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Le Pen, Macron Progress to Second Round as Establishment Parties Crash

By: Zero Hedge

With more numbers coming from the French Interior Ministry, as of 11:31 p.m. local time Macron’s lead is growing to 23.61% as more city votes are counted, vs Le Pen 22.20%, with 41 Million votes counted, or 85.4% of the total. The gap is likely to expand as the final votes are tallied.

Earlier, in a race that was too close to call up to the last minute, Macron, a pro-EU ex-banker and former economy minister who founded his own party only a year ago, was projected to get 23.7 percent of the first-round vote by the pollster Ifop-Fiducial and 24 percent by Harris. Le Pen, leader of the National Front, was given 21.7 percent by Ifop and 22 percent by Harris. Other pollsters projected broadly similar results.

Defeated Socialist candidate Benoit Hamon, Socialist Prime Minister Bernard Cazeneuve and defeated right-wing candidate Francois Fillon all urged voters to rally behind Macron in the second round. A new Harris survey saw Macron winning the runoff by 64 percent to 36, and an Ipsos/Sopra Steria poll gave a similar result.

According to Bloomberg, the key takeaways are as follows:

  • Winners: Independent centrist Emmanuel Macron, in his first run for office, and the National Front’s Marine Le Pen, who succeeded in detoxifying her anti-immigrant party enough to make the second round (as her father did in 2002). The runoff campaign over the next two weeks will feature a stark contrast between Macron’s pro-EU, pro-globalization world view, and Le Pen’s call to close borders and quit the euro currency. Polls show Macron winning handily.
  • Losers: Francois Fillon and Benoit Hamon of the Republicans and the Socialists, respectively, the parties that have dominated French politics for decades. Fillon, the man to beat as recently as January, was undone by a scandal involving an alleged no-show government job for his wife. Hamon was a surprise winner of the Socialist primary after President Francois Hollande decided not to run again, but he never gained traction. At last count he was a distant fifth. Leftist firebrand Jean-Luc Melenchon also lost momentum in the campaign’s closing days.
  • Euro soared against both the dollar – rising to the euro’s highest level since Nov. 10, the day after the results of the U.S. presidential election. – and especially the yen, as investors priced in a win for Macron and the receding threat of a far-left or far-right candidate winning the presidency.

But perhaps the most notable outcome, as Reuters adds, is today’s huge defeat for the French establishment – the two center-right and center-left groupings that have dominated French politics for 60 years, even as it reduces the prospect of an anti-establishment shock on the scale of Britain’s vote last June to quit the European Union and the election of Donald Trump as U.S. president.

SocGen’s Kit Juckes reiterates the most notable takeaways from the result:

There is a huge amount to be said in the weeks and months to come about the historic failure of the two establishment parties in France to make it through to the second round of the Presidential election, and indeed about what that means for upcoming Parliamentary elections too, but for now, the biggest takeaway from the first round result (and while the final count isn’t know yet, it results in a vote-off between Emmanuel Macron and Marine Le Pen) is that pollsters did a far better job of predicting the outcome in France than they did for the EU referendum in the UK or the US Presidential election. And it’ s worth noting that the first poll released after the first round vote ended, from iPsos, sees a 62-38 outcome in favour of M Macron in the second round. That’s what the FX market is going to trade off in the days ahead and indeed is already doing. The Euro is on its way (up) and risk assets and currencies are heaving a sigh of relief

* * *

In his victory speech, Macron told supporters of his fledgling En Marche! (Onwards!) movement: “In one year, we have changed the face of French politics.” Conceding defeat even before figures from the count came in, rival conservative and Socialist candidates urged their supporters now to put their energies into backing Macron and stopping any chance of a second-round victory by Le Pen, whose anti-immigration and anti-Europe policies they said spelled disaster for France.

Seconds after the first projections came through, Macron supporters gathered at a Paris conference center burst into the national anthem, the Marseillaise. Many were under 25, reflecting some of the appeal of a man aiming to become France’s youngest head of state since Napoleon. With an eye to Le Pen’s avowedly France-first policies, Macron told the crowd: “I want to be the president of patriots in the face of a threat from nationalists.”

Meanwhile, Le Pen, who is bidding to make history as France’s first female president, follows in the footsteps of her father, who founded the National Front and reached the second round of the presidential election in 2002. Jean-Marie Le Pen was ultimately crushed when voters from right and left rallied around the conservative Jacques Chirac in order to keep out a party whose far-right, anti-immigrant views they considered unpalatably xenophobic.

His daughter has done much to soften her party’s image, and found widespread support among young voters by pitching herself as an anti-establishment defender of French workers and French interests against global corporations and an economically constricting EU. “The great issue in this election is the rampant globalization that is putting our civilization at risk,” she declared in her first word after results came through.

She went on to launch an attack on the policies of Macron, whom she again described as “the money king” in a disparaging swipe at his investment banker background.

As Reuters adds, today’s result will mean a face-off between politicians with radically contrasting economic visions for a country whose economy lags that of its neighbors and where a quarter of young people are unemployed.

