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Socialism Today 159 - June 2012

French elections: austerity rejected

THE FRENCH and Greek elections are the most influential electoral rejections of austerity so far, marking a new stage in Europe’s crisis. Alongside the deepening economic and social crisis they have forced leader after leader to speak of economic growth, at least verbally. François Hollande’s victory made Nicolas Sarkozy the eighth European leader or government to be defeated in the last year.

Following the massive struggle over pensions in 2010 many French workers, youth and other layers turned their attention to preventing Sarkozy’s re-election. But it was not only a personal vote against the arrogant, rude, ‘bling-bling’ Sarkozy. It was also a rejection of the attacks he had presided over and a reaction to the mounting impact of the economic crisis on working people.

Hollande’s victory had most support from young people. Among 18-24 year-olds he polled 60% to 40%, a percentage which was exactly reversed with the over 65s. Although many voted Hollande mainly to oust Sarkozy, his victory has created big hopes and expectations – not just in France but internationally – that the tide is beginning to turn against the assault on living standards. Hollande had to reflect the growing pressure from below, making some limited promises and presenting himself as an anti-austerity, pro-growth candidate. He made a number of pledges, including increasing the minimum wage, creating 150,000 youth ‘jobs of the future’, hiring 60,000 new teachers and 5,000 additional police.

Hollande continued the pro-growth theme on election night. "Austerity can no longer be the only option", he said in a victory speech in his Tulle constituency. Later Hollande told the crowd at the Bastille, Paris: "You are much more than a people who want change. You are already a movement that is rising across all of Europe and maybe the world". But can Hollande deliver what millions are demanding?

Hollande’s narrow victory was the first Parti Socialiste (PS) presidential election success for 24 years and only the third (after 1981 and 1988) in the history of the fifth republic, established by General de Gaulle in 1958. But this is not a victory for socialism in the sense of breaking with capitalism. Although Hollande said his "true adversary was the world of finance", he does not stand for the nationalisation of the banks, finance companies and major concerns. His proposals were limited to measures to curb some of their activities and impose a ‘real’ tax on financial transactions.

PS leaders can sound radical, especially when they are challenged from the left. On election night, Ségolène Royal, PS candidate in 2007, declared to the Paris crowds: "With us, the banks will obey instead of commanding. There will be resistance, you will see. The power of money is still there". However, as Hollande’s new government shows, the PS is a party that seeks to work within capitalism. The Financial Times commented approvingly that the "first words" of Hollande’s finance minister, Pierre Moscovici, were that "public debt is an enemy of the country".

Hollande plans to eliminate the budget deficit by 2017, just one year later than Sarkozy had planned to. Hollande also proposes to introduce a constitutional requirement for the government to have a balanced budget. In this capitalist crisis this means cutting living standards and jobs. A Financial Times editorial commented that the "good news is that Mr Hollande is keeping many changes of the past five years, even those his party initially opposed".

Hollande seeks to save €100 billion a year through tax increases and spending cuts, although he has not said what will be cut. While promising new jobs, Hollande has also said that the overall number of public-sector workers will not rise. However, Hollande’s economic plans (like Sarkozy’s) are based upon a 1.7% growth next year. This is looking increasingly unrealistic; low growth or no growth will increase the markets’ pressure on Hollande.

Nevertheless, many capitalists fear that Hollande will be under enormous pressure from below to at least limit the impact of the crisis. His victory will have strengthened the confidence of French workers, youth and other oppressed layers by showing that the right can be defeated. Initial polls forecast increased support for the PS and parties to its left in June’s parliamentary elections.

The right’s defeats can lead to a reawakening of the French tradition of mass movements starting from below that could force Hollande to go further than he initially planned. After the bitter experiences of the PS in office during the 1981-95 presidency of François Mitterrand, and Lionel Jospin’s PS/Parti Communiste coalition government (1997-2002), pressures will build among workers that they need to act themselves rather than simply wait for Hollande.

Struggles could break out over offensive demands like higher wages, or against attacks like redundancies. At the end of April, Hollande warned in Le Parisien that his victory would see a wave of redundancies: "Decisions have been taken that are being postponed. It will not be our arrival that will have triggered these redundancy plans". In a radio interview, he said: "I won’t allow this cortège of redundancy plans to take place". Workers facing the sack will try to hold him to his word.

Hollande and his government will face enormous pressure from markets to resist any opposition to cuts and to demands for increased living standards. At same time, there are growing divisions among governments and capitalists over what to do. Angela Merkel and the German government, while generally standing tough, are giving small hints of doing more for ‘growth’, while rejecting any changes to the fiscal treaty.

The day after Hollande’s victory, Merkel, spoke about "two sides of the same coin – progress is only achievable via solid finances plus growth". Merkel and co hope that Hollande will accept the addition of ‘growth’ measures alongside the fiscal treaty. Events could yet force the hand of the EU leaders, compelling them to accept some larger measures that attempt to alleviate the crisis.

Because Hollande seeks to operate within capitalism, even during the election campaign hints were being given of the limits of a PS government. At the same time as Hollande was promising positive reforms, Michel Sapin, his campaign policy chief and now employment minister, said family allowances could be cut. Privately, he told German diplomats: "We can’t do Keynesianism twice in ten years". Philippe Aghion, an adviser to Hollande, wrote in the Financial Times: "Hollande is the first French Socialist president to advocate a supply-side approach to growth".

The ongoing economic crisis and demands from below will put Hollande to the test. While not challenging capitalism, Hollande can be pushed in conflicting directions: being forced to give concessions and to carry through attacks.

After the experiences of the Mitterrand presidency and Jospin government, many workers in France do not trust the PS. It is seen by this radical layer as a party that administers capitalism. Jospin actually carried through more privatisation than governments of the traditional right. This is the reason for the increasingly enthusiastic support in the first round of this election for Jean-Luc Mélenchon, the Front de Gauche (FdG) candidate. His call for a "civic insurrection" to "take power" was seen as a rallying cry against the ruling class.

It is possible that Mélenchon will defeat Marine Le Pen, leader of the far-right Front National (FN), for a seat in June’s elections to the National Assembly. This anti-capitalist mood was also shown by the over 600,000 who voted in the first round for the Nouveau Parti Anticapitaliste (NPA) and Lutte Ouvrière (LO), to the left of the PS and FdG. Similarly, there were large votes in 2002 and 2007 for the LCR (the main component of the NPA) and LO, to the left of Jospin’s coalition.

Now, in this stormy period, Hollande will be put to the test. Because his government will base itself on capitalism, it is inevitable that, over a period of time, a process broadly similar to that under Jospin will unfold. But, as this is a time of economic and social crisis, it will be a far stormier period. This will see a radicalisation to the left, creating the chance of building a new force committed to breaking with capitalism. It will also see opportunities for the FN to mix populism, racism and nationalism to build upon the support it has already amassed. A new, tumultuous stage has opened both in France and Europe.

Robert Bechert


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