Citation
Nationalization France, 1930-1950

Material Information

Title:
Nationalization France, 1930-1950 the coal mining industry
Creator:
Lere Fisher, Julianne Louise
Publication Date:
Language:
English
Physical Description:
v, 154, [1] leaves : illustrations ; 29 cm

Subjects

Subjects / Keywords:
Coal mines and mining -- Government ownership -- France ( lcsh )
Coal mines and mining -- Government ownership ( fast )
France ( fast )
Genre:
bibliography ( marcgt )
theses ( marcgt )
non-fiction ( marcgt )

Notes

Bibliography:
Includes bibliographical references (leaves 152-155).
General Note:
Submitted in partial fulfillment of the requirements for the degree, Master of Arts, History.
General Note:
Department of History
Statement of Responsibility:
by Julianne Louise Lere Fisher.

Record Information

Source Institution:
University of Colorado Denver
Holding Location:
Auraria Library
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
31508804 ( OCLC )
ocm31508804
Classification:
LD1190.L57 1994m .L47 ( lcc )

Full Text
NATIONALIZATION
FRANCE: 1930-1950
THE COAL MINING INDUSTRY
by
Julianne Louise Lere (Fisher)
B. A. University of Colorado, Boulder, 1981
A thesis submitted to the
Faculty of the Graduate School of the
University of Colorado at Denver
in partial fulfillment
of the requirements for the degree of
Master of Arts
History
1994


This thesis for the Master of Arts
degree by
Julianne Louise Lere (Fisher)
has been approved for the
Department of
History
by
Frederick S. Allen

Date
/ff/
11


Lere (Fisher), Julianne Louise (M.A., History)
Nationalization France: 1930-1950 The Coal Mining
Industry.
Thesis directed by Professor Frederick S. Allen
ABSTRACT
Nationalization of French enterprises in the
interwar years was undertaken primarily for political
reasons, while in the post-WWII years it was pursued as
an economic remedy for the country's war woes.
Regardless of the goals, political infighting within the
government, major political parties and the labour
unions have limited its effectiveness to the point of
being a burden on the government and the nation's
economy. Yet, while nationalization may not be a totally
successful economic measure, there is evidence that it
has provided social and political benefits.
This abstract accurately represents the content of the
candidate's thesis. I recommend its publication.
Signed_
Frederick S. Allen


CONTENTS
CHAPTER
1. Introduction..................................1
2. Socialism and Nationalization.................5
Notes........................................31
3. Labour Unions and Nationalization............35
Notes........................................62
4. Nationalization of Industry..................66
Notes........................................87
5. Economic Planning and Nationalization........91
Notes.......................................105
6. The Nationalized Coal Industry..............108
Notes.......................................124
7. Current Nationalizations....................126
Notes.......................................146
8. Conclusion..................................149
BIBLIOGRAPHY....................................152
iv


TABLES
1. Associations and Syndicates/Production Workers.40
2. Rationing 1941.................................46
3. Strikes........................................54
4. Coal Production................................55
5. Index of Economic Movement.....................56
6. Nationalizations...............................72
7. Percentage Coal Use by Industry...............109
8. Coal Prices -vs- Industrial Prices............118
9. Coal Production..............................12 0
10. Productivity of Underground Coal Mines........12 0
11. Public Sector Investment.......................141
12. Western European State Owned Enterprises.......142
13. French State Share of Manufacturing............143
14. Profits or Losses of Private and
Public Industry................................144
v


Chapter One
Introduction
The economics of nationalization in French
industrial enterprise is highly integrated1 with the
political arena and cannot easily be separated for
individual study. The word nationalization carries
socialist connotations and therefore is not thought of
in economic terms alone. Indeed, it never was used as
such, but instead, to advance political agendas, enhance
industrial production, aid in modernization and to
improve workers conditions.
From the first ideas of economic planning, of
which nationalization played a large part, through the
changing economic and political tides, there have been
key people who have advocated the notion of economic
control through State owned industries. Among them, men
such as Leon Blum, who headed the first socialist
government in France, the Popular Front government for
the common man; Charles de Gaulle, bringing a spirit to
the French people that the world wars had all but taken
away, restoring their industrial will and strength; Jean
1


Monnet, the recognized father of the Coal and Steel
Community and supporter of the EEC, uniting economic
goals of opposing peoples and industries; and more
recently Francois Mitterrand, who pursued national-
zation, yet altered these policies according to the
changing political climate. It has not been exclusively
individuals that have pursued nationalization and
socialist ideals, but various groups as well, notably
labour unions and special interest groups.
Comparing the new economic ideas and measures
from before World War II to the 1980's coalition
government of Mitterrand clearly exhibits the influence
of the political and social climate on the economic
policies of France. The earlier period displays
socialist motives while later the government is more
supportive of the capitalism encroaching from an ever
expanding and influential world market. A synthesis of
the available information on French nationalization
gives an overall view of nationalization as a political
and economic system.
The advent of large-scale nationalized
industries in France took place under pressure to
2


rebuild and modernize after two devastating periods of
war and deprivation. Conflicting ideas made compromising
necessary on the particulars of industrial management,
worker participation, and level of government involve-
ment. This led to a less than satisfactory system,
effecting the politics and economics of nationalized
industry, and one that contributed to exploitation of
workers and of the government. In practice, national-
zation did not turn out to be the expected panacea,
although it did aid in the industrial modernization that
was needed, and temporarily improved the workers'
conditions. However, it did not consistently demonstrate
profitability and continuously drained the government of
resources. Within socialist ideology, nationalization
was not undertaken to be profitable in a monetary sense,
however, it has instead proved to be a liability to the
government. The coal mining industry is a clear example
of this type of "non-profit" enterprise.
Nationalization, the people who supported it and
those who opposed it, the labour unions' influence, and
the political policies surrounding it, all this will
clarify why it has not proved to be the expected saviour
3


for industry. An examination of nationalization
encompasses the people and the politics as well as a
study of the money involved in this venture of
government as owner. The ideals of socialism, the
history of these in France, and their ultimate role in
nationalization policies, give a background for
understanding France's economic pursuits. The
involvement of the labour unions and their role in
aiding or impeding the progress of nationalization
illustrates various opinions on government interference
Focusing on the coal industry, an early nationalized
enterprise, and a vitally important product, one can
present a more intensive view on nationalzation at work
An overall analysis of nationalization through the
present day will shed light on the condition of modern
nationalization.
4


Chapter Two
Socialism and Nationalization
European nationalization has often carried a
socialist element in its definition. While actually an
economic measure, the involvement of the government
introduces political maneuver, and therefore subjects it
to the ensuing tides and currents within the
governmental ideology. Not all Socialists in France
supported nationalization, while other non-Socialists
did, con-tradicting the notion of nationalization being
strictly a Socialist ideal.
In a work by Jean Jaures entitled Socialisme et
Pavsan he defines socialism as .the theoretic ex-
pression of the present economic phase of human evolu-
tion,"1 thus tying, as Marx had, political doctrine to
the economic nature of man's social existence.
Socialism, as well as other political doctrines, are
closely tied to other elements in society and cannot be
easily understood as a separately functioning ideal.
5


Socialism, Capitalism, and Communism are political
formats that help define the nature of a country and its
people. France has been known as a socialist country,
pursuing socialist ideals in many of their policies.
Yet, the ideals and their manifesta-tion in reality,
combined with changes brought by ad-vancing technology
and an expanding world market, are not always simply
"socialist."
In 1879, French socialists effected a political
organization, but it was not until 1893 that they became
a distinct political party.2 Even in their union,
however, there was separation, and the members fell into
two distinct groups. One followed the beliefs of Marx,
with its proletarian revolution and idea that socialism
was a step in the evolution of society and economy,
while the others believed that socialism provided
preservation of the self and that man must work toward
the goal of the ideal society through use of moral
guidelines.3 Together they supported the idea of
progress, individual rights, decentralized government,
and economic freedom.4 In France, the 1789 Revolution
6


initiated a social awareness that naturally moved into
the political sphere. It became the mission of Frenchmen
to socialize their politics and instate change. It was
felt that only "When 'la pauvrete sera en haut et la
richesse en bas', would the French Revolution really be
accomplished.1,5 That idealized society has not been
created in twentieth century France.
Industrialization has wrought great changes in
the world, creating new relationships among men and
their socioeconomic progress. These changes affected the
character and direction of socialist theory in France,
resulting in a profound psychological reaction to the
transformed industrial conditions.6 Differences between
men were no longer drawn according to status, but
according to possession, and therefore attributed to
aspects of the industrial world. More importantly, these
were elements that could be altered and controlled.7
This great social change also affected interindustrial
relations. The working classes were aroused to a
conception of itself as a class with a class struggle to
be fought out on political lines.'" They became aware of
7


their "situation," and at the same time, developed the
"unfortunate habit" of considering their interests as
apart from those of their employers.8
France was primed for a socialist movement. The
workers were armed with socialist ideals and a political
voice. The progression of proletariat alienation brought
on by the continuing technological advancements, as well
as extremist influences from the Communists to the east,
added conviction to their dissatisfaction. The addi-
tional complications of two wars, and the ensuing
economic hardships contributed to the need for a change
in governmental pursuits. Yet, the divided socialists
would find it difficult to effect change with dissension
in their ranks.
The beginning of the twentieth century witnessed
the presence of six groups pursuing socialist ideals,
each with only slight differences, yet none willing to
compromise and form a unified party. The French Workers
Party, (POF), led by Jules Guesdes (his followers often
referred to as Geusdists), believed in the Marxist
doctrine. They were established in the Nord, Pas-de-
8


