Banks received 5100 billions euros of EU approved aid, but show no gratitude. They won’t lend money ahead of the European election, although the risk of default is small.
The National Rally was the first to complain about having a hard time to secure the loan it needed from a bank to finance its campaign for the European elections. Coming from the extreme-right party of Marine Le Pen, the news was not much to worry about: the controversial party has always been out of favor with French banks. NR even turned to Russian banks in the past.
But then came the news in February that François-Xavier Bellamy, the leader of The Republicans (Les Républicains, LR), was struggling to find money too. The right-wing LR is not any party. It has been one of the most prominent forces in the French political landscape for decades, and although on the decline over the past few years, it is still the second political force at the French Assembly.
Loan conditions are more drastic than ever
Since LR rang the alarm, there have been multiple reports in the press about the loan conditions being more drastic than ever. Almost all parties seem to have difficulties in securing the money they need to finance their electoral meetings or to print its programmatic brochures. The wealthy presidential party LREM is one exception though. As the most powerful party in the National Assembly, it gets a yearly public allowance of 22,5 millions euros and won’t even need to knock on the banks’ doors.
Not able to take part in the ballot
But for some, the situation is so dire that, at the end, they may not even be able to take part in the ballot. Take Benoit Hamon, the leader of Generation S, an offshoot of the Socialist Party. He recently said that he was still missing 600 000 euros to go ahead with his campaign after being rebuffed by a bank.
To overcome the financing problem his party was also facing, Jean-Luc Mélenchon, the eurosceptic leader of the left-wing part La France insoumise, successfully raised 1,5 millions on a dedicated digital platform. The National Rally has recently launched its own «patriotic borrowing», offering a 5 % interest rate to lenders.
The good thing with having to deal with stingy banks is that it forces political parties to remember the value of money. It might even encourage them to be more precautious with their expenses than they would otherwise, if money was pouring in.
The financial sector has received more state aid than any other sector
But still, it leaves a question unanswered. After the 2008 crisis broke out, massive bailout plans have been approved to rescue ailing banks in European countries. «Between 2008 and 2017, the EU approved aid to the financial sector for an overall amount of €1 459 billion of capital-like aid, and additional €3 659 billion of liquidity aid. (…) The financial services sector has received far more state aid than any other sector of the economy», recently noted the European Court of Auditors, the guardian of the EU finances, as the institution calls itself.
Some sense of civic duty
Given the fact that the big chunk of capital-like aids was taxpayer money, wouldn’t you expect in return a small but responsible gesture on behalf of the banks when it comes to financing democracy? Especially when the risk of default is almost non-existent? In the case of the coming European elections, any participating party reaching a 3% threshold of the votes will get a public refund of its electoral expenses. In addition, nobody has ever heard of a French bank getting into troubles after a political party defaulted on its loan. Come on banks, show some sense of civic duty !