LESS than two years ago, Bruno Le Maire was an outsider in the race for France’s centre-right Republican presidential nomination. Little over a year ago, he denounced another presidential candidate, Emmanuel Macron, as a “man without a project because he is a man without conviction”. Today, the “man without conviction” occupies the presidency and Mr Le Maire (who quit his own party) serves as his finance minister. Astonishingly, all this is regarded in France as perfectly normal.
If Mr Macron’s hybrid government, which has borrowed from the former left, right and centre, is ever a source of frustration for the self-described Gaullist, Mr Le Maire will not say so. “We are doing exactly what we need to do to be successful in the social and economic transformation of the French model,” he insists. In just over a year, the government has cut corporate tax, ended the wealth tax and introduced a flat tax on investment income. The budget deficit has been brought down to below 3% of GDP. Employment rules have been altered to give more flexibility to employers. Mr Le Maire is now piloting through parliament a bill, known as PACTE, designed to cut red tape and help small companies invest, grow and create jobs.
Sticking loyally to Mr Macron’s script, Mr Le Maire eschews the word “reform” in favour of the more epic term “transformation”: of mindsets, of economic culture, of the French social model altogether. This is no Thatcherite project, however. Mr Macron promised during the campaign to reduce public spending from over 56% of GDP only to 52% by 2022—which would still leave it well above the euro-zone average. A graduate, like Mr Macron, of the elite civil-service training college, the Ecole Nationale d’Administration, Mr Le Maire is unapologetic. “I don’t believe that cutting too far or too quickly is the right way,” he says. “We don’t want to break with French history.” Given his background, it is fair to guess that he would prefer to shrink the state faster. But he will not admit to that.
Indeed curbing public spending, the feeblest element in Mr Macron’s record so far, is already becoming the subject of furious resistance. A wide-ranging public-spending review, known as CAP 22, has produced such controversial ideas that, though the report has been leaked, it has not yet been published. Mr Le Maire says he is “determined to reduce public spending” but refers to it merely as “advice” and declines to say when, or whether, it will be published. All ministers have been ordered to contribute an effort. Decisions will now be dribbled out over the summer.
The point, Mr Le Maire stresses, is to improve French competitiveness while maintaining a strong guiding state, which has helped make France one of the few European countries in which inequality has not increased. In a nod to the left, his draft law, for instance, cuts tax on employee share-ownership schemes to encourage firms to spread profits more widely. Yet, to cries of protest on the left, he has also nearly halved the number of subsidised jobs, preferring to encourage private firms to create jobs themselves. France’s employment rate, at 65.7% in the first quarter, is now at its highest level since the 1980s.
Mr Le Maire will tell anybody willing to listen that “France is back”. The mood, even before the country’s World Cup victory on July 15th, has lifted over the past year. Stable policymaking has helped restore French credibility. Less clear, though, is whether Germany is ready to deal with renewed Gallic assertiveness. The French had hoped that last month’s European summit would seal an agreement on reforming the euro zone, notably with a deal on a common budget. But migration eclipsed almost all else; such ambitions must now wait until December at least.
Mr Le Maire says he is undeterred by what to many observers looks like a damaging rebuff. He calls “historic” the Franco-German deal reached in Meseberg shortly before the summit, which for the first time agreed to the principle of a euro-zone budget. A fluent German-speaker, Mr Le Maire has already held some 35 hours of meetings with Olaf Scholz, his German counterpart, twice working through the night until dawn.
“We won’t impose anything on anybody,” insists Mr Le Maire, mindful of smaller countries’ reticence. Experience shows, he claims, that “in the end, a Franco-German agreement remains the only basis for consensus among member states”. But Franco-German agreement is a necessary rather than a sufficient condition. Besides, Germany, with a weakened chancellor, is in no hurry to act on the objectives it agreed to. Mr Le Maire may have a long wait ahead of him.