JPRS ID: 9821 VIETNAM REPORT

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• Content Type: REPORTS

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- JPRS L/10087
2 November 1981
V~/est Euro e Re ort
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cFOUO ssia, a
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J'PRS L/1008 7
2 November 1981
- - WEST E~IROPE REPORT
FFOi30 56/81)
CONTEN TS
E~orloMtc
- BE LG I irM
- Citizens Polled on National Debt, Budget, Financea
(POURQUOI ~AS?, 1 ~ct 81) 1
Continuing Problema of Cockerill-Sambre Steel Company
(Paul Colson; POURQUOI PAS?, 24 Sep 81) 8
FRANCE �
Need for Antitrust Law Emphasized, Explained
(Raymond Bourgine; VALEURS ACTU~LLES~ 14 Sep S1) 14
POLITICAL
FR4NCE
- Responses to Detente, Cold War Viewa of I.owenthal, Labedz
(COA4[ENTAIRE, varioue dates) 18
Neutralism, Pacifiam, Finlandization, by Pierre Hasaner
Arms Control; Economic Relations, by Theirry de Montbrial
Results of Vietnam, Detente, SALT, by Raymond Aron
- a - [III - WE - 150 FOUO]
Cl1D I1CL~T/"T A ~ r rcc !?~tT V
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ECONOMIC BELGIUM
CITIZENS POLLED ON NATIONAL DEBT~ BUDGET~ FINANCES
Brussels POUHQUOI PAS? in French 1 Oct 81 pp 4-7
[Report on survey, conducted by SOBEMAP between 27 Ma.y and 25 June 1981: "The
Bel glans Accuse:..,"]
[Text] The public opinion poll was conducted by SOBEMAP [expansion
unknown] between 27 May and 25 June 1981, with a sample of 2,000
individuals, reprssentative of the Belgian populati~:~n~ 18 yeass of
age or older.
This sample was detern^...i.ned by a random selection from a list of
addresses ba,sed on voting lists. The persons thus designated were
interviewed in their homes by the team of interviewers from
SOBEMAP.
SOBEMAP adheres to the ethical code of ESOM!'.R [European Association
for the Study of Public Opinion and Maxk~ting]. It is, moreover~ a
member of FEBII~MAR [Federation of Belgian Institutes for Market and
Public Opinion Reseaxch].
Power void. Freezing of all political decisions. An increasingly cleax cut econo-
mic k~eak between the northern a.nd southern parts of the country. A neaxly complete
- drying up of the state coffers: Willy Claes is afraid that soon we will no longer
even be able to pay the unempluyed:
In the face of this dramatic situation~ whlch adds a frightening dimension to the
current political crisis, how axe the citizens reacting?
They hardly get an opport~anity to be hAard these days as their voices axe covered
by an absurd cacophony of slogans, demands and other uZtimatums from pressure groups
of ali kinds. Hence, the public opinion poll conducted by SOBEMAP, which we are
publishing exclusively f~r the. French speaking part of the country KNACK MAGAZINE
is doing the sa.me for th.: rlemish side came just at tYre right moments it finally
allows us to know the opinion of the citizens-~axpayers on the ma.nagement of their
public monies. Of our monies:
Will fou be surprised? The Belgians accuses too many expenditures, distributed
too ba,dly, an~i also too much bureaucracy: However, there is nothing perfunctory
about this opinion: as they were being questioned, these perceptive citizens also
showed that ~they know what they want. For those, whoever they may be, who will
take the country's rudder~ there are lessons here which should not be forgotten.
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Let it be said:
The first reaction~ proba,bly an immediate one, but impressive~ to the first ques-
tion: an overwhelming majority of Belgians 83.6 percent believe that the
state is doing ba.dly or very badly financially speaking. Politicians, take note!
Ba,sed on the sample of 2,000 respondents, according to the SOBEMAP criteria this
represents some 6.2 million angry citizens over the age of 18. And amcng ~lzese~
t1e men and especially the male inhabitants of Brussels are the most discontsnted.
Table 1. Do you think that the Belgian state is doing well financially sp~aking?
State doing very well 1.2
- State doing well 2.4
State doing neither well nor badly 12.0
State doing ba.dly 35.6
State doing very badly 4$.0
Do not know 0.8
The indictment is terrihle. To be sure, these taxpayers do not appear to be very
well informed, as individuals, about the mysteries of internal revenue~ about the
weight of what they pay to the tax collector in relat~on to iche effort made by the
enterprises, nor about the distribution between direct taxation and the TVA [Va1ue-
added Tax]. But is this important? As we will see later on, a laxge majority of
them (65.4~ percent) in any case believe that the taxes on earned income are too
high, and especially tha,t the state must reduce its expenditures: 77.8 percent of
them~ or 5.6 million out of the 7.2 million voters represented by the sur~~ey
sample are demanding a cha.nge of course. Is this not clear enough?
