The streets of Paris and other French cities have once again erupted in unrest. Hundreds of thousands have marched, while violent elements have set cars alight, looted shops and clashed with police.
On 17 October 2026, approximately 550,000 people participated in nationwide demonstrations, according to French government figures. More than 1,800 arrests were reported as the unrest continued. A week later, another 410,000 people took to the streets.
The immediate grievances included deteriorating school conditions, rising living costs, fuel prices and broader dissatisfaction with public services. The unrest has also unfolded against fierce political resistance to the government’s attempts at fiscal restraint.
Yet beneath these immediate grievances lies a deeper structural problem: decades of state intervention have expanded welfare commitments beyond what France’s productive economy can sustainably finance, while fostering a political culture in which those commitments are increasingly regarded as inviolable rights.
France is discovering just how difficult it becomes to restrain government spending once generations have come to depend on it.
The Fiscal Trap of Interventionism
France’s public finances exemplify the classic trap of interventionism.
According to Eurostat, government expenditure reached approximately 57.3% of GDP in 2025, among the highest levels in the eurozone. Meanwhile, the budget deficit stood at 5.1% of GDP, and public debt reached 115.7%.
The International Monetary Fund projects that France’s debt could exceed 120% of GDP by 2027 without sufficient fiscal adjustment.
Social protection absorbs an enormous share of national resources. In 2024, social protection benefits represented 31.9% of GDP, with pensions and healthcare accounting for substantial portions of this expenditure.
This is not merely a temporary consequence of recent crises. France has consistently run budget deficits since 1975, with successive governments failing to restore a sustainable balance between expenditure and revenue.
The state extracts substantial revenue through taxation and social contributions, only to redistribute it on a vast scale. The result is a fiscal position that leaves little room for adjustment when economic growth is weak, borrowing costs rise and demographic pressures intensify.
Successive governments have built an expensive system of benefits and obligations that becomes increasingly difficult to reform.
Specific legal frameworks underpin this expansion.
The Code de la Sécurité Sociale establishes an elaborate system of benefits covering sickness, maternity, old age, family allowances and numerous other contingencies. Legislation establishing and expanding the revenu de solidarité active (RSA) and related minimum-income schemes has created permanent claims on public resources.
Pension rules, repeatedly adjusted but fiercely defended against significant reform, impose substantial long-term obligations on the state.
Each additional commitment introduces administrative, regulatory and financial costs that future taxpayers must ultimately bear.
The Growing Cost of Government Intervention
The relationship between state intervention and public expenditure is not merely theoretical.
Research published in Public Choice, examining French legislative output between 1905 and 2015, identified a significant positive relationship between the volume of laws and regulations and the public expenditure-to-GDP ratio.
The researchers found that expanding legislative and regulatory activity was associated with rising government expenditure, reflecting the financial consequences of implementing and administering an increasingly complex state.
Further research examining French public expenditure between 1870 and 2010 found that spending directed towards protecting property rights made a clear positive contribution to economic growth.
By contrast, broader economic interventions did not produce comparable results. Among social spending categories, healthcare expenditure was the notable exception associated with positive output growth.
These findings reinforce the classical liberal argument that government performs best when concentrating on its essential functions rather than attempting to manage ever greater portions of economic and social life.
As redistribution and intervention expand, they consume resources that might otherwise support productive private investment or essential government functions.
The IMF has similarly highlighted France’s elevated public expenditure relative to its European peers, identifying opportunities for efficiency improvements in social protection, healthcare, education and the civil service.
The problem is not simply that France spends too much. It is that the state has accumulated obligations that are politically difficult to reduce, even when their financial sustainability becomes increasingly questionable.
When Entitlements Become Untouchable
When governments attempt to reverse course, the political reaction is fierce.
President Emmanuel Macron’s efforts to raise the retirement age provoked massive demonstrations and widespread resistance. Subsequent proposals to restrain expenditure, limit certain benefit increases and reduce the deficit have encountered similar hostility.