Calais, Aube, Isere, Gironde, and Gard, representing the
majority of the coal fields. The Revolutionary Socialist
Party, (PSR), led by Edouard Vaillant, followed less of
a doctrine and more of a strategy to break with the
bourgeois order, believing in the radical seizure of
power. The Revolutionary Socialist Workers Party,
(POSR), was formed by the split in the Federation of
Socialist Workers of France (FTSF), and with Jean
Allemane leading, was the only party with true working
class leadership. They were opposed to Parliamentary
government and wanted to create regional federations to
decentralize the government.
The last two groups were comprised of men
without official organization. The independents were led
by Jean Jaures and had the largest number of socialist
legis- lators. Charles Peguy, acting alone but with
influential support, opened a bookstore, creating "a
bastion of socialism" by producing and selling militant
books and pamphlets. He published and distributed two
newspapers, La Revue Socialiste, and Le Mouvement
Socialiste. Although not within any organized party,
Peguy created his "bastion" with many important and
9


influential supporters, including economists,
historians, politicians, and some names famous in the
history of French socialism; Herr, Blum, and Durkheim.9
At the annual Congress meetings of the Socialist
parties attempts were made to unify the various
factions. In the early 1900's Jean Jaures was the only
one able to bring about unification, if even for a short
time. His authority was officially acknowledged at the
1908 Toulouse Congress. This unified party was named the
French Section of the Workers International, or SFIO.
Their Parliamentary representation consisted of 51
deputies in 1906, rising to 102 in 1914.10
The advent of WWI brought out disparate views
within the party. The socialists were generally in
support of the war at that time, but that would change
as the war itself was given a new meaning. England's
socialists denounced the war as "'militarism and
capitalist imperialism,'" while German socialists
launched an appeal for peace. Under this new format the
French socialists followed suit and organized
opposition. In July of 1915 the first French National
10


Council of the Socialists was held and they adopted the
resolution "'bring forth, in the face of the horrors of
war, the light that will lead the world to peace.'"11
The conflicting ideas on the participation in,
and hidden agenda of, the war led to discord within the
party. Communist influences particularly from the
U.S.S.R., calling for the "'proletarian of all
countries' to unite against imperialism," only provoked
further splits.12 Leon Blum, a friend and follower of
Jaures, strived to unite the disparate parts of the
party, and became the "inventor of an elusive socialist
'center.'"13 The wartime Congresses of the SFIO
illustrated that the question of national defense was a
major issue of disagreement within the party. Some
Socialists were shifting from a stance of reformist
nationalism to that of revolutionary pacifism.14 A large
number separated from those who wished to pursue
alliance with the Bolsheviks in Russia, calling
themselves "reconstructors," and wishing to pursue
"'action on the basis of the traditional principles of
socialism. "l5
11


The 1920's saw a shift of power to the
Communists. While largely Leftist, there were two
smaller sections within, representing the center and the
right, which met separately from the majority. It was
not until after 1924 that equilibrium was established
between the Communists and the Socialists, the
Communists forming the French Section of the Communist
International, SFIC.16 This uneasy collaboration
continued until the early thirties when a new group,
calling themselves "neo-socialists," emerged. Their main
platform was anti-fascism, trying to dissuade the
extreme tenet so prevalent at this time in Europe. They
were defeated in their desire for power but would come
to play an important role during France's occupation in
mu.
Political life in France was rife with problems
in the years before WWII. Anti-parliamentarianism, anti-
communism, and anti-Semitism all played roles in the
behaviour of the politicians and the people, and in the
outcomes of political decisions.17 Leon Blum himself
experienced much discrimination, being a Jew. It was the
12


presence of such strong sentiments that aided in the
long fought for unification of the French socialists
becoming a reality, giving the various factions some
common enemies.
Blum headed the Popular Front government
beginning in 1936, pursuing a philosophy to bring about
the assembly of "'all forces determined to defend
freedom1 and 'the great revolutionary tradition.'" Their
oath stated that they would defend democracy, place
freedoms out of reach of fascism, and "'give bread to
the workers, work to the young, and to the world a great
and human peace.'"18
The Popular Front government gave hope to those
workers and industrialists who had been dissatisfied
with their small role in government, not to mention the
dismal state of their lives and the terrible conditions
under which they toiled. Blum instituted a national
unemploy- ment fund, a reduced work week, and other
"socialist" ideals that supported the working
population.19 These actions instigated the 1936 workers
movement. As one worker related,
13


When you feel strong in the street, you cannot
continue to feel like a slave in the factory.
When you have seen tomorrow's Premier raise his
fist like a comrade before the wall of the
fighters of the Commune, how is it possible not
to believe that, this time, the government
is no longer on the side of the capitalists?
The movement ended with employers giving in on all
demands; union rights, freedom of opinion, recognition
of workers' delegates elected in the factories, and wage
increases of 7% for the highest paid to 15% for the
lowest.20
The peace within the party, however, did not
remain, and the Socialist Party Congress of Royan, in
June of 1938, witnessed a split between those that chose
resistance against Hitler and those that would choose
Hitler over resistance.21 This particular split was
terribly disheartening to Blum, who saw the growth of
Nazism as a "'real beginning of a universal state of
alarm,'" and calling for unified forces to combat its
spread.22 Even passive socialists came around reluctantly
to the need for national defense. Due to their pacifist
dogmas and the fact that Marxist schema clouded the
understanding of the true character of 20th century
14


fascism, they did not see that this new movement
actually transcended economic and class interests.23
Therefore the fact that the socialists held the largest
single bloc of opposition votes against the grant of
unrestricted powers to Petain and the Occupation forces
means little when no single unified force voted solidly
against it. The remnants of their solidarity had been
destroyed.24 Leon Blum, himself, voted emphatically
against Petain.
Leon Blum was a Frenchman from Alsace whose
father was in the silk and velvet business. Born in
April of 1872, Leon would grow up to become a lawyer by
pro- fession, an occassional theatre critic, and a
socialist. The first group that he joined was "Unite
Socialiste," and their efforts to unify socialist
factions greatly affected him.25 At the age of 25 he
became the youngest member of the Chamber of Deputies,
entering politics as an Opportunist (the Opportunists
believed that "each advance must await the opportune
moment") .26 Later, his first major political work was to
call for the national- zation of the railroads.27 While
15


continually active within the Socialist party he would
not become their leader until the 1930's.
Blum's beliefs were socialist and humanitarian
in nature. He was "sensitive to the irrationality of a
social and economic organization based solely on profit,
convinced that the will of men is capable of modifying
the realities of public life if only they become
conscious of their power."28 He felt that freedom and
equality were economic in nature and the formation of a
political republic was incomplete without leading to a
social republic, with workers rights within the economic
community.29
While bourgeois himself, not living "like a
socialist," Blum did have a diverse group of friends,
including artists, scientists, and political activists.
However, his high social status contributed to a certain
amount of mistrust on the left, and a rising suspicion
on the right. Also, in the 1920's, the Socialist Party
was reviving primarily through its provincial
connections, and Blum's Parisian roots were not an
asset.30
16


Blum's politics were somewhat vague, and he
himself was aware of potential failure. He felt that a
strong government, united political parties, a
revitalization of the parliamentary mechanism, and
management and administration run by modern industrial
methods would make for smooth running politics.31 Yet, he
realized that society was not a homogenous receptacle
for his ideas, and at one low period in his inspiration
he felt that there was "'nothing to be done with this
society as it is, we can expect nothing from it, the
resistances of egotism, routine, and self-interest are
insurmountable. "32
Blum's political ideas contained many economic
measures, yet, while he was Prime Minister he failed to
supplement his social reforms with these measures. He,
instead, placed the purchasing power into the hands of
the masses and assumed that prosperity would follow.33
Part of the reason for this is that social reforms are
easier to accomplish than economic measures,34 but Blum
also felt that a planned economy was indicative of a
regime between democracy and totalitarianism, one which
17


held great risk of falling into fascism.35 Blum's
political priority, however, was not economic, and he
viewed measures such as nationalization as only a step
towards a socialized society, as a means and not an end.
Questioned on his views on devaluation of the franc Blum
countered by asking, "'Who would claim that the mission
of this government is to assume the predominance of the
individual property rights of industrialists over the
collective interest which is called social peace?'"36 His
altruistic, yet vague, economic politics plagued his
government throughout its existence.
Without a real understanding of economics Blum
was nevertheless astounded by the power of it to affect
social change. Thirty five years after the conflict of
1897-99 between the monarchist, anti-Semitic Right and
the Left, he noted that France remained the same because
nothing had affected the "human condition". Equating
this to the Dreyfus Affair he asked, "'Is that why
historic crises like the "Affair" and the war have left
fewer traces in the world than a simple crisis of
industrial "overproduction"?'"37 He believed in the
18


connection between society and economics, but he could
not translate that into political action to affect
positive change.
The economic hard times of 1936 and 1937
resulted in criticism of the Popular Front government.
Blum resigned his office but due more to the shootings
called for by the French Socialist Party (PSF), in
March of 1937 than public pressure. He said to Georges
Monnet, "'It is impossible for me to accept that, while
I was the leader of the government, responsible, mounted
police made the blood of workers flow. Do you want to
take my place? I cannot stay.'"38 He resigned after
thirteen months in office.
The socialist theories that Blum pursued came
largely from his friend and colleague, Jean Jaures.
Jaures, in seeking to reconcile his own liberal idealism
with Marxism, entered the French socialist movement
while Blum was still a young boy. Under Jaures'
leadership, "French socialism developed into a
constitutional party, the advance guard of the
democratic groups, and not into a dogmatic class-bound
19


revolutionary movement."39 Although he was unwilling to
assume power next to Radicals, who represented the
bourgeoise, Jaures was considered the leader of
international peace in 1912. But he would not "lead"
until there was an "initial challenge to a system which
practically excluded workers and peasants from economic
growth."40 Jaures succeeded in holding together the
socialist factions in his lifetime, and Blum wished to
follow in his footsteps. He pursued Jaures' "motto," a
government which represented an ideology "between
materialism and idealism, between reformism and
revolution, between patriotism and internationalism."41
Based on these beliefs Blum could not support the
Revolution in Russia. He saw that it was backed not by a
party based on the people's will, or the will of the
masses, but by the small elite group in power.42 He did,
however, support French Communists for a time, perhaps
because he did not want French Communism to be
associated with Soviet or Hitlerite fascism. It was only
when the French Communists applauded moves made by
Stalin that he voiced his disapproval.43
20


