Commentary (Sunday Times)

MT: “Saying adieu to their riotous past” (Sarkozy faces a ‘Thatcher moment’)

Document type: Press
Source: Sunday Times , 18 November 2007
Journalist: Matthew Campbell
Editorial comments:
Importance ranking: Minor
Word count: 3,294 words
Themes: Conservatism, Economic policy - theory and process

Saying adieu to their riotous past

Don’t be fooled by the wave of strikes, says Matthew Campbell, our Paris correspondent. The French have finally realised they have to work for a living. And now they want to overtake Britain

President Nicolas Sarkozy likes to think of himself as a friend of “the France that gets up early”. Last week that seemed to apply to most of the country as a public transport strike forced commuters to struggle to work at dawn on bicycles or on foot.

Railway workers marched under red banners in defence of their right to hold governments by the throat. And a whiff of tear gas hovered over university campuses where radicals were hoping for a rerun of May 1968.

This week civil servants, teachers and postal workers will go on strike. Magistrates, lawyers and clerks will have their say next week with nationwide protests against plans to close dozens of courts around the country. From fishermen to pampered national opera employees there is scarcely a sector without some grievance or other in what has been called Sarkozy’s “black November”.

The president always knew he would face a battle on the streets, because of the failure of previous governments to stand up to workers’ demands. Socialists and conservatives alike have given in at the first sign of trouble.

Something is different about this latest unrest, however. In a departure from tradition, some union leaders were last week condemning the strikes and protests; and a frustrated public, instead of venting anger on the government, as the unions had hoped, tore into the protesters for preventing them from getting to work.

The French call it a “Thatcher moment” for Sarkozy, who came to power this year with a promise of “rupture” with the bad old ways of the past: an end both to the strangle-hold of the unions and to the public’s traditional solidarity with “the workers”.

It is the first test of whether Sarkozy’s election was proof that the French really have changed – and have had their own “Thatcher moment”. Is a “new France” rejecting the old ways and embracing a transformation similar to the one that Britain underwent? If so, will it be as painful and – ultimately – as successful?

Nicolas Baverez, a respected economist, sees another British prime minister, Tony Blair, as the key to the answer. “While Margaret Thatcher had a real ideological vision, Sarkozy is more like Blair,” he said. “What was it that Blair said? Whatever works is what is right? That’s exactly what Sarkozy believes.”

Baverez added, however: “Sarkozy was elected to reconcile France with the modern world. He must do so quickly. The world will not wait.” WHETHER a legacy of the 1789 revolution or simply a fondness for drama and confrontation, France’s record of letting street protests, rather than the president or parliament, determine policy has prevented it from ditching an outdated system and implementing the sort of reforms that have invigorated Britain and much of the rest of Europe.

While France is in many ways a more authoritarian society than Britain, its postrevolutionary history is pockmarked with eruptions by its citoyensagainst this authority – from the Paris Commune of 1870 to the “events” of 1968 and the shocks of 2005, when the electorate rejected the European Union constitution and immigrant youths went on a rampage of rioting that forced the government to impose a state of emergency.

This spirit was out in force last week in vicious battles between students and riot police in Nanterre and Rennes, where the university president accused youths armed with baseball bats of “behaving like terrorists”.

The students were ostensibly protesting against a law that would give universities more autonomy but a hard core of protesters, encouraged by one of the most militant railway unions, talked instead about its hopes for “the end of the Sarkozy regime”.

“Sure, we don’t want our universities run on capitalist principles,” said Henri Gaillon, a student protester. “But this is a wider struggle in support of socialist ideals. We will not let ourselves be had like the workers in Britain.”

Such attitudes are by no means limited to the far-left fringe of French politics. The suspicion of profit, and demonisation of business leaders has been encouraged by François Hollande, leader of the Socialist party and estranged lover of Ségolène Royal, the defeated Socialist presidential candidate. He is remembered for having once declared: “I don’t like the rich.”

