PARIS — Jean-Luc Mélenchon pointed to Spanish Prime Minister Pedro Sánchez as proof that greater public spending can boost the French economy and repair its strained public finances. In a press conference focused on the budget on Wednesday, the 75-year-old radical doubled down on his calls for a positive demand shock driven by billions in new state spending. He also reiterated his proposal to write off billions of euros in French debt held by the European Central Bank, which has drawn strong criticism, including from ECB President Christine Lagarde.
Polls show Mélenchon neck and neck with center-right candidate Édouard Philippe in the race to qualify for a second-round runoff against Marine Le Pen, the far-right frontrunner who presented her own budget plans last week. Under Socialist Prime Minister Pedro Sánchez, Spain has significantly reduced its budget deficit, while public debt is projected to fall below 100% of GDP in 2026. His government has raised the minimum wage and supported investment in green energy, alongside other sectors.
Although inflation is a major concern and economic growth is expected to moderate in 2027, Spain remains one of Europe’s fastest-growing major economies, with the IMF on Tuesday forecasting 2.5% growth in 2026. Spanish deficit fell significantly under Sánchez, and became one of the Eurozone’s fastest-growing economies after the pandemic. Spain’s debt-to-GDP ratio dropped below 100% — while France’s raised to 119% — as the government invested heavily in sectors such as green energy and raised the minimum wage.
But the cost of living remains a major concern in the country, particularly housing — one of the issues that led Sánchez to call a snap election earlier this month. Mélenchon wants to boost growth by increasing purchasing power through higher salaries — including a higher minimum wage, a 10% raise for public-sector workers and a nationwide round of collective bargaining — as well as higher benefits for welfare recipients and a monthly payment of €1,337 for every French student intended to lift them above the poverty line. Together, these measures form what his campaign calls an €82 billion “emergency spending” package.
Eric Coquerel, a Mélenchon ally who heads the French National Assembly’s powerful finance committee, argued in the same press conference that the new spending would drive GDP growth and increase tax revenue. He also outlined ways to fund it, including a 2% wealth tax on households worth more than €100 million, popularized by French economist Gabriel Zucman, and higher taxes on large inheritances, which would be capped at €12 million under a Mélenchon presidency. Fiscally conservative think tanks such as Institut Montaigne have argued that Mélenchon significantly underestimated the cost of his proposed spending and the potential tax revenue in previous campaigns.
Critics also warn of capital flight if he is elected president, as occurred after his political mentor François Mitterrand was elected in 1981 on a platform of mass nationalizations. Mélenchon blamed the current state of France’s finances on President Emmanuel Macron’s decision to cut several taxes early in his presidency, a move Macron said was intended to attract more investment. Prime Minister Sébastien Lecornu’s government has presented a budget with €43 billion in spending cuts, aiming to reduce France’s deficit to 5% of GDP without raising taxes.
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