When Blum came into power he saw two
requirements for the government: a proletarian unity,
and a Popular Republican Front. He pursued these in "'an
attempt...to act quickly in order to relieve the poverty
and injustice which are the breeding ground of
fascism.'"44 The Popular Front embodied the defense
against fascism, the political stance taken by leagues
on the extreme right.
Upon his resignation he stated that in reality
the Popular Front government was "'merely exercising
power through a coalition of parties within the
framework of present society and republican legality'"45,
and did not accomplish the desired changes. Despite the
lofty hopes and tremendous will behind the movement, the
socialists were constrained by their own indecisiveness
and internal divisions, as well as the situation in the
country. Despite its general popularity, there existed
numerous forces against the Popular Front government,
including the press, military circles, and certain
currents of the Catholic church.46 The center and right
21


particularly disliked the tendency towards state
intervention in the economy,47 although the Popular Front
government did not actively pursue nationalizations.
The Popular Front government did achieve some
success. The benefits gained for workers, such as more
leisure time, and an increased standard of living, aided
in demonstrating the use of their political voice to
achieve change. Yet it also aroused the bitterness of
employers who were forced to deal with concessions and
shop turmoil.48 The Popular Front government remains a
step in socialist history, one that sought to effect
great social change, yet was only partially successful.
During the WWII Occupation by Germany, Socialist
party organization suffered, yet, the end of the war
witnessed a French legislature that had never been so
leftist. In 1945, the Communists, Socialists, and the
Popular Republican Movement- (MRP), held 3/4 of the
votes, with the Communist Party emerging as the largest
party in France.49 Occupation and resistance had brought
France a degree of unity that had not been seen in a
generation or so. The National Resistance Council's
22


program of reforms, which included nationalization of
many enterprises, was widely supported. Charles de
Gaulle, at this time a "dictator by consent," brought
back much of the country's nationalistic vitality, but
did little in the way of economic measures to bolster
the sagging industries. He was neutral on the issue of
nationalization, feeling that full nationalization
should only be undertaken by a duly elected government,50
and being only temporarily in control, he did not wish
to decide on such important matters. The segments of the
economy that were nationalized at this time (gas,
electricity, the four largest deposit banks, and most of
the insurance companies) were actually instigated by the
coalition government that succeeded him in 1946.51
During the Fourth Republic, 1944 to 1958, the
French experiment in national economic planning by a
democracy was undertaken, and the next few years would
witness an impressive industrial and economic increase.
Important segments of the economy were nationalized, and
the formation of "works committees" represented the
possibility of a voice for workers in management.52 It
23


was in this post-WWII burst of shared goals and ideals
that France formed the Planning Commission. Headed by
Jean Monnet, it was to engineer a controlled economy
with directed investments.53
Jean Monnet, born in 1888 in Cognac, came to be
known as the father of the European Coal Community for
his years of work towards planned economic
collaboration. He was involved as consultant economist
in the Peace Conference, 1919-1920, made important
contacts in the United States and Germany during the
inter-war years, and in the 1940's he helped prepare
reconstruction plans for General de Gaulle. Heading the
Commission to modernize and re-equip France's ailing
industries after World War II, he implemented the Monnet
Plan, enabling France to better its pre-war industrial
level.54 Monnet had neutral political views, giving
priority to financial questions and seeing money only as
a tool to be used in the interest of economic growth.
His real interest lay in international relations, and
although affiliated with no organized political group,
he worked within the political sphere to reach his
24


goals.
Monnet felt that "financial stabilization must
never be allowed to take priority over modernization."55
Willing to take a risk for change, he was not always
popular with the common man. He was essentially neutral
on the issue of nationalizations, wishing only to
construct a "neo-liberal capitalism via the use of the
state."56 Nationalization within that economic construct
would be acceptable.
Monnet and de Gaulle both wanted the best for
France, but often opposed each other, morally as well as
materially. They lived in a modern world that seemed to
condemn the "ancient" powers, having to adapt themselves
to a new geopolitical configuration.57 They disagreed
about European unification, de Gaulle caring little for
giving up any of Frances "greatness" by ceding power for
unity, Monnet envisioning France as a vital part of the
United Europe, which could be an equal partner to the
USA.58 Both sides had validity, de Gaulle understanding
the reality of nationalism as an inhibitor of Europe's
ability to unite, and Monnet adament on the necessity of
25


expanding and empowering Europe's image and economic
place in the modern world.
There was no precedent in European tradition for
these new ideas. It was an economic philosophy that
"resembled neither state socialism nor the approach
preferred by the businessmen on the Continent, which was
to espouse the politics of economic liberalism on the
one hand, while practicing what in Germany was known as
industrial self-regulation on the other." European
businessmen objected to anything resembling "state
dictation" or dirigisme.59 Monnet saw a much larger
picture, however, one not only of European unity, but
also improved international government. He wanted a
political framework to manage common international
problems, "and to move beyond the fragmented purposes of
a world seen by many nation states."60 While not
technically nationalization, the kind of world economic
community that Monnet wished to form, and the type of
economic community that he did form within the coal and
steel industries, embody the idea of a controlled and
unified economic enterprise, which is the essence of
26


nationalization.
Nationalization as a socialist measure has
proved to be rather complex, involving desires and power
plays to gain political control over an economic
operation. Embodied in the history of socialist ideas is
the need to alter the social creed concerning property.61
Industial- ization changed that, and socialism in France
came to include the "... ideals which count happiness to
be conditioned by material possessions,".62 Adjusting to
the modern industrial world, socialists such as Babeuf,
Proudhon, and St. Simon preached the doctrine of
progress but held that all productive property should be
left in societies control.63 Socialists and Communists
did not agree that this meant control by the State, Blum
himself initially refusing cooperation with a
"bourgeois" administration. The grand socialist ideas of
a government of the people inevitably lost any power
with the realities, of the fragmented political parties
and labour unions in France.
The idea of nationalization itself was a vague
one within socialist ideology. Born of an ideological
27


reformist tradition, out of the research of forms
between collectivisation of the economy by orthodox
Marxists, and the powerful private industrial economy on
its way to rapid concentration, it inserted itself
rather uneasily into the global philosophy of
socialism.64 If it is a truth, uttered by Professor Oskar
Lange (State Council of the Polish Peoples Republic), in
a speech on the political economy of socialism, that
"the gradual reduction of political guidance of economic
processes is an essential reflection of the process of
maturation of socialist society,"65 then, through
nationalization France is not pursuing or achieving a
socialist society.
Perhaps it is wrong to consider nationalization
in the context of a political concept, an ideal pursued
to improve societies' political and social state. While
impossible to completely separate it from its political
entanglements, it should not be labeled as an embodiment
of a particular political platform, although that
distinction has allowed its backers to become the
scapegoats for its failures.
28


Nationalization essentially means to convert
industries from private to total or partial government
ownership. A simple definition for a concept that was
actually very complicated and controversial; the years
of waiting for compensation payments, the politics
involved in the decisions of which industries should be
nationalized and to what degree, the administration of
industries receiving input from the Prime Minister down
to the wage earner, as well as the need for almost
constant government subsidization. A simple definition
for a concept that was propagandized to bring freedom to
workers, economic success to war-torn France, political
power to the Socialists, and a fair and equitable stake
in industrial adminstration for all concerned parties.
Nationalization was a word that was given the power of
ideology, and could not help but disappoint those who
had affixed to it their hopes of a socialist state.
Labour unions were among those that considered
nationalization as a path to power. Through it they
hoped to achieve a meaningful political voice in
government, envisioning an expanded role in fighting for
workers rights. Yet, the labour unions were not
29


supported by all French workers, and with many different
unions representing various needs and goals, there was
no united group to form or sustain the necessary power
base to motivate significant changes.
30


Notes
1. Jessica Peixotto, The French Revolution and
Modern French Socialism (New York: Thomas Y. Crowill &
Company, Publishers, 1901), pp. 291-2.
2 . Ibid., p. 279.
3 . Ibid., p. 316.
4 . Ibid., p. 358 .
5. Ibid., p. 204 .
6. Ibid., p. 268 .
7 . Ibid., p. 224 .
8. Ibid., p. 232-3.
9. Jean Lacouture, Meier, 1982), pp. 60-1.
10. Ibid., p. 69.
11. Ibid., p. 108.
12. Ibid., p. 108 .
13 . Ibid., pp . 110-1
14 . Ibid., p. 117 .
15. Ibid., p. 125.
16. Ibid., p. 164.
17. Ibid., pp . 201,
18. Ibid., pp . 222-3
19. Ibid., p. 238.
31


York
20. Ibid., pp. 257, 263.
21. Ibid., p. 392.
22. Ibid., p. 398.
23. Gordon Wright, France in Modern Times (New
W.W. Norton & Company, 1987), p. 379.
24. Ibid., p. 392.
25. Lacouture, p. 5, 63.
26. Wright, pp. 224, 259-60.
27. Lacouture, p. 123.
28. Ibid., p. 11.
29 . Ibid., p. 54 .
30. Ibid., pp. 154-58,
31. Ibid., p. 111-13.
32 . Ibid., p. 249.
33 . Wright, p. 372 .
34 . Ibid., p. 371.
35. Lacouture, p. 359.
36. Ibid., p. 363.
37 . Ibid., p. 51.
38 . Ibid., p. 376.
39. Wright, pp i. 260-62
40 . Lacouture, p. 96.
32


41. Ibid., p. 58.
42. Ibid., p. 138.
43. Ibid., p. 405.
44. Ibid., p. 224.
45. Ibid., p. 382.
46. Ibid., p. 271.
47. Wright, p. 375.
48. Val Lorwin, The French Labor Movement
(Cambridge: Harvard University Press, 1954), p.81.
49. Wright, pp. 407-8.
50. David Pinkney, "Nationalization on Trial:
France", Yale Review. (September 1950), p. 97.
51. Wright, p. 409.
52. Ibid., pp. 404, 409.
53. Ibid., p. 409.
54. Pascal Fontaine, Jean Monnet. L1Inspirateur
(Paris: Jacques Grancher, editeur, 1988), pp. 170-72.
55. Douglas Brinkley and Clifford Hackett, eds.,
Jean Monnet: The Path to European Unity (New York: St.
Martin's Press, 1991), pp. 96, 98.
56. Ibid., pp. CD 1 r" CO
t-* in Fontaine, p. 15.
58 . Brinkley, p. 121.
59. Ibid., pp. 140-1.
33


