more expenditure than revenue”, etc. In lecturing, he presented himself as the one who manages his budget as a good father.

It is true that the debt has never stopped growing and now stands at €345.8bn, or 114% of GDP. The argument often put forward is that if the state does not control its finances and lets its debt slide, interest rates could soar and consequently considerably increase the cost of borrowing.

This is what happened at the end of 2024 with political instability and the downgrading of France’s rating by the rating agency Moody’s (see our article on the subject here). However, it should be noted that France’s borrowing is done on the financial markets and is subject to speculation (up and down). In other words, the borrowing rate of the debt is suspended by the law of the market and the actions of speculators who brandish the threat of soaring rates, or even the refusal to lend.

Tsipras in Greece was forced by international capital to retreat

On this point, we can only agree with Bayrou, when he re-explains how, in Greece, Alexis Tsipras “had to” capitulate only a few days after his election in the face of the threat of the troika (ECB, European Commission and IMF) and the heads of government of the time, François Hollande of France and Angela Merkel of Germany in the first place, as well as the speculative capitalists brandishing the same threat.

Tsipras’s social reform programme turned into a draconian austerity plan: a 15% cut in civil servants’ salaries, a 30% cut in retirement pensions, to name but a few examples (see our article here). Such are the mechanics of the capitalist system, which obeys its own laws.

This is an important lesson that we must keep in mind. The capitalist class will put up a fierce resistance against any attempt at reforms of social progress. As long as it retains economic and political power, it will have the means to defeat reformist governments. It is no coincidence that Bayrou cited this example. It should be taken as a warning.

Of these cuts and restrictions of Bayrou, only the military budget is increased. From the outset, he announced an increase of €3.5bn in 2026 and 2027, which is in addition to the military programming law. To justify this increase, Bayrou brandished the threat of war that weighs on France. With these words, “we will not sell out our security imperative“, he is trying to instil fear and prepare us for war against an unknown enemy.

If France wages a war, it will be above all with the aim of defending French capitalist interests. By this means, political leaders worked to strengthen power and economic dominance for the benefit of French capitalists against their rivals. The appeal to patriotism and national unity by evoking a foreign enemy is a classic of the representatives of the capitalist class. They will try by all means to put the workers behind the banner of capitalist interests while at the same time they will suffer austerity and deprivation and thereby to make austerity accepted as a necessary evil.

The arms industry is rubbing its hands together because the increase in military budgets will result in additional orders. Shareholders will see dividends and stock yields increase when they are already at record levels. We will have to endure austerity, the degradation of our public services with fewer resources for hospitals and schools so that a handful of capitalists will enrich themselves and take us to the horrors of war.

Two obstacles are likely to stand in the way of the austerity “program” of the capitalist class. Barely unveiled by Bayrou, it is already unpopular. It is possible that, in the face of hostile public opinion, the 2026 budget will not be adopted. Bayrou would then be forced to resort to the constitutionarl clause 49.3, which would offer the possibility for deputies to bring down this government by a motion of censure in the National Assembly.

Most opposition parties would support a censure motion

The whole of the left and the Rassemblement Nationale (RN), the party of far right Marine Le Pen, would support such a motion, as was the case in 2024. Although it is easy to predict the position of the French Communist Party (PCF), and the left party, La France Insourmise (LFI) which will probably take the initiative, it is less clear predicting the stand of the Socialist Party, (PS).

The latter let themselves be fooled, consciously or unconsciously, by Bayrou during the last motion of censure in the Assembly, in exchange for restarting the pension reform, which ended in total failure. Bayrou will try the same maneuvre by opening discussions and reaching out to the PS, among others.

The second possible obstacle, and perhaps the most decisive, is the reaction of workers and youth. Thse social counter-reforms, considered as such in the eyes of all, despite all the sleight of hand to make people swallow the pill (threat of war, debt crisis), could be the starting point of a massive mobilization.

But this will depend on the attitude of the union leaderships, first and foremost the General Confederation of Labour (CGT), which will have the task of preparing the unions and the workers by giving concrete objectives and directives for the struggle.

The fight against this government must take the form of an extra-parliamentary movement to inflict a stinging defeat on this government and thus restore workers’ confidence in their ability to fight and in the possibility of victories. This would be a first step towards the revolutionary overthrow of reactionary governments and the capitalist edifice of which they are the political representatives.