July 18, 2024
Elections in France and the United Kingdom were a revolt against the incumbents. Over the past few weeks, discontented constituencies in the United Kingdom and France unleashed their frustrations at the ballot box– unseating incumbents and shifting the power dynamic. But while voters in both nations were united by a dissatisfaction with the status quo, the elections led to highly divergent results. In the United Kingdom, the country shifted center-left, and the next Prime Minister will be bolstered by a parliament with a huge majority for his own party. In France, however, President Macron now finds himself without a majority in Parliament and will need to figure out how to develop a functional coalition government.
In the United Kingdom, an enormous parliamentary majority for Labour points to political stability for five years to come – after what’s been a period of substantial political turmoil. The newly elected Prime Minister Keir Starmer quickly moved into the official residence on Downing Street 10, and previous cabinet members smoothly facilitated the installation of a new cabinet. Capital markets also responded positively to the Labour victory, in contrast to the negative response last year when Liz Truss briefly took the helm.
In France however, politics is in flux: President Macron finds himself without a majority in Parliament and will need to coax a coalition majority into being. Subsequently, he’ll need to work in “cohabitation” with a coalition government – uncomfortable territory for a French leader. Unsurprisingly, capital markets did not view the instability favorably, and it will be instructive to see how effective Macron will be given the high risk of political disfunction.
The electoral system had a big impact on the outcome of the elections in both the United Kingdom and France. In the UK, Labour and the Liberal Democrats withdrew their candidates in those districts where the chances of the other party to win were more realistic. In addition, the far-right Reform Party, Nigel Farrage, diverted a lot of voters who normally would have voted Conservative. This all led to a result where Labour, with just a 2% increase in the popular vote, celebrated a landslide majority in the House of Commons. The strong showing of the three opposition parties Labour, LibDems and Reform, also indicates that the election was a reckoning of the electorate with the Tories who had been in power for 14 years.
In France, a similar kind of tactical electoral engineering took place, and center and leftist parties withdrew their candidates in districts where their polls were weak. While potentially risky, this strategy ultimately resulted in a lower than anticipated number of seats for the radical right led by Marine le Pen, whereas in the nominal popular vote she came out much stronger than before. As it now stands, in France – like in the United Kingdom, Germany, and Spain, social democrat parties are primed to play a central role in government. This is, however, in contrast to other European nations like Hungary, Italy, and the Netherlands, where far-right parties claim that position.
Of note, the election campaigns in both France and the UK were marred by attacks against the candidates that ranged from physical harassment and violence to relentless character attacks and widespread disinformation campaigns on social media.
According to opinion polls, the results of the recent elections reflected discontent about ineffective domestic policies and the failure of political leaders to deliver concrete results instead of political spin and empty promises. Economic woes, including the costs of living, inflation, and high interest rates- as well as the increasing wealth gap between the ultra-rich and general population – were at the forefront of concerns. But constituencies also cared about net immigration of skilled and unskilled workers, students and asylum seekers and the resulting overload of the housing, health, and education systems, and how changes to the national culture could lead to loss of shared national values.
In terms of foreign and defense policies, continuity is expected in both France and the United Kingdom. Both nations are permanent members of the UN Security Council, both have nuclear weapons and the means to deliver them, and both are staunch US allies in NATO. In France, foreign and security policy is the political prerogative of the President – who will remain in office until 2027 – and is for a large part encapsulated by the European Union’s foreign policy. And in the United Kingdom, even when Keir Starmer was part of the opposition party, he pursued an almost bipartisan approach concerning Russia’s attack on Ukraine and the current Gaza crisis.
The new element for Labour will be a reset in relations with the European Union, which should lead to an EU-UK Security pact, less red tape for business when trading across the Channel, and increased mobility. In view of the geopolitical situation regarding Russia and China, a warmer and more productive UK-EU relationship is in the interest of both Europe and the United States. Further, with Hungary as the sole exception, both social-democrat and extreme right dominated governments support Ukraine – indicating a continued united front against Putin, regardless of domestic shifts.
The Arkin Group is a strategic intelligence firm offering investigative research, due diligence, international risk and crisis consulting, and security & preparedness services. We can be contacted at 212-333-0280.
