France is once again at a political and economic crossroads, with its government under mounting pressure from all sides as it grapples with a ballooning deficit, public unrest, and a leadership shake-up. The recent ousting of François Bayrou as prime minister, a move described by The Connexion as a critical blow to the country’s economic prospects, has only deepened the sense of crisis. Bayrou’s call for €44 billion in budget cuts to stave off bankruptcy was met with overwhelming opposition in the Assemblée nationale, where 364 MPs voted to remove him, leaving only 194 in support. The reasons for this dramatic rejection vary, with some on the left insisting that France’s welfare commitments must be preserved at all costs, while others, such as the far-right Rassemblement National, appeared motivated by political ambition rather than economic logic.
In the wake of Bayrou’s departure on September 8, 2025, President Emmanuel Macron appointed Sébastien Lecornu as his fifth prime minister in less than two years. Lecornu, a 39-year-old Macron loyalist, has inherited a daunting set of challenges. Not only does he face the immediate task of forming a government and drafting a 2026 budget, but he must also navigate a deeply divided parliament and a public growing increasingly restless over austerity measures and economic uncertainty.
Union leaders have wasted no time in ramping up the pressure. On September 25, 2025, they announced a new day of strikes and protests, scheduled for October 2, to demand the scrapping of Bayrou’s austerity fiscal program. The announcement follows a massive protest on September 18, attended by hundreds of thousands of people. Talks between union representatives and Lecornu on September 24 failed to yield any progress, with Marylise Leon, head of the CFDT union, bluntly stating, "The prime minister did not provide any clear answers to the workers' demands, so for the unions, it's a missed opportunity. It doesn't add up." Sophie Binet of the CGT echoed this sentiment, calling for increased mobilization: "There was a big turnout on September 18, and we need to step it up again on October 2."
While unions and left-wing parties resist further budget cuts, investors are sounding the alarm over France’s fiscal health. The country’s budget deficit last year was nearly double the European Union’s 3% ceiling, a figure that has shaken confidence in France’s ability to manage its finances. None of the three main parliamentary groups holds a majority, making it even harder for Lecornu to build consensus around a new budget. As Bloomberg reported, the political crisis is also threatening to choke off revenue for major defense contractors like Thales SA and Dassault Aviation SA, as delays in passing the budget cast doubt on the government’s much-touted plans to boost military spending. President Macron had announced an increase of €3.5 billion in the military budget for 2026 and €3 billion for 2027, aiming to bring total defense spending to €64 billion by 2027—double the level when he took office in 2017.
With the specter of further parliamentary gridlock looming, Lecornu is reportedly considering a controversial proposal to help balance the books: a wealth tax targeting France’s richest households. The idea, championed by left-wing economist Gabriel Zucman, would require individuals with net wealth over €100 million—about 18,000 households, or 0.01% of the population—to pay at least 2% of their wealth in annual taxes. Zucman estimates this could raise €20 billion a year, providing a much-needed injection of revenue. Polls indicate that 74% of French citizens support such a tax, though, as The Connexion points out, it is unlikely that those who would actually be affected are among the supporters.
The proposal is not without risks. France’s last experiment with a wealth tax was widely considered a failure, as many wealthy individuals simply left the country to avoid it, taking their purchasing power and tax contributions with them. Critics warn that repeating this approach could once again drive the rich abroad, resulting in job losses and further economic pain for those who depend on their investments. As one former official in the Macron administration, Antoine Foucher, noted, the incentives for ordinary French citizens to work have also eroded. After taxes and social contributions, the average worker keeps only €54 out of every €100 earned, a situation Foucher described as unprecedented since 1945: "For the first time since 1945, work no longer improves living standards."
Against this backdrop, Lecornu’s position is precarious. He must court support from the socialists, who are eager to see the wealth tax enacted, even as he risks alienating his own right-of-center base and the business community. The alternative—failing to act—could mean further strikes, more political instability, and the possibility of yet another round of parliamentary elections. Some commentators have gone so far as to suggest that if the current crisis persists, it could spell the end of the Fifth Republic and force a complete overhaul of the French constitution.
Meanwhile, the standoff between the government and the unions shows no sign of easing. With fresh protests on the horizon and no clear resolution in sight, France finds itself trapped between competing visions for its future. Should it double down on its generous welfare state, risking fiscal collapse and investor flight? Or should it embrace austerity and tax reform, even at the risk of social unrest and political upheaval?
President Macron’s promise to double defense spending by 2027 now hangs in the balance, as does the country’s broader economic trajectory. For now, all eyes are on Lecornu as he attempts to steer an increasingly divided nation through one of its most turbulent periods in recent memory. Whether he can succeed where his predecessors have faltered remains to be seen, but one thing is certain: the choices made in the coming weeks will have profound consequences for France’s social model, its economy, and its place in the world.
As the October 2 strike looms and parliament prepares for another bruising budget debate, France stands at a critical juncture—one that will test the resilience of its institutions and the resolve of its leaders in the face of mounting adversity.