France’s 26-Day Government: How Paralysis Turned Into Europe’s Costliest Political Crisis
France’s 26-Day Government: How Paralysis Turned Into Europe’s Costliest Political Crisis
Paris stumbles through yet another failed premiership as investors price in the collapse of executive power
PARIS — On Monday morning, Sébastien Lecornu walked into the Élysée Palace as France’s prime minister. Barely an hour later, he walked out jobless. After just 26 days in office, Lecornu resigned, making his premiership one of the shortest in the Fifth Republic’s 67-year history.
His fall wasn’t about scandal or incompetence. It was about déjà vu. The cabinet he unveiled looked almost identical to the one before it, and opposition leaders immediately swore to bring it down. France, already on shaky ground, now finds itself in uncharted territory: no prime minister who can govern, no budget that can pass, and no political solution in sight.
Lecornu admitted as much to President Emmanuel Macron, saying simply, “The conditions are not met.” Financial markets had already drawn that conclusion.
A Government on Fast-Forward
France is now changing prime ministers at a speed that would make even Italy’s famously unstable coalitions blush. But there’s one crucial difference. Rome has decades of practice with coalition-building; Paris doesn’t. The French system was built for a strong president backed by a loyal majority in parliament. Once that majority evaporates, the machine seizes like an engine without oil.
The numbers are brutal. Macron’s centrist alliance holds barely a third of the National Assembly. The rest is split between Jean-Luc Mélenchon’s far-left bloc and Marine Le Pen’s far-right movement. They despise each other, but they agree on one thing: blocking Macron. That leaves every law hanging by a thread.
Lecornu’s short-lived predecessor didn’t last much longer, and the one before him also failed. What’s emerging isn’t just political turbulence—it’s a hollowing-out of the presidency itself. Once the nerve center of French politics, the Élysée is starting to look more like a ceremonial office.
The Cabinet Nobody Wanted
Lecornu sealed his fate when he revealed his ministerial team. Same old faces, same portfolios, same centrist program. For the left, it ignored calls for stronger climate action and more social spending. For the right, it sidestepped demands for tougher immigration controls and economic nationalism. In the end, it satisfied nobody.
This move reinforced the criticism that’s dogged Macron since his re-election: that he hasn’t adjusted to France’s new political reality. The 2022 parliamentary vote didn’t just deny him a majority—it rejected his entire centrist project. Yet Macron has kept acting as though the arithmetic is temporary bad luck, rather than a structural shift.
Lecornu made things worse by promising not to invoke Article 49.3, the constitutional tool that lets a government force bills through parliament. That vow, meant to show respect for democracy, robbed him of his last bargaining chip. Opposition leaders realized all they had to do was wait him out.
When Politics Costs Time
Markets saw the resignation as proof of something deeper: France has lost its ability to make decisions. Investors now talk about “policy time”—the lag between spotting a problem and solving it. In France, that lag is starting to look infinite.
Take the 2026 budget. Brussels wants France to cut its deficit, which means either raising taxes or slashing spending. Both require parliament’s approval. With no majority in sight, approval is impossible. Governing by decree remains an option, but it risks court challenges and angry protests in the streets.
Bond traders have already reacted. The spread between French government bonds and Germany’s ultra-safe bunds has widened, signaling higher risk. Analysts warn that until France proves it can pass a budget the normal way, investors will demand more to lend money to Paris.
The Market’s Cold Shoulder
The ripple effects go beyond bonds. Banks face headwinds from slower activity. Retailers and construction firms see consumer confidence stalling. Even big industrial companies are struggling to push through procurement deals because ministries can’t commit to long-term contracts.
Stock market analysts are trimming exposure to French shares, especially cyclical sectors like construction and retail, and shifting into safer plays less tied to domestic politics. The CAC 40 index has already lagged behind its European peers, and traders expect more volatility every time another government collapses.
The euro itself often becomes a punching bag during French gridlock, weakening as investors question the eurozone’s cohesion. Options traders, reading the political tea leaves, are bracing for sharp swings in French assets.
Winners in the Wreckage
Ironically, the very parties blocking government after government are reaping the political rewards. Every failed premiership strengthens the narrative that Macron’s centrist model has run its course. Le Pen, in particular, is positioning herself as the only real alternative if France goes back to the polls.
At the EU level, the fallout is equally clear. A distracted France can’t set the agenda on industrial policy, defense, or fiscal rules. That leaves Germany and the European Commission with more room to maneuver. Other capitals have already started recalibrating their alliances.
What Comes Next?
Analysts see three possible paths forward. The likeliest option is a technocratic caretaker government—someone competent, but politically harmless. That would calm markets in the short run, but it wouldn’t fix the underlying paralysis. Expect small rallies, followed by new mini-crises.
A second option is snap elections. If bond spreads widen further and ratings agencies start rattling sabers, Macron may roll the dice. It’s risky—Le Pen could surge—but at least elections would deliver clarity. Markets might wobble before the vote, then breathe a sigh of relief if any stable coalition emerges.
The least likely outcome is a genuine cross-party pact. If that miracle happened, investors who bet on prolonged chaos would scramble to unwind their positions, triggering a sharp rally in French assets. A few traders keep small bets on this scenario, just in case.
The Signals to Watch
For those keeping score, a few indicators matter most. Bond auction demand tells you whether investors are still comfortable funding French debt. Widening spreads against German bunds raise the odds of snap elections. Coordinated no-confidence votes from both left and right would show they’re gunning for elections rather than negotiations. And if Macron shifts from “continuity” to “coalition-building,” it would mark a sea change in strategy.
A Sobering Reality
Lecornu’s 26 days weren’t just about him. They measured how long executive authority now lasts in France. They measured the patience of investors with endless reshuffles. And they measured how quickly the entire system breaks down without the presidential majority it depends on.
Until France shows it can pass a budget without burning through prime ministers like kindling, investors will remain cautious. For now, many fund managers see French assets as weak links in European portfolios—underweighting them while leaning into safer, more predictable bets in Germany and elsewhere.
Disclaimer: This article reflects current political and market conditions but isn’t investment advice. Political outcomes remain highly uncertain. Always consult a qualified financial adviser before making financial decisions tied to geopolitical risks.