Table 2. Knowing the indebtedness of th: st~�.te, do you think tha.t it should
Reduce its ex~enditures 77.8
Increase taxes or social contributions 1.8
Do both 8.6
Neither, leave the situation as it is 11.2
Do not know 0.5
But it would obviously be a good thing to further analyze and detaii these shaxp
reactions. As a ma.tter of fact~ it is true tha.t the B~.lgians have very precise
ideas as to the form of state spending in the ma.jor sectors. The following table
is very enlightening in this regard. The higher tho score, the n~ore the people
surveyed believe that the particular expenditures repreaent a large amount. In-
versely, the negative scores indicate the seetors in which the state effcrt is eon-
a sidered to be below the overall average.
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Table 3. Here then is haw, in the eyes of the voters, the state spends aur money:
Scientific research -10.88
National education, instruction 5.81
= Police, gendarmerie, security of persons and property.. 6.32
Health and disability insurance 7.82
Aid, subsidies to private enterprise .....a............ - 3�57
Unemployment 6.60
= Common Market 0.38
Public transportation (trams, buses~ trains, subway~).. 1.58
National defense, army~ NATO 4.65
Culture, radio and television, theater -10.41
Cooperation aid to developing countries - 8.4~4
~'ensions 2.25
Institutions: national, regional, community,
- municipal, government 5.78
Salaries of civil servants 4�65
Construction and maintenance of roads, expressways 10.91
Reimbursement of loans, interes~ 3�27
Family allowances ............e - 2�55
What is noticeable when reading these "scores"? First of a11~ that for the voters
in this opinion poll, a super maximum is spent ori ~;he construction and maintenance
of roads and expressways. That the second p].ace on the hit parade of public monies
is taken by the social budgets (health and disability insurance, and unemployment).
That for everything that concerns our security, we pay the prices police, gendar-
merie and other forms of protection of the security of persons and proparty obtained
a perfectly respectable score. Tha.t, on the other hand~ national education rated
an honorable score~ whereas our various institutions~ arlministratinns and our civil
servants together cost us a pretty penny.
On the other hand, it is in the negative scores assigned by the persons in the
survey (for the sectors in which the state spends little money) that we find the
sectors most likely to have a future and to provide personal enrichment: scienti-
_ fic research, apparently very much neglected, culture, radio and television, etce-
tera~ aid to developing countries, but a1.so aid and s~absidies to private enterprise
and family allowances.
Without once again making a value judgement, the Belgians ha.ve thus noted to what
extent an imbalance does exist to the disadvantage specificall.y of scientific re-
search, in spite of a11 the pretty speeches we axe being showered with which tell
us about lovely tomorrows.
- Could these Belgians be sceptical then? Not at a11: rather realistic~ looking at
things directly, but with a touch of resigna.tion when they consider the manner in
which our money is being managed. Which does not prevent them in the least from
responding very clearly when they are asked to give an opi.nion on a series of sug-
gestions submitted to them.
- Nearly 8 out of every 10 citizens (79 percent) either agree or fully a~gree that
taxes on earned income axe ~oo high. And it is the Walloons, the inhabitants of
Brussels and the warkers who are mo~t sensitive to this tax pressure.
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_ - Nearly 2 out of every 3 citizens (61.5 percent)~ and even more Flemish and shop-
keepers, would like to see a reduction ir, the number of civil servants.
- Likewise~ 2 out of every 3 citizens reject a further increase in private cont~i-
hutions to social security.
- An even larger majority (69.4 ~ercent~, and even ;nore in Wallonia (?9 percent),
the other hand, believe that the na.tional wealth should be better redistributed
through social achievements. ~
- Attaching an essential value to our currency, an overwhelming majority (78.6 peri
cent) believes that the Belgian state should ciefend the franc at any cost.
- Finally, 2 out of every 3 citizens firmly believe that they are being t~eated
unfairly by the state.
Table 4. Knowing that the puhlic debt amounts to 2 trillion francs, I would like/
to know again to what extent you personally agree wi+h the statements I
read to you earlier.
N~ully Agree N~ore Do Do Do
Agree or Not Not Not
� Less Agree Agree Knowr
Agree at
a11
Taxes on earned income axe too high...... 33�9 31�5 12.9 4.2 1.0 17.2
Number of civil servants should be
reduced 25.1 28.8 15.0 8.5 3.5 19.1
Private con~ributions to social security
should be increased 0.8 9.6 13~~ 37~~ 19�8 19�3
Taxes on dividends should be increased... 11.0 23.1 17.4 19.7 6.4 22.4
The state should better redistribute
national wealth through social
achievements 27.7 3~1-.8 11.0 4~.5 0.7 21.3
It wo uld be better to increase TVA
_ on products and reduce inc~:ne taxes... 6.6 15�~ 2~~3 19�3 9�~ 2~�9
_ Companies should pay less income and
- other taxes 6.9 20.0 20.5 18.1 1203 22.1
One has feeling of being treated fairly
by state 2.1 7.4~ 13.9 ?5.0 32.6 19.0
= State should defend Belgian franc at
a17.. cost 36.7 27.9 11.5 3.4 1.2 19.3
~ue, these large main themes ase slightly mi.tigated when the respondents ase asked
the same questions over again, after ha,ving been told about the enormity of the
a,mount of the state's indebtedness. Witness the table above~ where it is shown
that the positions remain oriented in the same direction, except that the propor-
tion of "do not know" increases noticeably.
