Presidential 2022: Why is the public debt one of the big missing from this campaign?

After more than an hour of interview on the results of his five-year term, Emmanuel Macron’s sentence sounds like an understatement: “The debt situation in France requires vigilance. ” Faced with journalists from TF1 and LCI , Wednesday evening, the Head of State spoke with lip service to France’s abysmal public debt. According to INSEE, in the third quarter 2021 it amounted to 2. 834, 3 billion euros, or 116, 3% of GDP. A record figure that the government had imagined even more important . The same day, the Assembly voted the last budget of the mandate. It totals an increase in the public debt of more than 150 billion euros.

The LREM budget rapporteur, Laurent Saint-Martin, himself concedes: “The next five-year period will be a five-year period for consolidating our public finances”. But then, how to explain the reluctance of the various presidential candidates to evoke this sword of Damocles above the heads of future generations?

A favorable situation

To face the health crisis, many countries around the world have chosen to spend heavily to keep their economy afloat. France, for example, voted a stimulus plan of 100 billion euros, of which 20% are funded by the EU. These billions have made it possible to see growth increase (+ 6.7% forecast in 2017, according to INSEE ). And to encourage this improvement, the European Central Bank also announced Thursday to maintain its key rates favorable to borrowing until March 2022 . You get the ideal remedy to avoid an outbreak of fever at the sight of the French debt.

“We talk less about the public debt today because it has less urgency, estimates economist Eric Heyer, director of the “analysis and forecasting” department of the French Observatory of Economic Conjunctures (OFCE). It has never been higher and yet it does not cost us more. Now, growth is greater than debt and it is much less of a problem with inflation around 2.5%. »

The right assumes to want to reduce the debt, not the left

An opinion shared by Benjamin Lemoine , researcher at the CNRS and author of The order of the debt: investigation into the misfortunes of the State and the prosperity of the market (Discovery, 2016). According to him, “the current low interest rates, which lower the cost of debt service, have weakened storytelling classic which makes debt a threat and a pretext for reducing public spending. “He continues with a more political comment:” For the neoliberal and authoritarian right, from Valérie Pécresse to Emmanuel Macron, the fact that the debt is no longer panicking is precisely a problem. “Precisely, the candidate of the Republicans, former support of François Fillon in 2016 and his austerity program economy, is one of the few to talk about debt reduction. She thus castigated Emmanuel Macron for having “burned the fund” – an expression that has flourished -, then proposed to reduce the number of civil servants in the administration of 150. 000 .

The reduction of public expenditure is therefore one of the favorite themes of the right. And with such a large debt, it is not surprising to see Valérie Pécresse attacking Emmanuel Macron on his budget management. “The Republican right is the only party to offer a fairly orthodox vision on the budgetary plan, analyzes Chloé Morin, political scientist at the Jean Jaurès foundation. All other parties agree that public debt is necessary to fuel the wheels of a highly billed society. ”

Jean-Luc Mélenchon advocates the cancellation of the” Covid debt “

” If the we are starting to say that the problem is debt, so we are removing all leeway to finance other projects such as ecological transition, public hospitals or even education, ”says Eric Heyer. So many themes historically preempted by the left. And on this side of the political spectrum, a voice stands out: that of Jean-Luc Mélenchon, the candidate of France Insoumise. The member for Bouches-du-Rhône simply wants to cancel the debt contracted during the health crisis. “The Covid – 000 triggered an increase in debt of approximately 19%, he said on BFM Business last May. I start by saying: let’s cancel these 20%. “Even Fabien Roussel, the Communist candidate, does not go so far and simply mentions a partial cancellation of this” Covid debt “. “There are lines of fractures on the left on this issue, because things are considered irresponsible,” said Chloé Morin. I doubt that the PS say they want to cancel the debt because no French believe in magic money. »

Will the low interest rates on the debt continue, and thus reduce the urgency to pay the bill? “They are based on how central banks view their ‘credibility’. If this credibility is based on the aspirations, desires and affects of the players in the capital markets, it is likely that they will rise again, ”predicts Benjamin Lemoine. And that the repayment of the debt does not become again a major subject in the months to come, advances Chloé Morin. “The subject is for the moment relegated to the background, but it will come back because the fear of paying more taxes tomorrow begins to increase in public opinion. ”