In a move partially obscured by yet another embarrassing display of squabbling within its ranks, France's Socialist-led government has agreed to a breathing spell in its ambitious and expensive social reform program.
Stung by setbacks in local elections last month--reflecting public dismay with the Socialists' perceived floundering after almost a year in power--the government eased the tax burden on industry in hopes of stimulating private investment and economic recovery.
Despite reiterated insistence that all the promised reforms still will be enacted, President Francois Mitterrand and his fellow Socialists appear to have accepted the "pause" they so loudly rebuffed less than five months ago.
The tax relief measures were spelled out in a meeting last week between Prime Minister Pierre Mauroy and Yvon Gattaz of the employers' federation, who had complained that the government was thwarting its own goals of economic expansion by soaking the private sector.
Although the relief generated by a 10 percent slash over the next two years in a single business tax alone amounts to 11 billion francs, or $1.7 billion, the real import is psychological.
More than the money involved, the government seemed to be signaling a shift in priorities that had been advocated by Finance Minister Jacques Delors, who was outvoted last fall when he proposed going slow on reforms.
Gattaz also won a government promise not to raise employers' social security contributions or legislate further reduction of the work week--the single most important reform in many employes' eyes--until 1984.
Signficantly, the Socialists plan to finance the tax breaks for industry by raising the value added tax--which they had denounced while in opposition as regressive and hurtful to low-income workers--and imposing a special levy on banks, most of which were nationalized last year.
The Communist junior partners in the government complained about the Socialists' "gift to employers" and said they had not been consulted despite assurances to the contrary issued by Mauroy's office.
Such jockeying for position seemed pale by comparison with the continuing rifts in the Socialist Party itself. The latest and most serious--pitting Interior Minister Gaston Defferre against Justice Minister Robert Badinter--reflected growing fears among the more conservative Socialists that the party will lose next year's municipal elections unless it is seen to be a strong defender of law and order. Popular feeling on the issue has grown following terrorist attacks and amid increasing juvenile delinquency.
Mauroy felt embarrassed enough by the dispute to write a front-page article in the newspaper Le Monde defending his style of government in which rival ministers are encouraged to air differences in public.
Both Lionel Jospin, the party secretary general, and Pierre Joxe, the party whip in the National Assembly, took serious issue with Mauroy.
Even left-wing friends of the government are joining the conservatives in complaining that "France is not being governed," thus prompting rumors of a government reshuffle. Given the backbiting among the various Socialist factions, finding a replacement for Mauroy could prove difficult.
Mitterrand today tried to close this chapter in Socialist bickering. He told the weekly Cabinet session of his "complete confidence" in the prime minister despite calculated leaks in the press from the Elysee Palace expressing presidential anger at Mauroy's loose-rein style of governing.
Under France's current political system prime ministers have tended to act as lightning rods to deflect public criticism from the president and, as a result, have tended to be disposable.
Sustained by the absolute Socialist majority in the National Assembly and the extent of presidential powers, however, Mitterrand seems certain to weather the economic storms until the international situation brightens.
Some analysts do doubt that the government will meet its 3 percent growth rate goal for 1983 without help from its major trading partners.
Signs of possible slippage abound. More than a month ago, Mitterrand pledged that the budget deficit this year would not exceed 3 percent of the gross domestic product. Specialists now predict that the deficit will be closer to $18.55 billion than the $15.3 billion target figure. They expect the difference to be made up by borrowings in foreign money markets.
More worrying is the persistent 14 percent inflation rate which, while no worse than that the Socialists inherited last year, is running almost three times that of West Germany, France's major trading partner.
A sympton of lingering doubts about the French economy has been the month-long weakening of the franc, which is now easing.
In just over a year the franc has slipped to 6.3 to the dollar compared to 5.16 before the presidential election. Foreign exchange reserves since March 1981 dropped 69.5 billion francs, or $11.2 billion at the current exchange rate, during the same period. An estimated 11.7 billion francs, or $1.88 billion, was spent propping up the franc last month alone.