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WINTER OF DISCONTENT
DECEMBER 8, 1995
TRANSCRIPT
Margaret Warner reports on the public employee strikes in France that have crippled the country. She talks with journalist, Daniel Vernet of the French newspaper, "Le Monde," and international affairs professor, Harvey Feigenbaum of the George Washington University.
MARGARET WARNER: This is what Paris has looked like at dawn each day for the past two weeks, with lines of cars snaking around the city for hundreds of miles. Tens of thousands of French workers are en greve, or on strike. It's the most disruptive social upheaval France has seen since the student protests of 1968. The first to strike were the railroad workers. They were soon joined by university students, growing ranks of civil servants, and some workers in private industry, and not just in Paris, but in Toulouse, Bordeaux, and other cities throughout the country. By today, more than 1/3 of all French public employees were on strike, protesting the government's austerity plan for cutting the budget deficit. Paris is trying to function without commuter trains, without subways, without city buses. People have been going to work on foot, by bicycle, and roller blades, and on private buses and tourist boats.
WOMAN ON STREET: I'm desperately trying to get to work, and I heard yesterday that they had these boats that would do--you know, go between Bersee and Ras Du France, but they could have put bigger boats, because this is ridiculous. And they could have started earlier.
MARGARET WARNER: Many have been driving their cars, turning the capital into one endless traffic jam and turning commutes into hours-long affairs. The strikes have hurt many businesses at the onset of the Christmas season, just as France is hoping to emerge from a long recession that has left nearly 12 percent of workers unemployed.
WOMAN IN SHOP: For the business, it's very quiet, and by this time, it's Christmas time, and the shop should be crowded of people, and for now, as you can you see, it's empty.
MAN IN SHOP: Everybody says it's going to be worse, and for me, I can imagine, it's going to be terrible.
MARGARET WARNER: The strikes began after the conservative government, led by President Jacques Chirac and Prime Minister Alain Juppe, announced plans to reduce the country's $60 billion deficit, which amounts to a hefty 5 percent of the Gross Domestic Product. The government is under pressure to reduce that to meet the European Union standards for creating a common currency. The government's plans call for raising health care premiums, changing pension eligibility rules, and reorganizing the national railroad network. Polls show that Juppe's plan is not gathering much support from the people.
YOUNG WOMAN ON STREET: We want that Juppe--
OTHER YOUNG WOMAN ON STREET: --get out of the French government.
YOUNG MAN ON STREET: We want to fight Juppe's government, okay, and we stay in the roads, in the streets, until Juppe explodes.
MARGARET WARNER: So far, both the government and the strikers say they won't budget. But yesterday, the government did name a mediator to begin talks with the union. Here now to explain and explore these developments are Daniel Vernet, senior editor for the French newspaper "Le Monde," and Harvey Feigenbaum, professor of political science at George Washington University's Elliott School of International Affairs. He has written extensively on French politics and the economy. Welcome, gentlemen. Mr. Vernet, why is there such an intense and overwhelming reaction to the government's plans?
DANIEL VERNET, Le Monde: I think you can see the problem from two different points of view. First, you can see privilege and unprivileged protesting against cutting welfare state in health care, in job security, and job benefits and so on, but it's also a protest against a plan for cutting budget deficit, and a protest against, maybe against European integration which has created a discipline, a finance discipline, and a necessity to have austerity policy. And I think the public sector is striking now, several public employees are on strike. The public sector is not concerned up to now, but you have a very big support in the public opinion for the strikers, because people have the feeling they have paid in the last five, ten years, they have paid for this austerity policy that they are a little bit fed up with, increased taxes and so on, and particularly because Jacques Chirac during the electoral campaigns, presidential campaign had promised taxes, to cut taxes, to create jobs, and so on. And now we have to face a very harsh reality.
MARGARET WARNER: A very different picture. Well, Mr. Feigenbaum, though, here in the United States, we have Congress talking about cutting the budget deficit, really tough cuts in programs, yet, you don't have everybody on the streets like this.
HARVEY FEIGENBAUM, George Washington University: Yeah. I think there are a couple of things going on. First, you have to realize that in France, the public sector is held in a great deal of esteem. People think it works well, it works efficiently. Most public sector firms actually are very profitable and often more profitable than private sector firms, with the exception of the national railroad. And so people tend to have a view, a positive view of the state, and since the state is very large, the public sector is very large, about 20 to 25 percent of GDP is occupied by the public sector, that means almost everyone has a brother or friend that, that works for the public sector. That's part of what's going on. I think, though, one thing that's crucial to understand about the current attacks, or the reform on the welfare state that's being proposed, is that France has a universal welfare state. Everybody gets something out of it, and so everybody feels vulnerable to these cuts, unlike the United States, which has a means-tested welfare state, and really over the very poor are the ones that are very, very hurt by reform.