Evidently, the fact of being informed of the seriousness of the country's financial
situation and of the catapulting amounts of indebte.~'xness does not cause the Belgians
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to lase their head. Is this a mistake? No, to the extent that, a,s we saw eaxlier,
they loudly demand a reduction in state expenditures. Which allows them to look at
the debt problem from a certain distance
Table 5. In fact, tYie public debt~ that is to say wraat the sta.te owes to those who
have lent it money, amo~an~s to 2 trillion f~ancs~ which means that a
Belgian owes 203,000 Belgian francs at birth~ or that a Belgian household,
on the average, owes 600,OQ0 Belgian francs.
a) What do you think about the situa.tion? .
It is not worrisome at a11 2.2
Tt is not wo~-risome 3.8
It is neither worrisame nor not worrisome 11.3
: It is worrisome 39.0
It is very worrisome 43.0
Do not know 0.6
b) And you personally~ do you feel
- Very concerned 2,0.7
Concerned G~3.8
Neither concerned nor not concerned 18.4
Not concerned 10.4
Not concerned a~ a11 6.2
Do not know 0.6
c) And your cl^.ildren~ or th.e next generation, axey tl~ey
Much more concerned 35~2
More concerned 36.9
Neither more nor less concerned 20�5
Less concerned 3.6
Much less concerned 2.9
Do not know 1.7
One will notice that the respondents are much more worried. about the consequences
of the state's indebtedness for their children or the next generation. Hence, to
- protect them against it, and because they are clamoring for a reduction of public
expenditures~ what solutions do they have to offer? How would they go about it if
they were minister of finance or of the budget instead of Messrs Vandeputte and
Ma,thot? The following table, listing the same main sectors of expenditures that
= were listed above~ shows the score given in terms of the importance of the efforts
to be agreed on with regard ;;o the current situation. The negative scorea indicate
the areas where there is a shortage and where investments should be made, wherea~
the positive scores indicate the areas which axe fa,vored too much and where more
or less serious cuts could be made.
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Table 6. Here then is, in general terms, the wa.y th~ Belgians would put together
the state budget:
Scientific research - 8.26
National education, instruction - 8.49
Police, gendarmerie, security of persons and property. 1.18
- Health and disat~ility insurance .....o - 6�5?
Aid~ subsidies to private enterprise Z�5Z
Unsmployment 2.37
Common Masket 8.51
Fublic transportation (trams, buses, trains, subways~. 3.26
National defense, army, NATO - 4.13
Culture, radio and televisionp theater - 2�37
Cooperation aid to developing countries 0.26
Per~sions -10.74
Institutions: national~ regional~ community,
_ municipal, government 9�55
Salaries of civil servants 5�73
Construction and maintenance of roacls, expressways 5.35
Reimbursement of loans, interest 1.~2
Family allowances - 9~37
Other responses - 2.4~9
Roughly, one might say then that the Belgians are:
- Allergic to excessive expenditures for everything touching the vaxious iristitu-
tions, the bureaucracy, and the civil service. To a somewha.t lesser degree, they
would readily give up on too much spending for roads and expressways. A few de-
grees lower yet, public transportation, aid to private enterprise, unemployment
and debt service should receive the same fate.
- Allergic to a reduction of expenditures, and even in favor of an increase in
them, in the social sectors (pensions, family allowance~, health and disability
insurance}~ and in the sectors affecting the future scientific; research or
_ the coming ~enerations national education. Defense problems would ~,ppasently
also warrant an effort.
As far as the social budgets are concerned, however, we have seen above that the
Bel~ians dema.nd a better distribution of their expenditures.
Regional Angle
However, when these issues are exa.mined from a regional or community an~].e~ one
often obtains notabl~ differences in attitudep even if icha ma,jorities are a11 going
- in th~ same direct~on.
Thus~ without distorting too much, it could be said that the Flemish are clearly
more in favor of a~eduction of the size of the bureaucracy and of the institutions
than are the inhabitants of Brussels or the Walioons. Similarly, they would look
with more favor upon a reduction of expenditures in terms of health and disability
insurance, than would the citizens of the other two regions of the country. The
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Flemish would also~ but preceded by the inhabitants of ~ussels~ more easily accept
paxsimony in terms of unerlplc~~nent expendi+ures~ whereas the Walloors refuse to a1-
low them to be touched. Identical divergences exist with regard to aid to enter-
prises, a reduction of which would be mQre easily accepted by the citizens of the
northern part of the country~ whereas the inhabitants of Brussels reject it. On
the other hand, the citizens of the capital and of Wallonia are much mere concerned
about the efforts to be ma.de in terms of scientific research than are their Flemish
' neighbors. Identical cleavages also in terms of defenses only the Flemish are
publicly more in favor of an increase in expenditures.
Conclusions
By developing, on these "hases~ a kind of rather coaxse profile, it could thus be
concluded that the F~emish are definitely more open to the liberal themes advoca-
ting a reduction of the burden of the state and of bure~.ucracy~ as well as the
"skimming off" of certain social budgets. All things being equal, they are also
more "militaristic" in that they would accept greater efforts in ma.tters of defense.
The Walloons,on the other hand, axe clearly more characterized in terms of themes
likely to strengthen the welfare state and bureaucracy, relying more on public as-
sistance than on private initiative.
