Source: CNBC

“A week is a long time in politics”

Former British Prime Minister Harold Wilson

It’s less then two weeks before the presidential election and the polls show that the centrist candidate has a commanding lead over the populist challenger. The consensus of the political experts is overwhelming. The race is over.

No, I am not referring to the current French presidential elections but the US presidential elections held last year. As an example, this Telegraph article dated 27 October, headlined with the Democratic candidate Hilary Clinton enjoying a massive 14 point lead and went on to describe the virtually inevitable political fallout of her victory on Election Day.

Of course, just because the experts have been wrong before doesn’t mean they are wrong this time.

Indeed, the 1^st round of the French elections was striking for the lack of surprises. No hidden Marine Le Pen (“Le Pen“) vote. No unexpected surge of support for the conservative Francois Fillon (“Fillon“). The Emmanuel Macron (“Macron“) vote remained firm despite the risk of undecided voters floating away to other candidates.

Le Pen has had a lacklustre campaign and her polling has dropped from a peak of 27% to 22% in the final count as voters moved away to the hard left Eurosceptic challenger Melenchon. Yet, the relatively poor performance of the populist hard right is in no way indicative of a broader rejection of anti-establishment populism by the French electorate.

As Ambrose Evans Pritchard notes in the Telegraph, 48pc of the French population “…voted for movements – from the hard-Left to the hard-Right – that fundamentally reject the EU as currently structured, with the sovereignty candidate Nicolas Dupont-Aignan winning 1.7m votes on a pure anti-EU ticket”. In other words, approximately half the French population rejected the pro-European establishment personified by the politics of Macron.

Source: Telegraph

From a historical perspective, Le Pen performed very well, and her entry into the second round is an historical success for the nationalist hard right. As the above map shows, Le Pen came first across broad swathes of France, with certain regions of the north-eastern Rust Belt polling above 30%. This is a massive step forward from the elections held in 2012, let alone the electoral drubbing her father received in 2002.

Taking this into consideration the fact remains that the overwhelming consensus is that Macron will comfortably defeat Le Pen on 7 May 2017.  This is backed up by the polling evidence which suggests that Le Pen will struggle to get more then 40% of the vote.

It is interesting to note that according to Opinionway, the issue of security and terrorism is a top priority for approximately 40% of the electorate. The same proportion of the electorate plan to vote for the National Front in the second round. The bad news for Le Pen is that whilst there is likely to be a correlation between the issue of security and voting support for the populist hard right, the issue of terrorism is not the top concern for the majority of the French electorate.

As noted in a previous post, the over 65 voters who preferred the Republican candidate Fillon will be the main kingmakers in this election. These “silver voters” are socially conservative, support membership of the Euro and the European Union and wish to see a muscular approach to the threat posed by jihadi terrorism and the rising tide of Islamic fundamentalism. The silver vote remained loyal to Fillon despite the corruption scandals and are now potentially in play for both candidates.

Le Pen and her inner circle have clearly been making steps to address the two biggest challenges to converting these voters, the first being the lingering toxicity of the National Front brand and the second the fear provoked by her economic plans to leave the eurozone. For pensioners relying on their savings, exiting the euro would likely lead to a significant depreciation of the value of their assets, potentially crippling the finances of a retired voter.

The decision to temporarily step down as leader of the National Front and to appoint the mainstream conservative Nicolas Dupont-Aignan as her proposed Prime Minister are further steps in distancing herself from the National Front. They are principally designed to reassure conservative voters who are open to voting for Le Pen in the second round.

It is potentially more significant that media reports are suggesting that a potential Le Pen/Dupont-Aignan government would not proceed with plans to call a referendum on leaving the Euro and the European Union. If true the main obstacle for the Catholic Right electoral block to switch to Le Pen has been removed. It has been calculated that Le Pen lost 4% of the electorate in the 2012 presidential elections due to its anti-euro stance.

The presidential debate due on 3^rd May will be critical to Le Pen’s chances. If she performs well, reassures conservative voters fearful of her economic agenda and provokes Macron into a series of blunders, you may see a surge of support for the hard right candidate in the polls.

Many voters complain that they don’t know what Macron stands for and if, under pressure, he comes out with statements that shock both the Left and Right, it will drive further voters to either abstain or turn to Le Pen. Macron has stated publicly his support for Angela Merkel’s controversial decision to open the borders to over a million Muslim migrants in 2015. The centrist candidate has also argued that France will be unable to stop the further mass migration of refugees into Europe. A population where a majority (60%) would back a total ban on migration from majority Muslim countries would likely be appalled by such comments in a nationally televised debate.

The Republican Front is fracturing, with the hard left populist Melenchon refusing to endorse Macron and the conservative politician Nicolas Dupont-Aignan joining forces with Le Pen. It is true that the established parties have endorsed Macron but it remains an open question whether the Left will come out in force for an ex-Rothschild banker and supporter of globalisation.

There is a narrow path to victory for Le Pen which will rely on mass abstention from the Left, the conversion of the Catholic Right and a strong turnout by her core blue-collar vote on 7 May. A prerequisite of such a scenario will be a breakthrough in the 40% polling ceiling in the coming week. Without that surge in support, as the successful forecaster Nadeem Walayat notes, it is highly unlikely that Le Pen can win the election.

Should Le Pen see a surge in support in the coming week and hit the mid-40’s, the hard right leader will be within the margin of error of victory, as noted by the French political scientist Serge Galam.

Galam has argued in a mathematical paper that should Le Pen voters turn out in greater numbers then the Macron vote, Le Pen can win even though she trails in the opinion polls. As an example, “if Le Pen is projected to lose by 45 to 55 percent in the runoff, she could win if turnout for her is 85 percent versus 70 percent for her rival, for an overall turnout of 77 percent.”

Overall, my current forecast, as at the current state of play, is that Macron will defeat Le Pen in the second round of the French presidential election.

I will be providing a final forecasting update on the likely winner of the presidential election in a week’s time.

British general election – probabilistic forecast update

I recently reviewed the British general election which you can read here.

My probabilistic forecast is that the Conservative Party has an 85% chance of winning with an enlarged majority in the House of Commons.