MR. VERNET: And you have to consider too that 12 percent of people are unemployed, and they are, they are--they fear that their children could be unemployed as they leave, when they will leave the university.
MARGARET WARNER: But still, I'm puzzled as to why the people who are upset take such a different protest route. I mean, they're not going to the parliament there; they're just going to the streets. Why is that?
MR. FEIGENBAUM: Traditionally in France, one has gone to the streets. Part of the reason is, in fact, because unions, for instance, are very weak in France, and they really don't have the power at the bargaining table to get what they want, that they've oriented themselves toward public and political protests, rather than economic bargaining. So this is, in fact, part of a long French tradition that includes not only unions but when agriculture is also upset, they go to the streets. This is a traditional way of expressing discontent.
MR. VERNET: There is a point that government did organize some round tables about the reform of the welfare state and security system and so on, but before, as discussions have ended in these round tables, he announced his plan and very strong medicine he proposed to the, to the country, and it explained also that people are going on the street.
MARGARET WARNER: So I mean, you're saying here in this country, we have months and months of debate and Congress is involved, and it goes on and on, whereas in France, it seems, what, more like an edict from the government?
MR. FEIGENBAUM: One might say that in the sense the same thing is going on in the United States and in France, which is that there are government deficits that each political force is trying to get the other side to pay. In the United States, the Republicans are trying to shift the burden of the deficit onto those people that normally vote for Democrats. In France, it's not a battle within the government, which is controlled entirely by one political grouping, but rather it's, it's a battle between the government, which represents one constituency, and the people that are getting hurt, which represents the other constituency.
MR. VERNET: But I--as I understood the question here, the U.S. administration is trying to cut deficit, or budget deficit in seven years. We have to do the same thing in two years in France, and there is a big difference.
MARGARET WARNER: How do you all think this is going to play out? Who do you--do you think both sides will have to give a little? Do you think either side will give a little?
MR. FEIGENBAUM: Both sides are vulnerable. The unions are vulnerable because they don't have strike funds; they can't hold out for very long. The government knows that, which is why it's digging in its heels. On the other side in the government, there is--there are people waiting in the wings to replace Mr. Juppe if, in fact, it's decided that he's expendable. The architect of Mr. Chirac's campaign was, in fact, is currently president of the National Assembly. He would be very happy to be prime minister.
MR. VERNET: The freedom of movement is very narrow for the government. It cannot give up totally. It--but it must compromise, but the cost of the compromise should not be too high, because we have to meet the criteria of Maastricht in two years in order to have a single currency in '99. That's the question for the government now.
MARGARET WARNER: But is the European Union demand the only thing driving this? I mean, could France otherwise continue being in 5 percent of its GDP, a deficit that size every single year?
MR. FEIGENBAUM: It's a matter of debate among economists about how large a deficit is really viable. The figure of 3 percent was one agreed upon in the Maastricht Treaty, but there's nothing magical about it.
MARGARET WARNER: That was the treaty--let me--just to explain--that would bring closer European integration.
MR. FEIGENBAUM: Yes. In order to create a single currency, the members have to agree on having deficits of no longer than 3 percent. But this is simply a somewhat arbitrary number that was decided at Maastricht.
MR. VERNET: What matters is not only the budget deficits of the state but the deficit of the Social Security System, which is high, $12 billion this year, and which is increasing.
MARGARET WARNER: Do you think that if some agreement is worked out that, that the French people could be persuaded to accept some austerity measures?
MR. VERNET: I think so, and you can see that one union, there are three main unions in France, it's a problem, it's a division between unions is a problem in negotiating as a government, but one of the big unions is CFDT, a democratic, non-Communist, I would say, non-Communist union, is in favor of the Juppe plan for cutting the deficit of the Social Security System. And I think it could be support for a more reasonable program of deficit cutting.
MARGARET WARNER: And before we go, do you think Paris can host the signing of these peace accords next week?
MR. VERNET: It would be very difficult only for technical reason, because of the traffic jam, and the impossibility to, to go through Paris with the cars and so, and all what is necessary for hosting a very big international conference.
MARGARET WARNER: But is there any doubt it will take place?
MR. FEIGENBAUM: They could always put the negotiations or the signing in a chateau a hundred miles from Paris. So I think it's very likely to go on.
MARGARET WARNER: Thank you, gentlemen, both very much.
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