Jacques Chirac's second term as President of France

The Law of Secularity and Conspicuous Religious Symbols in Schools was passed in September 2004. This law stated all religious items could no longer be worn in public schools including but not limited to: kippah's, catholic crosses, and Muslim religious attire.[5]

Chirac became the subject of controversy the day before the International Olympic Committee was due to pick a host city for the 2012 Summer Olympics. Chirac made comments stating that "the only worse food than British food is Finnish" and "the only thing the British have done for Europe's agriculture is mad cow disease". Not only were Chirac's comments considered unsportsmanlike where the normal etiquette is not to criticize rival cities, there was also the presence of two Finnish members on the International Olympic Committee who would vote in the final ballot. Out of the competing candidate cities, the bid was widely acknowledged as the front runner but Paris's narrow loss to arch-rival London led many to believe that Chirac's comments were at fault. It seems that the French public laid the blame of the failure on President Chirac, and not on the Mayor of Paris Bertrand Delanoë, whose popularity had in fact risen according to polls.

Even longtime Chirac supporters had lost their faith. Jean-Louis Debré, president of the National Assembly and a faithful Chirac supporter, declared "I'm not sure that Jacques Chirac succeeded in his presidency. I'd at least like that he succeeds in his exit."[6] According to a July 2005 poll, 32% judge Jacques Chirac favorably and 63% unfavorably.

It is unclear whether Jacques Chirac will run for a third mandate in 2007 and, should he not run or should he fail in a re-election bid, whether he risks prosecution and jail time for the various fraudulent schemes he has been named in. While he is currently immune from prosecution as a president, prescription (i.e. the statute of limitations) does not apply. His authority was seriously weakened by the October–November 2005 Paris suburb riots in which hundreds of cars and numerous warehouses were set alight throughout France by thousands of alienated North African immigrants who complain of widespread discrimination and unemployment. The riots were triggered by the accidental deaths of two North African immigrants in a poor Paris suburb named Clichy-sous-Bois who were rumoured to be fleeing from police.[7] Chirac later acknowledged that France had not done enough to integrate its Muslim North African citizens into French society or combat racism.[8]

One issue seen of increasing importance with respect to a possible 2007 re-election bid is Jacques Chirac's age and health. Chirac has often been described to be extremely resilient and hard-working, and to have conserved a legendary appetite; before 2005, he had never had major health problems throughout his long political career. He used to be a heavy smoker but had given up many years ago. Nevertheless, it has become apparent that he is also careful of hiding signs that may betray declining health. In October 2003, there was an intense debate about French leaders' tradition of keeping secret their medical problems (for example Mitterrand's cancer was hidden for 14 years) : Jacques Chirac has gone slightly deaf in one ear, and a former Environment Minister Roselyne Bachelot had revealed that a small hearing aid had been fitted discreetly into Mr Chirac's left ear. This debate leading to accusations of secrecy and speculation emerged once again in September 2005 when Chirac following a suspected stroke ( which provoked "slight impairment in his field of vision"). making it increasingly unlikely that he will run for a third term in 2007 and stoking the undeclared succession battle between Villepin and Nicolas Sarkozy (Villepin was appointed to serve in Chirac's place in the United Nations 2005 World Summit in New York City).

Jacques Chirac with George W. Bush, President of the United States of America.

On 19 January 2006, Chirac said that France was prepared to launch a nuclear strike against any country that sponsors a terrorist attack against French interests. He said his country's nuclear arsenal had been reconfigured to include the ability to make a tactical strike in retaliation for terrorism.[9]

On 17 March 2006, Chirac, was involved in a controversy over a youth employment law after protests in Paris against the measure ended in violence and 187 arrests.

Unions and student groups were reported to be planning further action, claiming up to 600,000 university and high school students took part in Thursday's action. They have tied any talks to withdrawal of the employment law, which is opposed by 68% of French people, according to an opinion poll published in Le Parisien newspaper, a rise of 13 percentage points in a week. Critics say the legal reform will create a generation of "disposable workers", but ministers tried to conciliate growing opposition, one saying no worker could be laid off without justification. The first employment contract (CPE) was designed to cut youth unemployment by allowing employers to dismiss workers under 26 within their first two years in a job. This led to a turn around by Chrirac and his Prime Minister on the 10 April saying the controversial law was to be scrapped. Chirac took the unprecedented step of signing the bill into law while at the same time calling for not applying the CPE clauses, a move with no base in the French Constitution. Stating the 'palpable discontent' in his country Chirac promised a more popular law would be enacted.

During April and May 2006, President Chirac's administration was beset by a crisis as his chosen Prime Minister, Dominique de Villepin, was accused of asking General Rondot, a top level French spy, of asking for a secret investigation into the latter's chief political rival, Nicolas Sarkozy in 2004. This matter has been called the Clearstream Affair. On 10 May 2006, following a Cabinet meeting, Chirac made a rare television appearance to try to protect Prime Minister Villepin from the scandal and to debunk allegations that Chirac himself had set up a Japanese bank account containing 300 million francs in 1992 as Mayor of Paris.[10] Chirac stated that "The Republic is not a dictatorship of rumours, a dictatorship of calumny."[11] Some political commentators note that the president's authority and credibility is in serious decline due to this scandal and combined impact of the French voters rejection of the European Union constitution in May 2005 which Chirac had publicly championed.

In July 2006, the G8 met to discuss international energy concerns. Despite the rising awareness of global warming issues, the G8 focussed on "energy security" issues. President Chirac continued to be the voice within the G8 summit meetings to support international action to curb global warming and climate change concerns. He warned that "humanity is dancing on a volcano" and called for serious action by the world's leading industrialized nations.