Upon taking office, Macron will be faced with the same issues that so bedeviled Hollande:
1. What to do with the EU? Hollande could have been an active supporter of German austerity, or he could have taken up the cause of the Greeks and Italians and demanded more pro-growth policies. He did neither consistently. Today, the EU economies are growing (albeit slowly), and the euro is not obviously overvalued in France, so I would anticipate that we would see some agreement on slightly higher deficits after the German election, but nothing more than that. New growth is going to depend primarily on the ever-popular “structural reforms.”
2. Whither the welfare state? Hollande took office as a Socialist determined to exact a pound of flesh from the finance industry, but he left it as a sort of moderate right-wing reformer with minimal public support. Macron’s platform included business-friendly changes to labor laws and the welfare state. Recent history suggests that the government will introduce very limited reforms, the reforms will meet ferocious resistance, and whatever is ultimately approved will raise suspicions about what will happen next without actually doing much good. Can Macron break out of this cycle? It will depend on the outcome of the parliamentary election and his political skills, which will be sorely tested.