60. Ibid., p. 204.
61. Peixotto, p. 211.
62. Ibid., p. 273.
63. Ibid., pp. 196-7.
64. Claire Andrieu, Lucette le Van and Antoine
Prost, Les Nationalisations de la Liberation. De
l'utopie au compromis (Paris: Presses de la Fondation
des Sciences Politiques, 1987), p. 183.
65. Oskar Lange, "The Political Economy of
Socialism", Institute of Social Studies Publications on
Social Change no.16, (n. date).
34


Chapter Three
Labour Unions and Nationalization
Nationalization in Europe seemed a panacea for
labour unions lack of governmental influence on the part
of the common man. They would discover, however, that it
was not the foreseen path to a workers state. The French
socialist parties could not gain significant and lasting
power due to their inability to unite, and the labour
organizations of France could not hope to achieve their
desired goals without a united front to present in the
political sphere. A long history of association did not
guarantee their stability, and their factionalization
only contributed to their dwindling power and influence.
It was following the French Revolution that
workers began to "combine" in order to improve their
condition. These meetings were illegal at the time, but
they were given the right to strike in 1864 and could
legally form syndical chambers by 1884. The first
meeting of the International Workingmen's Association
occurred in London in 1864, attended by French, English,
35


and German Socialists.1 The French section of these
early International's were followers of Proudhon and
they espoused "'a decentralized economic society based
on a new principle of right the principle of
mutuality,'" calling themselves the "mutuellistes."2 In
Paris, 1876, the first French Labour Congress met with
over 400 delegates from syndicates, cooperatives, and
mutual-aid societies. They wished peaceful solutions to
industrial problems, saw the strike as an unsatisfactory
weapon, and repudiated the ideals of socialism.3 The
third Congress, in Marseilles in 1879, supported a more
militant spirit, adopting the title of "Socialist Labor
Congress." They supported the collective ownership of
the means of production. They also formed their own
political party, the "Federation of Socialist Workingmen
of France."4
At the St Etienne Congress in 1882, the
socialist forces divided on the issue of the use of
violence. The two sections became the Parti Ouvrier
Francais, the more revolutionary of the two, and the
Parti Ouvrier Socialiste Revolutionaire Francais, which
36


later dropped revolutionary from their name. The Parti
Ouvrier wished to prepare the masses for the final
assault upon the state, which is the citadel of
capitalist societywhile the Socialiste party pursued
a peaceful and gradual process of infiltration into
governmental bodies.5 Along these lines of
disagreements, the parties continued to split into
numerous syndicates, and in 1886 at the Congress of
Lyons they formed a National Federation of Syndicates.
Rival to this but formed for a different reason was the
Federation of Labor Exchanges of France, formed in 1892.
It was a sort of clearing house where workers and
employers could meet and arrange for jobs which
benefited both parties.6
The Congress of Nantes in 1895 exhibited the
greatest progress towards unification, laying the
foundation for a new organization, the General
Confederation of Labor (CGT). Their policy was to remain
completely independent from politics, and it was then
that they incorporated the general strike as a tool of
their program. Georges Sorel, a Socialist theorist,
37


thought the general strike was "the social myth most
needed by the working class in their struggle for
emancipation."7 Wishing to pursue economic over
political action, they contained the germs of
revolutionary syndicalism,8 with class struggle as the
main idea. To fully understand revolutionary syndicalism
it is helpful to understand what a syndicate meant to an
individual. A syndicate is an association of workingmen
of the same or similar trades held together by bonds of
common interest.
Of all human groupings it is the most fundmental
and the most permanent, because men in society
are interested above everything else in the
satisfaction of their economic needs... enrolling
in a syndicate is not entering a party, not
subscribing to a platform, nor accepting a
creed. He is simply entering into a relation
which is forced upon him by his very
position in society.9
Revolutionary syndicalism encompassed direct action by
the syndicates, engaging in boycotts, sabotage, and
strikes. The boycott mobilized their power both as
consumers and producers, sabotage involved a "mauvaise
paye, mauvais travail" concept,10 and strikes were a
general show of force and importance of the countries
38


labour population. The government granted reforms in
order to quiet the revolutionary movement and develop
class harmony, but the syndicates believed that the
doctrine of class harmony "blinds the worker 'to the
real facts of inequality and of class distinctions,
which are the very foundations of existing society.'"11
While accepting the reforms that were advantagous they
also continued striking, which illustrated overall
dissatisfaction.
Syndicalists realized that their economic
interests bonded them to other workers in the world, and
by the same token, separated them all from Capitalists.
They viewed the state as imposing rule from without, and
without real knowledge of their situation. Therefore,
when the 1919 Congress favored the "'industrialized
nationalization of the great services of modern economy:
land and water transport, mines, water power, and credit
organizations,'" they visualized nationalization as
national property in the control of interested parties,
i.e. associated producers and consumers.12They
anticipated a larger role for themselves in their own
39


workplace, and not just an empty reform.
The French syndicalist movement of the early
twentieth century stimulated socialist thought, calling
attention to the weaknesses of parliamentarism,
inadequacies of bureaucratic state socialism, while
exposing the possibilities of trade union movement and
the importance of a producer's share in the control of a
new social order. The importance of belonging and
participating began to take hold and worker
participation in associations and syndicates increased
almost every year through WWI (Table l).13
Table 1
Associations and Syndicates/Production Workers
Year # of Groups # of Members
1900 247 10,793
1910 498 19,79
1920 439 18,284
1929 424 21,322
Trade unions had never allowed themselves to be
used by, or associated with, the current political
regime. In the 1930's, however, under the Popular Front
government, unions began to feel less animosity towards
40


government. Leon Blum saw French trade unionism as
"'...no longer an outlaw; social reforms no longer seem
unclean to it; it submits to arbitration; it seeks to
make collective agreements; it places itself under the
power of the law.'"14 This was an era of an increased
level of interest in political reform by the unions, and
one in which they became somewhat more involved in the
politics that effected them. This is not to say they
embraced politics, and in fact, they reaffirmed their
independence from political parties at the 1936 meeting,
but qualified it to be no longer a complete "aloofness."
They realized that despite their neutrality, they could
not "...remain indifferent to dangers that may threaten
public liberties and social gains."15
The trade unions were gradually becoming aware
of the fact that economic change was inevitably tied in
with the politics of the government. Successful
conclusions of mass strikes, particularly 1936-37, along
with the Matignon Agreement (giving a more comprehensive
legal voice to workers), generated great enthusiasm for
group participation to safeguard the improvements made
41


by the Popular Front government.16 Nevertheless,
government involvement was not universal among the
various trade unions, and their positions on the issue
of government intervention in the form of
nationalization made clear their differences in policy
and beliefs. The largest union, the Confederation
generale du travail, (CGT, founded in 1895), felt that
nationalizations satisfied the legitimate demands of
workers, corresponded to France's immediate post-WWII
economic needs, and would aid in establishing national
independence. They, as other unions, were also
interested in wresting industry control from the hands
of those that had collaborated with the enemy during
occupation.17
The Christian Union, Confederation fran^aise des
travailleurs chr£tien (CFTC, founded in 1919), were at
first hostile towards the idea of nationalization. A
minority within, developed after 1946, supporting
nationalization but only for public services (health and
insurance for instance) and not necessarily enterprises
directly productive.18 CFTC's opposition was for much the
42


same reason that other unions and factions of various
political parties did not support nationalization. They,
the Parti communiste fran^ais (PCF), and the Force
Ouvriere (FO, split from CGT in 1947) both opposed the
state intervention aspect of nationalization, feeling
that "true" nationalizations could not take place under
a capitalist government.19 The CFTC's position was that
"exploitation par l'Etat" was the same as "exploitation
par le patron." A simple change of ownership, they
deemed, did not assure the liberation of the worker, and
could lead to "1'etatisation" of industries.20
Before the trade unions themselves became
"involved" in politics, union members were participating
in various political parties. A mixture of many
followings, usually, the majority of the members of the
CGT in 1946 were Communists, the first time since 1895
that a political party was in command of a Union. This
was partially due to the fact that while other parties
had dispersed during Occupation, the Communist party had
remained organized.21 This situation not only meant a
majority rule within the union, but also within the
43


organizational boards of nationalized industries which
had labor/Union representation. In the case of the
nationalized coal mines, early post-war figures reveal
that of the 18 member board of directors, 12 were CGT
members, and of those at least 10. were Communists.22 This
Communist majority would not remain, however, as the
political tides shifted.
Labour unions were as greatly affected by the
world wars as other French organizations. Their various
political affiliations led to dissension among them, but
WWII also brought a kind of unifying power, albeit
short-lived, to the Unions. While the gains made under
the Popular Front government were suspended, and the
Vichy government officially dissolved all trade unions,23
in 1940 the Unions CGT, the Confederation Generale du
Patronat Fran^aise (CGPF), and CFTC made a joint
statement that called for employers and workers to
"become partners, inspired by the same desire for unity
and social peace, indispensable for victory."24 This
optimistic statement, however, did not lead to
collective action and millions of members abandoned
44


their unions just before WWII. At this time Union
members were being dismissed from tripartite boards of
nationalized industries, and there seemed to be an end
to active government-labour-management collaboration.
With national defense the first priority, the working
class was virtually excluded from national life.25
Mobilization of men disrupted union ranks, with almost
one million workers out of work due to closed plants,
and two million reported in prisoner of war camps.26
There were also factional hatreds that exploded over the
Nazi-Soviet pact when it became clear that the
"'workers' fatherland' had made a disguised alliance
with the national enemy."27 During the Occupation, the
Vichy government's ban on Unions allowed old practices
to come back, leading to brutal policies instigated in
the workplace, and working hours back up to more than 45
hours a week.28 This increased work also coincided with
the instigation of war time rationing. From the numbers
(Table 2) 29 it is apparent that the Frenchman got
considerably less then his German counterpart.
45


