Analysis - 2014
France is in dire need of major economic and structural changes. Successive governments have been promising these, but have failed to deliver. Can prime minister Manuel Valls deliver, where his predecessors have failed?
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France and change
Can anyone change France ?France, in 2014, is a country in the doldrums. For the past quarter of a century, France's economic situation has been going downhill, while successive governments have grappled with limited success with the need to adapt to a changing world. But the French are now increasingly convinced that nothing is changing, and nothing will change. Even, in the worst-case scenario, that nothing can change.
Up to a point they are right. There is a deep-seated suspicion of change in France, and in many quarters a deep aversion. And it is nothing to do with modern times; it's cultural. What other language - if any - has anything resembling two very well established French sayings : "Plus ça change, plus c'est la même chose" (The more things change, the more they are the same), and "On prend les mêmes et on recommence" (Take the same people, and start over again) ?
Grappling with change is something that the French have found extremely difficult, and it's been that way for over two centuries.
In his new-year address of January 2012, while he was still just a presidential candidate, François Hollande pledged to change France if he were elected. Lambasting the worsening economic and social situation under president Nicolas Sarkozy, he promised to turn things round. He was elected; but two years later, the voters who elected him to office in the hope of big changes were still waiting for anything positive to happen; the only changes French voters had noticed in the first two years of the Hollande presidency were a general worsening of unemployment, a rise in taxes and continuing fall in living standards. Thus in local elections in March 2014 they delivered a humiliating defeat to Hollande and his party, throwing the Socialists out of over 150 town halls and city halls across France.
Hollande's response was to sack his government, and bring in a new Prime Minister, reputed for his tough talk and his moderate-left credentials, Manuel Valls. That went down well in the French media, who saw a glimmer of hope that here, perhaps, was a man who could actually make things change; but the next day when Valls announced his list of ministers (drawn up largely by the President), there were gasps. Most of the new cabinet was made up of the same faces as before; there were just a just a few less ministers, and a couple of newcomers including, notably, the president's former partner and erstwhile defeated presidential candidate Ségolène Royal.
President Hollande repeated his pledges to turn France around, adding in a new sweetener of cuts in income tax at some time in the future; he is still promising to reduce state spending by 50 billion euros by 2017, and to halt the rise in unemployment. But new finance minister Michel Sapin - one of the old faces in the new cabinet - plans to ask Brussels to give him more time to reduce France's budget deficit to the EU recommended level of 3%. There is as yet no clear indication as to how the new government will achieve its planned economic targets without making major and unpopular cuts to public services.
Many of prime minister Valls' opponents, to the left and to the right, believe that he cannot succeed; yet maybe Valls - who was born and brought up in Spain and only naturalised French at the age of 20 - is one of the few politicians in France today who has the strength and determination that will be needed to push through some of the vital changes. He is certainly tough-talking, a "Sarkozy of the left", who is little appreciated by those on the left wing of his own party, and even less by the Greens, who have now quit the government. To succeed, he will need the full support of his ministers and of his fractious party in the French parliament, and it is by no means sure that he will get it; there are so many, particularly in the French political establishment, who remain fundamentally hostile to many of the changes that are needed.
A historic inability to changeThere is absolutely nothing new about this. This is the way France works. While many nations - including Britain - have had their revolutions, few pay such intense hommage to their Revolutionary heritage as the French. La Révolution is a point of reference for France, and to this day, the great revolutionaries – however murderous or bloody they may have been – remain revered as great figures of French history; and their greatest success was surely that they managed to change France. France is a country that has great difficulty changing or moving forward, other than in moments of revolution or great upheaval. French revolutionaries were people who actually succededed in imposing change on France – just like that great French hero of modern times, General de Gaulle, who also changed France profoundly.
More recently, over the past 30 years, successive French governments have vowed to change France, to modernise the country, to cut out waste, to simplify administration. There have been plenty of small changes, but the great reforms of the French state and the French economy, which have been recognised as essential since the 1980s, have not materialised.
It is not that successive governments have failed to propose reform: much has been proposed. Over the past decades, major projects have been put forward by successive governments to reform the economy, the education system, the jobs market, the French local administrative system, the increasingly cash-strapped health service (la sécurité sociale) , and much more. But apart from populist measures such as the reduction of the statutory working week to 35 hours, or the introduction of the 5th week of paid holidays, back in 1982, most important reforms have either gone through watered down in the face of serious opposition, been completely abandoned, or even rolled back by ensuing governments.
In 1995, for instance, during the presidency of Jacques Chirac, prime minister Alain Juppé was forced to abandon a major and necessary reform of the public sector pension system in the face of opposition from the unions. The consequences of this failure to reform have haunted France's rulers ever since, as the deficits of certain French public retirement schemes have continued to grow, leaving this as one of the major malfunctions of the French economy to this day.
President Sarkozy pushed through pension reforms in 2010, but only in the face of massive protest from the unions and others; and the Sarkozy pension reforms were insufficient to establish state pensions on a sound financial basis for the forseeable future. Worse, some bits of the reform - albeit minor and largely symbolic - were subsequently rolled back by President Hollande. The problem remains.
Another reform that has been talked about for many years is the need to modernise local government in France. In the 2000s, two official reports proposed reducing the number and multiple levels of local government and administration in France. Just after his election in 2007, new right-wing president Nicolas Sarkozy asked the economist Jacques Attali, a former adviser to socialist president François Mitterrand, to draw up a list of ways to simplify French bureaucracy, reduce its cost and generally modernise it, and get France out of its economic plight. The Attali commission produced a white paper outlining 316 propositions, including twenty major actions to be undertaken. One of the most significant of these was territorial reform. One might have thought that a report commissioned by a conservative President from a socialist economic consultant might garner enough consensual support to serve as a roadmap for change; but nothing has yet been done.
Territorial administration in today's France remains nightmarishly complex and costly to run. France has 40% of all the local authorities exisisting in the whole of the European Union (28 countries), and up to five levels of local administration, many of them duplicating the same services or competing. There are regions, then departments, then cantons, then "intercommunalités", and finally "communes" - of which there are 36,000 in France, each with its elected mayor and municipal council. While some urban communes are big - with over 200,000 inhabitants, many rural communes are tiny, with sometimes less than 100 voters and even fewer who have the skills to run a local authority, however small.
Attali proposed completing territorial reform within ten years, mergeing regions and departments or suppressing one of the levels, and greatly reducing the number of communes. The proposals were all pretty logical, in terms of improving efficiency and reducing waste; but nothing, yet, has happened. Reforming local administration would have stepped on the toes (and jobs) of so many local politicians and voters, that neither the Sarkozy government nor Hollande, during his first two years, made any progress on this highly symbolic structural change.
If Manuel Valls is to succeed, reforming pensions, local administration, bureaucracy, the tax system and employment law will be among the big changes that will need to be pushed through, in the face of opposition in parliament, and doubtless in the street too.
France can change; France must change. Failure to make the necessary changes in the past has led to revolutions and other major social and structural upheavals; currently it is leading to an upsurge in support for the extreme right-wing National Front. The cards are on the table; Valls will need to play is hand with great skill.
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