As for the inhabit~.nts of Brussels, they represent a special case. They are the
ones who, throughout this survey, showed themselves to be the most grumpy, the most
civic~ the most oppositionist. But they are also aware of their own needs, and
they let it be known. To ~the point tha.~ it could be said that, even if our new
ins+ituti~ns leave them sitting between tw~~ stools, they form a distinct entity.
The candidates presenting themselves at our electinns should also take this into
account. As a matter of fact, in the next part of this survey~ which we will
publish next week, they will find other subjects for thought of this kind.
May this be of some use:
COPYRIGHT: 19t31 POL'RQUOI PAS?
8463
Cso: 3100/29
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ECONOMIC BELGIUM
CONTINUING PROBLEMS OF COCKER~,L-SAMBRE STEII~ COMPANY
Brussels POUR~iJOI PAS? iri French ?J~ Sep 81 pp 8-11
[Article by Paul Colsoii: "The Big Wa1tz of the Billions"]
[Text] 'Tiow, at the enci of 1978~ a stimulati~n af inve5tmen~s is
imperative and actually appeaxa to be well under way. Iiowever~
- it will l~e abi e to succeed onl.y to the ex~ent tha~ ~re authori-
ties as iaell as the officia.ls of t~e private c;ompani~~ have a
= real dra,wing power for i:~vesto.rs."
The author o~ +his semi-praphesy in the form oF a Lious wish
- was the actin~ mayor of ~~ra:ng, a.ddrsssin~ those in the macha-
nical engineering division o~ S.A. CockerilT irho Y~ad been deco-
rated, on 11 DecembQr 1978� His name was Ja~q~~e. Vandebosch.
_ Three years later~ this same Vandebosch~ a colorfa~st socialist~ is prp~ident of the
- executive committee of Cocker~.ll-~ambr~. The hopes of 1978 have long vanished ir.to
- thin air. In this la~t quarter of 1~8~, ~he situatic~n of Walloor steel is drama.-
tic: One would neecl ar~ avdlanche of bilYions of fra~ncs into the coffers to re-
- trieve the situz,tion. And qui~kly. 4e.ry quickly:
- Capital Increase
Let us take a lcok at it: with the current stat~ o~ ~rders, the loss of substance
- cash drain in the parlance of the econor.ii~ts will amount to 1.2 billion
francs next October, 4~00 million francs the mon�~;n after that, and 1.3 billi,on
francs in December. Let us round it off at ~ billion francs. Plus 4 billion
francs in investment needed if we do not want the holes to become any deeper. That
' ma.kes 7 billion: Not to mention the debts, the burden of which shows signs of be-
coming rapidly worse because the company ha.d to subscribe to short term loans which
will do badly during the coming weeks.
~ At the end of June~ the state who is the main sha,reholder had decided to in-
crease the capital up to il ?~illions of our franes. But barely 25 percent of this
amount has been freed. Which is no more than 2.75 billion francs~ a mere drop of
water in a sea of fina.ncial difficulties. Very inadequate, even to soak up the
_ operating losses for the first 6 month period of 1q81. The accounts were quickly
- worked out: 6.2 billion francs minus 2.75 billion francs in capital increase~
_ leaves 3.~5 billion francs to be urgently found.
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At the request of the European Commiss~on~ the balance of the capitai incre,ase was
replaced by a short term cre3it: 700 million of our fxanes in Ju].y; 70 million DM
and 70 million Swiss francs the following month, which represents a total amount of
3 biZlion 142 million of our francs, with various interest and commission arra~ge-
_ ments whose expiration dates fall on 26 October (1 billior~ 138 million}, ~n 25 No-
' vember (1 b~llion 304 million), and on New Year's Ev~, h~ippy a.nd joyaus New Yeax:
(700 m~llion~.
Here then is, as it is~ the mathemati~s of anguish~ which would in princ:.ple oe
- gripping the managers of Cockerill-Sambre if they were anything but administrat4xs
_ appointEd by the public sector and the halding companies, thos~ who are refe~�red t~
as the .PS (stable private shaxeholders~.
Head Above Water
Each manufactured ton, especially af the least profitahle products~ is manufactured
belaw c:ost price. Under those circumstances~ the temptation to stop the march of
the ~everely wounded who with each step lose a little more blood, i~ gre.~�. It is
= the theme dcfended in certain F'lemish circles, accompanied with the dld nationalist
~logan: '~Flemish money for the Flemish." But 8ldmar is less si~k than Cockerill-
Sambre.
The overall state o.f the treasury in L~.e~e and Charleroi and the stzte of affairs
axe such that any capital input and we should count excZusively in billions of
francs would be immediately absorbed by some improvised sal~rage operation or
other. This is what is seriously referred to as the head ~.bove w~ter policy.
It mlist be acknowledged that when they perfozm the nohle and sen~timental waltz of
- the billions, the sociali.st c~mrades put fe~ling into its a1ZA~ro con tario:
~ Within the entPrprise itself~ two sides confront each other. That of the pessi-
mist.ti (or of the realists, the future will te11 us~ who estima�e the cha,nces of
- survival for Walloon steel at the lowest lev~l: one out o:f three perh~,ps, or one
out of fo~xr. And then the side of the optimis~s (or opportunists, we will soon
find out). The president of the executive committee~ Jacques Vandebosch, is one
of them:
"Al1 th~ Lur;,pean steel manufacturers axe in the same uoa,t. Nearly a11 of them
_ are ccnv~nce~ �ihat solidar~ty w~ll a11ow us to save the equipment dvring the diffi-
cult period while they ;rait for a cha.nge in the overall economic climate."