Table 2
Rationing 1941 (grains per day)
Germany Nord and Pas-de-
Calais
Normal Heavy Normal Mine
Consumer Worker Consumer Worker
Bread 321.4 664.2 300 450
Meat 71.4 171.4 51.4 75
Fats 37.6 104.5 14.3 29
Potatoes not rationed not rationed 100 100
Post WWII witnessed a declining membership in
Unions. The CGT and Communist Party were still the
strongest (CGT memberships in 1945 was at over 5
million),30 but the Union's role in government was
reduced despite the restoration of collective bargaining
in 1950.31 Perhaps the government guarantees contained in
the Constitution of the Fourth Republic led to decreased
need for union involvement. The Constitution gave the
right of employment, health protection, material
46


security, rest and leisure as well as unemployment
compensation.32 While not encompassing wages, the
Constitution did address many of labour's demands. The
uneasy, but eminently practical, reliance on government
had begun to infiltrate the Unions. The CGT had accepted
the need to work within the capitalist economy, turning
to the government for guidance in achieving their
goals.33
The CGT continued their support of national-
izations into the late 1940s, while the anti-Communist
syndicalists, the FO, and the CGT-FO no longer believed
that the state embodied national interest due to
adoption and support of the Marshall Plan. In their eyes
this changed their "battle of production" to "the
defense of industries threatened by the Marshall Plan."34
This "threat" came from the fact that financial support
of the Marshall Plan was only destined for certain
"essential" industries, and others were left out of this
funding.
Support and overall interest in nationalizations
decreased in the early 1950s. The realities of
47


nationalization, essentially the same industry under a
presumably more democratic boss, proved to primarily
serve the industrialists and businessmen and not the
worker. Even the CGT lost interest in a system where
"l'Etat patron" was like all bosses, taking in the
profits and lessening the purchasing power of the
workers. The CGT reversed its support and retreated to
the old Communist opposition of nationalization within a
capitalist system.35 Nationalizations had lost their
democratic aspect in the eyes of the workers, and the
Unions.36
As the isolated industry of study, coal mining
labour organizations were generally held in high regard
by mine workers, and they put faith in their organ-
zations ability to represent them and achieve the
necessary action, oal mining was a very important
industry for France, a vital part of their economy. The
role of coal workers and their Unions in the government
therefore had quite alot of authority. In the first half
of the twentieth century, coal was still a vital
commodity and the country could little afford loss of
48


production due to strikes or sabotage.
The coal mining industry was supportive of
nationalization in the post-WWII era, but they were not
always such. The WWI wartime intervention by the
government, to better control the vital war-time
product, was accepted only reluctantly.37 The coal miners
had an ever changing relationship with their government.
Organized very early on, they instituted strikes in the
mid 1800's, using government intervention to their
advantage. They found that often, with government
involvement, they saw partial fulfillment of their
demands instead of complete defeat.38 The mining firms in
the north of France were involved in the first series ,of
wage agreements in 1891, proving that collective
bargaining could achieve the desired goals. This led to
the widespread use of bargaining for wage rate
establishment in other mining areas.39 In these early
days, the mining companies ruled and the government
would intervene as a neutral party, whereas the miners
would find that after nationalization the government
acted as owner and there was no neutral party to which
49


to appeal.40
Before nationalization of the mines, the workers
participated not only in the national Labour Unions but
also in their own mining-specific organizations. The
Syndicat national des ingenieurs des mines (SNIM), was
associated with the CGT and acted as a bridge between
"cadres" (loosely interpreted as executives), and the
workers. The Syndicat des ingenieurs des houilleres du
Nord-Pas-de-Calais (SIHN), was affiliated with the
Confederation generale des cadres (CGC). When
nationalization of the mines took place it was the CGTs
SNIM that was named the representative union, and their
leaders assumed new positions in the mines, at the
protest of the SIHN who claimed to be the largest group
of mining engineers.41 The CGC opposed the national-
izations themselves, seeing them as an economic
albatross. They pointed out that in 1947 it took a
minimum of 80 billion francs of subsidies for the
nationalized enterprises. SNCF (railways) received 35
billion in 1946, d'EDF-GDF (gas and electricity), 18
billion in 1947, the Charbonnages (coal), 12 billion in
50


1938. They also maintained that this aid only
illustrated the fundamental economic inefficiency of the
nationalized sector.42 The fact that nationalization
began a vicious cycle, with the government putting money
in without ever seeing a significant return, and the
industries becoming used to this support and not
striving to function on a competitive edge that would
bring them profit and efficiency only added credence to
their argument.
The mine workers, as individuals, gave their
support to nationalization, seeing it as their path to
participation in the national economy.
...the emphasis on political and legislative action
at the national level pointed the mine workers
toward government ownership of the mines as the
only real way to protect mine workers and the
mining communities from mass layoffs, low wages,
and other problems. The elusive notion of 'la mine
aux mineurs1 ('the mine to the miners') took root
among the mine workers, mingling with early
conceptions of nationalization...From the miners'
perspective, the task of building a national
federation of mine workers became linked with the
idea of a 'nationalized'industry.43
As with other nationalizations, it did not turn
out to be the expected answer to all the miner's woes.
They put their faith in the party and union to bring the
51


necessary sweeping changes after WWII, and "it is not
likely that many workers fully considered the tension
that would emerge once the union attempted to square the
demands of its members with the needs of the nation."44
The reality of the functioning nationalized industries
did not allow for the fulfillment of the miners'
Socialist ideals.
Therefore, strikes continued, more numerous than
ever. Even during the Occupation, under the Vichy
government, there were strikes, with a large northern
coal strike in 1941.4S Strikes during occupation were
generally short in duration, protesting low wages and
food shortages, but it was felt that they were really
strikes against German occupation.46 (Table 3)47 gives the
numbers involved in strikes and the numbers of workers
days lost due to them before WWII.
52


Table 3
Year______# of strikes # persons days lost
1900 902 222,714 3,760,577
1910 1,502 281,425 4,830,041
1920 1,832 1,316,559 23,112,038
1928 816 201,116 6,376,675
1935 376 108,884 1,182,159
Their conditions were horrible during the
Occupa- tion, nonetheless, and protests were not
unwarranted. The Occupation had left them politically
helpless and without the benefits gained in the 1930's.
Also, the governmental economic planners were busy
working towards rebuilding post-war France, using
economic planning and nationalization, but "while the
think tanks were drawing up blueprints for the new
France, coal miners were being crushed by the weight of
occupation. "4K Coal was a "war commodity" and in great
demand, by France as well as Germany, and the enemy
necessarily would give little concern to the workers of
their "captive" nation. The coal miners bore much of the
pressures and unpleasantries of the Occupation.
53


After Liberation, in conjunction with national
policy, mining companies participated in the "battle of
production," a plan to rapidly increase France's
industrial production. The CGT leaders repudiated
strikes, propagandizing that they only helped the Nazis,
and called upon workers to cooperate with management to
bring about the needed increase in coal production. Coal
production did rise, with a lowering in number of days
lost due to work stoppages, but worker morale
necessarily suffered as the miners were pushed to the
limit.49 (Table 4)50 and the following graph51 illustrates
the rise in coal production, (Table 5)52 the general
index of production.
54


Table 4
Coal Production
(in tons)
Year All French mines Natlzd mines*
1938 48,000,000
1945 35,000,000
1946 49,000,000 47,400,0
1947** 47,000,000 45,400,000
1948** .45,000,000 43,600,00
1949 53,000,000 51,000,000
Prance.
**Lower yields due to strikes,
Dutput per man day worked in French coal mines 1938-1946
(annual averages)
55


Table 5
General Index of Economic Movement
1900 1910 '20 '25 '30 '35 '45* ' 50
Ag 86 79 80 96 87 95 61 102
Ind 72 97 67 117 133 96 50 128
*data unavailable for 1940.
For the Unions, the battle of production
symbolized a return of France as an economically
independent nation, and the Federation of Miners pledged
their support with maximum production efforts. This
massive mining effort was quite successful and led to
the myth of the miners as "superproletarians. "53 Note
that the distinction of "proletarian" had changed so
drastically. In the not too recent past it was used to
designate the workers against the state, against the
establishment, and not, as here, to mean the worker
collaborating successfully with the state for the good
of the nation. The world wars had redirected efforts
from an internal class war to external nationalism.
In 1944 the government offered miners a 40% wage
increase plus rewards for high productivity, including
butter, pigs, shoes, and bicycles. Despite the coveted
56


value of the these, particularly the bicycles, in true
solidarity the miners were reluctant to accept
individual prizes and favored a more collective system.54
In June of 1946 the Miners Statute was enacted. The
Statute, drawn up by the Communist Ambroise Croizat,
conformed to the national labour code with some added
specific provisions for mine workers.55 An answer to some
of the miners demands, the Statute, however, did not
relieve all their woes, and the strikes continued.
In 1947 a general strike encompassed many
industries in France. "Attempts to negotiate had failed,
and by the end of November the generalized strike wave
had swept through key industries and services such as
metals, automobile manufacturing, the railroads, the
docks, and the Paris metro."56 In these post WWII years,
"from the workers perspective, the government was
blocking the way to progress on the economic front and
breaking promises that had been made," and, "the
dismissal of union representatives from key positions in
the nationalized industries continued." Examination of
days lost due to strikes show the cost of worker
57


unhappiness during this period. In 1947 alone, in the
three months of January, February, and March, the days
lost number 157,000, while in the month of November
alone there were 7,548,000 workers days lost.57
Nationalization of the coal mines did not bring
the hoped for and anticipated "federation of mine
workers" but instead yielded a system where the state
was in power, wielding "veto over nominations from the
administrative councils of the Charbonnages de France
and the regional houilleres. "58 The Unions feared that a
great amount of State power would lead to a heavy hand
from above, and in the 1948 coal strike workers were
protesting issues including government tightening of
discipline and efforts to reduce absenteeism. To this
the CGT added wage demands. The heavy hand struck in the
form of troop intervention, resulting in deaths and the
production loss of 5.5 million tons of coal. This only
led to a deeper fissure between the government and
workers.59
While strikes were seen as political actions,
their demands were almost always economic in nature.
58


