- The Washington Times - Sunday, June 19, 2005

PARIS — An ambitious plan to revive the French economy faces growing problems amid recriminations and opposition charges of government ineptitude.

Barely three weeks after French voters rejected the proposed European Union constitution, labor unions are threatening walkouts and demonstrations, fearing that the well-embedded welfare state system is in jeopardy.

For the time being, Prime Minister Dominique de Villepin, a flamboyant poet and former diplomat, has given little indication about how his program to reduce a debilitating 10 percent unemployment rate is progressing.

Appointed by President Jacques Chirac after the May 29 referendum that plunged the European Union into crisis, Mr. de Villepin promised to heal the ailing economy within 100 days and to give frequent reports to the skeptical public.

Opponents say that his program is inadequate and that the conservative government has either misread or camouflaged the causes and implications of the resounding “no” vote in the referendum.

The country, said former President Valery Giscard d’Estaing, voted not so much against the constitution as for a radical change in the system — including Mr. Chirac’s presidency. Mr. Giscard d’Estaing headed the committee that drafted the rejected 450-page EU charter.

According to most assessments, Mr. Chirac’s recent Cabinet reshuffle has brought no major changes or innovative ideas, despite Mr. de Villepin’s somewhat strained enthusiasm. Many say the measures announced so far are cosmetic in nature.

The opposition’s view was reinforced Thursday by the 30-nation Organization for Economic Cooperation and Development (OECD), which said the government had to take stronger action if it intended to live up to its pledge.

“What we urgently need is not a succession of mini-measures but stimulated growth,” said Dominique Strauss-Kahn, a prominent figure in the French Socialist Party.

The government has staked its future on a $5 billion program under which enterprises could hire workers on a short-term basis without contract or tenure. The scheme would at least temporarily boost employment, but is anathema to the average French worker, who values job security more than anything else.

MEDEF, a conservative employers’ association still smarting from the 35-hour week introduced by the previous socialist government, tentatively approved the latest measures. But even some members of the governing center-right coalition described the program outlined by Mr. de Villepin as “useful but not miraculous.”

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