The French Socialists, who have been in and out of power for much of the past 30 years, are yet to undergo the “demarxification” process that made Spain’s Socialists, for example, able to transform the Spanish economy into a capitalist “Iberian miracle”.

The paradox is that the France afraid of capitalism and globalisation – the France of the 35-hour week – coexists with another highly dynamic and entrepreneurial France, the globalised France of international commerce that includes some of the world’s most successful companies.

Corporate France has been booming: from banking to fashion, cosmetics to telephones, the outlook has seldom seemed rosier. French workers are more productive per hour than their American counterparts although their overall productivity is lower because they work so few hours.

At the same time the public’s appetite for capitalism is growing, whatever the rhetoric of radical students about the savagery of the free market: when EDF, the electricity company, was floated, more than 5m French people rushed at the chance to acquire shares.

This is the “France that gets up early” and not only when there is a strike. It is like Britain, to the extent that even the once sacred ritual of the lunch hour is under revision: more and more people eat a sandwich at their desk.

Indeed it has learnt from Britain. The many thousands of young French men and women who have been drawn across the Channel by the lure of higher pay for harder work have taken the message back home that France can, after all, learn something from the Anglo-Saxons.

In the country famous for an antiglobalisation campaigner’s attack on a fast-food restaurant, McDonald’s is turning a huge profit; and predictions a few years ago that Starbucks, the American coffee chain, would never make it in Paris have been confounded by the satisfied customers queuing each day at numerous Parisian outlets.

The new France has little patience for the old, and vice versa. “This is just so old-fashioned,” was how Laurence Parisot of the Medef employers’ union described last week’s strikes. Such feelings are widespread.

“The France that wants change is very irritated by all these strikes,” said Didier Neyrat, president of a firm of information technology consultants with 350 employees.

“We can’t have a country of two speeds in which some people have pension privileges and others do not. It’s a symbolic reform that, with any luck, will lead to others. Our labour market, for example, freezes any dynamism. It needs to be more supple.”

Neyrat, a 44-year-old father of two, was glad that France had elected a president prepared to make changes.

“When I was at school,” he said, “they used to teach us that France had a stronger economy than Britain. Now it’s the other way round. If things go on like this we’ll end up going under. It may take some time, but we’ll go under.”

Nina Mitz, French director of Financial Dynamics, a public relations company, said: “People in these big private sector companies are angry about being handicapped by a relatively small bunch of people trying to preserve their pension rights.”

Yet Mitz, the daughter of a Polish immigrant, feels torn in her attitude to the unrest, calling herself a “child of the republic” who benefited greatly from the generosity of the state. She understands the desire of so many others to maintain the status quo.

When the family moved to France in the 1950s, she said, “we were living in a maid’s room covered in an army coat to keep warm”. She remembers her father pawning his watch to put food on the table.

“Had it not been for the free education, my brother, who is a surgeon, and my sister, who is a dermatologist, would never have succeeded so well. Neither would I. We could never have afforded to pay for an education.”

Most French people, she argued, believed in the need for reform but not draconian austerity measures that would tear to shreds the safety net on which the most disadvantaged members of society have come to rely.

“It may be arrogant of us to believe it,” Mitz said. “But perhaps France is capable of finding its own kind of balance. I tell my foreign clients that you cannot handle things here as you would elsewhere. Pragmatism is not sufficient. You need vision.”

SARKOZY, as Baverez points out, is more pragmatist than visionary. A punchy, combative figure who seems to relish a scrap, he has gambled everything on pension reform and cannot afford to lose. He has prepared the ground well, having learnt from the mistakes of previous French leaders.

The confrontation that people are comparing with the present strikes is the railwaymen’s “glorious victory” in 1995, soon after the election of Jacques Chirac as president.

Sarkozy – budget minister in the previous conservative coalition cabinet but not reappointed by Chirac, who distrusted his uppityness – watched from the sidelines, and learnt, as the government caved in.

Chirac had reached power on a promise to cure France of its economic sclerosis. But his government’s proposal to curb railwaymen’s pension perks was withdrawn after three weeks of transport gridlock that cost the country 0.3% of its GDP.

