France’s present economic plight, ofnwhich I will simply pick out three. Thenfirst has been the increasingly glaringndiscrepancy between what French manufacturingnindustry needs and what anhopelessly sclerotic, monstrously bureaucratized,nand centrally controlled educationalnsystem is able to provide. Toncite but one example: the Peugeot automobilencompany, run by Jacques Calvet—thenvery prototype of the capitalistnmagnate most French Socialists abhor,nbut who had been one of Edith Cressoii’snfirmest supporters in demandingnmeasures to dam the inrushing tide ofnJapanese manufactured goods—neededna full year to recruit the 1,500 engineersnand qualified technicians needed to operatenan ultramodern plant it recentlynopened at Poissy, northwest of Paris. Atnthe present time some 14,000 engineersnare graduated every year in France, whennat least 25,000 are needed—amongnother things to manufacture and controlnthe robots increasingly used in manynfields of production. (A year and a halfnago, in an eye-opening article publishednin Figaro, one of France’s most persistentnmodernists, Jean-Jacques Servan-nSchreiber, was already sounding thenalarm, pointing out that Japan’s manufacturingnsupremacy was due in no smallnpart to the awesome fact that it hadn175,000 robots in operation, comparednto a mere 35,000 for all of Europe.)nAnother root cause of France’s presentnindustrial woes has been a built-innsystem of job security that has remainednvirtually unchanged since the immediatenpostwar years. During that period, whichnbegan with General de Gaulle’s 16monthnpremiership (September 1944-nJanuary 1946), when the French railways,nthe steel and coal industry, and fivenleading banks were nationalized, thenmain aim of social policy was to assureneach French working man and womannguaranteed stability of employment.nThis proclaimed objective of “justice fornthe worker” was naturally championednby the communists, who for a dozennyears controlled 25 percent of the vote,nand for similar ideological reasons by thenSocialists, who formed one of the threensupporting pillars of the short-livedncoalition governments that were formednand that kept collapsing right up untilnthe end of the Fourth Republic.nIn 1958, when Gharles de Gaulle returnednto power, first as premier, then asnpresident of the republic, he chose anconservative, Antoine Pinay, to be his fi­nnance minister. But Pinay, one of thenmost underrated French politicians ofnmodern times, did not share DenGaulle’s anti-Anglo-Saxon and anti-NA­nTO prejudices or the General’s addictionnto prestige politics, and after 18nmonths in office he resigned. His placenwas taken by a brilliant graduate of thenEcole Polytechnique (roughly speaking,nthe equivalent of our M. I. T.), ValerynGiscard d’Estaing, an ardent dirigistenwho invented the pernicious ValuenAdded Tax (a boon for finance ministriesnbut a bookkeeping nightmare fornshopkeepers and entrepreneurs) andnwho was an ambitious and often demagogicnopportunist with one eye trainednon the presidency.nIt can be argued that, even if Francenhad been fortunate enough to have anLudwig Erhard to free its economy fromnthe shackles of state control, it wouldnnot have made that much difference,ngiven the unimaginative stodginess ofnmany French entrepreneurs and the lacknof worker discipline in a country that hasnno less than four major labor confederationsnand where today only one workernin every ten actually belongs to a union.nBut what is undeniable is that under the ,nsuccessive presidencies of Georges Pompidoun(1969-1974), Valery Giscard d’Estaingn(1974-1981), and for the first fivenyears of Frangois Mitterrand’s presidentialnterm, the credo of job security remainednan “untouchable,” a sacred cow.nThis meant, in practice, that no entrepreneurnwishing to expand his operationsncould hire a worker or an employeenand then decide to fire him ornher at short notice for laziness or incompetencenwithout having to pay exorbitantnamounts of compensationnaccording to complicated stipulationsnprescribed by the state. For big concernsnpossessing large capital resources or partlynfinanced by the state, the indemnitiesnhaving to be paid out for the laying-offnof workers have never posed a majornproblem, but they have had a disastrouslyninhibiting effect on the managersnof medium and small companies in ancountry where two out of every threennewly formed enterprises founder beforenthe end of the third year.nIt would of course be expecting toonmuch of a Socialist government to graspna nettle of this kind. But in 1986, whenna conservative coalition led by JacquesnGhirac toppled the Socialist governmentnof Laurent Fabius, the moment seemednto have arrived at last for a wholesalennndismantling of the complex fiscal restrictionsnand taxes that had long beenncrippling medium and small enterprisesn(most of which in France employ from 1nto 500 workers). Jean-Marie Benoist,nwho at the time was the self-appointedn”philosopher” of the Chiracian “renaissance,”nadvocated the launching ofnan all-out offensive, employing thenNapoleonic language of “one hundredndays” as the limited time available fornmaking decisive breakthroughs on thenlegislative front before the powers of inertianregained the upper hand. Unfortunately,nhis “strongman” idol turnednout to have feet of clay; for JacquesnChirac, like his successor, Michel Rocard,nis a typical product of the EeolenNationale d’Administration, where futuren”public servants” (including manynpoliticians) were until recently trained innan emphatically dirigiste atmosphere.nFaced by the prospect of tens and perhapsnof hundreds of thousands of workersntaking to the streets behind theirnleft-wing rabble-rousers to uphold thensacrosanct “right to work,” Chirac’sncourage failed him, and the Napoleonicn”offensive” bogged down in the usualnmorass of interminable negotiations.nIt has been calculated that if Frenchnmanagers of medium and small enterprisesn(roughly one and a half millionnstrong and comprising 63 percent of thenlabor force in the un-nationalized industrial,ncommercial, and service sectors)nwere freed of their present fiscalnand other shackles, an unfettered freedomnto hire and dismiss workers couldnproduce as many as 500,000 new jobs—nin a country where the level of unemploymentnis now approaching the threenmillion mark. Such predictions are necessarilynspeculative. What is certain isnthat whereas from 1979 to 1988, majornFrench industrial concerns, in a “streamlining”ncampaign aimed at making themnmore efficient and better able to withstandnforeign competition, had to laynoff 870,000 workers and employees,nFrance’s medium and small enterprisesnmanaged to create 450,000 new jobs.nDue credit must be given to EdithnGresson for having tried to reverse thentendency of previous governments to favornbig industrial concerns. “Small isnbeautiful” was the caption chosen by theneditors of the weekly Le Point for hernphotograph last September, when shencame out with a program of 19 specificnmeasures intended to help mediumnand small enterprises—but which, pre-nAUGUST 1992/41n