The main reason put forward by the rating agency Fitch when it reduced France's rating from AA- to A+, was the country's political instability at a time when it was facing a deterioration in its public finances. The very alarmist speeches of the previous government, probably made to get unpopular measures accepted, could not leave the agency indifferent. But the A+ rating remains a good level and the financial markets have understood this since the CAC 40 ended up 0.9% today and the Agence France-Trésor issued nearly 8 billion euros of Treasury Bills (BTF) without difficulty against a demand of 26 billion.

The link between the political situation in France and that of its public finances is a certainty, but not necessarily in the sense generally put forward: it is economic policy that has led to the fragmentation of the political class with the rise of extremes. This is now a major factor of instability that makes it difficult to restore public accounts. The rise in the deficit and the increase of 1000 billion in the debt were largely the result of the policies carried out for nearly fifteen years.

The foundation of the European social model adopted in the aftermath of the Second World War, which contributed to the restoration of lasting peace on the continent, was based on a fair distribution of the wealth created, which made it possible both to sustain growth through investment and to consumption facilitated by the increase in purchasing power. In Germany, this shared prosperity has taken place within companies, a fair balance being found between the remuneration of labour and shareholders and the means necessary to finance investments. This model is now reaching its limits with the energy crisis caused by over-dependence on Russia and the trade war initiated by Donald Trump.

France has chosen another model that entrusts the State, directly or through social benefits, with the task of carrying out the redistribution necessary to reduce inequalities and the feeling of injustice. The deterioration of the social climate and the rise in votes in favour of extremist parties, which is largely at the origin of the fracturing of political life and therefore of its instability, shows that this objective has no longer been achieved. But at the same time, through tax reductions and tax reductions in order to improve the competitiveness of companies, the State has widened the budget deficit and increased the debt without achieving the objective since France still has a heavy external deficit in manufactured goods, unlike Germany, of course, and even Italy.

The German example shows that a fair distribution of wealth within the company is in no way incompatible with its competitiveness. The strength of German industry, and the enormous external surplus that results from it, lies in its good strategic choices and certainly not in the cost of wages, the level of which is even higher than that of France. François Michelin used to say that the most important person in the company was the customer. His French counterparts would have done well to draw inspiration from this evidence rather than embarking on costly acquisitions abroad leading them to decline (Renault) or even disaster (Alcatel).

 The economic policy pursued for more than ten years has contributed both to the emergence of extremist parties and to excessive debt. The proposals of the resigning government further aggravated the situation by putting the burden on the population: abolition of public holidays, postponement of the retirement age, a blank year for social benefits, reduction in healthcare reimbursements, etc. To persevere in this direction inevitably leads to a political deadlock without addressing the roots of the evil.

In addition to the obvious observation that past policies have failed, it must be admitted that France is a prosperous country and even that this prosperity is increasing, as evidenced by the evolution of the level of financial assets held by households, which exceeds 6000 billion euros in 2025. But this increase was concentrated on a very small part of the population and it was easy for populist oppositions to claim that while the state was getting into debt, the rich were getting richer and richer.

To get out of this crisis and the political and economic impasse in which France is plunged, we must abandon the logic of communication with spectacular announcements (retirement at 64, taxation of the hundred richest people) and take a long-term approach with measures that are staggered over time and that guarantee the return to a healthy financial situation. The public sector, with the State on the front line, companies and households must play their part.

In addition to an essential reform of the architecture of local authorities (the mille-feuille) which can only be debated and implemented after the municipal elections of 2026, the State must begin to drastically reduce its standard of living with the slimming down of central administrations, the abolition of the many useless organizations or operators and the sale of the real estate assets that host them,  in the Paris region and throughout France. The size of governments will have to be strictly limited as well as the number of staff in ministerial cabinets.

A change in the bases and rates of social security contributions will have to be discussed with the social partners. The increase in the ceiling for pension contributions under the general scheme will make it possible, without the need to postpone the legal retirement age, to quickly restore its balance. Similarly, an increase in the ceiling for reductions in the burden on wages will have to be introduced to encourage the recruitment of qualified jobs that are essential for the competitiveness of industry. It will be offset by a reduction in the relief granted since 2017, mainly for low-wage earners, and by a tax on share buybacks by companies and financial institutions.

A contribution will have to be requested from the wealthiest households with an increase in the "flat tax" which could go from 30 to 34% and the reinsertion of non-professional financial assets into the wealth tax base. Secondly, a 2% increase in the VAT rates currently at 10% and 20% can be proposed, in the current context of very low inflation. Intense competition, particularly in the retail sector, would allow this increase to be passed on to consumers very partially, while at the same time making a major contribution to reducing the budget deficit. This measure could be temporary until the structural reforms relating to the lifestyle of ministries and public agencies have had their full effect.

Finally, it is imperative that Brussels recognises that the level of French public spending and its debt is also linked to the effort undertaken over the past decades in the field of defence, unlike almost all Member States, and this is all the more necessary as Europe's strategic autonomy has become a priority.

France's financial recovery is based on two conditions. To even implicitly acknowledge that it is past policy that is at the origin of excessive debt and the rise of extremist parties. Adopt measures that are long-term and that favor efficiency over the spectacular. It is up to the next government to show that it has understood the nature of the problems posed and to adopt the right measures to get the country out of the crisis that is hitting it.