FRENCH ELECTIONS: AGAINST THE ODDS JUNE 2, 1997 TRANSCRIPT

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After 4 years in the political wilderness, the left wing of French politics came to a surprizing, decisive victory on Sunday with the election of a socialist prime minister. A background report is followed by a panel of experts who analyze the results.

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A RealAudio version of of this segment is available. June 2, 1997: A background report on Sunday's socialist victory in the French elections. January 8, 1996: The NewsHour remembers the life and work of French President Francois Mitterrand. December 8, 1995: French public employees strike in opposition to government policy. Browse The NewsHour's European coverage. Outside Links: French Television's coverage of the election

MARGARET WARNER: Now, three perspectives on what these results may mean. Jacqueline Grapin is president of the European Institute in Washington, a think tank that focuses on European-American relations. She's a French citizen and an international economist specializing in European integration.

Simon Serfaty is director of European Studies at the Center for Strategic & International Studies in Washington and a professor at Old Dominion University in Virginia. A native of France, he has recently published a book entitled Stay the Course: European Unity and Atlantic Solidarity. And Jim Hoagland is foreign affairs columnist for The Washington Post, and a former Paris bureau chief for that newspaper. Welcome, all of you. What do you think is the message of this election? What were the French voters saying?

SIMON SERFATY, Old Dominion University: Well, they were first of all stating their displeasure over the policies of the prime minister and by implication that of the president as well. They were complaining about the notion that in a sense the state has not been taking care of the citizens for quite a while and the high levels of unemployment. They were saying, it seems to me--

MARGARET WARNER: We should point out that unemployment is nearly 13 percent there.

SIMON SERFATY: Exactly. They were also stating, it seems to me, again to certain vision of Europe. Europe has become too intrusive of domestic national policies, a Europe too that has tended to erode a sense of national identity. They were finally stating a sense of exasperation about the way France is and about the way France is being governed. It was a massive rebellion against the way the nation has been thwarted over the past many years.

MARGARET WARNER: How do you read it?

JACQUELINE GRAPIN, European Institute: I also think the president, I think that is true. At the same time I think that the French wanted to express their notion that there was an alternative. The campaign of the right was very weak, and obviously the outgoing majority was thinking that there was no alternative to their policies, and what--what has been shown is that, first, the Socialist Party had gotten organized during the two years since they have been defeated in the presidential election in 1995, and secondly, that they are proposing an alternative set of policies, which have been studied and can be conducted.

MARGARET WARNER: Jim Hoagland, explain what those policies are in a nutshell. What does socialism mean in a French context?

JIM HOAGLAND, Washington Post: Well, it's hard to say. The Socialists were first elected in 1981 under President Francois Mitterrand. For two years they followed the policy of nationalizing industries, banks, and major businesses in France. And the franc went--really had big problems, shall we say, in those years. And the economy was on its back. Mitterrand in 1983 suddenly on the course of a weekend reversed his policies, began pursuing austerity, ceased the nationalizations, pegged the franc very much to the German marks, and asked the French people for sacrifices for a better future. Sacrifices remained--Mitterrand remained for 14 years, but the future never really got better.

Unemployment continued to rise, and there were no real set Socialist policies at the end of that time. I think it's very important in terms of the election results to emphasize the personal aspect of this. I think it was a very personal rejection of Jacques Chirac and his prime minister, Alain Juppe. In 1995, they promised that they would tackle unemployment as their first priority; that they would reduce unemployment, while continuing to work for a single European currency, and greater European integration.

They did not deliver it. Unemployment today is, in fact, higher than it was in 1995; the French people have not forgiven Chirac and Juppe for failing to deliver those promises. They now turn to the alternative party, the Socialists, for a new set of what I see really as promises and not policies. Again, the promises to increase employment, particularly government employment, while reducing the budget deficit, promises really that cannot be kept any more than Chirac's could be kept.

MARGARET WARNER: How can this new government do, as Jim Hoagland just pointed out, both create all these new public sector jobs, and at the same time not raise taxes, without ballooning the deficit further?

SIMON SERFATY: Not easily, and in fact, it's quite unlikely for it to be feasible. This carries two implications. For one, it suggests that the cohabitation, that is to say this kind of shared coexistence--

MARGARET WARNER: With a Conservative President, Jacques Chirac.

SIMON SERFATY: Exactly. And a Socialist prime minister--will be enormously difficult to sustain over time. What happened during periods of this nature earlier was that the Socialists had moved to the center and there prevailed a consensus position on the main decisions to be made by the state; so that, by and large, the president and the prime minister could govern together without too much conflict; it happened twice before.

I believe it will be difficult this time, so that after a period of time there may be a new clash as to who ought to take over, possibly toward the presidential elections, say by the year 1999, but the second implication is that to the extent that those new policies require a reassessment of budgets planning and then the ability to meet the criteria of economic and monetary union is compromised, the ability to do so enhanced, the ability to enforce that particular objective as well--

MARGARET WARNER: And we have to point out that to meet the standard for common currency--European currency--all these governments that are part of it have to get their deficit down to 3 percent of the Gross Domestic Product.

SIMON SERFATY: That's right.