Leon Blum, speaking on the labour strike wave of 1947
felt that one must "dissociate what is aggression
against the institutions and doctrines of the Republics
from what is the legitimate or at least the natural
manifestation of want and suffering."60 Certainly many
strikes were instigated by suffering, by the need for
bread, for higher wages, or for better living
conditions. The ultimate resolution, however, lay in the
political and economic measures pursued and therefore
are inexplicably tied into the "institutions and
doctrines of the Republic." The Unions and the workers
were beginning to understand where the final power of
change lay.
The Unions, or rather the powerful CGT,
initially had majority representation on the
nationalization councils, but through the turmoil of
war, members were lost, Unions dissolved, and their
importance waned. Without the Unions the workers were
thrust back in time before the gains of the 30*s and
their working conditions were once again unbearable. The
end of the war saw a new attitude within some of the
59


Unions, notably the CGT, that allowed them collaboration
with the government in order to achieve their desired
goals.
With the nationalization of many key industries
the involvement of the government increased, forcing the
Unions to come to terms with the new shared power of a
partially State-owned economy. After 1950, interest in
nationalization decreased and the workers, seeing that
nationalization was not the answer to their problems,
continued to strike to achieve gains, it being one
vestige of their limited political power. The 1950 and
1960 data closely resembles the strike numbers of the
pre-WWII years, (see Table #4, pg. 55), but the numbers
for 1974 were much lower, with 142,700 participants and
only 281,400 days lost.61
Nationalization represented for many a move
towards worker control, a step in creating a socialized
society in which the common wage earner would have a say
in his economic life. As a concept, nationalization
seemed to be an answer to many of France's problems. In
reality, some industries did not function well with the
60


State as owner. The Renault auto industry was
successful, with their coefficient of production
activity rising from 29% in 1938 to 85% in October of
1946.65 Coal mining had a significant rise in production
as well, yet, a rise in production alone does not
indicate other indicators of success, indicators such as
worker well-being and production and product costs.
In 1947 the planned economy pursued national-
ization as a means towards higher production. This was
in lieu of increases paid for by inflation and therefore
by higher prices.63 This meant that nationalization of
industry was to bring about the needed increased
production figures without raising prices, prices of the
product, or the cost of production. This was
accomplished for a time with heavy governmental
subsidization.
61


Notes
1. Harry W. Laidler, ed., Socialist Planning and a
Socialist Program (New York: Falcon Press, 1932), pp.
277-8.
P
2 . Ibid., p. 279.
3 . Ibid., p. 280.
4 . Ibid., pp. 281-2.
5. Ibid., pp. 284-85.
6. Ibid., pp. 282-3, 287.
7. Ibid., p. 301.
8 . Ibid., p. 289.
9 . Ibid., pp. 293-4.
10. Ibid., pp. 295-6.
11. Ibid., p. 296.
12 . Ibid., p. 310.
13 . Annuaire de Statiaues de France
40. Vol 46, 1930, pp. 50-51.
1910,
14. Laidler, pp. 311, 314.
15. Val Lorwin, The French Labor Movement
(Cambridge: Harvard University Press, 1954), p. 70.
16.Henry W. Ehrmann, French Labor From Popular
Front to Liberation (New York: Oxford University Press,
1947), p. 51.
62


17. Claire Andrieu, Lucette Le Van and Antoine
Prost, Les Nationalisations de la Liberation. De
l'utooie au compromis (Paris: Presses de la Fondation
des Sciences Politiques, 1987), p. 132.
18. Ibid., pp. 144, 146.
19. Ibid., p. 161.
20. Ibid., pp. 148-9, 365-6.
21. Lorwin, p. 109.
22 . Ibid., p. 114.
23 Northern Darrvl Holter. The Battle for Coal Illinois University Press, 1992),
24. Lorwin, p. 88.
(Dekalb:
p. 39.
25. Ibid., pp. 83-84.
26. Richard F. Kuisel, Capitalism and the State of
Modern France (Cambridge: Cambridge University Press,
1981), p. 133.
27. Lorwin, p. 85.
28. Holter, Battle, p. 42.
29. Alan S. Milward, The New Order and the French
Economy (London: Clarendon Press, 1970), p. 208.
30. Lorwin, p. 101.
31. Ibid., pp. 118-9.
32. Ibid., p. 105.
33. Ibid., p. 147.
34. Andrieu, pp. 140-1.
63


35. Holter. Battle, p. 48.
36. Ibid., p. 365.
37. Holter. Battle. pp. 30-1.
38. Ibid., pp. 266- 7.
39. Ibid., p. 28.
40. Ibid., p. 165.
41. Ibid., pp. 95-6
42 . Andrieu, pp. 152-3.
43. Holter. Battle. pp. 29-30.
44. Ibid., p. 54.
45. Lorwin, p. 95.
46. Holter. Battle, pp. 49-50.
47 . Annuaire. vol. 30, 1910, p
p. 52. Vol. 56, 1940-45, p. 103.
48. Holter, Battle, p. 46.
49. Ibid., p. 81.
50. David Pinkney, "Nationalization on Trial:
France." Yale Review (September, 1950), p. 104. and
Holter, Battle. p. 107.
51. Milward, p. 201.
52. Annuaire.
53. Holter, Battle, p. 84.
54. Ibid., pp. 87-8.
64


55. Ibid., P* 102 .
56. Ibid., P- 143 .
57 . Ibid., pp. 139-40.
58. Ibid., P- 104 .
59 . Lorwin , PP . 129-30
60. Ibid., pp. 121-22.
61. Annuaire. vol. 90,
62. "Economy Not To Depend Upon Foreign Favours,"
Times (London), 4 January 1947, 5F.
63. "U.S. Aid Bill Signed," Times (London), 2
January 1947, 4E.
65


Chapter Four
Nationalization of Industry
Nationalization was undertaken on a large scale
in France in two different periods of her history. Many
key industries, such as railways, coal, electricity,
banks and airlines, were put under State control after
WWII and again in the 1980's. The earlier national-
izations had primarily an economic purpose to them,
while the latter were more political in nature.
Nationalization of industry in post-WWI France
was neither a new concept nor an exclusively French
phenomenon. As early as 1849 nationalization was an
element in the French governmental program,1 followed,
at the end of the 19th century, by the identification of
nationalization as being contributive to social
transformation. The Congress of Marseille of 1879 felt
the goal of workers should be nationalization of French
"assets" (mines, railways, etc.), putting them into the
hands of those that "produce" them, meaning the workers
66


themselves.2
Jean Jaures had proposed nationalization as a
"socialist" idea even before the turn of the century,
speaking in terms of the principal means of production
and workers rights.3 It was in the early years of the
20th century that nationalization became a part of the
socialist strategy. Never without opposition, the early
resisters were the revolutionary syndicalist faction of
the CGT, the SFIO, and the Guesdistes. The oppostion was
initially victorious in keeping nationalization out of
governmental policy.4 It was the economic depression and
devastation of property wrought by the first World War
that brought the debates on nationalization into the
limelight. At the CGT national conference, in 1916, the
Union adopted a program to reorganize the economy,
placing emphasis on nationalization of key industries as
an important part of this planned economy.5 At the 1919
CGT Congress they endorsed nationalization of the coal
mines. Yet, by the end of WWI, employers were frustrated
with the necessary war-time government interference and
price fixing and there was no support for the Union's
67


plans.6
It wasn't until Leon Blum took office in 1936
that any real progress was made on the idea of
nationalizing industries. Following Jaures in the spirit
of his politics, Blum crusaded for political party unity
to further the advancement of socialist ideas. He
considered socialism to be fundamentally moral and even
went so far as to connect capitalism with war. The
impact of this on a country just recovering from war
should be considered powerful.7 At the SFIO Congress of
Lyon in 1927, Blum spoke on the changes he saw in
capitalism, the continued concentration of industrial
and financial power strengthening their cause, obscuring
the class struggle rather than intensifying it.8 It was
after the 1930's that nationalization became a more
common ideal for all the parties of the Left, with the
SFIO supporting it during Blum's Popular Front
government, and the others joining in following World
War II.9
This support was hard won however, with the
68


various factions of all political parties splitting on
the details of nationalization. In the interwar years,
the Communists most strongly opposed them, although they
did accept the nationalization of armaments, feeling
that nationalization undertaken within the context of a
capitalist regime would only lead to a concentration of
the means of domination and oppression.10 They maintained
that the right of control should go to the workers, but
their case was weakened by the vagueness of their
organizational and managerial procedures.11 The Movement
Republican Populaire, (MRP), a capitalist party, wished
the nationalized industries to have almost complete
freedom from central State control. On this, neither the
Socialists or the Communists agreed with the MRP.12
The right wing of the Socialist Party also
opposed nationalization, feeling that it did not fit
with the clearly emerging international economy.13 This
issue still exists today. In the realm of an
interconnected world economy, can nationalization hope
to "compete" in a free market economy? This type of
economic socialism may not be able to survive in the
69


capitalist dominated world economy.
Nationalization, in the interwar years, was
addressed for various reasons. Blum felt it necessary to
rid the country of monopolies, to rapidly socialize the
industrial powers, and to transform the society to a
socialist ideal. He could not act upon these ideas then,
due to the opposition of the bourgeois supported
Radicals and the Communists,14 and the presence of a
minority of zealous pro-nationalizationists who viewed
national- ization as a step towards revolution.15- The
talk of interwar nationalization involved intangible
ideals but no unified support or discernible program,
and it was not until after the devastation of World War
II that nationalization was looked to as a panacea for
economic woes.
In 1934 Jules Moch, a collaborator of Blums,
spoke about nationalization as a method of addressing
the problems of disequilibrium inherent in capitalism.16
The nationalizations of the Liberation, beginning late
1944, were the result of pragmatic responses to the
necessities of the moment.17 Whether the socialists
70


gained recogni- tion by the implementation of the post
war national-ization program, and whether or not that
was their intention was not of prime importance.
Nationalizations were seen as a way of gaining control
over a weakened economy and building up much needed
industrial productivity.
It was in 1944 that the program of the
Liberation, the "Programme d'action de la Resistance,"
was signed. Nationalization was at the heart of this
program. The Conseil National de la Resistance (CNR),
creator of the program, announced the return of the
means of monopolized production to the nations control
This program was the only one co-signed by the
rightists, assuring a future for a time at least.19
(Table 6)20 lists these nationalizations.
(Note: Railways were nationalized in 1936)
71


