French Unrest and Venezuela Threats

O’REILLY: “Impact” segment tonight, no surprise, French President Jacques Chirac has surrendered to the howling mob. For weeks, thousands of young French citizens, as you may know, have been demonstrating against a proposed new law that would allow French companies to fire them within the first two years on the job.

The young French workers want job guarantees. And now Chirac has caved and the new law is dead.

In another foreign development, Venezuelan police are allowing thugs to harass the American ambassador there. These are pictures taken from his limo. People throwing things at him.

Presidente Hugo Chavez seems to be encouraging the disrespect. And joining us now from Washington is Michael O’Hanlon, senior fellow of Foreign Policy Studies at the Brookings Institution.

Let’s go with Chirac first. No surprise to me that he folded. And now the people are going to be able to work with guarantees of labor. And that will mean nobody is going to get hired, correct?

MICHAEL O’HANLON, BROOKINGS INSTITUTION SENIOR FELLOW: You’re right, because 22 percent unemployment among youth in France is a big problem. But of course, it seemed pretty arbitrary to say that there was one set of rules for people 26 and under, and a different set for people 27 and over.

And I think they didn’t develop enough political consensus behind this idea before they pushed it.

O’REILLY: All right. Now he substituted something else. Can you explain that to us, what Chirac substituted?

O’HANLON: Well, they were trying to soften the law. I don’t know the details of what he substituted. It’s being portrayed essentially as a capitulation. And so, there may have been something very mild – some kind of a code of guidelines for employers or something. But basically, the law is withdrawn.

O’REILLY: Yes.

O’HANLON: And they’re not going to push it.

O’REILLY: He did, he did surrender completely, Chirac. But what he did was, as far as I understand it, he is now going to spend money, government money. And they don’t have any money in France, they’re bankrupt. All right, to encourage employers to hire young people. You know, the usual game. But France is basically a socialistic country now, is it not?

O’HANLON: It’s not doing that well, because it does have way too many of these laws.

Now one thing you could say in their defense, I think they have a little better budget deficit situation right now than we do. But overall, they’re not the engine of growth that our economy is. And you’re right, it’s because of the heavy hand of all these regulations.

O’REILLY: No, they’re not spending the money on the war on terror like we are as well.

O’HANLON: That’s fair.

O’REILLY: But they’re going to run out of money because they don’t have the workers to support the elderly people, who are entitled to, you know, enormous pensions and everything else.

All right, let’s go to Venezuela. Now why would Hugo Chavez allow his thugs to, you know, disrupt the American ambassador’s car and visits to other places? Why would he do that?

O’HANLON: Well, of course, there’s what he said and there’s what really happened.

What he says is that the U.S. ambassador did not give any notice of where he was going, and therefore, this kind of a mob which doesn’t like the United States to begin with, couldn’t be easily stopped by police.

Of course, that’s nonsense because the police were there and just chose not intervene. And Chavez, instead of doing the responsible thing and saying it won’t happen again, I apologize, decided to go after the United States. It’s obviously a very childish sort of maneuver. There’s not much of a better word for it I can think of. It’s just.

O’REILLY: But what’s in it for Chavez to alienate the United States? He obviously wants a confrontation with us. He’s threatened to expel the ambassador now. He wants a confrontation to the USA. What’s in it for him?

O’HANLON: I think he thinks it’s a freebie. I think he believes that his oil is so needed by the world economy in a world where we have no spare capacity and $3 a gallon gasoline here, we’re not going to do the one thing that could really hurt him, which is to try to not only cut off oil imports ourselves, but discourage other suppliers or other buyers from buying that oil.

So he basically feels like, you know, he can have this one for free. We’re not going to come invade him because this kind of insult doesn’t justify a military operation. And we’re tied down in Iraq And the one economic thing we could do to hurt him, we’re not willing to do because we need the oil so badly.

O’REILLY: So he just hates us? Is that it, the bottom line on this guy, just hates America?

O’HANLON: My guess is he doesn’t really like us very well. And he’s probably developed quite a bit of disdain for the Bush administration, but I don’t know how to read his mind, thankfully. Not really clear on this, but he thinks he can get away with it. And so far, he probably is.

O’REILLY: All right. Michael, thanks. As always, we appreciate it.

O’HANLON: Thank you.