Why the Yellow Vests Remain a Thorn in Macron’s Presidency
(Bloomberg) -- No matter which side of France’s political divide you’re on, the yellow vests donned by protesters angry at President Emmanuel Macron’s policies and personal style have come to represent everything that’s wrong with the country. For supporters of the grassroots movement, they symbolize the gulf between the ruling elite in Paris and workers who face rising costs of living, shrinking public services and an unfair tax burden. For others, the yellow vests signify the French people’s resistance to sacrificing any social benefits to help create more jobs and make France competitive again. Macron’s actions have so far failed to squelch the movement. The weekly Saturday protests have continued to attract a hardcore group of demonstrators and trouble makers who vandalize bank branches and luxury boutiques.
1. What sparked the protests?
Initially, anger focused on government plans to raise gas taxes to help fund incentives for cleaner cars and home-heating systems. It was a final straw for many in France’s small towns and rural areas, who rely on cars and have seen public services dwindle. An online petition grew into a grassroots movement that organized local road blockades and other actions through social media. They named themselves after the “gilets jaunes,” or reflective yellow safety vests, that French motorists must have in their cars in case of an emergency. After a national “Day of Action” on Nov. 17, 2018, demands by the loosely affiliated protesters expanded, ranging from raising the minimum wage, increasing retirees’ pensions and restoring the wealth tax. Much of the anger focused on Macron himself, a former investment banker elected as France’s youngest leader since Napoleon, who is seen by many as out of touch with average people.
2. How has Macron responded?
After initially seeking to dismiss the movement, the government scrapped the planned gas tax hike and then announced a 10 billion-euro ($11.2 billion) stimulus package in December. As the protests dragged on and taking into account the results from a “Grand National Debate,” where people aired their views on where France is headed, Macron added more sweeteners in a televised announcement in late April. Estimated to cost an additional 7 billion euros, they included:
- 5 billion euros worth of income tax cuts for lower income households
- help for retirees with small pensions by indexing them to inflation
- more decision-making power for mayors and regional officials, including on school and hospital closures
- lower barriers to holding referendums
He also plans to close the elite National School of Administration, called ENA in French, a training ground for many of the country’s presidents including Macron himself. Through it all, he’s tried to stay the course on labor market reforms and refused to bring back a wealth tax he scrapped, a move seen by many protesters as a gift to the rich while they have trouble making ends meet.
3. Did Macron’s pledges calm things down?
Yes and no. Over time, the weekly Saturday protests dwindled into smaller gatherings and mostly disappeared off the front pages of newspapers. But they haven’t gone away. Instead they’ve become a fixture of France’s political landscape, paralyzing parts of central Paris and other major cities every Saturday as the police try to keep order and stem vandalism. Protests turned particularly destructive in mid-March with widespread looting on the Champs Elysees. A bank was set on fire near the iconic avenue, sparking France’s biggest banks to call on protesters to spare their offices and let employees do their jobs in peace. More than 760 bank branches have been damaged countrywide since the beginning of the Yellow Vests movement.
4. What was the national debate all about?
Macron gets accused of not listening, so he wanted to show that he is. On Jan. 14, he published a “Letter to the French,” where he laid out the themes of the debate: taxes, ecological transition, democracy, and organization of the state. He also set some limits, such as saying he wouldn’t go back on tax cuts he made at the start of his term, which are intended to make France more attractive to investors. City halls across the country put out almost 15,000 “grievance registers,” where anyone could make suggestions, a tradition dating back to before the 1789 revolution. An online version received 1.7 million contributions. About 10,500 town hall meetings were held across the country to debate a series of issues.
5. What else can Macron do?
It’s tough to say. A poll showed that 65 percent of the French who watched or listened to his April televised announcement said they were not convinced. And yet the cost of the moves so far will almost certainly see France breach the European Union’s budget deficit ceiling this year. Macron is arguing that the concessions are necessary to maintain public support for his efforts to make the economy more efficient, including reforming unemployment insurance and simplifying France’s retirement systems. The jury is still out on whether he will succeed.
6. What’s at stake for Macron?
Macron had bet that by front-loading unpopular, but in his view necessary reforms, the benefits would become clear by the time he faces re-election in 2022. That’s not happening, even if France’s economic performance is better than most of its neighbors, unemployment has declined and Macron’s popularity has recovered slightly from record lows. European parliamentary elections in May and a series of municipal and regional votes in 2020 could shape up as referendums on his policies. Surveys have shown that many Yellow Vest activists are likely to vote for either Marine Le Pen’s anti-immigrant National Rally or various far-left groups. Any breakthroughs by those parties in the May European elections will make it complicated for Macron to push on with his agenda -- for France and beyond. But attempts by Yellow Vests to try to create political movements have all fizzled, largely due to in-fighting, and polls show they are among the French least likely to actually vote.
7. What’s the cost to France?
The Yellow Vests protests hit the French economy just as the government was banking on a rebound from a lackluster growth in most of 2018. But the statistics agency Insee said in March that the impact on the economy was less than some initially feared, apart from in sectors like hotels and restaurants who say they will never catch up some of the sales they lost during the critical year-end holidays. Even if the protests dwindle there are concerns of lasting damage to the France’s image because of the violence. Hotel stays in Paris were down 5.3 percent in December from a year earlier after rioters defaced the Arc de Triomphe during one of the most violent protests. Still, there may be some upside for the economy. Macron’s measures to boost low incomes will give consumers their biggest lift in over a decade, according to the Bank of France.
8. Have people supported the Yellow Vests?
They did originally. France is accustomed to protests. After all, the nation’s identity was formed by the 1789 revolution. The Yellow Vests protests are the fifth of a series of major public uprisings in the past half-century that have helped shape the nation. But it’s not clear what “supporting” them really means. Regardless of the protests, most French people would probably say they want more government services and fewer taxes. Support dropped after Macron made his gestures and the violence continued. After peaking at 75 percent in November, support and sympathy for the Yellow Vests was down to 50 percent by April, with 60 percent of those polled wanting the movement to end, according to pollsters Elabe.
The Reference Shelf
- A story on Macron trying to reboot his presidency
- How violence flared again at a Yellow Vest protest mid-March.
- Macron tells the French to channel anger away from streets.
- Macron’s problems are a setback for centrist politicians across Europe.
- How France’s poorest view the Yellow Vests.
- A QuickTake explainer on Macron’s battle against France’s labor law.
©2019 Bloomberg L.P.