' Last ~eek~ at E~ar~~er (Eurofer is a kind of club of the bi~ steel manufacturers in
Europe; nothing ~fficial; it involves a union of interests~ the Germans apparent-
ly d~manded a price increase to be applicable as of next 1 January. This is sur-
prising n~:ws, .tn ',he senae tha.t it is known that a few ironmasters from across the
~thirie ase fieire advocates of war to the knife among the Eiaropean producers and
which will be won by the best. Apparently they are no longer the only ones to be
heard in the FRG and in the European caucuses.
Pr~ce Decrease per Ton
Jacques Vandebosch estimates that: "If prices could increase from 1,000 to 1,500
francs per ton, we would once again be able to sell above cost price."
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Without for all that getting out of the red, because the liabilities are heavy.
"The enterprise owes 28.8 billion francs in short term credits and 31 billion francs
, in long term credits~ of which a large part however are SNCI [National Company for
Credit to Industry] credits. The interest burden to be paid by us can be estimated
at 2.5 billion f'rancs."
It is true that the cr~sis has thinned out the European ranks. The Brescia,ni, tho~
small producers from Northern Ita1y who 5 years ago struck fear among the soundest
steel empires, have in turn been routed.
As for the big producers such as Cockerill, part of the tragedy was acted out on an
overwhelming combination of circumstances. At the very moment when the crisis pro-
duced a price collapse on the international maxkets~ it proved to be necessaxy to
modernize without delay.
"We know that we will be able to influence our cost price only by actin~ on the
'process' (the production techniques editorial note). The continuous casting
and modernization of equal scope are allowing for an 800 to 1,000 francs price re-
duction per ton~" said the manager of Cockerill-Sambre. "If we li~nit ourselves ~to
simple replacement changes of one kind of equipment or another~ then our profits
will not go beyond 100 to 200 f`rancs per ton. "
Up a Tree
In such a context, last week' s chance r,~i.shap could only take on catastrophic pro-
portions.
Without going into details billion by billion, the stakes are clear: the financial
extension is not sufficient to hold Cockerill-Sambre until the economic clima,te
recovers. In other words, salvation will have to come from the outside or circum-
- stances wi11 have to be willing to intervene. There axe still more tha.n 38,000
_ workers and employees in the steel industry in Wallonia~ of which 25~000 are at
Cockerill-Sambre alone. This represents a large number of ballots in the ballot
box in case of elections and a iarge number of people on the street if the unions
- decide to take up the ?~attle ax.
~3ut is the survival operation as urgent as is claimed by the socialists of Guy
Spitae~s and the FGTB [.General Federation of Labor of Belgium~ supporters of that
- union hero named Robert Gillon?
~ "If there is no overall and certain financial soluti~n by December~" said Jacques
Vandebosch, "then we will be up a tree. We can no longer ga~ap here and there
every day to try to find a little money."
With each new move, confidence in Cockerill-Sambre goes down a notch among the
~ suppliers and financiers in the foreign markets. Ths socialist lobby maintains
that if we wait too long, it will no longer even be possihle to collect a single
additional franc to salvage the Walloon enterprise. And this would mean death,
- period .
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Additional guaxantees
~ Our ba,nkers have already stopped believing in it. There have been doubts for se-
veral months. Last week, pressed to make a statement on their previous commitments,
- the ba,nkers had no other recourse, seen ~om the left, than to set their dema,nds
_ high. UndPr conditions that the government could no longer afford.
"It has become evident to us~" commented Jacques Vandebosch, "tha,t the private fi-
nanciers xefused to take risks and that, in order to cormit themselves~ they deman-
ded complete covera.ge from the state, whicY. did not correspond at all with the p~�e-
ceding agreements."
- It should be noted that the opinions of the accused are very different. The So-
ciete Generale [SGB1 ~ the Brussels Lambert Barik [B~I,] ~ the Kredietba.nk [KB] and
Paribas all deny with utmost energy tha,t they issued an edict last week.
"First remark," explained the ba.nkers. "You should not confusP holding companies
and ba.nks. The mo ney we loan to the steel industry is not ours. We axe respon-
sible for it to our clients. Second remark: for us, the negotiatior.s concerning
- the steel industry have been going on since 1976. Over time, the options and the
tone have f7.uctuated. In this case as in others~ our line of conduct consists of
assessing a risk. If it seems to be getting worse, then we demand additional gua-
rantees from the client. We did indeed consider that the risk was getting worse
these da,ys in the Wa.lloon steel industry. On the other hand~ we had been promised
that the financial. operation would be ba,sed on a precise restructuring plan. Henc~,
= we requested that an outside auditor keep an eye on the precise implementation of
that plan . What could be more natural?"
As for the asked for but not obtained guarantee from the state for the opening up
of adequate lines of credit, the bankers ha.ve a different version from the one cir-
_ culating in Liege.