MARGARET WARNER: Help us, though, understand a little more. To an American audience you would say here's a country with 13 percent unemployment; their deficit is more than twice as high as the U.S., as the percentage of GDP; and they elect a party that says we're going to create more government jobs, more government spending. I mean, explain that.

JACQUELINE GRAPIN: Well, this is a little bit of a caricature because they didn't say it was going to be government jobs. They said jobs. And also as the campaign was going on, they said progressively--so they didn't say they were going to create next week 700,000 jobs. I think that whatever the government--any government has to work within the same economic frame work, economic limitations, and in the case of France within the same set of treaties.

We have many European treaties, agreements, and all sorts of regulations which have to be respected because--just because they've been signed by the country. And so this government will have to abide by that. At the same time, there is a certain margin of maneuver, and I think the implication of the change of government is going to be that the French--in France in general in the next few months is going to insist that the frame work in which the European community is working be more goals-oriented. It is true that for years the Bundesbank has obliged--

MARGARET WARNER: The German central bank.

JACQUELINE GRAPIN: The German central bank has obliged the European countries, of which wanted to be part of the European monetary union, to have a rather deflationary policy, to fight inflation which is not a problem because we have no inflation in Europe at that time, without consideration of unemployment, which is a problem because we have a high level, and for the public it is not clear why we should fight inflation and not fight unemployment.

So this is also a heritage of the period which Jim was referring to, this period of the 80's where even the Socialist government like Francois Mitterrand's government was conducting relatively conservative policies in line with Germany. Now you have out of 15 governments in Europe, you have 11 Socialist also--democrat governments--so it is going obviously to change the policies.

MARGARET WARNER: So you think that's what this is leading to; do you agree that there's going to be some real rethinking among many European governments about what they--how aggressive they want to be, and what the criteria are for this new European currency?

JIM HOAGLAND: Well, there are really only two governments that count on this question, it's France and Germany, and there is a reassessment going on in both countries. I think what we've seen in the French election is that it's easier to change governments than it is to change habits, to really change your standard of living, which is what the French were being asked to do in order to step aboard the globalization express.

In Germany you've got quite a debate going on right now between Chancellor Kohl and the Bundesbank over the terms for European monetary union, which is supposed to occur in 1999. Right now, you see the schedule for that beginning to slip. I would agree with Jacqueline that what is needed now by the Socialist government in France is some way to package many of the same things that were being done and will have to be done in a growth label.

It will be labeled as a new growth stimulus package, but in the end I think it'll amount to a lot of the same things under a new label. But what has to happen, I think, is a deal now, a political deal, between Germany and France, to try to revive the economy to get the emphasis off of the sacrifices that people are being asked to make for the Maestricht Treaty and EMU.

SIMON SERFATY: I would seem to see three problems with this. One, the main--the second main loser in yesterday's election in France is Helmut Kohl, who's been enormously weakened.

MARGARET WARNER: The chancellor of Germany.

SIMON SERFATY: Exactly. So it's much more difficult for him to make a deal. Second, whom is he going to make a deal with? Will he make it with the president or the prime minister? The two of them don't agree at this point in time on the substance of policies.

JACQUELINE GRAPIN: Perhaps he can make it with the Bundesbank because he also has a problem with the Bundesbank.

SIMON SERFATY: And once he's made his deal with the Bundesbank he will still need to go to Paris and make a deal with the French--and there's a very rigid timetable. This is the last minute--

JIM HOAGLAND: You can't do it under the current timetable. I think that's the result--

SIMON SERFATY: Exactly.

JIM HOAGLAND: --of the French elections yesterday.

MARGARET WARNER: That's definitely going to slow it.

SIMON SERFATY: The postponement of economic and monetary union may mean its failure or else will have such implications on the balance of the construction of Europe as to make one wonder about the next few years.

JIM HOAGLAND: But I think the situation today is you can delay and fail, or you can fail right now. That's the choice.

SIMON SERFATY: Fair enough.

MARGARET WARNER: So do you agree that we may look back on this moment, or we may be looking on it now and saying this is the moment that European governments even realize the public was saying, hey, the sacrifice is too high; something has to give?

JACQUELINE GRAPIN: We may, but I do not believe it's going to happen because I know that the team which composes the new government is made of people who want the monetary union to happen; just they don't want it to happen any way; they want it to happen with certain conditions. And if these conditions are met, it will happen.

SIMON SERFATY: Except that the Communists who belong to the coalition government and without whom the Socialists cannot maintain a majority in the national assembly.

JIM HOAGLAND: It's important to point out that the Socialists, in fact, do not have a majority in the assembly; they rely on the Communists for about 36 votes to give them a majority.

MARGARET WARNER: Who are unremittingly hostile to a lot of these--

JIM HOAGLAND: So far they have been. Get ‘em to the trough, show ‘em some power, and maybe they'll be compromised as well.

JACQUELINE GRAPIN: But what may happen is that we may kind of a parliamentary system appearing in France for the first time because you may have center parties voting with the Socialist Party against the Communist Party on European issues, and that would be very interesting.

SIMON SERFATY: Which would mean, of course, the end of the Fifth Republic and the start of the Sixth.

MARGARET WARNER: All right. And we have the end of this discussion. But thank you all three very much.

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