Table 6
Year
Nationalization
1944 Coal mines of Nord, Pas-de- Calais
1945 Renault Air Transport Banque de France, and 4 banks of deposit
1946 Electricity and Gas Some Insurance Companies Banque de 1'Algerie
1948 Shipping and Air France
Nationalizations were only a part of the planned
economy France was undertaking, which was an attempt to
gain control and direction of their economy. After WWII
France was floundering in industrial backwardness and
with great destruction to contend with, not to mention
the bitterness over the Occupation. In 1870 France was
the world's second in industrial production and trading,
but by 1914 she had fallen to fourth. Frances share in
world industrial production had fallen from almost 10%
to only 6.21 During WWII industry operated with 60% of
72


its coal supply, and domestic use dropped to 35% by
1944.22
The basics of a planned economy are simplistic
in the "big picture" and get progressively complex from
there. The general idea is to divide the national income
between accumulation and consumption, achieving a
balance, and also to direct investments.23 Jean Monnet
was appointed the Commissariat du Plan. He carried on
communications with Modernization Commissions, repre-
senting the interests of particular industries and
sectors of the economy.24
The Modernization Commissions were made up of
industrialists, trade unionists, civil servants and
independant experts. These officials lacked precise
knowledge of the extent of war damage, size of existing
inventories, and quantitative and qualitative
deficiencies of manpower supplies. There were five
overall Commissions over large areas of the economy:
general finance and economy, manpower, research,
productivity, and regional development. More specific
commissions acted as liaisons between the large
73


"horizontal commissions and the industries of their
sector, (sectors being coal, electricity, steel, cement,
fuel and fertilizers, farm machinery, and transporta-
tion) They were responsible for reporting on the
implications of the Plan, as well as problems and
measures needed to ensure Plan fulfillments.25
By nationalizing key industries the State
assured itself the needed input of ideas and finances to
plan the development and growth of French industry.
Resources were concentrated on basic industries in the
first Plan, (1947-53), with private and consumer goods
industries accorded low priority.26 The first three Plans
(Plan II 1954-57, Plan III 1958-61) generally were aimed
at stimulating the growth of output and capacity, with
the Fourth (1962-1965) and Fifth (1966-1970) having to
work out conditions for a high rate of growth and the
pursuance of certain social policies.27
The Monnet Plan, 1944-45, was the initial Plan
which led to the others. His ideas contained a large
amount of government intervention, but not in the area
of direction of investments. Therefore the industries
74


operated as "profit-maximizing enterprises," the Plan
resembling "nothing so much as empirical direction of
the economy." Yet, the nationalized industries did
receive privileged access to capital for investment.28
The changing Plans that followed were indicative of the
efforts to sort out the parts that each group would
play, with the recognition of problems as they arose and
attempts to remedy them.
By pursuing a planned economy, France wanted to
direct and control the economy to bring about the needed
upgrading in industry to once again be competitive in
the world economy. But why nationalization? Certainly by
becoming the "owner" of a particular enterprise imparted
a certain amount of control, but there was an economic
issue as well. No private company had the sort of
capital needed to put into any one industry to initiate
the great economic boost needed. The amounts of money
were stag- gering and only the State had that kind of
investment potential. As late as 1948 the government
provided 7 0% of the funds used for investment.29 Through
the sheer weight of its spending power the State
75


exercised a decisive role in the economy, investing in
infrastructure, research, education and training. It
came to be that the State could be "regarded much as a
single vast enterprise."30
The onset of nationalization brought procedural
questions on shifting a private to a public enterprise.
Each case was different, banking and insurance at one
extreme with the State becoming sole owner of all
shares. The managements of coal, gas and electricity
were dissolved and new ones established.31 The Regie
(meaning state-control) Renault company was a special
case, in that nationalization was "as a punitive measure
against the owner because of collaboration with the
enemy," with their General Director coming directly
under the govern- mental authority.32 The organization
and administration of the nationalized industries ranged
from the extremes of pure government control to public
corporation, with "mixed" ones in between. Armaments
nationalized before WWII were administered like
government departments. Aircraft construction and
railroads were mixed, meaning they combined private and
76


public share capital. Coal, banks, insurance, gas,
electricity and Renault were all public corporations.
Coal, gas and electricity enjoyed a near monopoly.
Others had some degree of competition from privately
owned firms.33 The change-over for most companies
involved some type of compensation from the government,
usually in the form of small yearly payments extended
over a great period of time, (and in most cases felt to
not be adequate), except Renault which was essentially
confiscated.
The actual functioning of the enterprise after
nationalization varied, depending on the degree of
government control and intervention. In one case the
company may be run as before with the State as sole
shareholder, with unionized workers and the consumers
locked out of the production and marketing process. In
another the old management vacates their positions and
the company is then either headed by a newly installed
management accountable to workers, consumers and
interest groups, or the assests are directly
redistributed to worker, management-worker, or consumer
77


cooperatives. In the third case, the company is
reorganized along new lines entirely.34
Each case carries with it its pros and cons.
Government control leads to the use of that company for
their own political and financial advantages. Worker
control tended to be no more democratic than a large
private company, with the same degree of worker
participation but no real control. Management control
gave freedom of decisions, but they were measured by
more capitalistic values, i.e. profit, cost control and
consumer acceptance. Interest group control still had to
bend to government financial control, and usually the
government appointed the interest group representatives,
reguiring representation on the boards from union
workers, consumers, government and management.35 Control
itself, no matter the type, called for the appointment
of a Chief Executive Officer and a Board of Directors,
overt intervention in decision making, and financial
control.36
The process of nationalization is complex even
with only one particular type of organization, and with
78


the many interest groups, political agendas, and
economic and social goals, it was difficult to create a
viable industry that could function properly.
Nationalization had to try to manage successfully
"combining government control with financial autonomy
and managerial independence and of achieving unity of
direction while allowing participation of diverse
interests in manage- ment."37
Initially, a tripartite board was felt to
encompass all interests. The mere presence, however, of
those representing various aspects of the government,
the employees (through their unions), and the consumers
would soon prove to in no way guarantee a consensus on
any issue.38 While the representatives were not supposed
to pursue their own interests, or even be influenced by
any outside interest groups, their main loyalities
tended to remain with their particular interests.
Therefore, the councils were rarely united in their
purpose.
Nationalization board members were part-time,
unpaid, and usually had no knowledge of the particular
79


enterprise or its product. In the absence of a strong
consumer organization the French Parliament would
substitute union representatives, who were usually
concerned only with worker's interests, often at the
expense of the consumers. Even without government
appointment, the trade unions were sufficiently
organized to place many of their representatives on the
boards. For example, on the Charbonnages board appointed
by Marcel Paul, 14 out of 18 were trade unionists.39 The
powerful CGT in fact at times was so pervasive that a
nationalization board could resemble "a ball game in
which the main trade-union confederation, the CGT,
appearing in the role of union, government and consumer
representative, is throwing the ball in a three-cornered
arrangement, always to itself."40
Due to these problems the tripartite board was
seen as the "weakest feature" of the operation of the
nationalized industries.41 One recommendation to help
allay these difficulties was to turn it into a
quadripartite,board, adding experts especially competent
in the particular field.42 This, however, does not seem a
80


satisfactory solution, but one with a strong liklihood
of adding another representative with selfish interests,
and leading to deadlocks by having an even number of
representative groups.
The responsibilities of the boards were
extensive, with decision making processes in many areas
of the industry. They decided on purchases, sales,
hiring and firing, determined wages and salaries, fixed
the administrative budget, made production plans, and
determined the use of disposable funds. For other
decisions, including budget changes and general rules on
wages and working conditions they needed the approval of
the minister involved, at times, of the Minister of
Finance.43
The problems involved with the nationalized
companies' administrative organizations were numerous.
The government would make decisions without consulting
the General Manager or the Board. Orders would be given
directly to subsidiary companies, ignoring the Board.
Labour unions complained directly to the Minister of
Industrial Production and these were acted upon. The
81


government decided on wages, on the selling price of
electricity, all without consultation.44 There were
criticisms on production, on financial mismanagement,
and on the failure to solve administrative difficulties.
One top executive said, "'Running a nationalized company
is like having a stockholders' meeting every day,'" so
great were the administrative duties. The potential for
a chief executive to lose his position would come, "not
from private investors who want to see the value of
their stock increase, but from government officials who
want to be reelected." The nationalized firm was
therefore ultimately a political organization instead of
an economic one, and the manager's task was "to
determine what the companies best political performance
might be."45
These types of politically driven economic
decisions had far-reaching effects. For example, when
the steel industry increased prices against the will of
the authorities the relevant nationalized suppliers put
into effect a price increase in the cost of
transportation and coal, which were used directly by the
82


