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Business|Why France’s Financial Woes Are Pushing Its Government to the Brink
https://www.nytimes.com/2025/09/07/business/france-government-collapse-economy.html
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The French prime minister has proposed drastic spending cuts and tax increases to shore up the country’s accounts, but his plan could backfire.
By Liz Alderman
Liz Alderman, who writes about business and economics in Europe, reported from Paris.
Sept. 7, 2025, 12:01 a.m. ET
Italy was once Europe’s emblem for political instability, with a mounting debt and deficit and few options to fix the mess. Now, it’s France’s turn, and the situation is about to get worse.
On Monday, President Emmanuel Macron’s government is expected to fall for the second time in just nine months after a confidence vote in Parliament.
The French prime minister, François Bayrou, called a vote to shore up support for his plan to mend the country’s finances with 44 billion euros (a little over $51 billion) in spending cuts. If the vote goes against him, Mr. Bayrou will be forced to resign and Mr. Macron will have to name yet another prime minister, who will have to immediately return to the task of fixing France’s budget.
In the meantime, investors have pushed up French borrowing costs to among the highest in the eurozone, reflecting rising risk.
How did France get this point?
The country’s economy, the second largest in Europe after Germany’s, appears strong at first glance. Before President Trump’s tariff war, growth was slow but steady and employment was picking up.
Behind the scenes, outsize government spending and falling tax receipts strained finances. The European Commission, the European Union’s executive branch, reprimanded France last year, and Mr. Macron’s government raced to fix a surging debt and deficit with cuts to the welfare state and tax increases.
