Dominique de Villepin was appointed prime minister by President Jacques Chirac in the wake of the rejection of the European Constitution by the French electorate in the referendum of May 29. Upon assuming office, Villepin declared he would respond decisively within 100 days to the major concern of the French people: mass unemployment.

The new prime minister recognised that a major reason for the rejection of the European constitution was the perception that the neo-liberal “free market” policies enshrined in the constitutional treaty were fuelling unemployment and job insecurity.

The current unemployment rate in France stands at 10.2 percent, and has not dropped below 8 percent for two decades. One in four workers under the age of 25 is unemployed, with much higher rates on working class housing estates and amongst immigrants.

On June 8, Villepin unveiled his “emergency plan for employment.” Insisting on the need to “act quickly,” he used article 38 of the French constitution to impose his policies by decree, and thus avoid parliamentary debate, consultation with the trade unions, or any other normal democratic process.

Dressed up as a plan to boost employment, his scheme is a continuation of measures by successive governments—of the official “left” as well as of the right—to diminish workers’ rights and give concessions to employers, so as to encourage them to take on labour. Such gifts to the bosses have notably failed to achieve the stated aim of reducing unemployment.

Villepin’s “new employment contract” applies to firms of less than 10 employees and extends the probation period for new-hires, presently two to three months, to two years. During this period, bosses will be able to fire workers without any justification and without the worker having any legal redress for unfair or wrongful dismissal.

Promises of enhanced unemployment benefits for workers sacked under this plan, and help in finding another job, in no way diminish the fact that it represents a further attack on job security. It is a large breach in the labour code of legal protections for workers that has been developed since the end of World War II.

A statement issued by the main large employers’ organization, Medef, approved Villepin’s plan as a step in the right direction, but criticized it for being too limited. Medef “regretted,” in particular, the lack of sanctions against public service strikes and the absence of proposed cuts in public spending.

The small firms covered by Villepin’s plan represent 4 million workers in 2.2 million enterprises—some 36 percent of France’s total workforce. They have virtually no union representation and are therefore seen as a relatively easy target for such an attack on workers’ rights.

There are other provisions in the government’s plan to provide kickbacks to small companies that hire new employees. Levies on these firms for social programs are to be relaxed if they employ workers younger than 25. In addition, firms will be able to more freely alter the terms of employment for new-hires.

The labour correspondent for Libération explained in a June 9 article: “[T]he employment cheque removes the obligation to sign a work contract which would stipulate the wage, work time, length of the contract.... the boss could perfectly well promise 12 euros and pay only 7. Or he could impose unpaid overtime. In such a case, the employee will have great difficulty obtaining redress.”

Villepin’s plan also includes penalties for unemployed people who do not accept the jobs they are offered.

No political commentators, either from the official left or the right, give serious credence to the claim that these measures will have any but the most minimal effect on unemployment rates in France. The editorial of Le Monde on June 10underlined the stagnation of the French economy: “Without economic recovery, expectations of an improvement in employment are in vain.”

Villepin’s measures have met with verbal objections, but no serious challenge from the labour movement. Bernard Thibault, leader of the CGT trade union confederation and member of the Communist Party, said the Villepin government had made “a bad start,” but did not question its legitimacy. He pointed out that the new work contract “added up to the planned end of permanent work contracts, as demanded by Medef.”

Thibault, concerned at being excluded from the corridors of power, complained, “No meeting has been arranged for negotiations, the social dialogue has been ignored, social policy has been changed by decree, which is particularly unhealthy.”

The CGT called for a demonstration on June 21 against Villepin’s measures, which did not receive the support of other unions and which passed off unnoticed. This is in contrast to the vast movements of strikes and demonstrations against the previous Raffarin government’s privatisations of gas and electricity utilities, reduction of pension rights, and measures to break up the national education service.

The Villepin government has a 33 percent approval rating, while the poll numbers for President Chirac have plummeted to 24 percent. It is a government of crisis and bewilderment. Repudiated by the electorate, along with its loyal opposition, the Socialist Party, in the European Constitution referendum, the ruling Gaullist party embodies the chasm separating the entire political establishment from the broad masses of people.

This is why Villepin has resorted to government by decree to impose his programme. The administration can remain in place only because of the absence of any serious opposition from the official left parties or the trade unions.

The most evident opposition to the governing team comes from within: the minister of the interior and chairman of the Gaullist Union for a Popular Movement, Nicolas Sarkozy. He is seeking to turn the ruling UMP sharply to the right, and making open appeals to the electorate of the National Front.

Sarkozy is waging a propaganda campaign based on strident law-and-order demagogy and appeals to anti-immigrant racism, while fully backing Medef’s calls for the removal of all restraints on employers in relation to labour relations. He has already declared that he will stand against Chirac if Chirac seeks a third term as president in the 2007 elections.

Soon after taking over as prime minister, De Villepin, for the first time in over a decade, invited the neo-fascist National Front to participate in a round of prime ministerial consultations. Sarkozy was the most vehement supporter of this move to bring Jean-Marie Le Pen’s party in from the cold.