The failure of Macronism and its cost for Europe LSE article

France, long regarded as a pillar of stability within the eurozone, is facing an unprecedented economic and political crisis. In a recent article for the London School of Economics and Political Science (LSE), John Ryan argues that the failure of Macronism—once hailed as a pragmatic, centrist approach—has left the country highly vulnerable. Caliber.Az presents the most telling parts of the article for its readers.

“Emmanuel Macron promised to act as a pragmatic moderniser and bridge France’s traditional left-right divide. Yet as John Ryan argues, the failure of Macronism now risks destabilising both France and Europe.

France is not a marginal economy struggling on the periphery of global finance. It is the world’s seventh-largest economy [...] Its size has long insulated it from the kinds of fiscal discipline imposed on smaller eurozone states.

Yet that insulation is now eroding. The combination of structural indebtedness, political fragmentation and the collapse of Emmanuel Macron’s self-styled ‘radical centre’ has left France more vulnerable than at any point since the creation of the euro.

France’s debt metrics are stark. External debt stands at approximately $7.7 trillion, equivalent to around 248 per cent of GDP [...] Among advanced economies, only Japan exceeds this ratio.

The difference, however, is decisive. Japan’s public debt is overwhelmingly domestically owned. France’s is not. Roughly 54 per cent of French government bonds are held by foreign investors, exposing the state to shifts in international confidence that it cannot fully control.

Debt, the euro, and the limits of sovereignty

Historically, large states facing excessive debt have relied on monetary sovereignty to escape fiscal dead ends. Inflation, generated through money creation, reduces the real value of outstanding debt and transfers losses from debtors to creditors [...] France no longer has that option. Membership of the eurozone brings clear benefits in good times – lower borrowing costs, reduced currency risk and deep capital markets – but it also removes the ability to monetise debt in bad times. The euro is both a shield and a straitjacket.

This constraint became brutally clear during the eurozone crisis. Countries such as Ireland and Greece were forced into sharp fiscal adjustment because they could not print money to stabilise their economies. Instead, they relied on emergency support from the European Central Bank (ECB), conditional on austerity and structural reform. 

[...] France is entering a period of acute fiscal and political vulnerability that is testing both domestic governance and the resilience of eurozone rules [...] France’s budget deficit now exceeds five per cent of GDP, well above the EU’s three per cent reference value.

This reversal of France’s traditional status as one of the eurozone’s safest sovereign borrowers reflects declining investor confidence and raises questions about potential reliance on emergency mechanisms at the ECB.

The ECB dilemma

[...] Since taking office, Emmanuel Macron has presided over an unprecedented expansion of the French state. By 2024, public spending had risen to more than 57% of GDP, the highest share among all OECD countries. [...] 

[...] in 2017, France’s debt-to-GDP ratio stood around 11 percentage points above the eurozone average. By 2024, that gap had widened to roughly 25 points. [...]

Technically, the ECB has few hard constraints [...] The ECB can purchase sovereign bonds in unlimited quantities if it judges that doing so is necessary to preserve price stability or the integrity of the monetary union.

[...] The ECB’s interventions during the eurozone crisis were justified as exceptional responses to exceptional circumstances, tied to compliance with fiscal rules and reform commitments. An open-ended bailout of France – particularly under a government hostile to EU fiscal norms – would stretch that justification to breaking point.

The collapse of the ‘radical centre’

France’s economic fragility is inseparable from its political crisis. In the space of less than two years, the country has cycled through five prime ministers, an unprecedented level of instability for the Fifth Republic. Each government has been weaker than the last, unable to command a durable parliamentary majority or articulate a coherent programme.

This is not merely turbulence. It is the disintegration of Macron’s central political promise: that a technocratic, post-ideological “centre” could overcome France’s traditional left-right divide. 

[...] His movement functioned less as a party than as a personal vehicle, sustained by his authority rather than by shared ideology or grassroots organisation. As his popularity has declined, that structure has collapsed.

At the same time, his policies have alienated nearly every constituency. To the right, reforms appeared hesitant and over-regulated. To the left, they were experienced as an assault on labour protections and democratic accountability. By trying to satisfy everyone, Macron ultimately has satisfied no one.

Implications for Europe

The deeper problem is that the technocratic centre lacks a moral anchor. Its claim to pragmatism masks a consistent bias towards preserving existing economic hierarchies. [...] The language of reform has come to mean the dismantling of social protection. 

[...] As living standards stagnate, public services deteriorate and the cost of living rises, trust in institutions erodes. [...] The result is a vicious circle. Each failed government deepens public cynicism, fragments the political landscape further and increases the appeal of parties promising rupture rather than compromise. Macronism, designed to stabilise the system, has instead accelerated its breakdown.

France’s crisis is no longer a purely domestic affair. It poses a direct challenge to the eurozone’s institutional architecture and to the ECB’s role within it. A large, indebted state without monetary sovereignty, governed by a fragmented and delegitimised political centre, is a systemic risk.

European policymakers have relied for too long on the assumption that France would always anchor stability. That assumption is no longer safe. The question is not whether France will face a reckoning, but how – and whether Europe’s institutions are prepared for it,” the article states.