French Stand With Pension Strikers as Prices Soar and Energy Bills Bite

French unions vowed to bring the country to a standstill on March 7 as strikes over President Emmanuel Macron's pension reform gain momentum across the country. Even though the Elyse Palace earlier insisted that raising the retirement age to 64 by 2030 is "non-negotiable," protesters appear to be willing to prove to the contrary.

"The current and probably future strikes are particularly significant because of the support they enjoy in public opinion, but also because of the unity between the different trade union organizations," Jacques Sapir, director of studies at École des Hautes Études en Sciences Sociales (EHESS) in Paris and head of the Centre d'Étude des Modes d'Industrialisation (CEMI), told Sputnik.

"This point is particularly important. Even unions with a reputation for being 'reformist', and which had not taken part in the previous mobilizations against the pension reform, have joined – and sometimes even been at the initiative – of today’s movement," he continued.

Why Macron's Pensions Reform is a Powder Keg

Macron came up with the pension reform in 2017 when he was first elected. However, the French government failed to build consensus over the plan which saw the nation strike in December 2019 to reject it.

Over 30 unions launched industrial action and demonstrations in what turned into the longest period of strikes in the country since the uprising of May 1968. The protesters wanted the Macron government to throw out a plan to replace France's 42 separate pension regimes with a universal points-based system that would make the official retirement age of 62 obligatory for all workers and envisage it being raised to 64 . The COVID pandemic prompted Macron to shelve the reform in 2020.

Having been reelected in April 2022, Macron decided to return to the controversial reform in January 2023. In response, the French unions brought over a million people into the streets on January 19. Meanwhile, the president's plan has seen some changes: now it includes an increase of €100 ($107) per month to €1,200 for the minimum state pension as well as extra pension credits for those who have physically demanding jobs or began to work when they were very young.

Still, French Prime Minister Elisabeth Borne highlighted on January 29 that the headline age limit of 64 was "non-negotiable," insisting that it's the only way to lift France’s pensions system out of deficit by 2030.

Nonetheless, 1.27 million French returned to the streets on January 31, protesting against what they consider "one of the most brutal pension reforms for 30 years," as per the French union Confédération Française Démocratique du Travail.

Prior to the March 7 strike, unions promised to bring the country "to a standstill" and the French economy “to its knees”. Even though Borne denounced these calls as "irresponsible," 59% of citizens backed the idea to bring the country to a standstill, according to the Elabe survey, as quoted by the national media. At the same time, Macron's approval rating reached a three year low in February with just 32% saying they are happy with his presidency.

"This movement enjoys enormous sympathy in public opinion," Sapir pointed out. "A survey carried out by the IFOP (French Institute of Public Opinion) shows that in the population only 32% of those questioned are in favor of the government's pension reform project while 50% are completely opposed. If we only take into account the active population, we arrive at 75% of the people questioned who are opposed to the project, with rates which are even higher for those under thirty-five. All this has, and will have, political consequences for Emmanuel Macron."

The French economy is not in its best shape. Even though the nation's inflation is one of the lowest in the Eurozone, the country's annual inflation rate rose from 6% in January to 6.2% in February of 2023, well above the European Central Bank's 2% target. What's more, food inflation reached 14.5% in February year-on-year, as per INSEE, the French national statistics institute, prompting the Elyse Palace to strike a deal with major retailers to cap many food prices.

"These strikes, as such, say little about the real state of the French economy. The latter is ill," the French academic said. "The growth, however weak, that we recorded in the 3rd and 4th quarters of 2022, was only possible on the basis of extremely high public spending. In fact, the deterioration of the economic situation, of which the best indicator is the high inflation combined with a virtual stagnation of production, plays against the current protest movement. The French feel a deep concern which weighs on the social movement which visibly prevents it from being even wider than it is today."

Energy Crisis and Ukraine Conflict Fatigue

Meanwhile, soaring energy costs are also continuing to bite. This year the French government expects that household energy bills will rise by a whopping 15%. Still, according to Sapir, it's only the beginning.

The Bruegel Institute had calculated that, since July 1, 2022, the French government has spent €92 billion (about 4% of GDP) to protect the French against the effects of the energy crisis, according to the scholar. In total, €657 billion were spent by EU countries; €103 billion by Great Britain; and €8 billion by Norway. Sapir highlighted that these sums are comparable to those spent during the COVID-19 pandemic.

Nonetheless, the energy crisis is hitting the French hard in three different ways, according to the academic. First, it affects people through fuel and heating expenses which are going up despite the French government's measures. Second, it stings via the increase in food production and packaging costs, which is closely connected with soaring energy prices. Finally, this energy crisis also affects jobs in France: a whole series of small and medium-sized industrial companies are being gripped by rising energy prices.

"Overall, it is the international competitiveness of the French economy, and beyond that of the European economy, that will be affected by the rise in energy prices," Sapir continued. "So, if the direct and indirect effects of this increase will probably diminish from the second half of 2023, the question of the competitiveness of the economy will arise in an increasingly dramatic way in the coming years."

Europe's energy crisis, which started as a result of the combination of "green policies" envisaging phasing out the funding of fossil fuels and post-COVID energy deficits, was amplified by the West's anti-Russia energy embargo covering coal, oil, gas, and petroleum products over Moscow's special military operation in Ukraine. Simultaneously, the French government along with its NATO allies is prolonging the Russo-Ukrainian conflict by providing the Kiev regime with heavy military equipment and training.

So far, Paris has supplied Ukraine with a substantial number of Caesar cannons, anti-tank missiles, Crotale air defense missile batteries, and rocket launchers. Last month, France pledged to expand its military assistance to Kiev and supply it with armored combat vehicles. It is also training around 2,000 Ukrainian troops on French soil.

However, Ukraine conflict fatigue is gradually taking shape in France: thousands of people unhappy about French arms deliveries to Ukraine marched through Paris on February 26. Protests took place also in other parts of France. Demonstrators carried national flags and banners that read, "For Peace," "No to a Third World War" and "Let’s Quit NATO."

These citizens are well aware of the unfolding multi-facet crisis, according to the academic.

"If the French react very negatively to the direct and indirect effects of this crisis, in other words to the inflation that we are currently experiencing, and if they also express their anger by protesting against the pension reform project, they have no doubt not yet fully aware of the threats hanging over employment and economic activity," Sapir concluded.