Democratic Regeneration

Suddenly, Spain's government has decided that its priority for the coming months is what it describes as 'democratic regeneration'. These are words that few have ever associated with the Partido Popular and Mariano Rajoy but there's no need to worry; Spain's right wing hasn't suddenly caught the democracy 'bug'. The weight of that long political tradition is still sufficient to ensure that the PP regards anything smacking of greater democracy as something to be avoided at all costs.

Instead we are getting a response to the dismal results that Spain's two main political parties obtained in May's elections for the European Parliament. 2015 is a big election year in Spain, if everything is scheduled as expected the country will have municipal and regional elections followed a few months later by a general election. The shock of the European elections was twofold, firstly because support for the two main parties combined fell just short of 50% of the vote, and secondly because of the surprise emergence of Podemos as a potential threat to that two party hegemony.

The PP does not panic in a very public way, but results which had the party not even reaching 30% of the vote in their strongholds of Madrid and Valencia have had a profound effect internally. Were this pattern to be repeated in the municipal and regional elections then the PP faces the prospect of losing power in places where they have governed for decades. Imagine the bonfire of incriminating documents that might mean, assuming of course that any incriminating paperwork that exists hasn't already already been destroyed in the wake of all the corruption scandals of the last few years.

The PP has an abysmal problem in reaching agreements with other parties, and the prospect of either governing in minority or passing to the opposition is too terrible to contemplate. Something must be done, and that something appears to consist of manipulating electoral law to ensure they can still govern with fewer votes. Pioneer in the gerrymandering exercise has been Maria Dolores de Cospedal, who combines her job as secretary general of the PP with that of president in Castilla La Mancha. Using the excuse of austerity, Cospedal has pushed through a law drastically reducing the number of members of the regional parliament. The new law has the happy effect of both making it harder to dislodge the PP from power and of effectively excluding any smaller parties from representation unless they can overtake one of the big two.

Inspired by such an impeccably democratic example, Mariano Rajoy has announced that he intends to change electoral law for the municipal elections so that the party which receives the most votes gets to govern regardless of whether they have an absolute majority or not. Although they talk of a minimum threshold necessary for a party to claim control of a city without winning the election, we will have to wait and see what the PP tries to get away with. Currently they talk of 40% of the vote, but that could easily be lower if the poll data they manage isn't looking good. Today's El Mundo poll has them on 30% nationally, a third of those who voted for Rajoy in 2011 have gone and many may not be returning. Rajoy seems determined to push through a major change in electoral law regardless of whether any other party supports it or not, and the talk of 'democratic regeneration' is merely the cynical touch the PP seems to feel is needed to decorate all of their measures. If that's still not cynical enough for you they also claim the change will help to avoid corruption.

The illusion of change in order to ensure that everything remains safely in the same hands seems to have become the trademark of Rajoy's administration and the management of the country's crisis. As the two-party system shows signs of weakness they change to law to try and prop it up. If someone like Pablo Iglesias becomes popular partly as a result of television appearances, then the PP has a solution; try to make sure he doesn't appear on television. It's the concept of the managed democracy they hoped for after Franco's death, sure people can vote but not just for anybody. Come on. This is not just the attitude of the PP, the whole establishment of the transition years gets intensely nervous at anything that might upset the cozy cronyism they have nurtured carefully for so many years.

There is a delicious irony in seeing all those who shouted in 2011 that what the indignados had to do was form a political party and present themselves for election changing their tune. Now that a section of the movement appears to have done just that and with a certain amount of success, not just the music changes as laws get quickly changed to preserve the status quo at any cost. This is not just about Podemos, new broader based civic platforms are quickly forming to present alternative candidacies in big cities like Barcelona, Sevilla and Madrid. The common denominator is a rejection of the old way of doing politics, and of those who administer the crisis in their own interests.

The emergence of Podemos, placed just behind the PSOE in El Mundo's poll, has had the effect of provoking some kind of crisis in almost all of Spain's political parties. This was most evident with the PSOE, who finally realised they had to renovate their image after over 2 years of steady decline rather than improvement in opposition. The unconvincing way they have done this, with all sorts of manoeuvres to try and fix the election of a new leader, doesn't bode well for a significant change of direction. The PP, who vilified Rubalcaba as being the epitomy of evil, suddenly realised how much they will miss him as they become the only party of the 'old guard'. They were much more comfortable with the ritual 'y tú más' sessions that the increasingly rare parliamentary debates in Spain consist of.

