The Letter from Europe column from the January 1985 issue of the Socialist Standard
SOCIALISM = NEW POVERTY reads a poster stuck up all over Paris by a conservative students' association. Of course this has nothing to do with genuine socialism but concerns rather the false variety represented by Mitterrand and his "socialist party" who have been governing French capitalism since 1981. Since the number of destitute people has increased in France since Mitterrand came to power, and partly as a result of measures which running capitalism has obliged him and his government to adopt, this slogan is not entirely unjustified. Reformists masquerading as socialists have once again dragged the name of socialism through the mud.
One of the main electoral promises made by Mitterrand and the PS in 1981 was to reduce unemployment. In a televised debate Mitterrand declared that there would be two-and-a-half million unemployed by 1985 if the policy of the outgoing conservative President. Giscard. continued (Le Monde, 7 May 1981). Well, Mitterrand beat Giscard but unemployment continued to rise. The peak of 2.5 million was in fact reached in October 1984 . . . under Mitterrand. The only thing that the Mitterrand government has reduced has been unemployment benefit and the number of unemployed entitled to it.
Unemployment benefit was only introduced in France in 1959. Before then the unemployed had to rely on hand-outs from local councils. The scheme introduced in 1959 was not a state scheme but took the form of an agreement between the employers' organisation and the unions; both employers and workers paid contributions and the scheme (known as UNEDIC) was jointly administered by representatives of both sides of industry. The state also paid a subsidy to the scheme and a small allowance to some of those who exhausted their benefit rights under it.
In 1979 (under Giscard) this scheme was reformed. Basically the contributory scheme and the state dole were amalgamated under a single administration and both benefits and contributions were increased; in addition, a formula providing for an automatic state subsidy was agreed. By 1981. however, with the deepening of the economic crisis this new scheme turned out to be too generous by capitalism's standards. The task of rectifying this fell to the newly-elected Mitterrand government.
Their tactic was to try to push this unpopular task onto the employers and the unions who had negotiated the original agreement and the subsequent reforms. The employers were willing enough and they even went so far as to repudiate the 1958 agreement setting out the scheme but the unions, understandably, were more reluctant. In the event the government itself had to take a decision, by decree in November 1982. The effect of this decree was to worsen, except for certain cases of long-term unemployment, both benefits and the conditions for obtaining them while at the same time increasing contributions.
The employers and the unions subsequently negotiated a new scheme within the framework of this decree, which came into force in March 1984. Under double pressure from both the employers and the government the unions were compelled to accept a regression to the pre-1979 position — a reflection of their weakened bargaining position with two million unemployed. In addition to longer waiting periods, shorter benefit periods, harsher benefit conditions and reduced benefits, the previous dual system of contributory benefits followed by a means- tested state dole for some of those who had exhausted their contributory benefits was re-introduced.
The main way in which the November 1982 decree saved money for the government was by reducing the number of the unemployed in receipt of benefit. A surprisingly high number of the unemployed in France receive no unemployment benefit at all. According to a survey carried out by UNEDIC and released to the press last November, some 40 per cent of job-seekers in France receive no benefit. This represents nearly a million people. Some of these will be married women with husbands in work or young people still living at home so they won't be completely destitute (though the standard of living of the families concerned is of course drastically reduced). However a large proportion of them must rely on charities or, as before 1959, on any hand-outs they can get from their local council.
Clearly, if you have no job and receive no unemployment benefit of any kind then, unless someone else in your family is working or is in receipt of some other state benefit, you soon become completely destitute. Which is precisely what has happened: the ranks of the traditionally destitute — the handicapped, single mothers, ex-prisoners, ex-mental patients, old age pensioners - have been swelled by the benefitless unemployed, the "new poor”.
According to the UNEDIC study, of the 600,000 ejected from the contributory scheme since the November 1982 decree came into force "one out of three are today without resources" (Liberation, 6 November 1984); that is. some 200.000. To this must be added a similar, or perhaps larger, proportion of the 600,000 or so whose application for unemployment benefit was rejected over the previous 12 months. At least 400,000 people reduced to complete destitution and dependence on charity — a fine achievement for a caring, reforming government such as Mitterrand's claimed to be!
The appearance of these "new poor" has been highly embarrassing for the Mitterrand government which came to power on promises to improve workers' living standards rather than preside over the growth of destitution among the working class. In October last year they did announce a pathetic attempt to alleviate this problem, the main feature of which was to increase the wealth tax on the very rich to buy "surplus" food to give to the poor and to subsidise various charities operating in this field.
This appearance of the "new poor” represents not just a failure of the Mitterrand government to humanise capitalism for the workers but is even a direct consequence of measures they themselves took to cut back on the cost of the unemployment benefit scheme. Admittedly this was something forced on them by the logic of capitalism, but then resisting the logic of capitalism was one of the things they claimed to be able to do if they were elected to power.
We have consistently argued that this is not possible, at least not for any length of time. Any government of capitalism, whatever the intentions or background of its members, is sooner or later forced to apply the logic of capitalism. The growth of primary poverty in France is yet another proof of this.