Mitterrand victory could make Thatcher shift economic focus

Could the stimulus for reversing Britain's plunge toward deeper and deeper unemployment come from her next-door neighbor, France? As a new French government pledged to pursue job-generating Socialist policies settled into power, Whitehall's latest figures showed one Briton in nine out of work.

The question being asked by opposition politicians and Thatcher government supporters alike is: Should not Britain take a leaf out of the French book and dedicate official energies to cutting unemployment, possibly at the expense of reducing inflation?

French Socialist thinking on unemployment runs counter to Prime Minister Margaret Thatcher's own. So far she has rejected the option of spending more public money to create jobs, instead concentrating on public spending cuts aimed at taming inflation.

But the French Socialists' sweep, together with an unexpecttedly sharp upsurge of joblessness in Britain, is making Thatcher advisers reconsider their priorities.

The new figures show nearly 2.7 million people out of work, a quarter of a million of them young people just out of school.

On the eve of a parliamentary debate on employment Mrs. Thatcher was handed a position paper showing that unemployment had doubled during her two years in power.

Employment Secretary James Prior, disturbed by the figures, urged Mrs. Thatcher to resist Treasury demands for new spending cuts because, he said, they would push the jobless total over 3 million.

Only a week earlier, Mrs. Thatcher told top employers she had no intention of switching the emphasis from containing inflation to curbing unemployment.

At a reportedly tense special Cabinet meeting on the economy, Mrs. Thatcher overcame arguments from so-called "wets" who favor modest government spending geared to at least stabilizing the total of jobless Britons.

But that was before Mr. Mitterrand clinched his party's absolute majority in the National Assembly and reaffired his determination to put France back to work.

According to one British official, the French example is likely to prove powerful on this side of the English Channel, especially since unemployment in France is much less serious than in Britain. France, with a slightly smaller population, has 1.7 million people without jobs. Mitterrand proposes to create nearly a quarter of a million government jobs.

Mrs. Thatcher's situation is made no easier by her party's need to fight two by-elections in the next few months. The Labour opposition will use the unemployment issue as their main argument to electors for rejecting Tory candidates.

Labour opposition leader Michael Foot, whose party is deeply split on ideological grounds, is glad to find an issue on which his own rank and file can agree.

Describing unemployment as a great scourge, Mr. Foot noted French Socialist success in campaigning on that issue and urged electors to consider the damage being done to Britain by high joblessness.

Mrs. Thatcher's faith in cutting inflation has been matched by her hope that by about midway through her five-year term in office -- that is by the fall -- inflation would be less than 10 percent.

Inflation continues to drop but is still well above that figure. Treasury forecasts suggest single figures will not be achieved before inflation again starts to soar in a few months' time. This means Mrs. Thatcher is likely to be robbed of the argument that her antiinflation theories were soundly based.