France’s government collapsed on Wednesday after Prime Minister Michel Barnier was forced out in a no-confidence vote in Parliament. 331 out of 577 lawmakers in France’s National Assembly voted against him. Barnier was appointed in September by President Emmanuel Macron after an inconclusive July parliamentary election.
His exit means his tenure as prime minister is the shortest-lived in modern French history. This development leaves the second-largest economy in the European Union with a caretaker government that may not be able to address an escalating budget crisis. This is a concern for financial markets.
Trouble has been brewing since Barnier, a conservative, was asked by Macron, a centrist, to lead a minority government after June’s parliamentary election ended in a deadlock. Lawmakers loyal to Barnier and Macron were outnumbered in the National Assembly by a left-wing coalition and a right-wing one. The left and right were angry at Barnier’s proposals for tax increases and spending cuts to reduce France’s deficit.
He used special powers to force through a welfare-related budget bill not voted on by lawmakers. Barnier is the first French prime minister to be ousted since 1962. There won’t be a fresh snap parliamentary election, at least not straight away.
Prime minister forced out
Current regulations prohibit Macron from calling another vote before this coming summer. Macron can, however, pursue a new round of talks with lawmakers from France’s different political coalitions to try to appoint a new prime minister.
The next few weeks and months could be politically and economically turbulent for France. Investors may punish French stocks and bonds, which could lead to contagion in other areas of the EU where the euro currency is used due to the size of the French economy, about $3 trillion, according to the French National Institute of Statistics and Economic Studies. Government business won’t entirely shut down, though.
Barnier is expected to stay on in a caretaker role until a new prime minister is appointed. Macron remains president until 2027 when his term expires, unless he resigns, which he has said he won’t do. In France, the prime minister is in charge of the day-to-day operations of the government, tabling laws and making sure they are implemented, while the president handles defense and foreign affairs.
There is some overlap of roles. Macron is highly unpopular in France. He’s caught in the middle, trying to push back on the appeal of far-right voices promising lower immigration and left-wing disaffection over his reforms.
Analysts say to some degree it’s a crisis of Macron’s own making. Jean-Yves Camus, a political scientist at the Paris-based French Institute for International and Strategic Affairs, said Barnier’s exit is “proof that Macron’s gamble in calling a snap election last Spring totally failed.”
