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Crisis In France
How welfare state economics failed a generation

For years, France was warned that economic and social neglect of its large ethnic-minority population would produce an explosion. The surprise was that it didn't happen sooner. On Oct. 27 two teenagers were accidentally killed during a police sweep in an impoverished Paris suburb. The deaths set off a wave of violence that spread to dozens of cities and even reached briefly into neighboring Belgium and Germany. Night after night a stunned France watched on television as rioters -- mostly teenagers and young adults from Arab and African families -- injured dozens of police officers with rocks and bullets, killed at least one bystander, and torched schools, community centers, and thousands of cars.

Much as Hurricane Katrina did in the U.S. two months ago, the violence has laid bare the ugly underside of a wealthy nation. "Violence, unemployment, discrimination," says Mounir, a 21-year-old of Moroccan origin, summing up his life in the Paris suburb of Clichy-sous-Bois where he took part in the rioting. (He declined to give his last name.) Many French are frightened by the government's seeming powerlessness. "They were out defying us in terrific numbers," says one police officer. "The dialogue has completely broken down."

On Nov. 8, France's center-right government declared a state of emergency. It has clamped curfews on dozens of troubled neighborhoods and ordered the expulsion of foreigners convicted in the rioting. Prime Minister Dominique de Villepin announced a package of measures aimed at fighting discrimination and poverty, including increased spending on housing and social programs in disadvantaged areas as well as expanded job-training opportunities for young people.

But without more sweeping economic change, it won't be long before unrest flares anew. The riots in France underscore just how untenable Europe's economic model has become. For decades government policies across much of the Old World have put a higher value on social protections and job security than on growth and job creation.

"They're Humiliated"
Those policies had the laudable goal of guaranteeing everyone a decent standard of living. But instead, in today's globalized economy, they are helping to create a vast underclass of jobless youths, many from immigrant backgrounds. "These young people have no dreams. They're humiliated and excluded," says Yazid Sabeg, an Algerian-born French businessman who has called for affirmative action programs.

Economic growth won't end racism, of course. But minorities are more likely to encounter discrimination when unemployment is high and applicants are competing for scarce jobs. That's the situation now. For at least five years, economic growth across most of the Continent has been far too feeble to create jobs that could lift have-nots into the mainstream. France's economy has grown an average 1.5% annually for the past four years and is set to grow only 1.2% this year. Unemployment is nearly 10%, and among those under 25 it is nearly 22%, about twice the U.S. rate. Youth joblessness runs over 50% in the suburbs that are home to many of France's more than 5 million first- and second-generation African and Arab immigrants.

Many of the French rioters have been students who figure they probably won't find jobs. Good jobs "are reserved for certain people, and usually it's white French people," says Abdel Karim, a son of North African immigrants who lives in Clichy-sous-Bois, where the rioting began. French-born Karim, 26, finished high school but has never held a steady job. He lives on welfare and rent subsidies totaling about $980 a month.

High unemployment among immigrants and young people isn't limited to France. Joblessness in Germany's Turkish immigrant community is an estimated 25%, and 14% of British Muslims are unemployed. Youth unemployment tops 20% in Italy, Spain, and Belgium. Mix in racial discrimination, crumbling education systems, and scant representation of ethnic minorities among the political and business elite, and it's easy to see why young immigrants are alienated....