The markets appear giddy today over the election prospects of Emanuel Macron in France.

Equities are up along with bond yields. Gold is down. The day is still young though.

Macron won round one of the French election yesterday and will square off against Marine Le Pen in round two on May 7. He is widely expected to win round two, becoming the next president of France.

Policy Advancement

Can Macron Save the World? Save France?

Let’s phrase this a different way. Can Macron advance his policies?

I would ask the same question if Marine Le Pen were expected to win. Macron will not have a mandate. Neither would Le Pen if she were to win.

Certainly, the EU would prefer working with Macron. With Le Pen at the helm, France could throw Brexit negotiations for a loop.

internally, Macron has his work cut out for him. Here are their policies as described by the Guardian.

Macron Policies

Remake the “failed” and “vacuous” French political system; relax labor laws; cut business taxes; reform unemployment system; encourage social mobility; cut public spending (but boost investment); shrink public sector; reduce the number of MPs; establish eurozone government; hire 10,000 more police and gendarmes.

He says: “I will work over the coming fortnight so that together we can gather as many people as possible around my candidacy. The strength of this coming together will be decisive for the government. The challenge this evening is not to vote against a person, but to decide to break completely with a system that has been incapable of responding to our country’s problems for 30 years.

Le Pen Policies

Policies: Priority for French nationals in jobs, housing, welfare; extra tax on foreign workers and imports; proportional representation in parliament; negotiate with EU for return of “full sovereignty” including the franc; in-out referendum on EU membership; cut immigration to 10,000 a year; restrict nationality rights; hire 15,000 police; create 40,000 more prison places.

She says: “The French people now have a very simple choice: either we continue on the path to complete deregulation, or you choose France.

Questions

1. Would the French parliament go along with relaxing labor laws? Cut business taxes?
2. Would the parliament allow a referendum on the Euro?

If the answers are no and no, then what’s changed?

The real battle over the survival of the eurozone will take place in Italy, not France.