Blum’s difficulties over the Spanish war were a reflection of both the contradictions of his coalition and the divisions of French society. The Radicals were essentially conservative and had little interest in the Popular Front’s economic programme. Blum faced the hostility of powerful economic interests: he was greeted by a major flight of capital and an investment strike. After the pay rises of Matignon, he was forced to devalue the franc by 25-35 per cent in September 1936. He was increasingly dependent on foreign loans and so under pressure to produce a balanced budget and to curtail the reform programme. The Radicals moved to the right, claiming that they were defending peasants, small businessmen, and pensioners from socialist profligacy. Blum was in the middle-trying to appease Radicals by declaring a ‘pause’ in reforms and shelving plans for inflation-indexing of wages, old-age pensions, and the National Unemployment Fund. This turned the left against a government which appeared impotent before the power of capital. The breach between the government and the workers came on 16 May 1937 when leftwing anti-fascist demonstrations were violently suppressed by the police, leaving seven dead and two hundred injured. Outrage that the Popular Front had spilled working-class blood erupted in a wave of national strikes. The right responded with a further flight of capital and Blum resigned on 22 June 1937.
The Popular Front experiment was over in all but name. Blum was replaced by Chautemps with a predominantly Radical cabinet dominated by an orthodox finance minister Georges Bonnet, whose policies, including a further devaluation, led to the departure of the socialists in January 1938. The major concern with security meant that by 1938 30 per cent of the budget was devoted to defence and rearmament. Chautemps was succeeded by Daladier on 12 April 1938. Daladier’s government was principally concerned with foreign policy and firm economic policies—a combination of devaluation and public works, especially housing. With the enthusiastic support of industrialists, the orthodox finance minister Paul Reynaud began an assault on the 40-hour week to cut labour costs. When the unions finally responded, all they could manage was a feeble token strike whose defeat was followed by the concerted persecution of workers.
The feeble demise of the French Popular Front was not to be compared with the long heroic defeat of its Spanish counterpart. The Republicans tried to halt the Nationalists’ inexorable progress by a series of offensives in 1937 — at Brunete, west of Madrid, in July; at Belchite, near Zaragoza, in August, and at Teruel in December. In each case, the initial advance gained was soon contained by the superior Nationalist forces. After defeat at Teruel, the Republicans had to retreat before a massive Nationalist offensive in the spring of 1938 through Aragon and Castellon towards the sea. The Republicans were exhausted, short of guns and ammunition and demoralized after the defeat of Teruel. That they could expect no help from the democracies was emphasized by the supine response of the latter to the German invasion of Austria on ii March 1938 and Hitler’s declaration of its annexation (Anschluss). By mid-April 1938, the Spanish Nationalists had reached the Mediterranean. They then attacked Valencia, only to be diverted by a spectacular Republican assault across the River Ebro in an attempt to restore contact with Catalonia. A desperate battle for the territory which had been taken lasted for over three months. Despite its strategic irrelevance, Franco was determined to smash the Republican army. By mid-November, at horrendous cost in casualties, the Republicans were pushed out of the territory captured in July. Barcelona fell on 26 January 1939; Madrid on 27 March. Over 400,000 Republicans trudged into exile. Nationalist victory was institutionalized into the Franco dictatorship. Over i million Spaniards spent time in prison or labour camps. In addition to the 400,000 killed in the war, there were 200,000 executions between 1939 and 1943.