Macron’s gradual deregulation measures are likely to be welcomed by global financial markets, as are cuts in state expenditure and the civil service. Le Pen wants to print money to finance expanded welfare payments and tax cuts, ditch the euro currency and possibly pull out of the EU. If he wins, Macron’s biggest challenges will lie ahead, as he first tries to secure a working parliamentary majority for his young party in June, and then seeks broad popular support for labor reforms that are sure to meet resistance.

 

“Markets will be reassured that the dreaded Le Pen versus Mélenchon run-off has been avoided,” said Diego Iscaro, an economist from IHS Markit.

 

“As a result, we expect some recovery in French bond prices, while the euro is also likely to benefit,” he said. “However, a lot can happen in two weeks and French assets are likely under some pressure until the second round is out of the way.”

But the biggest, still unanswered question that remains after today, is whether the anti-establishment wave that started with Brexit and Trump, was effectively put to rest with today’s result.

Timothy Ash, an economist at Bluebay asset management, said Trump’s victory last November marked a turning point for electorates playing the protest card.

“Despite all the hype about the rise of populism, 60 percent of voters went for mainstream candidates … In an uncertain world, they rather go for what they know best and want to take fewer risks,” he said.

It remains to be seen if other European countries agree with this assessment.

* * *

Update 4:42pm: As expected, with the city vote starting to come in, Macron has just taken the lead according to Interior Ministry data:

  • MACRON SURPASSES LE PEN IN FRENCH INTERIOR MIN PRELIM. DATA
  • MACRON AT 23.12%, LE PEN AT 23.06%: FRENCH INTERIOR MINISTRY
  • INTERIOR MIN DATA AT 10:35PM BASED ON 33.42M VOTERS (69.47%)

Germany’s chancellor Angela Merkel is delighted, saying that it is “good that Macron was successful.”

* * *

Update 4:10pm: Le Pen’s lead in the official votes is slipping, and according to Interior Ministry data, now been updated with 50.02% of the total eligible voters, Le Pen’s lead continues to narrow now at 1.71% points from 2.19% in the last update. This is expected given that urban areas are the last to report results, and are less likely to vote for the far-right candidate.

* * *

Update: 3:49pm ET: With 50% of Votes Counted, France’s Interior Ministry reports LE PEN AT 24.13%, MACRON AT 22.42%

The latest Interior Ministry preliminary estimates put Marine Le Pen at 24.3%, or roughly 7.5 percentage points better than the 2002 performance that got her father, Jean-Marie Le Pen, into that year’s presidential run-off. This would also be the National Front’s best first-round showing to date.

Meanwhile Melenchon has refused to endorse anyone for the second round for now. According to Citi, Melenchon has more or less conceded and adds that “far-left communist-backed candidate Jean-Luc Melenchon says he will await full results, and says that he trusts his supporters to ‘know what to do in the second round’. He hasn’t quite conceded, in black and white. He refuses to endorse anyone else ‘for now’. He expressed anger that two ‘establishment’ candidates are present in the second round (he considers Le Pen to be a part of the political establishment).”
He remains in fourth place in all polls.

Additionally, France’s largest union, The CFDT, has called up in ts members to vote for Macron in the second round “to beat the National Front.”

* * *

Update 3:26 pm ET: Here is where the latest results stand 90 minutes after the results were initially released: the latest figures from Kantar figures expected Macron to win first round with 23%, Le Pen coming second at 22%. while the latest numbers from the Interior Ministry show Le Pen at 25.1%, Macron at 21.3% however the results from the big cities are expected to come in later and boost Macron. Le Pen has called the result `historic’, and has predicted she will be in the run-off. The euro has rallied following the early results, gaining as much as 1.9%, the highest since November, although 1.09 is proving to be a modest resistance level for now.

* * *

Update 3:22 pm ET:  In a statement released on Facebook, Jean-Luc Melenchon has reefuseds to concede defeat and asks for his supporters and the press to ‘show restraint’ and wait for more votes to be counted. He is currently a close fourth in all polls. Fillon, as reported earlier, wasted no time in conceding. It remains to be seen whether or not the order will change, but the polls have fluctuated in the past. He says he will speak to his supporters at 21:00 BST (his supporters reportedly ‘still believe’ according to French tv station BFM TV).

Headlines via Bloomberg:

  • MELENCHON SAYS DOESN’T VALIDATE CURRENT POLLS ESTIMATES
  • MELENCHON ON FACEBOOK CALLS FOR ‘RESTRAINT’ ON VOTE ESTIMATES

* * *

Update 3:10pm ET: Marine Le Pen is speaking, and acknowledges she will be in the second round of the election, and that she is honored her voters have sent her into the second round.

She says he result in the first round is “historic” and that her “result is an act of French pride.” She also adds that “she’s ready to take on the defense of the French republic” and that the French need to seize this historic opportunity to fight “savage globalization.”

