French election to test European stability amid potential NATO crisis

French election to test European stability amid potential NATO crisis
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As the credibility of NATO mutual defence commitments has become tainted by President Trump’s judgment of its obsolescence European countries will find it increasingly expedient to accelerate the development of their own defence infrastructures within the structure of the European Union (EU). The French presidential elections will be a major event in the context of ongoing transatlantic diplomatic shifts and potential realignments.

NATO is “obsolete”

Despite their differences,May’s visit to the United States and Hollande’s Berlin meeting were, at least in part, a response to President Trump’s unprecedented claims about NATO in the beginning of the month. Classifying it as ‘obsolete’ and questioning the fulfillment of the US commitments within the mutual defence alliance caused “worry and concern” across Europe, according to Germany’s foreign minister, Frank-Walter Steinmeier.

The inconsistency in US policy is not mere showmanship. Despite the more orthodox views expressed by the foreign affairs and security members of his cabinet and their efforts to walk back his Twitter controversies, the permanent damage wrecked by President Trump’s transactional approach to NATO erodes the alliance’s credibility. It leaves its members exposed to their heretofore enemies expectant.

The shifting weight of US influence in Europe

However, the cost of this paradigm shift in US foreign policy will be felt in yet more subtle ways. At the peak of the Eurozone sovereign debt crisis, President Obama lobbied German Chancellor Angela Merkel adding weight to the unpopular, but then crucial, cause of sovereign bailouts. Should another such crisis present itself during the Trump presidency, the White House will, at best be absent or, at worst, be a force for further chaos.

That the first week of president Trump’s presidency ended with the elevation of Steven Bannon to a permanent seat on the National Security Council (NSC) only exacerbates these fears. His promotion also emphasises the popularity of his vision of a bilateralist world with a mercantilist United States, dominating its partners, is with president Trump. The incompatibility of this vision with the multilateralism of the EU can only signal a less cooperative relationship between the White House and Berlaymont. Historically, this antagonism, and the divide-and-conquer approach that may escalate to, present European integration, and the political stability it had created, with its first geopolitical challenge. That it comes from a traditional ally at a time of heightened animosity with the Kremlin only compounds the danger of this challenge.

The dangers of political integration through crises

For now, the EU remains a project in progress. Jean Monnet, one of the founding fathers of European integration best described this process in his memoirs when he argued that “Europe will be forged in crises, and will be the sum of the solutions adopted for those crises.” The permanent risk underlining such an evolutionary process of European integration is that it may be overwhelmed by the number and magnitude of crises it faces and, unable to grasp the necessary solutions, perish.

The true danger of President Trump’s comments is that they undermine the credibility of NATO as the only tool of European defence against military threats. They transform the United States into a source of crises rather than as a source of stabilisation. Unsurprisingly, and already compelled by the problems highlighted by the Syrian refugee crisis, calls for enhanced European defence integration and an EU army have gained new prominence.

The Franco-German engine

The other truism about Europe is that its integration is driven by the “Franco-German” engine. The withdrawal of one of those parts would throw the whole into a crisis. It is in this context that the internal challenge presented by the presidential aspirations of Marine Le Pen and her anti-EU agenda compounds the instability created by the Trump presidency. Should her candidacy win the day at the French presidential election of May 7th, Angela Merkel will most likely be unable to hold the torch of European unity on her own for very long.

At the cross-roads of Europe’s future, a Le Pen presidency would be as paradigm-shifting in its dismissal of a European army as the 1954 referendum that blocked the first attempt at creating a European defence union. Deprived of a credible commitment from the United States to NATO, a Le Pen presidency would effectively leave European countries to fend for themselves. Despite legislative deadlocks, in a single vote, the French people will push Europe forward or begin to roll back the clock.

Le Pen wins first round…

Understanding the likelihood of a victory by Le Pen in the French presidential election is complicated by the two-round electoral system and the fact that the two major political parties have only recently chosen their candidates. However, some facts are quite clear. On the first round, most recent polls are in agreement that Le Pen is expected to win a plurality of votes, worth around 22% and 27% of the total. The contest is between herself, the candidate of the main centre-right party and ex-prime minister Francois Fillon who gathers between 21% and 28% of the vote, and the 16% to 24% of voter intentions support the independent candidacy of Emmanuel Macron. The recently chosen candidate of the Socialist party, Benoit Hamon, has not figured prominently in most surveys and his candidacy is in its early stages, relatively speaking, so it is not unsurprising that he comes in at fourth place with 6% to 15% of voter intentions. More so than Emmanuel Macron’s campaign, Hannon’s chances are likely to be hurt by the association with the historically unpopular presidency of the incumbent president Francois Hollande.

…But loses second round

Should these intentions hold until the first round on April 23rd, then the second round contest should be between Fillon and Le Pen. This is where Le Pen’s appears to run into trouble as her message fails to appeal to voters beyond the growing, but still limited, support of her Front National base. Not a single poll gives Fillon less than a 14% margin of victory over, and most recent polls give him at least a 20% advantage. Unsurprisingly, the same is true of polls comparing the popularity of Macron with that of Le Pen, giving the young independent candidate a margin of victory of at least 24% and as much as 30%.

Beware the polls

In light of the recent polling failures to accurately predict the result of the Brexit referendum and the US presidential election, some caveats are warranted. It is important to note that as many as 44% of respondents reported that they would not vote or that they were still undecided, according to the latest poll. So the race is far from over. The next three months will determine how much impact the recent corruption scandal engulfing Fillon’s campaign and Macron’s investment banking past will have on these polling figures.

About Author

Filipe Albuquerque

Filipe Albuquerque is an economist with extensive professional experience in macroeconomic, political and financial analysis. He holds an MSc in European Political Economy from the LSE and is researching the structure of fixed income markets as a PhD Economics candidate at Birkbeck College, University of London. He lives in Stockholm where he is a visiting PhD student at the Swedish House of Finance, researching CDS markets. His research interests also include development economics, geopolitics and history.