Students Pound the Streets, and Paris Beats a Retreat

TO explain Prime Minister Edouard Balladur's retreat from the youth minimum wage issue that has thrown trouble into French streets for the past month, one need only consult the country's political calendar: The presidential election on which Mr. Balladur's gaze is fixed takes place in a year.

After insisting as recently as March 25 that he would not scuttle a plan for providing the young jobs at less than minimum wage in exchange for on-the-job training, Mr. Balladur said in meetings with youth leaders three days later that the plan would be ``suspended'' for a week until an alternative could be created. Aides at the prime minister's Matignon offices said more succinctly that the plan will indeed be dropped.

With angry anti-Balladur slogans filling the streets - and thus the news media - the prime minister and his supporters worried about alienating the young and some of their parents.

Weeks of demonstrations by students culminated on March 25 in an ``anti-youth-wage day'' that brought out 200,000 youths in Paris and dozens of other cities. The action left the government facing an unpleasant dilemma: Maintain the new law at the risk of seeing a social malaise transformed into a damaging revolt, or scrap the law - and feed the impression of a government ready to retreat from positions at any sign of resistance.

With opinion polls showing a majority of the French opposed to the new law, and with signs of growing cracks in the government's once-solid ratings, the decision was made to retreat. With a under-the-surface rivalry in the French right heating up in anticipation of the spring 1995 presidential election, analysts say the Balladur camp wanted to cut short a street fight. Whether Balladur's official ``suspension'' of the youth wage will be enough to calm spirits looks doubtful. Student leaders announced their intention to maintain a March 31 demonstration.

In that context, the conservative Balladur government appears more frightened of a ``social explosion'' than of the potentially bad impression left by retreat. Already in his first year at the helm, Balladur has backed down three times in the face of public opposition: first before striking Air France employees last fall, then over higher public subsidies to private education, and most recently when fishermen protests over low prices turned violent.

Balladur's governing ``method,'' which appears increasingly to consist of offering initiatives and then modifying or simply dropping them in the face of public reaction, may in fact be well in tune with a French society clamoring for change but fearful of what that change might mean in a poor economic context.

Matignon aides are now highlighting the Air France case as an example of how Balladur's method works. An initial restructuring plan for the ailing airline may have been withdrawn following a debilitating employee strike, they admit. But now a new plan based more on consensus - and accomplishing what the first plan set out to do - is close to winning employee acceptance.

That begs the question of what Balladur will do now. Currently 1 of every 4 French youths aged 18 to 26 is out of work. And with many economists citing France's minimum wage of 5,900 francs (about $1,000) a month as a heavy impediment to hiring, most observers believe that the minimum wage will have to be addressed if high youth unemployment is to be reduced.

So far, the only alternative is creation of a separate youth unemployment agency. That may help address the perception among French youths that the government does not consider their needs. But such a measure alone seems unlikely to tempt a generation that sees little economic security on the horizon to throw out its placards reading ``Balladur: No Future.''