Emmanuel Macron rose to the French Presidency on a promise of reform and economic revitalization. It looks increasingly like he will finish his second term with much of his first-term success having been reversed.
On Tuesday the National Assembly voted to suspend his hard-won pension reform. The 2023 reform gradually raised the retirement age to 64 from 62 in a concession to fiscal reality as the French grow older and live longer. The Assembly voted 247-234 to pass a social-security
Emmanuel Macron rose to the French Presidency on a promise of reform and economic revitalization. It looks increasingly like he will finish his second term with much of his first-term success having been reversed.
On Tuesday the National Assembly voted to suspend his hard-won pension reform. The 2023 reform gradually raised the retirement age to 64 from 62 in a concession to fiscal reality as the French grow older and live longer. The Assembly voted 247-234 to pass a social-security budget that puts the reform on hold at least until after the 2027 presidential election.
This was probably inevitable after Mr. Macron called impulsive snap parliamentary elections in 2024 and his centrist party was routed. Parties of the left and insurgent right in the Assembly don’t agree on much but they do agree on more spending and higher taxes.
Pensions consume some 14% of the French economy. Total public spending is 57% of GDP, and the social-security system is running a deficit of $23 billion. Yet this bill raises spending on hospitals by nearly $1 billion, among other increases. It also raises the social-contribution tax on revenue from assets and realized capital gains, paid in addition to the income tax, to 10.6% from 9.2%.
Mr. Macron’s choice as Prime Minister, Sébastien Lecornu, is touting Tuesday’s vote as a victory, and it’s true he dodged a censure vote and will keep his job. But the French fiscal crackup gets closer each year.
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