I hesitate to dedicate scarce editorial resources to France’s budget drama, not because it isn’t notable, but rather because in all likelihood it’ll end in some manner of compromise.

But considering the extent to which the fiscal wrangling is a reminder of the rolling crisis of government facing (another) one of the world’s foremost democracies, it’s worth a quick note for those unapprised.

Recall that the great (or not-so-great, depending on how you want to look at it) irony of Emmanuel Macron’s risky gambit to keep the far-right from power in France was that he ended up beholden to France’s far-left, in turn setting the stage for the silliest outcome of all: Partial dependency on the very same far-right to thwart the far-left. Call that irony squared. Or cubed.

In September, three months on from France’s closest brush with a far-right government since World War II, Macron appointed Michel Barnier — of Brexit negotiation fame — as prime minister, teeing up what was always guaranteed to be a contentious budget battle at a time when France’s public finances are front and center.

Fast forward two more months, and the French left’s threatening a no-confidence vote against Barnier if he avails himself of the usual constitutional end-around to pass a finance bill. In order to survive such a motion, Barnier will need Marine Le Pen (i.e., the far-right) to kill it. That’s a lot of leverage for Le Pen, and markets don’t love it.

The figure shows the OAT-bund spread. It’s at the wides since the eurozone debt crisis.

Is this a disaster? Not exactly, or anyway not yet, but France really does need to figure it out on the fiscal front. Remember: France isn’t a monetary sovereign. The country doesn’t issue the currency in which its debt’s denominated. That’s a straitjacket, and it means that whatever budget leeway France might enjoy outside of a currency union, it doesn’t enjoy as part of one.

So, the budget matters, and France’s fractious domestic political situation raises the stakes materially. Gridlock’s one thing. Chaotic gridlock — what Le Pen’s implicitly threatening — is another.

Why might Le Pen not topple the government? Well, a few reasons:

1. There’s something awkward about an alliance between National Rally and the far-left.
2. Her leverage sets up lots of RN-friendly concessions.
3. If things keep going the way they’re going in the Western world, Le Pen’s odds of finally claiming the French presidency were pretty high until accusations of financial chicanery threatened to remove her from the ballot. Conceivably, toppling Barnier for the sake of it could be a strategic blunder if voters view the ensuing chaos as a sign of what a Le Pen presidency might look like.
4. It’s possible — I guess — that Le Pen could use her legislative leverage to secure some manner of backroom deal in the embezzlement case which threatens her candidacy for the 2027 election. Plainly, any decision to disqualify her would be derided mercilessly by at least a quarter of the French electorate as unacceptable judicial intervention in France’s democratic processes. Prosecutors have also floated a jail term for Le Pen in the case, although that’s far-fetched. She was deeply involved in fighting the case, and is quite indignant about the charges, even as she seems resigned to some manner of guilty verdict. I think it’s reasonable to assess that her newly-combative stance on Barnier’s budget could be both related to the case and negotiable in the event… well, in the event anyone’s interested in avoiding sundry “messy” scenarios both related to a no-confidence vote for the current government, and all the societal unrest that would almost invariably accompany a decision to bar her from public office next year, and then again on appeal in 2026.

That gives you an idea of the stakes, and also of the extent to which France’s political scene remains quite ill-tempered, with apologies to the French for casting stones from the glass house that is America.

Allow me a brief remark on the embezzlement allegations. Barring Le Pen from running for president in 2027 is probably a bad idea. That would render the results illegitimate in the eyes of millions of French, particularly if whoever RN runs in lieu of Le Pen were to lose. Bear in mind: That assessment’s coming from someone — i.e., me — who thinks Le Pen in the Élysée could be a risk greater than Donald Trump in the White House. Simply put: The optics of a judge declaring her ineligible for an office she’s sought three times, and now seems poised to claim having reached the zenith of her domestic political power, are egregiously bad.

On Thursday, 10-year yields on French bonds exceeded those for Greece. I’ll just leave that there.