News Focus
News Focus
icon url

FinancialAdvisor

05/24/05 9:41 AM

#8184 RE: FinancialAdvisor #8176

Chirac Allies Criticize EU Treaty, Defying Leader (Update1)

Chirac Allies Criticize EU Treaty, Defying Leader

May 24 (Bloomberg) -- French President Jacques Chirac suffered a double blow in his campaign for Europe's constitution as members of his party joined to speak out against the treaty and polls showed support for the ``no'' vote growing.

Fifteen members of Chirac's Union for a Popular Movement such as Senator Philippe Marini issued an appeal criticizing the constitution, five days before a May 29 national referendum. Other treaty opponents include former Socialist Prime Minister Laurent Fabius, anti-immigration leader Jean-Marie Le Pen, the Communist Party, and anti-globalization campaigner Jose Bove.

``Voters see whichever `no' they feel the closest to,'' said Bruno Jeanbart, director of political studies at Paris-based polling company CSA. ``Sympathizers of the left see a leftist `no,' and nationalists see a sovereign `no.'''

Opposition increased to 53 percent from last week's 51 percent, a poll by CSA for Le Parisien showed. The CSA poll of 999 people was conducted on May 21 and 23, Le Parisien said. No margin of error was given. An Ifop poll for Paris Match magazine put opposition at 54 percent, Agence France-Presse reported, up two points from a survey conducted on May 19 and May 20.

The vote on the treaty, a 232-page document that spells out EU procedures without specifying policies, is turning on the declining popularity of the government, as the economy slows and unemployment rises to its highest since 1999. Chirac's approval rating plunged to its lowest in eight years last week, a BVA survey showed.

Chirac's Popularity

A rejection would scupper Chirac's hopes to run for re- election in 2007 and kill the treaty, which requires unanimous ratification by the EU. A loss may weaken the euro and securities of eastern European nations that plan to adopt the common currency, according to economists including Eric Chaney, Morgan Stanley's London-based chief European economist.

Fabius, 58, who served as prime minister from 1984 to 1986 and as finance minister from 2000 to 2002, may be the biggest winner if voters reject the constitution. He began campaigning against the document last September in a challenge to his Socialist Party leader Francois Hollande, a supporter of the constitution. Chirac announced the referendum July 14.

Fabius supported the creation of the single European currency and designed income tax cuts as finance minister from 2000 to 2002. He said two years ago he sometimes has the 2007 presidential election in mind.

``I don't want to foot the bill because Fabius intends to take over the Socialist Party,'' said Nicolas Sarkozy, the former finance minister and head of Chirac's UMP, on May 19. Advocates such as Sarkozy say the treaty is a key step toward EU integration.

UMP Appeal

The appeal by members of the party came today in Parc Monceau, less than a mile from the President's Elysee Palace.

``The `no' is a `no' against bureaucratic drift, social retreat, and a weakening of European power,'' said the statement read by Marini, 50, a member of the Senate Finance Committee.

The ``no'' coalition comprises self-proclaimed Trotskyite parties to anti-globalization activist Bove, the farmer who received a jail sentence for ransacking a McDonald's Corp. restaurant in 1999.

It also includes Chirac's former interior minister Charles Pasqua, accused by a U.S. Senate report this month of being given 11 million barrels of Iraqi oil by Saddam Hussein, and then covering up the profit. Pasqua denies the charges.

Though the factions have different agendas and say they don't coordinate their campaign, they've had rallies and posters plastered throughout the country.

Campaign Funding

Based on past elections results, nationalist party Mouvement Pour la France, headed by Philippe de Villiers, Le Pen's National Front, Pasqua's Rassemblement Pour la France and the Communist party have received 800,000 euros ($1 million) each from the government for the campaign.

Four parties backing the treaty have received the same amount. They include the UMP, Union pour la Democratie Francaise, founded by former French president Valery Giscard d'Estaing, who helped draft the constitution; the Socialists, and the environmentalist Green Party.

Lutte Ouvriere, a Trotskyite group led by Arlette Laguiller, that won 5.7 percent of the votes in first round of the 2002 presidential election, wants to eliminate private property and markets globally. It's budgeted as much as 70,000 euros for public meetings and fliers, and has distributed about 200,000 leaflets per week since Feb. 1, according to its spokeswoman Henriette Mauthey.

Critics of the constitution, including the Communist party, say the economic section of the proposed charter, which chiefly compiles pre-existing treaties, is locking in free-market policies of governments and the European Central Bank that have set back growth, and that will undermine France's welfare system and public services through market deregulation.

`Social Dumping'

``There will necessarily be social dumping'' and ``competition among workers,'' Catherine Gallon, a 53-year-old university teacher and member of Attac, a lobby that calls for taxing financial transactions to fund aid, said at a rally for the ``no'' at Place de la Republique in Paris on May 21, where bands played reggae music after the speeches ended.

Villiers and National Front leader Le Pen say the constitution will pave the way for Turkey, a mostly Muslim country with 69 million inhabitants, to join the EU bloc. Le Pen, who got 16.9 percent of the votes in the first round of the 2002 presidential election, wants France to abandon the euro and exit the EU.

He held his traditional May 1 Labor Day rally with posters of Joan of Arc, a French 15th century leader who organized resistance against British occupation, describing her as the person who said ``No.''

To contact the reporter on this story: Francois de Beaupuy in Paris at fdebeaupuy@bloomberg.net.


LINK: http://www.bloomberg.com/apps/news?pid=10000085&sid=ac2y0imJsCcc&refer=europe