"The position of zhe state does not necessarily ha.ve to be interpreted as the re-
jection of an edict. The truth is tha.t any guarantee granted Uy the state must be
chaxbed against the budget. Which seemed impossible to the government in the cur-
rent state of publ ic finances
Greater Clarity
What did the bankers demand then? The finicky application of the restructuring
plan as specified last May. A yeaxly verification (external audit~. Substitution
of the private cornpany by a paxastatal organization in case of failure by the
debtor. In return for which the ba,nks maintained the current credits and uncondi-
tionally assumed the strictly commercial credits.
"We also regret," said the ba.nkers, "that thi~ summer's contacts took place between
experts, those from the state and ours, without the d3scussion ever reachirig a
higher level. Except for last week."

- At the time of the meeting which resulted in the consequences we know about.
"As the situation of Walloon steel had deteriorated," the four (SGB, KB~ BBL and
Paribas) explained, "we could no longer content ourselves with vague declaxations
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of intentions. We had to have certainties. Actually, we didn't ask for anything
new, but greater clarity in the financial contract we were to adopt."
Le~ us note in passing that the ba.n.~ers did not take kindly to serving as ball
boys for everyone, including for the ~ava~es in the government, while at the same
time the state was insistently seeking their cooper~.tion in investing the Municipa7.
- Savings Bank loan which is supposed to provide a financial extension to two cities
in ctesperate plight: Liege and Antwerp. Cuddled on the one hand, kicked in the
behind on the other, the least that could be said is that they did not appreciate
it.
Contagious
And now?
"Far us, nothing has been l~oken off," stated the four, "and we remain open to any
- proposition. Indeed, there is the question of whether they can do without us?"
For Vandebosch, the answer is yes.
"With a fallen government," he said~ "the only thing left for us to do is go for-
ward until the financial difficulty becomes too specific. In which case we will
turn to the main shaxeholder. And he ha.d better stick to his commitments."
Since Monday, the union organizations have been on the was path.
"However, I remain convinced," said the president of the executive committee, "that
a social agreement is possible. But it is a fact that the rank and file will ac-
cept the implementation of the plan (laying off 5,000 workers between now and 1985,
- and wage reductions) only on the condition that investments are actually achieved."
~ In the overall maneuver, thia confirms the fact that the union threat is specific:
no money, no truce!
Right before the fa11 of the E~rskens I a.cl.ministration, Jacques Vandebosch asserted
that there were three chapters to his bihle: the report of the presidents (F`rere-
Chaxlier), the conclusions of the Japanese e~-pert Nippon Steel, and last May's
government plan. In short: social sacrifices, yes, but fresh money to modernize
the plant. On this point, a11 the figures do not a~ee, concerning the benefits,
for exa.mple, of continuous casting on the cost reduction per ton produced.
As a matter of fact~ the overall impression is one of great confusion as soon as
figures are involved, that everyone has his own and uses them for his best inter-
ests. And. shame does not stifle anybody.
When it heard about the government's false note ori Monda.y evening, the first con-
cern of the management of Cockerill-Sambre was to find out whether the granting of
the necessary credits actually comes under current affairs. Well, those current
affairs could gQ on for quite a while. Apparently~ the response is yes. Sigh of
relief on the Walloon side.
- Nevertheless, what takes place on the sta,ge is only the reflection of what is
stirring in the wings.
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In one of those popcorn books, Philippe Bouvard, who is a more serious boy than
one might have thought, notes that ideologies are like the plague: conta,gious.
Well, the last remaining question about Cockerill-Saml~e is to find out wha,t dirty
disease it might die from.
COPYRIGHT: 1981 POURQUOI PAS?
8463
cso: 3100/23
~
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ECONOMIC FRANCE
NEED FOR ANTITI~UST LAW II~lPHASIZED, EXPLAINED
Paris VALEURS ACTUELLES in French 14 Sep 81 pp 24-26
[Article by Raymond Bourgine: "More than Ever We Need an Antitrust Law"]
[Excerpts] The Socialist government could have done
without nationalization. It is imperative that it
develop for France a law against schemes and abuses
by those in positions of power.
So, we are going to nationalize! However, as regards "sacred and inviolable" property,
the Constitution sets precise limits to the ruling party's authority. Good sense
and the public interest set additional ones.
Rather than nationalize, it would be better to develop in France a suhstantive law
against schemes and abuses by those in positions of power and to apply the law
effectively. It would have been better to develop '4nass capitalism."
Let us turn to Francois Mitterrand. As French chief of state he is at the head of
an enormous enterprise, the French economy, whicb is entirely dependent on inter-
natianal cc,mpetition. W~~.h a foreign trade of aUout 600 billion francs each for
exports and imports, I'rance must export over 40 percent of its industrial and agri-
cultural production, and it imports more than 30 percent of the indu:~trial products
sold on its domestic market.
Industry is the concrete foundation of the economy. Trade, administration and social
services are only the auxiliaries, the accessories, sometimes even the parasites.
I~dustry ~:.sures the existence of productive ~obs. It is *_t~e primary t~Y has?. I*_~
prosperi_ty furnishes the state with taxes and assessments upon which administrative
and social jobs depend. Its ability to compete is the prime imperative.