Perhaps the party which has taken the biggest hit from Podemos has been Izquierda Unida, who found themselves pushed behind the new party in several regions. IU had benefited from disenchantment with the major parties, but not as much as they should have. Podemos come in a with a different language and fresher style, and the leadership of IU has been left wondering what happened. The dead hand of the Spanish Communist Party has damaged IU's prospects for years as many of those who could be attracted to the platform left to do other things. Those behind Podemos amongst them. 

Even Unión Progreso y Democracia, who presented themselves as a safe way to break the two party hold, have a crisis of their own as they are no longer in pole position to be the alternative. Still very much the personal project of Rosa Diez, the party machine reacts badly to dissent and those who favour a fusion or agreement with Ciudadanos are subjected to insults by the loyalists. Diez apparently believed she could eclipse the Catalan upstarts, but her right wing media allies seem to be in favour of the merger and have fanned the flames. Again, the emergence of Podemos leaves UPyD looking every bit as much a part of Spain's political establishment as the two big parties, a case that is supported by the reaction of its leaders to the new party.

The opinion polls differ greatly on just what is happening, and are also subject to ever greater manipulation as part of the, occasionally hysterical, counter attack. The attempt by El País a few weeks ago to spin a revival in the PSOE's fortunes following the election of Pedro Sánchez as leader was widely criticised because of the way in which they found a 10% increase in support for the major parties that no other poll seems to detect. The pollsters in general have yet to offer any explanation for how they got the voting pattern so badly wrong in the European elections, and given that there have been no elections since you have to wonder how they are adjusting their polls to fit the new scenario?

The European elections in Spain are special in that they are the most representative, despite the low participation. This is because it is a national vote and therefore doesn't suffer the sort of deformation present in general elections here, that which allows Rajoy to have an absolute majority in parliament with well under 50% of the vote. Precisely the sort of system he now wants to introduce in municipal elections too. Incidentally, if you think that the Spanish electoral system has been brutally unfair in past general elections, just wait and see what happens in the next election if the two major parties have a lower vote but are still clear of any rivals. That could really provoke some democratic regeneration.

Tramping The Dirt Down

Although I usually blog about Spanish issues here, there are always exceptional cases. I was not even planning to write anything about the death of Margaret Thatcher, but the disgraceful and ideologically incoherent decision not to privatise her funeral and to turn it instead into an expensive and wasteful military jamboree has made me change my mind.

The armed forces presence in her funeral has of course been designed above all to pay homage to a military adventure only exceeded in its pointless absurdity by Aznar's dramatic capture of the goats grazing on Isla Perejil a few years back. The Falklands War was memorably described by the Argentinian writer Jorge Luis Borges as being like two bald men fighting over a comb. Nevertheless, we are still force fed a mythical account of democracy triumphing over fascist tyranny as one set of troops conscripted by unemployment overran the positions of another group of, often very young, untrained conscripts shivering in their trenches. 

Except that not too long before the Falklands War the UK was training Argentinian naval officers in Portsmouth. That's right, the same navy that was running one of the most notorious torture centres of the last 50 years. Why be surprised? Anyone who was such an ardent friend and admirer of Pinochet as Thatcher was would also surely be a friend of those who tossed their victims alive from planes into the sea? Operation Condor, bringing nasty vicious murderers together throughout the 1970's and 80's. Indeed, such was Thatcher's fierce commitment to liberty that she was also one of the most determined defenders of the apartheid regime, labeling the ANC as a terrorist organisation. For a while I was becoming concerned that she would outlive Nelson Mandela, thankfully we've now been spared that sorry and unjust outcome.

Meanwhile the fans of Thatcher's economics, of which there are many, have developed an understandable aversion to hard data. Because it's not a theoretical debate, not any more, after 34 years the results are in and it doesn't look good. Average economic growth in the 30 years following her election in 1979 has been significantly poorer than in the preceding 30 years. Then there is unemployment. Here things are even worse, high unemployment has become an almost permanent feature of the UK economy since 1979. Ironic when you consider that Thatcher used it as the main issue of her first election campaign. Even more so when you take into account the numerous changes made to the unemployment count that were designed to artificially reduce the figures.

Then there is oil. Many oil producing countries have been noticeably wasteful in the use they have made of their earnings from it. But even so it's hard to think of a country that has obtained absolutely no long-term benefit at all from it. That's the UK. Stupid Norway eh, with its sovereign wealth funds trying to use oil revenues to guarantee decent pensions and to invest in the future of their economy! What would they know? Idiots. Showing the way forward, the UK under Thatcher pissed away the country's oil wealth on corporate tax breaks and the like. Not even a balance of payments surplus to show for it. Nada, cero patatero.

