Mélenchon's debt cancellation plan ignites French presidential campaign

Mélenchon's debt plan sparks fierce backlash

Jean-Luc Mélenchon, the hard-left candidate for France's 2027 presidential election, has proposed that the European Central Bank (ECB) waive interest payments on a large portion of France's public debt, a plan he has described as setting fire to the country's debt burden. The proposal, delivered to a crowd of 10,000 at a lakeside conference center in Châteauneuf-sur-Isère on August 23, has ignited a storm of criticism from political rivals and economists.

Mélenchon's plan would target debt held by the Eurosystem, which holds around one-sixth of French public debt, totaling some €600 billion. He has framed the proposal as a necessary response to what he calls tax giveaways under President Emmanuel Macron, which he says are equivalent to the country's entire deficit. His lieutenant, Manuel Bompard, has described the approach as an act of "disobedience" against EU rules, echoing Mélenchon's broader pledge to defy European regulations on trade and economic policy if elected.

The proposal has drawn immediate condemnation. Prime Minister Sébastien Lecornu called it "a scam in its purest form," while Jordan Bardella, president of the far-right National Rally, dismissed it as "nonsense." Former European Commissioner Thierry Breton published an op-ed opposing the plan. Former IMF Chief Economist Olivier Blanchard criticized the proposal as "irresponsible." German economist Carsten Brzeski noted that France has breached EU deficit rules in almost every year over the past two decades, adding that the country has shown little appetite for structural reforms.

Support for the proposal has come from an unexpected quarter: banker Matthieu Pigasse, who endorsed it during a video conference. In the European Parliament, Aurore Lalucq, an ally of center-left candidate Raphaël Glucksmann, acknowledged that the debt issue "is here to stay" but called for a more nuanced approach. Antoine Léaument, a France Unbowed MP, defended the plan, saying, "Debt is the excuse used to roll back social rights." The ECB's role is constrained by EU treaties that forbid it from bailing out eurozone countries, although it has intervened in past crises.

First debate exposes deep divisions

The debt plan was a central issue in the first televised debate of the campaign, held on August 27 at the Roland-Garros stadium in Paris. The debate, organized by the employers' federation MEDEF, ran more than an hour over its scheduled time as seven candidates—Mélenchon, Le Pen, Philippe, Glucksmann, Gabriel Attal, Bruno Retailleau, and Marine Tondelier—clashed on the economy, public debt, and France's role in Europe.

Marine Le Pen, the far-right front-runner, announced a €125 billion cost-cutting plan, including cuts to immigration spending, reductions in state agencies, and a €5 billion reduction in France's EU contributions. She also confirmed her intention to lower the minimum retirement age to 62, reversing Macron's 2023 reform, and proposed a constitutional amendment limiting budget deficits, similar to Germany's debt brake.

Mélenchon urged business leaders to raise wages to prevent France from "falling into recession," while Philippe accused him of seeking to "burn" France's debt and taking measures that would "result in France being shut out of the banking system." Glucksmann attacked Philippe and Attal over their positions on public debt, arguing that France had failed to seize the geopolitical moment for a more strategically autonomous Europe.

Divisions over Europe were sharp. Philippe criticized European Commission President Ursula von der Leyen's decision to sign a trade deal with S. President Donald Trump, calling it a "pitiful treaty," and endorsed an EU-wide capital markets union. Mélenchon described the EU as a vehicle for "unbridled German-style capitalism" and said France would "disobey" EU rules on trade and economic policy. Le Pen called for scrapping thousands of European rules, while Glucksmann rejected the idea that France's main industrial problem was competition from neighboring EU countries, saying businesses were instead concerned about China.

No clear winner emerged from the debate, which the format made difficult to achieve. A poll by Ifop-Fiducial projected that Mélenchon could advance to the second round against Le Pen, while a separate Toluna Harris Interactive poll put Mélenchon at 17 percent, neck and neck with Philippe.

Left-wing alliance speculation grows

Mélenchon's strong campaign start has fueled speculation that the Greens might back him instead of running their own candidate. Marine Tondelier, the Greens' presidential candidate and France's first pregnant presidential candidate, has struggled to break through, polling in the low single digits. At a press conference, Tondelier said, "Neither Jean-Luc Mélenchon nor Raphaël Glucksmann are the worst enemies of ecology in France," and stressed that the debate on the left was now focusing on who is the biggest environmentalist.

Key Greens figures have publicly discussed backing Mélenchon. The Greens' top lawmaker, Cyrielle Châtelain, attended France Unbowed's summer event and said there was common ground with Mélenchon. Monique Barbut, a former head of WWF France and now ecology minister in the center-right government, said Mélenchon incorporates climate issues most fully into his proposals. France Unbowed lawmaker Paul Vannier said his party was "ready to discuss" policy changes and offer cabinet roles to the Greens. Green campaign director Léa Balage El-Mariky said those who say left factions cannot be reconciled are lying.

However, significant differences remain. Mélenchon wants to pull France out of NATO, opposes Ukraine joining the EU, and has called for "bringing Russia back into the European family," while the Greens support Kyiv and advocate EU federalism. The Greens also view Mélenchon as too friendly toward China. Tondelier's candidacy, despite her low poll numbers, could still influence the outcome by potentially pushing Mélenchon into second place if she does not advance.

Far right warns of 'civil disobedience'

In a sign of the campaign's increasingly confrontational tone, the far right has accused the left of seeking to "undermine civil peace" should Le Pen win. At an agricultural fair in Chalons-en-Champagne, Bardella said he was concerned by calls from the left for "civil disobedience" if the National Rally comes to power. He called such calls "an admission of weakness from the left, which hates democracy and is calling into question the fundamental principles of the rule of law and the electoral process."

Mathilde Panot, parliamentary leader of France Unbowed, and Tondelier have both said they would support "civil disobedience" in the event of an RN victory. Bardella said he was concerned about Mélenchon's "true intentions."

Business leaders have also expressed unease. A survey by MEDEF found that 82% of French business leaders are concerned about the impact of the next president's economic policies. Patrick Pouyanne, CEO of TotalEnergies, said that a runoff between Le Pen and Mélenchon would "pose a risk," citing proposals that "do not seem responsible," including on public finances.

Election outlook

The first debate took place eight months before the election, with Macron unable to run again after serving two consecutive terms. A July court ruling allowed Le Pen to run despite her embezzlement conviction, though a final ruling from the Court of Cassation on misuse of EU funds could still rule her out. Retailleau, of the Republicans, has said he would not drop out of the race, despite some supporters backing the far right if he withdrew.

With the race still open, Mélenchon's debt plan has become a defining issue, underscoring his readiness for what promises to be a contentious campaign.