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Ethics and Economics | French protests may be an indication of future unrest

The French youth's protest of the CPE, a new labor law which would have allowed employers to fire any worker younger than 26 during a two year trial period of employment, reflects the deep social, cultural and political crisis evident in modern France.

French students took to the streets to protest the new labor law, calling it "absurd," "criminal" and "unjust."

The roots of this frustration run deep. Over 20 percent of French youths aged 15 to 24 are unemployed. This is one of the highest rates of youth unemployment in Western Europe. In addition, many French youths feel abandoned by the government and ignored by society.

Newspapers around the world were quick to draw parallels between the French protests of May 1968 and the events of March 2006. However, there is a major difference between the two.

The spontaneous events of May 3, 1968, when three hundred student activists met in the Sorbonne to protest against the closure of Nanterre University the day before, were followed by a week of clashes between extreme right wing groups and students campaigning against the Vietnam War. By May 18 over two million people were in the street demanding change.

In contrast, the events of March 2006 were organized by labor and student unions. It was not a spontaneous movement but rather an orchestrated upheaval. Like in May 1968, the protests did reflect the French youths' frustration with their government.

The March 2006 protests, however, demanded the change of a specific law, not a radical change in government.

French students certainly do have reason to protest. The rate of unemployment for 15 to 24 year old citizens is 23 percent overall and 45 percent in disadvantaged neighborhoods.

Students have lost so much purchasing power that, for the first time in French history, retired citizens over 65 have greater purchasing power than that of people under thirty. In addition, over 600,000 French youths are considered to live under the poverty line, and more are added each day.

The problem is that the French government, first under Mitterrand and currently under Chirac, has failed to make any constructive progress.

These two governments have spent millions on diverse forms of aid, temporary youth contracts, and plans to reduce the length of the work week.

All of these initiatives, however, simply appeased the public without tackling any of the underlying causes of unemployment: social unrest and the failed integration of immigrants.

Part of the problem has been that the government has been attempting to solve France's problems without consulting either the private sector or the public. The CPE is a perfect example of the government's failure.

In endorsing the CPE, Prime Minister Dominique de Villepin was attempting to satisfy employers who have been asking for employment reform. de Villepin reasoned that if companies were able to fire young people more easily than older workers, employers would be more likely to hire them.

This reasoning stems from the belief that hiring young workers under the new law would be less of a risk.

de Villepin, though, never asked employers whether they thought this new law was helpful. It turns out that even employers did not particularly like the law, because it failed to address the major problem of the French labor market - the enormous bureaucratic and legal cost that firms incur in order to terminate employees.

While it is a necessity to provide social services and benefits to these French workers, there must be mobility in the labor market for an economy to thrive. Such mobility does not currently exist in France.

Because the CPE law solved nothing and served no purpose, it was eventually struck down by President Chirac. Perhaps it was useful as a wake up call to French society, but even so, reform is needed now.

If change does not take place soon we could see a real reenactment of the events of May 1968 in the near future.