THE CAMOUFLET TAKEN BY EMMANUEL MACRON FACING JOE BIDEN'S INFLATION REDUCTION ACT

Presented as a celebration of the "deep" relationship between two allies, the state visit, explains Chris Coons, an influential senator close to Joe Biden, of Emmanuel Macron in the United States will not produce a miracle for European industrialists, penalized by a US climate law. Focused mainly on climate and social spending, the plan, dubbed the “Inflation Reduction Act” (IRA), provides for more than $430 billion in investment, including $370 billion to reduce greenhouse gas emissions by 40%. by 2030, the largest effort ever made by the United States in this area.

On the first day of a state visit celebrating Franco-American friendship, the French president nevertheless called for "trying together to live up to what history has sealed between us, an alliance stronger than everything", considering that his second state visit to the United States in four years "also showed the strength, the link between the United States and France".

The IRA or "the United States looks first to the United States"

But he again warned his ally: "the risk is that, faced with the challenges of the time, the United States will first look at the United States, that's normal (...) and then look at the rivalry with China, and, in a way, that Europe and France become a sort of adjustment variable” between the two leading world powers.

In a speech to the French community at the French Embassy in Washington, French President Emmanuel Macron warned the United States on Wednesday that their $430 billion investment and subsidy program to help their businesses and fight against inflation risked "fragmenting the West".

He also warned against the "risk" that "Europe and France become a kind of adjustment variable" of the rivalry between the United States and China, the two leading world powers.

The French president told his compatriots at the embassy that he "said with great frankness, friendship (to the American elected officials) (...) that what has happened in recent months is a challenge for us because 'we are starting to shift our focus on energy issues and the cost of the war (in Ukraine) is not the same in Europe and the United States'. "But above all, the choices made, whose objectives I share, in particular the Inflation Reduction Act (IRA, a program of environmental and social reforms and investments for American companies) are choices that will fragment the West" , lamented the French president.

For Emmanuel Macron, the IRA “creates such differences between the United States of America and Europe that those who work in many companies will just say to themselves + we are no longer making investments on the other side of the Atlantic Ocean. »

During this lunch with American parliamentarians, he denounced the “super aggressive” measures taken by Democratic President Joe Biden to boost American industry, pleading for better economic coordination on both sides of the Atlantic.

Yet the hope of French President Emmanuel Macron to obtain exemptions for European manufacturers, penalized by the "Inflation Reduction Act", Joe Biden's great climate law which gives preference to American car manufacturers, has been radically showered. by Joe Biden himself. This is THE current point of tension between the two countries, and the subject that came up the most during this conference: the American industrial program, the “Inflation Reduction Act”, deemed too protectionist by Paris.

“The United States will never apologize for the plan we are going to put in place”

There is no development in sight for the US aid package even though US and French Presidents Joe Biden and Emmanuel Macron sought on Thursday to play down trade tensions between the European Union and the United States by saying want to "synchronize" their approaches in terms of green industry and avoid competition for jobs.

However, there is little chance that Washington will alter the Inflation Reduction Act, this 430 billion dollar investment program launched to help its American companies.

“We have the same objective: to invest massively in clean energies. Our teams will continue to talk to each other, to coordinate us”, tried to reassure Joe Biden. While being very clear: “The United States will never apologize for the plan that we are going to put in place”, did he -he adds,

As part of the Inflation Reduction Act, the largest clean energy transition investment in U.S. history was passed and with full force by the Biden administration A great victory and achievement for Biden therefore on which he will be judged in the next presidential election. Wanting to revitalize his industry and reassure a middle class shaken by globalization, while standing up to Beijing, the American Democratic President has voted this gigantic investment program, the IRA which worries Europeans.

The text rightly panics the European Union, which fears a massive industrial exodus across the Atlantic. And for good reason, the economic fabric of the Old Continent, which is already suffering from the gas crisis, risks suffering a little more, in the absence of equivalent subsidies.

“For me, the right policy in this matter is to seek European consensus first and then talk to the Americans from a common front. It is obvious that France does not have sufficient weight to influence American decisions. The French economy represents 2% of global GDP while the United States is around 20%. It's as if we were asking the question of whether Belgium (0.5% of world GDP) could influence the decisions of France. Very generally, in the national debate, we are particularly interested in the position of Germany and possibly Italy.

I rarely see the Belgian positions debated in France. “You have to be aware that seen from Washington, our country is a secondary player on the European scene. The Germans dominate. And on the global aspect, the French state is not at the same level as China with the Americans. So the right level to fight American protectionism is to bring this subject to the European level. “, concludes Gilles Babinet co-president of the National Digital Council, questioned by a colleague from Atlantico.

"Once again, we are not in a partnership of equals. The French state must agree to pursue a policy of middle power.", he concedes.