Why is France unable to reach social compromises?

As today sees a tenth general strike in France against the pension reform, an exit is needed from decrees and street clashes towards negotiated governance.

The disastrous pension reform launched by the president, Emmanuel Macron, in France raises once again recurring questions for French society. Why does it almost never manage to negotiate social compromises? Why are there repeated strikes and demonstrations most of its neighbours hardly ever experience, at least in comparable proportions? And what can be done about it?

It’s a long story that goes back to the French revolution. Contrary to what many think, the revolution was above all a great liberal moment, economically and socially. One of the first tasks of the revolutionaries was to abolish the guilds holding back economic dynamism. But with the d’Allarde decree and the Le Chapelier law adopted in 1791 they also banned all forms of nascent unionism and contractual negotiation. As Isaac Le Chapelier put it, ‘no one is allowed to inspire citizens with an intermediary interest, to separate them from the public thing by a corporate spirit’. Between the state and the citizen, the republic does not want to recognise any ‘intermediate body’.

While in the rest of the western world, trade unions were gradually developing, it was not until 1864 that strikes were no longer considered offences in France and 1884 that unions were officially recognised. In 1895, trade unions and labour exchanges federated to form the Confédération Générale du Travail (CGT) but the latter decided in 1906, with the Charter of Amiens, not to join forces with the socialists who had just achieved unity the previous year, contrary to what had happened in almost all other developed countries. This missed opportunity contributed to a lasting division and weakening of the labour movement. It delayed the institutional recognition of trade unionism.

Negotiation very limited

Social negotiation remained very limited and trade unionism was actively combated by the public authorities, particularly the government of Georges Clemenceau. During World War I, the CGT was involved in the management of the war economy but the Russian revolution of 1917 and the divisions it brought about weakened French trade unionism once again.

In 1936 came the Front populaire with its social conquests but the episode lasted only a few months and was followed by fierce repression during the second world war. Then there was the Conseil national de la Résistance and its famous programme, followed by reconstruction and the Commissariat général du Plan, with which trade unionism was closely associated. The cold war however quickly divided trade unionism once more.

The Fifth Republic and its Bonapartist constitution was never very much inclined towards social negotiation. On the contrary, in 1967 the president, Charles de Gaulle, excluded the trade unions from the management of social security. Although ‘May ’68’ brought new advances for workers’ rights, in the succeeding years the right wing, still in power, and the employers did nothing to encourage social negotiation in a context of increased conflict and a worsening economic crisis.

When the left came to power in 1981, it was marked in all its components by statist and Jacobin reflexes towards social rights. It was uncomfortable with a French trade unionism as weak as ever, further fragmented with the emergence of Solidaires, l’Union Nationale des Syndicats Autonomesand the Fédération Syndicale Unitaire.

Structural conflict

For two centuries, France has therefore remained a country where social issues are mainly settled by law or in the streets and on the barricades. This has its charm and may appear romantic from afar. But from the point of view of economic and social efficiency, there is little doubt that its Nordic and Germanic neighbours benefit from their ability to reach social compromises more easily and more regularly. They are thus able to develop their societies without major clashes. It is thanks to this that their economies are more innovative and resilient, particularly in industry, despite high labour costs.

With its tendency to structural conflict, France is however also an exception compared with Italy or Spain. There, although trade unionism is divided along ideological lines as in France (albeit to a lesser extent), a culture of social pacts has been manageable.

After the strong tensions caused by the law establishing the 35-hour week at the turn of the millennium, a consensus was reached that, in the social field, France had too many laws and not enough contracts. The space for social negotiation had to be expanded.

‘Social refoundation’

A refondation sociale was supported in particular by the Mouvement des entreprises de France (Medef) under Ernest-Antoine Seillière and the Confédération Française Démocratique du Travail (CFDT), led at the time by Nicole Notat. But Bernard Thibault’s CGT, which had broken away from the Parti Communiste Français and was looking for its place in the French institutional landscape, was not hostile.

The desire was also widely shared across the political spectrum. The left parties, which were in opposition, could not but subscribe to an attempt to social-democratise French society. But it was mainly the right which was at the forefront. The current president of the Senate, Gérard Larcher, then minister of labour, left his name to a 2007 law which stipulated that, before legislating on labour issues, the government should first allow the social partners to negotiate—if they reached an agreement, it would become law.