steel companies. The steel companies were understandably
more wary of this type of independent pricing decisions
in the future.46
Nationalized companies were created to promote
political and economic recovery, but have created
obstacles by saddling the government with their
operating deficits and have aided in the politicization
of an economic realm. Some of the criticism raises
doubts about the ultimate success of nationalization of
industry.47 Few nationalized firms perform as well as
their privately owned counterparts.
Exactly what then, if any, purpose does
national- zation serve? There are political reasons, to
win elections even a conservative may have to support
nationalization to avoid high unemployment; it is a
means of revamping and insulating domestic industry from
outside influences and competition; and it is effective
in keeping a large factory or entire industry from
shutting down. The manner in which nationalization has
been approached is evidence that socialists do not
necessarily make decisions on the same data as
83


capitalists.48 These are all interesting and plausible
arguments for nationalization, but in the long run it
has been shown that nationalization leads to firms
becoming "addicted" to annual subsidies, low interest
rates, protection from imports, and assured government
purchases. It has been said that nationalization is
nothing more than a "politically fashionable alternative
to bankruptcies."49
Voters have been told that to nationalize a
company is to:pursue public interests and not profit,
but where is the "economic wisdom of expecting
nationalized firms to pursue social goals. Clearly a
point is reached where the social benefits come at a
high price and the firms become uncompetitive." Yet, if
that company should pursue the same policies as a
private firm, then the argument that nationalization
serves social goals is no longer valid.50 The view of
nationalized industry may be entirely skewed from the
start, placing it in direct comparison with privately
owned industry. With an implicit assumption that the
policies of privately owned firms are correct, then the
84


comparison is likely to be unfavorable. In post-war
France, within the nationalized aeronautical industry,
there were heated debates regarding low productivity,
inferior workmanship, and incompetent management. Yet,
national ownership cannot be blamed exclusively for
problems within an industry that had been dislocated by
four years of occupation.51
The organization and administration of
nationalized firms is complicated, and overrun with
problems. They tend to be less productive than their
private counterparts, often failing to relieve shortages
of products. They are not radically effected by market
demands and competition, as they are not set up to react
to these exclusively. They have an awkward and seemingly
unfair system of representation, and their politics tend
to override their economic goals. Yet nationalization
brought rapid and radical recovery to much of France's
key industry after WWII, progress "...not likely to be
achieved without an able and vigorous management and a
reasonably satisfied labor force,"52 The question is, is
it a viable economic and political policy worth
85


following into the future, or only valuable in a crisis
situation?
As part of the planned economy that post-WWII
France pursued, nationalization came to symbolize the
country's efforts to gain control, over its lagging
industries. By functioning within a planned economy
France hoped to once again take a high-ranking position
among the industrial nations. This structured economy
was a widely supported policy, but support was not
unanimous. However, given its general success, opponents
had difficulty in maintaining the questioning of the
Plans' value.
86


Notes
1. Claire Andrieu, Lucette Le Van and Antoine
Prost, Les Nationalisations de la Liberation. De
l*utopie au compromis (Paris: Presses de la Fondation
des Sciences Politiques, 1987), pp. 53-4.
2. Ibid. p. 19.
3. Jean Lacouture, Leon Blum (New York: Holmes &
Meier, 1982), pp. 53-4.
4. Andrieu, p. 21.
5. Ibid., p. 26.
6. Darryl Holter, The Battle for Coal (Dekalb:
Northern Illinois University Press, 1992), p. 33.
7. Lacouture, p. 120.
8. Ibid., p. 164.
9. Andrieu, p. 129.
10. Ibid., p. 36.
11. Ibid., p. 37.
12. Times (London), 18 December 1945, p. 3 E.
13. Ibid., pp. 31-2.
14. Ibid., p. 33.
15. Ibid., p. 30.
16. Ibid., p. 32.
87


17 . Ibid., p. 183.
18 . Ibid., p. 238.
19. Ibid., p. 59.
20. Ibid., pp. 254-55.
21. Gordon Wricrht. France in Modern Times (New
York: W.W. Norton & Company, 1987), p. 271.
22. Richard F. Kuisel, Capitalism and the State in
Modern France (Cambridge: Cambridge University Press,
1981), pp. 141-2.
23. Oskar Lange, "The Political Economy of
Socialism", Institute of Social Studies Publications on
Social Change no. 16, p. 22.
24. Malcolm Maclennan, Murray Forsyth and Geoffrey
Denton, Economic Planning and Policies in Britain.
France and Germany (New York: Frederich A. Praeger,
Publishers, 1968), p. 81.
25. Maclennan, pp. 88-89. Warren C. Baum, The
French Economy and the State (Princeton: Princeton
University Press, 1958), pp. 22-3.
26. Maclennan, p. 82.
27. Ibid., p. 99.
28. Charles Poor Kindleberger, Economic Growth in
France and Britain 1851-1950 (New York: Simon &
Schuster, 1964), p. 188.
29. Edward Mead Earle, ed., Modern France. Problems
of the Third and Fourth Republics (Princeton: Princeton
University Press, 1951), p. 375.
30. Maclennan, p. 218.
31. Adolf Sturmthal, "The Structure of Nationalized
88


Enterprises in France", Political Science Quarterly
(September, 1952), pp. 358-9.
32. Ibid., p. 363.
33. Ibid., p. 358.
34. Keith Coleman, Nationalization. Beyond the
Slogans (Braamfontein: Raven Press, Ltd., 1991), p. 88.
35. Joseph R. Monsen and Kenneth D. Walters, Nationalized Companies: A Threat to American Business
(New York: McGraw-Hill, 1983), pp. 67-8.
36. Ibid., p. 36.
37. David Pinkney, "Nationalization on Trial:
France", Yale Review (September, 1950), p. 110.
u> 00 Sturmthal, p. 363.
39. Ibid., pp. 366, 369-70.
40. Ibid., pp. 370-1.
41. Ibid., p. 369.
42. Earle, p. 366.
43 . Sturmthal, p. 364.
44. Pinkney, p . 108.
45. Monsen, pp . 52-3.
46. William James Adams, Restructuring the French
Economy. Government and the Rise of Market Competition
since World War II (Washington D.C.: Brookings
Institution; 1989) p. 64.
47. Earle, p. 356.
48. Monsen, p. xii.
89


49 . Ibid., p. 27.
50. Ibid., p. 132
51. Earle, p. 359
52 . Ibid., p. 363


Chapter Five
Economic Planning and Nationalization
Economic planning has been a counterpart to
laissez-faire economics for decades, and has been
pursued primarily by Communist and Socialist countries.
The planning of an economy within the ever-changing
economic indicators, consumer whims, and unreliable
forecasts has rarely run smoothly or without
protestations. Economists have had various opinions on
the inherent deficiencies of both planning and laissez-
faire economics.
France began thinking about economic planning in
the midthirties, but it was not to become policy until
after WWII.1 The government then pursued control and
forecasting as replacements for natural mechanisms,
challenging the "individualistic capitalist order."2
These "planistes" fell into two camps, the neo-liberals
who "embraced planning to perfect capitalism," and the
91


socialist-syndicalist who sought to build socialism
through planning. It was the latter who supported
nationalization,3 believing it to be a step towards a
socialist state.
World War II made apparent the industrial
weaknesses that needed addressing in France. Andre
Philip focused on the problem of Frances' high
population of artisans and agriculturalists when he said
"'war has demonstrated that only great industrial states
count in the modern world.'"4 Modernization was
essential to bring French industry into the 20th
century. Economic planning, with nationalization as an
important element, was seized upon as the way to bring
this about. Jean Monnet, in the London Times, (January
1947), pointed out what he saw as the clear choice for
France, "she can modernize her means of production or
she must face disastrous and inevitable decline."5
Surveys showed that in 1939 the average age of French
machinery was 25 years, and for modern sectors, 12
years. This is in comparison with the UK's 7 years and
the 5 year figure of the USA.6
92


The goals of the Monnet Plan were to recover a
world position for France, raise the standard of living,
and reconstruct and modernize industry.7 Jean Monnet's
plan had little in common with the radical conceptions
of young socialists in the thirties, being more like the
type of capitalist economy sought by the neo-liberals.
It stressed "investment over consumption, modernization
over recon- struction, or the future over the present."8
In fact, as early as 1950 the evolution of the Monnet
Plan brought it closer to operating within a capitalist
market economy, experiencing the revival of competition
and private funding of investments.9 The Plan II marked
further adaptation, losing its coercive character and
socialist inheritance.10
Immediate post-war planning for France stressed
reconstruction with public investment in energy and
transport, and later would include systematic
projections." The long-term investment was coupled with
a personal investment by the workers, 48 hours of work
instead of 40.12 The impressive recovery of industrial
output in the early post-war years depended to a large
93


extent on foreign aid, but the technological changes
made would carry on after the aid was halted.13
While the Plan I, (1947-53), concentrated on
basic industry over consumer goods and small-scale
manufacturing, Plan II, (1954-57), lifted these
restrictive practices. This led to general overful-
fillment of targets and rapid expansion leading to
rising prices and increased deficits. With no control
over internal demand the Plan allowed inefficient firms
to survive with no incentives to upgrade.14 Plan II's
public expenditures rose above forecasts for several
reasons; the Algerian situation drained resources, and
there was increased spending on social welfare, building
of schools and hospitals, and state financed housing.
Subsidies to farmers and nationalized industries were
deemed necessary to keep down the price of their
products.15
Plan III, (1957-61), was a more integrated and
coherent program, with preference given to projects that
saved imports and promoted exports.16 This Plan also
increased taxes and cut public expenditure,17 but social
94


welfare lagged. Plan IV, (1962-65), gave priority to
social investment over productive investment or private
consumption, and public funds were cut again. The French
were striving to develop an integrated, complete Plan
that would strike a balance between consumption and
investment, and between productive and social welfare
expenditure.18
Plan V, (1966-70), showed a definite break with
previous policy, reducing the amount of aid to national-
ized industries, to urge pricing policies which more
nearly reflected costs.19 It's major concern was to
reshape manufacturing industry into a more competitive
structure.20 Until the late 1950s France was less
dependent upon international trade than most Western
European countries. At that time the country began to
experience more and more outside competition and
recognized the need to adapt the economy in order to
accomodate these encroaching influences. In 1951, the
formation of the European Coal and Steel Community bound
these industries with France's neighbors in production,
95