Prior to the second round of the French presidential election, DiEM25 (the pan-European movement of democrats, mostly of the left, that I helped to found) promised Emmanuel Macron that we would “mobilize fully to help" him defeat Marine Le Pen. This we did—incurring the wrath of many on the left—because maintaining “an equal distance between Macron and Le Pen", we believed, was “inexcusable".

But there was a second part to our promise to Macron: if he “becomes merely another functionary of Europe’s deep establishment", pursuing dead-end, already-failed neo-liberalism, we “will oppose him no less energetically than we are—or should be—opposing Le Pen now."

Relieved that Macron won, and proud of our support for him, we must now fulfil the second part of the promise. No “honeymoon" period: we must oppose Macron immediately. Here’s why.

Macron’s electoral programme made clear his intent to continue with the labour-market policies that he began to introduce as former President François Hollande’s economy minister. Having spoken to him about these policies, I have no doubt that he believes in them strongly. He follows a long tradition of blaming the legal constraints on firing workers for the fall in permanent employment and the emergence of a new division between protected and precarious employees—between insiders, with well-paid, quasi-tenured positions, and outsiders, who work as service providers without benefits and often under zero-hour contracts.

For Macron, a true progressive must not only support reforms that strengthen employers’ right to dismiss and manage workers; equally important are increases in social security for those losing their jobs, training in new skills, and incentives to take up new jobs. The idea is simple: If employers have more control over how long and how much they pay their employees, they will hire more workers under normal contracts. And the improved social safety net will ensure that workers with the right skills will be available.

There is nothing new to this idea. Known by the neologism “flexicurity", it was implemented with some success in Denmark and other Scandinavian countries in the 1990s. But flexicurity is bound to fail in France because it can work only in a macroeconomic environment of investment-led growth. Alas, this is not the environment that the new French president has inherited.

In today’s France, investment in fixed capital, relative to national income, is at its lowest level in decades—and falling. This reinforces deflationary expectations, which, when dismissals become easier, imply a rapid reduction of permanent, full-time positions. Rather than ameliorating the division between insiders and outsiders, Macron’s labour-market legislation would deepen it.

Macron’s greatest difficulty will be the same as Hollande’s: dealing with Germany. The German government—and the Eurogroup, which Germany dominates—never misses a chance to castigate the French for their failure to bring the government’s budget deficit below the agreed 3% of gross domestic product limit.

Macron has pledged to achieve this by dismissing civil servants, cutting local government spending, and increasing indirect taxes, which ultimately hit the poorest. In any economy afflicted by low and falling investment, cutting government spending and raising indirect taxes is bound to weaken aggregate demand, thus confirming the pessimistic expectations that prevent investors from investing and giving the deflationary wheel another spin.

As if this were not enough, Macron has pledged to reduce taxes on wealth or assets that do not generate incomes above a certain threshold. As with flexicurity, there is a logic to this: Taxing assets that do not generate incomes makes little sense from an ethical, political, or economic viewpoint. Even so, to reduce wealth taxes before closing the loopholes that allow the income-rich (who are often also asset-rich) to pay their share of income tax makes little sense. To do so while practicing austerity on the poor is to commit an act of vandalism on an already divided society.

Macron understands the folly in the foundations of the eurozone. And he has promised to convince Germany that Europe must speedily create a proper banking union, common unemployment insurance, a debt-restructuring mechanism for countries like Greece and Portugal, a proper federal treasury, Eurobonds (operating like US Treasuries), and a federal parliament that legitimizes the federal treasury’s authority. So, what will Macron do when Germany says nein?

Hollande, lest we forget, also won the French presidency by promising to challenge Germany on eurozone macroeconomic policy—and then quickly abandoned the fight. If Macron is to succeed, he will need a credible fallback position and a European strategy that he can pursue without German agreement. Such a plan is not in evidence. All we see is a readiness to do whatever Germany demands in advance, including “flexicurity", austerity, and so forth, in the hope that Germany will then agree to some of his eurozone reforms before it is too late.

Reasonable people understood that Macron ought to be supported against Le Pen. Now they understand that Macron’s policies will worsen the deflationary, regressive cycle that is Le Pen’s greatest ally. With the election over, opposing Le Pen now means opposing Macron. ©2017/Project Syndicate

Yanis Varoufakis is professor of economics at the University of Athens and former finance minister of Greece.