The Times THURSDAY, MARCH 17, 1938. France and the Crisis

Manawatu Times, Volume 63, Issue 64, 17 March 1938, Page 6

The Times THURSDAY, MARCH 17, 1938. France and the Crisis

ITance’s latest political crisis was much more easily solved than was anticipated because in the iace ot the international menace all parties agreed to sink their differences and accept a Government which otherwise might have met with strongopposition. In June last M. Blum, the Prime Minister, who led a Government oi tile Left, asked for full financial powers. This request was refused, and he resigned. He was succeeded by M. Ghautemps, who formed a composite Cabinet, including M. Blum, with a much more moderate policy. It continued to function till about six weeks ago, when the Socialist Ministers withdrew. M. Ghautemps thereupon resigned, after declaring that there was nothing to justify tfie attacks on the Government that had been made, for the Budget was balanced and the Treasury was in a position to meet all its immediate obligations. There was a tense struggle behind tlie scenes between bigbusiness interests and the supporters of the Popular Front. The financiers and industrialists feared that if the Popular Front was not broken it would push through Parliament a new Labour code more drastic than that which M. Blum had passed, one effect of which had been greatly to increase the costs of production with the inevitable rise in internal prices. With the resignation of the Government a period of political chaos followed. The President called on various leaders, M. Blum being among them, to form a Cabinet. They all failed, in the end M. Lebrun had to fall back on M. Ghautemps, who remarked: “You see we have looped the loop and have come back to where we left off.” The upshot was the formation of a Radical Government which was assured the support of M. Blum’s Socialists and the Communists. M. Ghautemps, in his policy speech, said the social advantages which the working class had recently acquired would not be impaired. There would be further legislation on the matter, and provision would be made for workers’ pensions.

The next move Was a demand by M. Ghautemps for full financial powers. He declared that he would resign if his request was not granted. The Chamber declined to grant the powers asked for and the Prime Minister resigned. It is difficult to understana“the actions of M. Chautemps, for he said that France was not experiencing a pressing Treasury need, adding that he had intended using the extended powers only in the interests of the country, the idea being to place the Government beyond the reach of an isolated incident in the Chamber of Deputies. That was not a very convincing explanation.

The clouds on the international horizon changed the situation. The Socialist National Council and the Confederation of Labour modified their attitude, and favoured the formation of a National Government. This is characteristic of the country, which in time of peace is hopelessly divided by political quarrels, but when danger threatens from without the ranks are closed and a united front presented.

The internal troubles of France are caused by the difficulty of achieving budgetary equilibrium, due to the reluctance of the people to submit to adequate taxation, and the industrial unrest, resulting in constant strikes. The effect of the introduction of the forty-hour week is referred to in an oblique way in the annual report of the Bank of France, which emphasises the urgent need for an immediate increase in production. The report declares that the financial resources of private enterprise are insufficient, that a cheap money policy must be enforced, and that France must seek its salvation in “its own riches and its qualities of labour and saving.” The solution of French difficulties, the report adds, lies in improving the balance of trade, which in 1937 showed an import surplus of 17,000 million francs—a deficit which lies at the root of the weakness of the franc, and involved a heavy loss of gold from the banks in 1937.