In 2006, the CGT, the CFDT, Medef and the small-and-medium enterprises’ confederation had agreed a reform of trade union representation which would be based on electoral outcomes in companies. Nicolas Sarkozy, elected as president the following year, supported this movement to facilitate social negotiation at all levels by increasing the democratic legitimacy of agreements.

Return to statism

But this approach was often implemented without real conviction and with backward steps. The Larcher law contained many loopholes. The urgency imposed by the multiplication of crises, particularly the financial crisis of 2008 and its aftermath, provided a pretext for French technocracy to impose a return to statism.

Above all, the reform of trade union representation missed its target. It had been conceived as a means of getting the unions—in particular the CGT and the CFDT—to unite, by introducing a 50 per cent threshold for validating agreements across professional groups. But the weakening of the CGT meant that the CFDT and its ‘reformist’ allies alone secured this famous 50 per cent, pushing the CGT into systematic opposition and thus ultimately aggravating trade union division instead of reducing it. Moreover, the employers, obtaining almost everything they wanted from the successive presidential administrations of Sarkozy, François Hollande and Macron, were no longer asking for social negotiations which would have forced them to compromise.

At the beginning of his mandate in 2012, Hollande tried to revive somewhat this social-democratic approach. But he quickly gave in to the Jacobin and authoritarian policies sought by his prime minister, Manuel Valls, and his minister of the economy, Macron. They were competing to see who would be the most anti-social and the most neoliberal on the economy. This led to disaster for the entire left.

Since the start of his mandate as in 2017, with the labour ordinances, Macron has openly chosen to follow the opposite path of these attempts at social-democratisation—authoritarianism and statism. After having already triggered the revolt of the gilets jaunes, the longest and most violent of the entire postwar period, with a particularly unfair tax policy at the beginning of his first term, he stirred up the largest social movement of the last 30 years with the pension-reform project at the beginning of his second term.

Thanks to the spirit of responsibility shown by the trade unions, for once united against this project, this massive opposition took non-violent forms this time (although this has frayed at the margins). But the government only saw it as a sign of weakness, allowing it to show even more intransigence than in the face of the gilets jaunes.

Perverse dynamic

Can France get out of this perverse dynamic, which is leading the country into the wall on a democratic, economic and social level? It is obviously not easy, insofar as these authoritarian practices and this refusal to negotiate are deeply rooted in French history. But there is nothing genetic or irreversible about it.

France needs to move in four directions. First, it must change the governance of companies, still essentially feudal structures. It is enough to copy the German model, co-determination, which gives employee representatives infinitely more power than in France. And this is true, from the threshold of five employees, not only through the equal presence of employees’ representatives on supervisory boards but also in each establishment where works councils have extensive veto powers.

There must also be strong pressure on the unions to unite, or even merge, to get out of the fragmented landscape debilitating French trade unionism. This means, in particular, strengthening the rules governing the validity of majority agreements: the majority must be raised above 50 per cent, to 66.6 or 75 per cent. This is often considered impossible because it would imply reaching agreements with the CGT or Solidaires, considered opposed to any compromise. But this is a too static view: if they have to be responsible, they will very quickly get out of this position.

The effective presence of employee representatives must further be generalised in small companies. This means in particular the creation of representative bodies in the networks of franchisees which today structure most of local trade and personal services. Indeed, it is to a significant extent the abandonment of employees in these small businesses that feeds the decline of trade unionism and the political left and the rise of the extreme right.

Finally, the Larcher law must be reworked to define better the relationship between social democracy and political democracy at national level. This entails increasing the powers of the Conseil économique, social et environmental and renewing the governance of social protection, to get it out of the clutches of the Ministry of Finance.

The difficulty, of course, is that in a political landscape polarised between hard-line, authoritarian liberals and Jacobin populists, of the right and left, the forces likely to carry such a project are today very weak. Yet France’s future depends significantly on its ability to turn the page on authoritarianism and statism in the management of the social sphere. As William of Orange said, ‘It is not necessary to hope to undertake nor to succeed to persevere …’

This was originally published in French in Alternatives économiques