At this very momer.t, our competitors are undertaking some formidable~measures.
In the United States, Ronald Reagan has started a fiscal revolution. This new
American fiscal reallty will give a spectacular boost to "mass capitalism."
Imagine similar accounts [IRA accounts] in France--at least a million and a half
taxpayers would benefit! It would be a net influx of 20 billion francs of savings
per year.
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~ It has b~in repeatedly said th~t French firms are in danger because of their lack
of equity. This will not appear miracul~usly; it wil~ only happen through profits
~prices high~r than costs) or through stockholders.
_ The firms ehat are going to be nationalized aarn large amounts of foreign currency
on internationa~ markets. Would it not have been better to have reinforced their
capital by reinforcing mass savings?
lhere is talk of m~nopolies, but it would t~e more accurate to say that there are
abuses by those in positions of power which skew the competition. Nationalizations
will only ~ggravate this tendency. There must be an antitrust law. It will be
needed more than ever aft~r the nationalizations--the state must guard itself against
~ its own temptations ~nd protect the economy against possible abuses by the nationalized
firms.
If we call things by their right name, we see that prior administrations orere grossly
at fault. They should have though~ of a policy similar to Reagan's, but they did not
dare. Their economists were like frightened birds, twittering over Margaret Thatcher's
_ obvious failure. But it had two causes: an overly strong pound which ruined British
industry and caused it to export factories and jobs overseas, and the inability to
reduce public spending.
Reagan's experiment is altogether different: expenses are being cut in correlation
with the red,iced taxes. The expensive money is actually a sign of the size oi profit
margins in an economy where most of the large firms are not net borrowers but lenders.
On the world market we are going to encounter an overactive American effectiveness.
The Germans are benefitting fully from the present overevaluation of the dollar and
_ franc compared to the mark. Not to speak of tfie Japanese, whose trade surplus
is staggering,
In short, our competitors are well supplied with capital, and their modernization
and sophistication will increase.
Why are we nationalizing?
Because of the socialist ideology which says that "the nation must take over the
handling of its economic policy." A pointless argument, since the large companies
were already, and in the most regrettable fashion at the government's disposal.
But the Socialists also claim to be religiously attached to democratic law. They
must abide by the Constituion, which proclaims the permanence of the 17$9 Dec.laration
of the Rights of Man: "Property is an inviolable and sacred right. No one can be
_ deprived of it except when demanded by l~egally determined public necessity, and on
the condition of a just and prompt compensation."
Who is to judge the evidence? The legislator.
But who is to be the judge of the "jus~:: and prompt compensation"? Article 55 of
the Constitution states that international agreements overrule laws.
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Nationalization will affect foreign property owners protected by treaties, especially
hy the Treaty of Rome which applies to the Europeans.
In addition, the European Convention on Human Rights provides that the right of
property is protected by "general principles of international law," with, moreover,
- no distinction between foreigners and nationals. (Refer ~o Alain Margaron's article
or_ page 61 of this issue: "The Battle of the Law.")
In 1956 the Socialist government of Guy Mollet emphasized, in opposition to the
~ nationalization of the Suez Canal, the internationally accepted principle of a
"prompt, adequate, and real" compensation. .
Ir may be that foreign states will defend their nationals for the simple reason that
the interests of individuals are part of the nation's assets.
For example, rest assured that the U.S. Congress has a sense of authority at least as
keen as that of the French parliament.
How effective will our large firms be after nationalization?
If as realists we could tolerate some obsessional fixation, we admit that it would
be contained in the word "effectiveness."
In the American magazine F'ORTUNE (September 7 issue, page 97), Michel Rocard,
planning minister, expressed a wish: "I hope that we will not try to apply the
same to all the nationalized firms."
He explained that the most well managed ones are those, such as Renault and Air France,
that have tough bosses capable of resisting the government's injunctions. He made
the following very significant remaric: "When managing a large firm, the horizon is
at least 10-12 years ahead. It is much different than the government's. No one
expects a minister to Zook 12 years ahead."
"Thus," the minister concluded, "the m.anagement of Iarge companies must be divorced
from governmental concerns." He then added, "We are looking for a system of management
by contr.act between the state and th,~ nationalized firms, and this contract would be
- linked to the national plan. The more successful the enterprise, the less it will b~
under public control."
'Ifi is must indicate that firms will be keeping their autonomous identities and th~t
their presidents will be protected from ministerial mood changes.
How? .
Let us see how Albin Chalandon, president of Elf-Aquitaine, was treated by Andre
Giraud, minister of industry. (The same issue of FORTUNE has some interesting
comn~ents by Chalandon about his relations with the Elysee.)
In the present state of affairs, the lack of small scale savings is such that large
companies quoted on tt~e stock exchange now have, for the most part, state organizations
as their major stockholders. True individual capitalists in France can be counted
on one's fingers.
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In other words, the Socialist government cauld just as well not have nationalized at
all. It could have exercised the same power as its predecessors without any difficulty.
How many pre~idents of large firms have been asked by prior administrations not to
close this or that factory for local, political ~r electoral reasons? They were
compelled to finance the deficits of dead branches with the profits of advanced
sectors, and thus became extremely weak thanks to the whims of irresponsibl.e leaders.
iI~GTIROLIS losses of this or that firm are not due to the incompetence of the bosses,
some of whom, on the contrary, are remarkable. They are due to public constraints.