I think of these things when, as I did in the days immediately preceding Thatcher's death, I travel on the finest Victorian public transport system in the world. I don't know what they did to make The Tube work during the Olympics but the sellotape and chewing gum has now fallen off again and you get plenty of time to think about all sorts of issues as the tannoy announces yet another delay or line closure. Cut long term investment for short term political gain via tax cuts and nobody notices the true effects for 15-20 years. Thatcherism in a nutshell.

It's a failure, an abject failure if you analyse the data. But the dogma survives in the form of "my theory must be correct so therefore something is wrong with the economy". We see it today with the slash and burn economics practised in the name of austerity. Indeed, the current crisis has its roots deep in the kind of economics advocated by Thatcher. The UK economy has been hollowed out and nobody has any notion of how to get it working again without generating yet another "your house is temporarily worth four times its real value so don't worry be happy" credit and property bubble. Of course we have to present the other side of the argument. There are some impressive statistics from the period since 1979. Inequality has increased enormously since Thatcher came to power. Poverty too. That deliberate redistribution of wealth to those that already had the most is what sustains the stupid, failed dogma. It works magnificently for those who wield economic power.

It's hardly surprising in this context of economic failure that the inheritors of Thatcher's political tradition promote hatred and fear of the poor to mask their failure to deliver. If a millionaire member of the Bullingdon Club turns out to be a misogynist prepared to kill his children to take revenge on a woman who has spurned him then it's an isolated case you see. Shit happens. But if the misogynist in question happens to be drawing welfare benefits then we get the vile, repugnant attempts by the likes of George Osborne to use the case to smear all welfare recipients. Likewise, if you've promoted policies that mean a huge chunk of social housing stock has ended up in the hands of private landlords then obviously the only solution to a lack of housing for those on low incomes is to blame those who are still lucky enough to have a roof and a spare bedroom. So you make their incomes even lower. There are even more vindictive policies than that.

Ah, but you don't understand how terrible things were before she came to power is the last resort of the Thatcherites. But I do know how things were before Thatcher, and it seems I have a much better memory than her fans. I don't just remember strikes and tales of inexorable decline, I remember a country supposedly much poorer than it is now yet able to provide a whole range of reasonable public services that have now become perplexingly unaffordable. Pensioners weren't expected to live out their last years on the poverty line, a health service that kept people healthy without corporate sponsorship! Industries that made things. All terribly old-fashioned I know, but if I want to look for evidence of long term decline I don't need to go back into history to find it.

So I'm glad that she's dead and I hope the coffin is made of lead. All the better for it to sink slowly, but relentlessly, down through the sticky London clay until it reaches a point where return becomes impossible. Now, if you'll excuse me, I need to go and check that the cava I have in the fridge is chilling nicely and that I have the right music selection ready for such a solemn day.

The Real Rajoy

I said it last year, didn't I? Somewhere a bit further down the page. In the comments to what I now realise was a hopeless and pathetically inadequate attempt to parody what Mariano Rajoy might say about the EU rescue for Spain I noted just how difficult it is to parody the man. Then today he said this, I swear I haven't changed a single word:

"A veces la mejor decisión es no tomar ninguna decisión y eso es también una decisión"

It's just not fair, how am I supposed to compete with this?

The Mystery Of The Hole In The Wall

A very strange thing happened last week in Spain. An elected representative of the Partido Popular resigned after his involvement in murky events came to light, and not only did he resign but he did it quickly. Even stranger still, his own party did nothing to defend him. Odd when you consider how long the PP affords protection to people who take money supposedly destined for children suffering sexual abuse or for those suffering from AIDS and spend it instead on apartments in Valencia.

But everything is odd about the case of Santiago Cervera, a member of the Spanish parliament for the PP until his sudden resignation just over a week ago. Cervera was arrested in Pamplona two days before he resigned by a unit of the Guardia Civil who were staking out the drop off point for a supposed blackmail attempt on the president of the local savings bank. They caught Cervera in the act of retrieving the (fake) package that had been left as bait in a hole in the wall of the city's old fortress.

Cervera claims he has been the victim of a setup and after his resignation produced anonymous emails that claimed to offer confidential information on what had been happening in the Caja Navarra savings bank. This information was supposedly to be placed in that same hole in the wall in Pamplona, and Cervera claims that he only went there motivated by curiosity. The investigating judge is clearly not convinced, and has formally notified Cervera that he could be facing criminal charges. 