France’s Le Pen hails ‘historic result’ after reaching runoff

* * *

Update: 2:58pm ET:  Another polling agency has released projections putting Macron in the lead (barely):

  • *MACRON TO WIN FIRST ROUND OF FRENCH VOTE WITH 23% VOTES: KANTAR
  • *LE PEN AT 22% OF FRENCH VOTE IN 1ST ROUND: KANTAR NEW ESTIMATE

* * *

Update 2:43pm ET: Francois Fillon concedes, saying “this defeat is mine, and mine alone”, although as Bloomberg notes, “Fillon is still bitter, though, about the investigative journalism and resulting criminal investigation, that torpedoed his campaign.” Oh, and like all of the French political establishment, he endorses Emmanuel Macron.

BREAKING: Defeated French conservative Fillon calls on supporters to support centrist Macron against the far-right leader Le Pen.

* * *

Update: 2:34pm ET: Interior ministry data shows Le Pen pulling away for the time being and now has over 25% of the early vote, based on 7.8 million votes.

  • LE PEN AT 25.2%, MACRON AT 21.1%: INTERIOR MINISTRY AT 8:21PM
  • FRENCH INTERIOR MINISTRY 8:21PM DATA BASED ON 7.8M VOTERS

Le Pen picking up in the latest French ministry projections and leading Macron

A note from Bloomberg in its live elections blog on the discrepancy:

“An important note that 7.8 million votes have been counted as of 8:21 p.m. Paris time. The total size of the French electorate is about 47 million (the abstention rate is about 20%). The Interior Ministry numbers are based on the actual count, while the numbers from pollsters are based on samples of counts from polling stations across the country — the pollster numbers may be more accurate. While both the Interior Ministry numbers and the pollsters’ figures show Macron and Le Pen making it to the second round, pollsters show Macron ahead of Le Pen.”

* * *

The first results are in and according to IPSOS exit polls, Macron leads with 23.7% of the vote, Le Pen is second with 21.7%, with Fillon and Mellenchon tied for third at 19.5%. However, according to official results, from the French interior ministry, Le Pen is leading with 24.3% of the vote, Macron is at 21.4%, while Fillon has 20.3%.

Meanwhile, according to French official data:

  • LE PEN GETS 24.2% IN FRENCH INTERIOR MINISTRY PRELIMINARY COUNT
  • MACRON GETS 21.4% IN FRENCH INTERIOR MINISTRY PRELIMINARY

And an update:

  • LE PEN AT 24.9%, MACRON AT 21.1%: INTERIOR MINISTRY AT 8:13PM
  • FILLON AT 20%, MELENCHON AT 18%%: INTERIOR MINISTRY AT 8:13PM
  • FRENCH INTERIOR MINISTRY 8:13PM DATA BASED ON 5.25M VOTERS

Elsewhere, Benoit Hamon, the candidate for the incumbent Parti Socialiste of Francois Hollande, has just conceded defeat after a dismal showing of around 6%. He spoke to supporters and the press in a packed out hall and made an instantaneous endorsement for Emmanuel Macron.

  • HAMON SAYS ENDORSES MACRON TO BEAT LE PEN IN SECOND ROUND: BBG

* * *

Earlier:

While we urge taking early polls with a big grain of salt, according to a Harris poll, Macron is in the lead with 24.5% of the vote, follow by Melenchon and Le Pen in second place with 20% of the vote.

  •     Macron (EM-*): 24.5%
  •     Melenchon (FI-LEFT): 20%
  •     Le Pen (FN-ENF): 20%
  •     Fillon (LR-EPP): 18%

France, Harris poll:

Macron (EM-*): 24.5%
Melenchon (FI-LEFT): 20%
Le Pen (FN-ENF): 20%
Fillon (LR-EPP): 18%

A separate poll from La Unne shows Macron leading with 26% with Le Pen in second at 23%.

France, La Unne:

Macron (EM-*): 26%
Le Pen (FN-ENF): 23%
Melenchon (FI-LEFT): 21%
Fillon (LR-EPP): 17%

Additionally, Harris estimates that the turnout in the election will be roughly 80%, while Ifop predicts a 77% turnout.

That said, as Reuters cautions, in 2012, some media outlets leaked estimations before the 8 p.m. embargo time. This time, analysts warn any figures on social media before 8 p.m. should be treated with extreme caution as likely based on incomplete surveys that don’t meet the gold standard.

Some have warned that if the race is extremely close, the polling companies won’t be able to call it and we’ll have to wait until the complete count of votes by the Interior Ministry expected Monday morning.

Reuters also adds that a downbeat tone is emerging from Socialist Benoit Hamoin’s election-night base, “where the main concern appears to be whether alternative left-wing candidate Jean-Luc Melenchon will go through.” “We hope the score will be worthy of this very fine campaign. We would hope to qualify but it doesn’t seem to be the case,” adviser Julia Cage tells Reuters correspondent Dominique Vidalon.

Meanwhile, Reuters’ journalists say “Marine Le Pen supporters are in confident mood in the National Front’s northern stronghold of Henin-Beaumont, where hundreds of supporters and journalists are trying to enter a sports hall chosen for tonight’s rally. Civil servant Delphine, 49, dismisses recent polls showing a tight race. “I totally reject the polls, I am confident for this evening and I can’t wait to see the difference between the (results and the) figures which have been hammering us for weeks. For us it’s clear – Marine is in the second round.”

* * *

Readers can following the latest news on the ground courtesy of France 24:

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