The proposed 2027 budget includes measures affecting pension indexation, healthcare spending and other public expenditures, alongside targeted revenue increases.
Each proposed adjustment becomes another political confrontation.
To be clear, not every French protester is demanding an expansion of the welfare state. Complaints about deteriorating schools, declining public services and the rising cost of living are not inherently unreasonable.
However, the broader political resistance to reducing state commitments reveals a fundamental contradiction.
Many citizens demand improved public services and the preservation of existing benefits while opposing the financial adjustments necessary to place government expenditure on a sustainable footing.
The protesters are not predominantly marching for freer labour markets, lower barriers to enterprise or greater economic liberalisation.
Wouldn’t that be something!
Instead, much of the political debate revolves around preserving or expanding existing state provision, even as debt servicing and demographic ageing place increasing pressure on public finances.
A population accustomed to extensive government provision understandably comes to regard those benefits as permanent entitlements.
Once established, these expectations become extraordinarily difficult to reverse.
The Problem With Positive Rights
This is a predictable consequence of positive rights enforced by the state.
Negative rights, such as the rights to life, liberty and property, fundamentally require others to refrain from aggression or interference.
Positive rights, by contrast, establish claims to goods or services that someone else must provide.
Rights to income, healthcare, education or retirement benefits at a specified level require resources that must be continuously collected, administered and redistributed.
These resources do not materialise simply because politicians declare that citizens are entitled to them. They must ultimately be produced through economic activity.
When the state assumes responsibility for providing these goods and services, citizens increasingly regard them as guaranteed entitlements rather than benefits dependent on the productive capacity of the economy.
Over time, political expectations become detached from economic realities.
Consequently, attempts to restore fiscal balance are perceived as taking something away from citizens rather than correcting commitments that government can no longer sustainably finance.
Politicians are then trapped between economic necessity and political survival.
Reducing expenditure provokes public anger. Maintaining expenditure requires additional taxation, borrowing or the sacrifice of other priorities.
The longer reform is postponed, the more difficult the eventual adjustment becomes.
France’s experience demonstrates how interventionism can create constituencies that resist any retreat from state provision, regardless of the long-term consequences for public finances and future generations.
A Warning for South Africa
South Africans observing these developments should take note.
Our own political debates reveal similar tensions between expanding government commitments and the economic capacity required to finance them.
National Health Insurance, the public-sector wage bill, expanding social expenditure and the persistent failures of municipalities all raise questions about the appropriate responsibilities and limits of the state.
South Africa faces particularly severe constraints, including weak economic growth, high unemployment and a relatively narrow tax base.
Yet political demands frequently focus on expanding government responsibilities rather than creating the conditions for sustained private-sector growth.
The danger is that each new intervention creates additional expectations, administrative structures and political interests that make reform increasingly difficult.
Once government establishes a programme, reducing or abolishing it becomes a political battle, irrespective of whether the programme achieves its intended objectives.
France demonstrates that even wealthy economies cannot indefinitely escape the consequences of excessive public expenditure.
For South Africa, with its far weaker economic foundations, the risks are considerably greater.
Entrepreneurship, voluntary exchange, secure property rights and limited government remain the most reliable foundations for widespread and sustainable prosperity.
Economic development requires productive activity, investment and wealth creation. Redistribution cannot substitute for these processes indefinitely.
France’s fiscal predicament was not created overnight. It is the accumulated consequence of decades of political decisions that expanded government commitments while postponing difficult choices about how those commitments would be financed.
Its latest unrest illustrates how politically explosive those choices become when the state can no longer satisfy the expectations it has encouraged.
When the bill finally arrives, a population accustomed to the state’s open hand finds it extraordinarily difficult to accept one that must close out of economic necessity.
That is France’s reckoning, and it is a warning South Africa would be foolish to ignore.
Zakhele Mthembu, BA Law, LLB (Wits), is a Policy Officer at the Free Market Foundation.