Macron Wants to Save Europe. He'll Need to Save France First


Emmanuel Macron announced his arrival on the world stage last May by grabbing hold of Donald Trump and not letting go. France’s youngest-ever president had been in office for 11 days when they met at a NATO summit in Brussels. Trump is known for trying to dominate fellow politicians with an aggressive grip, but Macron turned the tables on him, seizing his hand and holding tight even as Trump tried to pull away. Macron then gave his remarks in French, even though he’s fluent in English. Trump, with no translation earpiece, nodded along earnestly. The point was plain: Macron was not going to be dominated.

Featured in Bloomberg Businessweek, April 23, 2018. Subscribe now.

His strategy seems to have worked. A senior official in the Elysée presidential palace says Macron and Trump have established a strong relationship. U.S. administration officials say the French president has become an influential voice for Trump on Iran, Syria, and trade. Despite their clear differences in character, both are political outsiders who have little patience for diplomatic niceties, the French official says. That allows them to get down to business, even when they disagree.

Trump has rewarded Macron, 40, with what will be the first official state visit of his presidency, set for April 23-25. Macron arrives in Washington in better standing with Trump than his German counterpart, Chancellor Angela Merkel—who visits the White House on April 27, but just for one day. The allied airstrikes against Syria were a diplomatic victory for Macron, who was the first and strongest advocate for a military response to the suspected chemical attack against civilians, confirming his position as one of Trump’s most trusted foreign counterparts. Germany earned a rebuke from Trump’s future ambassador to the country, Richard Grenell, for refusing to join the coalition. “Macron is the only major European leader to have a working relationship with Trump,” says Martin Quencez, a fellow at the German Marshall Fund of the U.S. “That gives [France] a stronger position vis-á-vis Berlin.”

If Macron can prevent Trump from advancing down the path to a trade war, it will earn him political capital he’ll be able to deploy as he pursues his two grand ambitions: to reform a France that has resisted change for 30 years and to reverse the relative decline of Europe. His goal is to restore not just the Continent’s economic muscle but the aspirational idea that the European Union can be a unified superpower.

That premise has been put to the test over the past several years, first by the sovereign debt crisis, then the influx of refugees fleeing war and terrorism in the Middle East, and finally the Brexit vote in 2016. Exhausted by the compromises required to contain those troubles, most European leaders are now eager to preserve their sovereign powers rather than embrace Macron’s plan for a more federal union. “Europe’s destiny is being decided now,” Macron said in a French television interview on April 15. “My responsibility is to advance this ambition in the name of France, and that is why I am doing all these reforms, all these transformations.”

GDP Per Capita, Current U.S. Dollars

Data: World Bank

While chasing his dreams for Europe, Macron has a lot of work to do at home. France has stubbornly high unemployment, the second-highest tax burden in the Organization for Economic Cooperation and Development, an outdated industrial base, and a restive populist movement. An accelerating economy helped him roll back labor protections and cut taxes for investors, but now he’s facing the first big obstacles in his 10-year plan to transform France and Europe (yes, he seems to be banking on a second term).

Workers at the state rail company shut down much of the train network in April and have scheduled weekly stoppages through June as they fight his plans to shake up the enterprise. Students are protesting reductions in their entitlements, and pilots and cabin crews at Air France are striking over pay. A survey published by France’s most watched TV news channel shows 74 percent of respondents believe Macron’s policies are “unfair” and 77 percent say they’re dividing French society. His approval rating slipped to about 40 percent in early April after entering the year at 47 percent. Macron is not deterred. “I want to change things, and I will not let up,” he told French television in another interview this month. He will push on “to the end.”

A stronger France would help Macron challenge Merkel’s vision of Europe as a community of nations and convince her that it could become a more integrated economic superpower. He envisions a sovereign entity—a United States of Europe in all but name—that can match the U.S. for innovation and entrepreneurship and use its clout to protect industries and workers. Macron’s Europe would impose common labor and environmental protections across the bloc. It would force tech giants to pay their fair share of taxes and enforce external borders to control the flow of refugees and immigrants.

His fellow EU leaders aren’t so excited about making Europe great again—at least not if it means falling in line behind a resurgent France and its precocious president. Dutch Prime Minister Mark Rutte openly defies him, leading a group of eight northern countries that insist member states need to do their own work to make the bloc stronger, rather than look for new forms of risk-sharing. Germany’s 37-year-old health minister, Jens Spahn, part of a new generation of German leaders jostling to succeed Merkel, said in March that the EU needs to “get real” and forget about “lofty speeches” and a “utopian vision” of grand projects.

Macron is starting to realize that Merkel may never sign up for his boldest plans, according to a person familiar with his thinking. In fact, senior French government officials suspect that his vaulting rhetoric is starting to annoy her. As a June deadline approaches for a joint Franco-German plan to let banks compete across Europe, Macron is struggling to win Merkel’s support for a common deposit guarantee system. And his talk of European economic sovereignty sends shivers down the spines of German industrialists imagining foreigners defending their export interests.

Merkel, who scored only a narrow victory last year, has faced protests at home over the European Central Bank’s decision to allow inflation to accelerate to encourage growth in the rest of the euro area. When Macron talks of European solidarity, conservatives in Berlin picture non-Germans gaining the power to funnel their tax euros to basket cases like Greece.

Macron’s hubris doesn’t help. In March he was almost an hour late for a meeting with Merkel in Paris—after spending much of the day in the south of France for a photo session with Annie Leibovitz. A few days later, Rutte was showing Macron around his office in The Hague as the French leader looked conspicuously uninterested, twice cutting off his host’s historical explanations. Dutch daily De Telegraaf said the snub was “brutal,” and video of the exchange went viral in the Netherlands. “I’m not arrogant, I’m determined,” Macron told German weekly Der Spiegel in October (again cutting short an exchange).

That claim isn’t entirely convincing from someone who celebrated his election last year not with the French national anthem but the European one. And, pointedly, he walked out to deliver his victory speech across the Louvre’s Courtyard of Napoleon (another provincial guy who tried to conquer Europe, the Paris wags observed). Macron has entertained world leaders and corporate titans at the Palace of Versailles, inviting comparisons to the Sun King, Louis XIV, who dominated the 17th century. “When you are French, there is always an idea that you will be somewhat arrogant,” says Jean Pisani-Ferry, a professor at Sciences Po in Paris and the Hertie School of Governance in Berlin, who advised Macron during the campaign. “You have to be aware of that and be careful. But being ambitious is not being arrogant.”

BOTTOM LINE –
French President Macron wants to reform France and strengthen Europe. His relationship with Trump could help, but he’ll have to win over his skeptics in Europe.



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