Sarkozy shakes up cabinet after poll defeat

President Nicolas Sarkozy dismissed his labour minister and reshuffled several other Cabinet posts today after a heavy defeat for his conservatives in France’s regional elections – a loss which exposed his inability to convince the public on his economic reforms.

Labour minister Xavier Darcos lost his job after being soundly defeated in his election bid in the western Aquitaine region. Twenty of President Sarkozy’s Cabinet members ran for regional posts and all lost. Budget minister Eric Woerth stepped in for Mr Darcos, the presidency said.

The election blowout on Sunday could hand a new opening to President Sarkozy’s potential presidential rivals – from IMF chief Dominique Strauss-Kahn in the Socialist camp to former prime minister Dominique de Villepin on the right. It also puts the onus on President Sarkozy to lift public fortunes before the next presidential race in 2012.

“Overall, these elections are a serious warning for Nicolas Sarkozy ahead of the presidential elections,” said Emmanuel Riviere, a pollster at TNS Sofres. “When you lose the mid-term election, you lose either the next presidential or parliamentary election.”

The election leaves President Sarkozy weakened as he heads off on two important trips – to an EU summit in Brussels on Thursday and Friday and a US visit to New York and Washington next week.

France and Germany have been at odds over how to handle the Greek debt crisis, with France preferring a European Union solution. But German officials said they cannot rule out financial aid from the International Monetary Fund – a move that could boost Mr Strauss-Kahn’s profile.

Meanwhile, Mr de Villepin – President Sarkozy’s political archenemy – was poised to announce a new political party on Thursday, according to conservative lawmaker Francois Goulard, a member of the political group ClubVillepin.

A close Villepin ally was named in the Cabinet reshuffle, with lawmaker Georges Tron taking a new post in charge of the civil service.

Francois Baroin – who was briefly interior minister in 2007 and is considered close to President Sarkozy’s predecessor Jacques Chirac – became France’s new budget minister in a further change taking into account differences within President Sarkozy’s conservatives.

Lawmaker Marc-Philippe Daubresse stepped in as minister for youths, while Martin Hirsch, head of the High Commission for Active Solidarity, was to be named president of an agency for civic service.

President Sarkozy, who has emerged from the political doldrums before, could bounce back after the setback: his party controls parliament with a big majority, and polls suggest French voters know the country needs reform on difficult issues like pensions.

The long-flailing French left made a big comeback in Sunday’s vote, dominated by worries about jobs, wages and pensions in the wake of France’s worst recession since World War Two.

Nationwide strikes are planned on Tuesday by train drivers angry over pension reforms – the pillar of Mr Sarkozy’s presidential policies – and by teachers angry over job cuts.

With 99.6% of ballots counted, the Socialists and their left-leaning allies won 53.8% of the vote nationwide, while President Sarkozy’s UMP party had 35.5%, according to the Interior Ministry. Turnout dropped to record lows in the election – 51% in Sunday’s run-off and 46% in the first round a week earlier.

The vote left President Sarkozy looking more isolated, squeezed between a resurgent left and resurgent extreme right.

His effort two years ago to sap the Socialists by inviting them to his government failed to bring leftist voters to his side and alienated members of his own party.

Meanwhile, his bid to draw in far-right voters with a debate on France’s national identity and firm stance against Islamic full-face veils backfired, bringing anger at immigrants to the fore and sending more voters to the anti-immigration National Front.

The National Front party reversed years of declining support, winning between 13% and 22% of the vote in the 12 regions where they made it into Sunday’s run-off.

Sunday’s vote left Socialists in control of 23 of France’s 26 regions. The conservatives held on to Alsace but lost control of Corsica, and won control of French Guiana in South America, and Reunion in the Indian Ocean.