In any case, the government has never heaitated to use other means of pressure:
- controlling access to capital markets, public decrees, or numerous administrative
authorizations.
_ A young, high-levEl civil ser~ant said one day: "It's a pleasure to see an important
boss tremble before you while asking for something."
An immoral pleasure--if this important boss was trembling, it was for the tens of
thousands of jobs for which he was responsible.
We must now wa~t for the laws ~~n n~tionalization. The fate of our large industry hangs
in the balance.
COPYRIGHT: 1981 "Valeurs actuelles"
- 9720
CSO: 3100/986
,
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POLITICAL FRANCE
RESPONSES TO DETENTE, COLD WAR~VIEWS OF LOWENTHAL, LABEDZ
Neutralism, Pacifism, Finlandization
~ Paris CONIMENTAIRE in French Spring 81 pp 22-27
[Article by Pierre Hassner--foxmer Ecole normale superieure student, passed the
philosophy agregation eaamination, researcher at t~e International Research and
Studies Center of the National Political Science Foundation; has published numer-
ous articles in France and abroad on problems of political philosophy and inter-
national relations--: "Holding On To Both Ends of the Chain: Commentary on a
Debate"J
[Teat] Wantiing to settle things between two friends as formidable and easily pro-
voked as are Richard Lowenthal and Leo Labedz, who for a generation now have `~een
accustomed to delivering and exchanging blows, runa the risk of leading the novi.ce
mediator to the fate which often awaits his kind: reconciling the two adversaries
but bearing the brunt himself.
If, nevertheless, I eagerly accept thia challenge, it is specifically because
- nothing seems more important to me at the present time than fighting on two fronts.
_ A Fight on ~tao Fronts
Lowenthal's article and Labedz's (which is worth reading in the long and complete
ENCOUNTER version) are interesting not only in themselves but also because they
display misunderstandings and conflicts which risk dividing the Western world and
the various countries which make u~ that worZd, not to mention a milieu such as
that of ENCOUNTER's and SURVEY's regular readers, a milieu that many of COIrRrIEN~
TAIRE's authors have felt quite cloae to for a long time. Without a doubt it is
the fault of the times, a period in which there is no longer a prevailing consen-
sus on international problems, in which some hang on to the discredited assumptions
of the seventies come hell or high water, while others, without much more success,
try hard to regain the lost innocence of the fiftiea. The ob~ective of this set
- of articles should be to help to rise above that conflict inatead of aggravating it.
_ Nothing seems more important to me during these first months of the Reagan Admin-
istration than to have Americans and French Reaganites hear Lowe~thal's message
about the need to combine rearmament with negotiation, and above all to combine
- ~'FFosition to Soviet policy with understanding of autonomous sources of conflict--
, lg.
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particularly in the Third World--an awareness of the role of military force with
- awareness of its limitations. Nothing more important, that is, other than having
Europeans, even those taking part in summit meetings of ~overnments (Franco-
Germaia or Scand~navian~, hear Labedz`s message, according to which the cult of ne-
gotiation for negotiation's sake and optimism as to Soviet intentions or talk
about the impotence af military might can be excuses for appeasement or self-
_ Finlandization.
In this fight on two fronts I would like to salute (for a last time, though perhaps
that is temporary) a third duellist of the same family, the inventor of the ~erm
"self-Finlandiza~ion" (ss is Lowenthal af the term "Finlandization" and Labedz
_ of the term "competitive d~cadence"), the mun who has succeeded in making himself
equally hated in Moscow, Bonn and Washington, Zbigniew 3rzezinski. Whatever his
- numerous intellectual transformatione and political mistakea, he knew how to ex-
= press better than anyone, particularly in hia last speeches, the need to hold on to
both ends of the chain, by denouncing the blindnesa of liberals confronted with the
USSR's actions and the role of military force, and the blindness of "hawks" faced
with the historical upheavals which are tearing societies apart and with the rise
of new forces and aspirations. Like Brzezinski, I think that in order to understand
and respond to this crisis on its own level one must start out by looking at all
societies; but, in the second place, one must see how much the crisis is exploited
by the Soviet Union and how futile it is, for example, to be deveted solely to the
problems of development and North-South relations without at the same time resist-
ing Moscow's maneuvers by military force if need be; and finally, in the third
- place, that in order to simultaneously exploit Soviet vulnerabilities, to con-
struct a balance more fav~rable to peace and to the West, and to respond to demo-
- cratic needs in the East as well as in the West, one must be sensitive to the posi-
tive changes which can occur within the international communist movement (the
PCI's evolution), the Soviet bloc (Poland events) and the USSR (need for cooperation
in the economic field and, to a certain extent, in the field of arms control).
Both Lower.thal and Labedz would undoubtedly agree with this program at a level of
~ sufficient generality. But Labedz puts so much emphasis on head-on resistance
to the USSR that other aspects are always likely to seem premature, illusory or
dangerous to him. Thus hE runs the risk of neglecting the dan~era which brought
about the Vietnam catastrophe as well as neglecting the poasibilities that an ac-
tive detente policy much needs make use. of in order to protect, for e