Now it is apparently well known in Navarra that Cervera and those running the Caja do not get on, just as it is well known that Cervera has plenty of enemies there as a result of the political shenanigans of the last few years involving the PP and their, occasional, partners in the ruling Unión del Pueblo Navarro. Perhaps this history is the reason why Cervera ran on the PP list for Madrid in last year's general election despite his long association with Navarra.

Santiago Cervera would not be the first person in the PP that you would link with sinister activities such as blackmail, there are many other far more likely candidates. Indeed Cervera - and you have to take this statement in the general context of the PP and how they behave - had something of a reputation for integrity and for campaigning for greater transparency in politics. As I say, I wouldn't like to stretch that point too far; we're talking relative integrity. Perhaps that's why his party dropped him so coldly and quickly?

Or maybe they know more than we do? The details we have of the case so far just don't fit. The emails produced by Cervera were dated almost a week before the president of Caja Navarra went to the police over the alleged blackmail attempt. So if Cervera went to the hole in the wall earlier there would be nothing at all to find and life would have resumed its normal course. Now we must await further news from the judicial investigation. Running with the bulls isn't the most dangerous sport they play in Pamplona.

Happy Anniversary

With all the fuss around the Catalan elections, the first anniversary of Mariano Rajoy's election slipped by almost unnoticed. Of course it's still not a year since he (allegedly) took office as it takes a month or so after the elections for a change of government to take effect in Spain. Anyway what a year we've had, packed with hugely impressive achievements of all sorts. This is really just a small sample:

Unemployment - at the end of the third quarter of 2011 Spanish unemployment stood at a measly 4,978,300. Thanks to the rapid and forthright measures taken by Rajoy's government to reactivate the Spanish labour market, we have now reached the historic high of 5,778,100. The once remote possibility of having 6 million unemployed in Spain will now almost certainly be happening in 2013. If that perhaps seems a bit grim, it's not all bad news. Hundreds, if not thousands, of new jobs have been created in the public sector for friends and relatives of senior PP politicians. 

Economic growth - if last year the economy was showing some weak signs of recovery (Spain was no longer in recession) the new government swiftly put paid to any of those old fashioned notions about the necessity of economic growth and now we have -1.6 growth and a profound recession which is predicted to last throughout next year at the very least. 

Taxes - the party which took to the streets against an increase in sales tax when it was imposed by Zapatero quietly deleted the web page publicising this campaign shortly before Rajoy introduced a further increase in the same tax. Income tax has also been increased but then the requirements of having a balanced view oblige me to put the other side. The onerous burden of shared sacrifice means that the enormous fortunes stashed away in the SICAV investment funds have retained their hugely generous tax status untouched. A similarly generous tax amnesty for fraudsters has flushed out less than half of the target figure even on the government's own figures.

The banks - in one year we have gone from "we won't put a euro of public money into the banks" to the Bankia fiasco and possible fraud and the creation of a bad bank. Worse, that is, than the others. 

Still, at least the pensioners have been protected? The last remaining unbroken electoral commitment of the few that Rajoy actually made has just fallen, with the breaking of the link between pensions and inflation. Rajoy had made a sort of implicit contract with pensioners, they would vote for him to protect their pensions whilst he made sure that future generations would never enjoy the same conditions. He lied.

Yes, it's been quite a year.

Catalan Elections....The Loser Is The Winner

It didn't work. That's the simple and clear verdict of yesterday's elections for Artur Mas and Convergència i Unió (CiU). The gamble that they could capture absolute power in the Catalan parliament has backfired in a spectacular way that few expected. Whilst the last opinion polls suggested Mas might not reach the objective of an overall majority, I don't think any polls predicted that CiU would lose ground in the way that they have. It seems evident that there has been a significant shift of votes from CiU to Esquerra Republican (ERC). So one of the main consequences of this gamble by Mas has been to restore the fortunes of his main rival for the nationalist vote. That should have a few people inside his own party sharpening their knives. 

Despite the setback, CiU are still very much the dominant force in Catalan politics. If anyone believes that the shift in support from CiU to Esquerra represents some sort of major turning point in nationalist voting patterns then I suggest they click on the results for 2006 in the results widget in my previous post. Esquerra have been here before, they've even done better than this before. The general assumption this morning seems to be that CiU and ERC will unite in a grand coalition, as between them they command a majority in parliament. This is not, it needs to be pointed out, the same as a majority of the votes cast. Between them the two parties can claim just over 44% support. Ironically, the alliance last time around between CiU and their good friends from the Partido Popular could claim greater electoral legitimacy, at least they made it to 50%. 

