After the Olympics, let's return to the traditional framework of international relations. The most important issue concerns the outcome of the American elections in the this November. he outcome will have a significant impact on world politics, starting with the international relations with China and Russia and, for other aspects, Israel and Palestine.

But the American elections in November, regardless of the outcome in favor of Kamala Harris or Donald Trump, will not substantially change the current context of the European Union, where, for the first time, the two dominant countries, Germany and France, are in crisis.

France

In France the government of Emmanuel Macron is not only a minority but without a political alternative that could preserve its fundamental  policies. He has nominated Michel Barnier - who has already been a member of the old governments twice – as candidate president of the council of ministers. The opposition parties, despite representing the parliamentary majority, cannot form an alternative government being divided.

An alternative government has always been possible in the past. Twice it happened with Mitterrand when he had to nominate two heads of government of the opposition. And, again, under the presidency of Chirac, president of the right, who had to nominate a representative of the center-left as head of government. In these circumstances the President of the Republic suffered a drastic reduction in his decision-making power, but retained his own role in international politics.

 The current situation is radically different. government. The alliance in favor of Macron's presidency, Ensemble, has 168 seats* which, added to the 60 of the Republicans (and allies), reach total 228 seats.

The two opposite coalitions have a total of 325 representatives amongst 577 members in the Parliament. It means that the two coalitions of the opposition have a clear majority **, but they are divided***. So, the announced government close to Macron would be, if realized, a minority government.

Is this a permanent framework? It may be. But there is also the chance that the two opposition coalitions could change their current position.

It cannot be ruled out that the left-wing coalition along with the right-wing one may find an agreement by appointing a prime minister who does not belong to either coalition. A new government, on the basis of the current programs, should adopt a domestic policy in favor of the less well-off classes. The increase, for example, of the minimum hourly wage to 1750 euros per month; an increase in spending on public activities; a new industrial policy; the possible reduction of years of work in the individual choice of retirement, and so on.

It is just a chance, but it can’t be ruled out. It should be added that an agreement between the two coalitions could propose a compromise to stop the conflict between Ukraine and Russia.

In short, we will see if in the next few months we will arrive at an alternative policy, considering that France is, together with Germany, one of the two largest and politically decisive European countries:

Germany

France is not the only problem. The tripartite government of Germany has only about 30 percent of the parliamentary vote, and the parties that make up Olaf Scholz's majority are deeply divided. The Chancellor's Social Democratic Party has only about 15 percent of the electorate. Meanwhile, the other two parties, the Free Democratic Party (FDP) and the Greens, which help form the government, are losing votes and are deeply divided.

This composition has now changed with the elections in Thuringia and Saxony on September 1. For the first time, the Alternative for Germany won the elections in Thuringia and is second in Saxony (with a small difference to the Christian Democratic Union, (CDU). The results of the two opposition parties were expected, but the level of their success was not.

However,  the most surprising result was that of BSW, the party founded last January by Sahra Wagenknecht who left The Link, the main opposition party in the past. The new party won 15.8 percent of the vote in Thuringia and 11.8 percent in Saxony. Unlike Link, the new party advocates a cooperative relationship with Russia.

These political changes coincide with the crisis of the German economy. Economic growth has been around zero or even lower as in the last months of 2023 and the first of the new year. A picture in stark contrast to the traditional German economic growth, which for many years has been among the highest among Western countries.

In this context, for the first time in its history, Volkswagen has announced the dismissal of 50,000 workers out of 300,000 employees in Germany. Layoffs that will be the first in the history of Volkswagen, whose birth dates back to the early 1930s. Not an isolated case, but an aspect of the general reduction in production and exports of German industrial products.

Europe

We know that from the end of the 50s, starting with Charles de Gaulle and Adenauer, the European community has always been characterized by the dominant alliance between France and Germany. But now they are two countries in difficulty.

Let’s look at the position expressed by a number of economists on a letter to Financial Times of September, 15: : “In the incoming Budget it is essential that the Government recognises  the important role that public investment must play in the decade  of national renewal. Further cuts to public investment must be avoided, a strategy for substancial increasing of public investment adopted”.The letter is signed, among others, by  Lord Gus O’ Dommel. Lord Jim o’ Neill, prof. Marianna Mazzucato, prof. Jonathan Fortes, prof. Susan Newman.

What is the role of European Union in the new circumstances? The economic policy of the national countries is mainly in the hands of the European Commission, which has as its main input a policy against public investment. The opposite of what happens in the United States and Japan, to name the two most important countries with market economies. In essence, a European policy that paralyzes growth to apply rules that sacrifice public investment in the essential sectors of production and employment.

As we have seen, France and Germany could have a different political and economic future. But this is still uncertain, even if desirable. Predictions are always difficult. But it is a fact that the old European politics has failed. In the coming months we will see what the future of the European Union could be in today's ever-changing world.
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* Ensemble comprends 5 parties: Renaissance, Mouvement démocrate, Horizons, Parti radical, Union des démocrates et indépendants.

** The three main parties of hte leftwing coalition are La France Insoumise with 74 seats; the Socialistes, 59; the Verts, 29. Among the others here is the Communist party with 9 seats, allied with France insoumise.

***  The far-right coalition led by Marine Le Pen and the young Jordan Bardella has 126 deputies, to which are added 17 representatives linked to Eric Ciotti, former head of the Republicans, for a total of 143 seats.