In those days the public supported the strikers – if only because they despised Alain Juppé, Chirac’s prime minister.

Juppé’s inability to communicate why pension reform was necessary was typical of a ruling elite whose members all went, literally, to the same school and whose sense of brilliance and entitlement was based in part on the trente glorieuses, or three decades of economic expansion they had presided over.

Twelve years on, the elite’s governing model – the methodically planned and lavishly financed state dirigiste system whose architect was Louis XIV’s finance minister – remains a symptom of “old French” values.

It has certainly notched up successes. Excellent hospitals, one of the best birth rates in Europe and high-speed trains have been the envy of France’s neighbours.

At what cost, however? Somebody has to pay for the state’s largesse, which is beginning to look like an albatross around the neck of the next generation.

The situation is not quite as dire as it was in Britain in the 1970s; but while the German economy is perking up once more after hard-won reforms, France is gently stagnating.

German business, which had been hampered by the survival of the consensual social-market model built for the industrial 1950s, demanded reforms and achieved some of them. At the same time they have adopted “Anglo-Saxon” business practices and are thriving.

French corporations that have adopted the same model – such as Lagardère and Vivendi – have expanded overseas with great success. But in large swathes of the unreformed French economy, it is a different story.

Over the past 15 years, French per capita GDP has slipped from seventh in the world to 17th. More alarmingly, France has had to borrow so much to prop up its extravagant model that public debt has grown faster than anywhere else in Europe, to 66% of GDP (compared with 45% in Britain).

If things carry on this way, experts have been warning, the country could in effect go bankrupt. In the May election, the French gave Sarkozy a mandate to save them from this fate. Can he do it?

Sarkozy’s father, a Hungarian immigrant, told him when he was a child, in a reference to French racism: “With a name like yours, you’ll never succeed here.” Sarkozy has spent every day since then proving him wrong.

Having suffered the recent disappointment of a divorce from his wife, he was not about to let a bit of labour unrest obstruct his quest for a place in the history books.

If there is any motto to sum up the Sarko approach, it would be he who dares, wins. The key to understanding his character – and his strategy now – was an incident in 1993 when, as the youngest mayor of the Paris suburb of Neuilly, he marched into a kindergarten to confront a “human bomb” holding hostage a classroom of toddlers.

He offered money and a means of escape and, in exchange, was allowed to walk out with a child in his arms. The bomber was later shot dead by police.

In the same way, it took guts to walk into a hostile railway depot, as he did last month in an attempt to convince drivers, live on television, of the merits of his “work more, earn more” gospel.

When someone shouted an insult from a rooftop, his response was: “Come down here and let’s talk about it.” The French, used to monarch-like presidents who seldom descended from their cloud to mingle with mortals, had never seen anything like it. The polls showed their approval.

He has managed to keep much of the public onside by demonstrating that the striking railwaymen are, by any rational measure, making unjustified demands.

Les cheminots, as the railwaymen are collectively known, are the beneficiaries of decades of militancy that won from the compliant state the right to retire on a full pension at the age of 50.

Some other state employees also benefit from such “special regimes” dating back decades – or centuries, as in the case of retirement deals relating to national opera and theatre workers. Some enjoy the right to retire after contributing to the pension system for 37½ years.

In all, the special regimes affect one-tenth of the public sector, or about 500,000 workers, and 1.1m retirees. Yet they cost the state about £3 billion a year and account for most of the deficit in the overall pension system.

Sarkozy, 52, ridiculed the idea of retirement at 50 when he was on the campaign trail, saying: “Look at me, at 50 I’m only just starting!”

While offering negotiations on the details, he has vowed not to cede on his “red lines”: the principle at stake is that all workers should contribute to the pension system for 40 years. The battle over the special regimes is about much more than any single reform, however.

The pint-sized “hyper-president” knows that success in his battle with the union behemoth could bring a big payout, proving just as much of a watershed as Thatcher’s victory over the miners, allowing him to implement other much-needed reforms, such as abolition of the 35-hour week and deregulation of the labour market, that could push France to the top of Europe’s economic chart.

