Postwar France

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Finally, the main problem the French State had to face since 1973 was balancing its economic and social policies in order to address its ability to function as a welfare state under growing economic pressures. During the Glorious Thirties, France experienced unprecedented economic growth averaging about 5.8 percent annually from 1960 to 1971; thus, the state had no problems financing its generous social security system. Yet, the AOPEC embargo skyrocketed the price of oil and made the unemployment rate grow exponentially from 450 000 in 1974 to 2.8 million in 2003 (10 percent of the active population). Facing a struggling economy, the French State had to readjust its policies on retirements benefits, regulations with the UNEDIC, and impose occasional freezes on the SMIG (the government fixed minimum wage.) As the generation of baby-boomers aged, the burden on the welfare state also increased. French politicians have sought ways to find more sustainable ways to maintain the retirement system. For example, in 1995, prime minister Alain Juppé tried to postpone the retirement age (which provoked nation-wide strikes); in 2010, president Nicolas Sarkozy increased the amount of time individuals had to contribute to earn their pension funds, thus effectively delaying the retirement age. Thus, readjusting the State’s economic policies in order to continue to function as a welfare state has been one of France’s main challenges since the 1973 Oil Crisis.

In conclusion, after thirty years of uninterrupted growth and development, the French State struggled greatly to come to terms with the reality of the Oil Crisis. With the unprecedented prosperity that the Glorious Thirties brought to France, the country slowly evolved into a welfare state; the AOPEC oil embargo however challenged the state economically and socially, and pushed it to move towards a more sustainable way to maintain its generous social programs without over-burdening the economy. France really had no choice but to stray away from Dirigisme to accept free-market capitalism in order to integrate world economic governance. The nation-state no longer functions independently but as part of a wider network of governance.

Sources:

Historical Perspective on the Contemporary World & Twentieth-Century America

France since 1945, Economic, Social and Cultural Evolution

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