Fourteen Hours Old: New French Government Doesn’t Wave White Flag, It Just Quits

At the beginning of September, I told you how French President Emmanuel Macron was on the hunt for Prime Minister Number Four after yet another French government went le poof like a deflated souffleé.

It’s always entertaining to watch the turgid burps of the excitable Gallic political process as they go about trying to form and reform governments, with cranky citizens (and others) taking to the streets in rowdy, car-b-quing mobs expressing either their delight or disgust. Public unions often join the fray in generally making things even more difficult by striking various aspects of the national service industries.

Macron settled on a fellow named Lecornu as his Prime Minister, and things seemed to settle down, which made those watching more than merely the political upheaval breathe a small sigh of relief. Stability in France has many in Brussels and beyond very concerned right now, as the French are in quite possibly one of the worst financial pickles they have been in decades – some say since the founding of this latest iteration of government in the early 1950s. Without a settled government, they are paralyzed as far as taking any action to correct it.

Hopes of breaking the impasse and moving on to restoring some fiscal sanity were dashed when No.4, Prime Minister Sebastien Lecornu, resigned twenty-seven days after accepting the office and about fourteen hours after Macron finally named his new cabinet.

YOU ALL ARE CRAZY AND I’M OUT OF HERE

France’s new Prime Minister Sebastien Lecornu has resigned just weeks after his appointment, plunging the country into a fresh political crisis.

Lecornu, France’s fifth PM in less than two years, quit just hours after naming a new cabinet on Sunday.

Speaking after the resignation, Lecornu said “each political party is behaving as if they have their own majority in parliament” and that the “conditions were not fulfilled” to stay in office, according to comments translated by France 24.

“I was ready to compromise, but each political party wanted the other political party to adopt its entire program,” he said in a speech in the courtyard of Matignon Palace, the PM’s headquarters, France 24 reported.

He now departs the role after just 27 days, making him the country’s shortest-serving prime minister with little to show for his time in office.

As Lecornu had no majority to back him up in any attempt to rein in the spending, he was at the mercy of the forces running amok in the Parliament and faced a no-confidence vote practically before he ever set foot in the chamber.

It was an impossible situation. Completely untenable.

…While Lecornu was clearly in deep trouble with no majority emerging to back him in parliament, and speculation that he could face a vote of no confidence as soon as this week, his abrupt departure was a surprise.

The resignation came less than 24 hours after President Emmanuel Macron named a new cabinet stacked with centrist loyalists, ignoring threats from opposition parties not to appoint a continuity government. That plan immediately backfired.

French stocks took an immediate nosedive. The word ‘ungovernable’ is being bandied about by analysts because it appears that while all the protagonists are willing to do whatever it takes to ensure the others are gone, none of them are willing to step into the breach to rule once that’s achieved.

…But John Plassard, partner and head of Investment Strategy at Cite-Gestion, told CNBC on Monday that the worst-case scenario for France’s financial markets would be a Macron resignation.

“I don’t think he wants to do that, but I think that would be the worst for the market because I don’t think the Socialists or even the far right in France wants to govern this country actually, they want to wait for a [new] election,” he told CNBC’s “Squawk Box Europe.”

Plassard said France was showing itself to be “ungovernable” with parties on all sides showing themselves unwilling to make crucial decisions and to deal with its problems.

The gap, or “spread,” between France and Germany’s 10-year bonds — a reflection of investors’ perception of their respective government debt — currently stands at 87 basis points. If the gap widened further it would be “something that is very dangerous for France,” Plassard noted.

Macron has almost too many choices and none of them good. He has asked Lecornu to hold talks with the other parties to work their way out of this crisis. He could reappoint Lecornu, appoint a new prime minister and name a new cabinet, call for snap elections – the year stipulated by law since the last one has passed – or he could resign himself, something he has insisted he won’t do.

Naturally, all of the warring parties are split on the options available.

…Far-right and hard-left parties immediately zeroed in on Macron, urging him to call new snap parliamentary elections or quit.

“This joke has gone on long enough, the farce must end,” far-right National Rally chief Marine Le Pen said.

Mathilde Panot, of the hard-left France Unbowed, said: “The countdown has begun. Macron must go.”

However, the Socialists said their preference was to avoid a snap election or a presidential resignation, and instead have Macron name a left-wing prime minister.

The Socialists were the gloomiest of all as the economic risk deepened.

…French Socialist Party leader Olivier Faure, whose party holds a potential swing vote in parliament, said Macron’s group is imploding and the new government had no legitimacy. “We are witnessing an unprecedented political crisis,” he said shortly before Lecornu announced his resignation.

French bonds fell as investors braced for more political uncertainty, widening the nation’s borrowing premium over German debt — a key gauge of fiscal risk — to over 89 basis points, the highest level since late 2024.

Macron, one historian said, might have no choice but to call snap elections.

…French historian and political expert Jean Garrigues said Monday’s “incomprehensible psychodrama” makes it increasingly difficult for Macron to avoid calling snap legislative elections, as he did in June 2024.

“Even though Macron doesn’t want it, he might be forced to do it again,” Garrigues said.

...The political crisis has brought France not only new records but also legal complications. Until now, a resigned government continued to carry out its duties until a new cabinet was appointed. This time, however, the government fell before the official decree was published, leaving no clear understanding of who is legally considered the executive authority.

Meanwhile, Macron is clearly having a rough Monday. He was spotted walking alone along the Seine.

The French president faces an unpleasant choice. He can appoint another Prime Minister, which would effectively prolong the crisis, call early elections, or resign himself.

Meanwhile, the pool of candidates from the centrist bloc is shrinking. Macron may be forced to consider candidates from other, less popular blocs—a scenario he is trying to avoid at all costs.

They need to get cranking on solutions for major problems, if it’s at all humanly possible. 

…The country needs to close a budget deficit of 5.8% in 2024, and address a significant debt pile that amounted to 113% of GDP in 2024. Both levels are far above EU rules demanding that individual members’ deficits should not exceed 3% of GDP, while their public debt should not surpass 60% of economic output.

France suffered a ratings downgrade by Fitch last month, with Moodys widely expected to follow suit at the end of October.

And time is very, very short.

If we thought our job in pushing back against the Academia/media/Democrat censorship complex was over with the election, think again. This is going to be a long fight. Ed, David, John, and I are here for it.

COME AT US, BROS!

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