These will be much harder to sell – but he will not even get the chance if he falters in the arm-wrestling test over his pension reform. THE railwaymen take pride in their record as slayers of government reform. By the end of last week, however, more and more railway workers were returning to work in defiance of hardliners fomenting warfare against “Sarko”, whom they regard as a dangerous rightwinger.

Bruno Duchemin, a train driver and union leader, personifies the reason why the strike appeared to be failing.

On the one hand, he defends early retirement as a justified pay-off for the hardship entailed in the job, which involves unsociable hours and loneliness in the driver’s cabin.

He also talks of “the amazing feeling of solidarity” among drivers. “After a day’s work, we all meet in the mess room and there you find a quality of human relationship that you don’t find in many professions.”

On the other hand, he is the head of the only railway drivers’ union to oppose the transport strike and last week called on his members – 30% of all drivers – to keep working. Why?

Duchemin, an affable 47-year-old with grey hair and metal-rimmed glasses, writes novels in his spare time. Like the hero of his first one, The Choice, he grew up in the kind of impoverished, racially segregated suburbs where Sarkozy, whose heavy-handed policing as interior minister was blamed for sparking the riots of 2005, finds his most virulent critics.

“Now they’re calling me a traitor, a coward and Sarkozy’s lackey,” Duchemin complained. “I’ve had threatening letters. Some of my colleagues have had their cars vandalised, paintwork scratched, tyres punctured.”

He went on: “We’ll be outcasts, but this time there is more to be gained from negotiating than striking. We knew that the government would not back down. This time we knew that the president meant what he said. Unlike previous governments, Sarkozy gave a personal guarantee that he would see the reform through.”

Another thing that impressed him about Sarkozy was the respectful way in which he had treated the unions.

In 1995 Juppé had seemed haughty and contemptuous by comparison; and 18 months ago, Dominique de Villepin, the aristocratic, poet prime minister, did not even bother to discuss with unions a reform of the employment law that he rammed through parliament by emergency decree. Faced with a big student protest, he did what French governments have always done until now: retreat.

Sarkozy, by contrast, has been wining and dining union leaders over the past few weeks in some of Paris’s best restaurants, insisting that he would do “nothing brutal like Thatcher” as he tried to cajole them into a deal.

The inclusion of ethnic minorities and luminaries of the left, such as Bernard Kouchner, the foreign minister, in his “rainbow” government has also helped to sweeten the bitter medicine of reform.

“We had to negotiate,” said Duchemin. “We’re at a difficult time. France has to wake up to certain realities. People are becoming aware of this and are making an effort. Why shouldn’t we? It was a matter of showing respect to French taxpayers who are having to carry the cost of the pension deficit. Everyone has to make an effort.”

As a result of Duchemin’s negotiations with the SNCF railway company, drivers in his union have already accepted the offer of more money to work 2½ years longer. This is expected to form the basis for an agreement with all of the strikers. THE student movement is similarly divided over Sarko’s charm offensive. Only 18 months ago Julie Coudry, an economics student at the Sorbonne, was the star of the successful revolt against de Villepin’s proposed reform. Last week she switched sides, trying to help the government put an end to the chaos on campuses.

Yet even though hopes among student radicals of fomenting a common “AntiSarko” front appeared to be fading, Sarkozy fears that public sympathy for his reforms might start to wear thin when other sectors go on strike or if he has to send in the police to end sit-ins threatened by diehard railway workers. He has told aides: “I am prepared to be unpopular.”

Some of his party faithful were last week already showing signs of nervousness about municipal elections in the spring, indicating that he could come under pressure from within his own team to water down the reform.

Wavering, according to Baverez, the economist, would be disastrous for the rest of Sarkozy’s programme to reform France.

“This is a symbolic conflict that he has to win,” Baverez said. “Otherwise, no other reforms will be possible.”

A poll last week showed that 79 per cent of the public hopes that Sarkozy will not back down. The new France, it seems, is on the march.