The solution of a nationalist coalition might appear to be obvious but it's not so simple. Esquerra have never wanted to be a junior coalition partner to CiU, and that option is full of danger for them. There is, of course, the compensation that they get back their offices and official cars and all the trappings of power which they showed such a liking for with the 'tripartit' government a few years back. Unfortunately for them it didn't go down so well with their voters. Also, an agreement with Mas means they have to publicly line up behind setting the Mossos d'Esquadra and their rubber bullets onto anyone who doesn't like their health service being dismantled. There isn't that much remaining of the 'Esquerra' part in ERC but they also have to keep an eye out for emerging rivals, look at the rise of the CUP in yesterday's election.

In return for keeping Mas in power, ERC will need something to show for it and the obvious trophy is paving the way for an independence vote. The problem is, following yesterday's results, that the popular enthusiasm for such a move seems to have been wildly exaggerated. Nor is it really valid to spin the result by confusing an apparently pro-referendum majority with a pro-independence one. Despite what some appear to think, being in favour of the 'right to decide' yet against independence is both a coherent and an impeccably democratic viewpoint. It's the position I hold, for example, concerning Scottish independence. Even though I'm entitled to the passport if Salmond gets his way. 

It's also important to remember, when considering the balance of forces,  that regional elections tend to overstate the nationalist vote in Cataluña, with a reverse effect being seen in national Spanish elections. Nationalists are more motivated by the issues of Catalan government than Spanish. That seems to have changed a bit this time, there has been a greater mobilisation of anti-independence voters. The unionist party Ciutadans have been regarded as something of a joke, but they have tripled their representation in the new parliament. The PP also did well, by their own standards, although they are still a minor party in Catalan politics. After a build up that had almost everyone expecting a major shift towards pro-independence sentiment, a closer examination of the results reveals a small reverse in nationalist support. 

The Catalan socialists of the PSC must be relieved, not because they did well but because it could have been worse and because of all the attention focused on Mas. The PSC should be the big hitter of the national Spanish parties in Catalan elections, and in the end they've finished in third place just ahead of the PP. That's an awful result, but I still believe it has as much to do with national issues as with local ones. It fits the pattern of dismal results in other regions for the PSOE. It's hard to say whether they have lost votes to Ciutadans and the harder line anti-separatist positions. Iniciativa per Catalunya, which would expect to pick up votes on the left from disillusionment with the PSC, have gained three seats which isn't bad but it doesn't suggest great things to come either.

There are all sorts of lessons to be drawn from these elections, but perhaps its the Catalan left that really needs to be thinking hard about where it is going. Seeing every issue through the prism of the national question isn't offering any solutions to those who need them as the crisis continues to bite hard. The idea that the unemployed of Badalona have more in common with Artur Mas and company than they do with the unemployed of Alcobendas looks patently absurd. As does pretending that the rest of Spain lives a leisurely life of ease and comfort at Catalan expense. Hard times are still ahead, and holding hands with Artur won't do anything to help those who are bearing the brunt of the crisis.

Catalan Regional Election Results 2012

So is this it, crunch day for Cataluña as it decides its future relationship with Spain? Well no, not really. We are treated to yet another early election called, as in the recent case of Galicia, for opportunistic reasons. Which is not to say that today's elections won't be something of a turning point, it's just that it would not be fair to judge the results purely as a verdict on the future status of Cataluña. But such is the game being played by regional president Artur Mas that nobody can be sure that anything will happen in terms of a future sovereignty vote, even if he gets his desired overall majority. That majority is what this election is really about, Mas decided to try and ride the wave of nationalist sentiment surrounding the huge march in Barcelona on September 11th to try and get the majority government that he couldn't get last time around in 2010. 

Mas and his party, Convergència i Unió (CiU), have never been in favour of Catalan independence, and the language he has used in the campaign to refer to the national question has been deliberately ambiguous. It's not hard to foresee that he could disappoint an awful lot of people if he gets his desired result. Not the for the first time, and it's not that easy to feel much sympathy for those who allow a bit of demagogic, flag waving, populist tub thumping rhetoric to triumph over the reality of their own experience.  Mas runs a right wing government that cuts welfare services at the same time as reducing taxes for the better off. To then plead that there is no money to pay for essential services because of Spain seems blatantly ridiculous but you can hardly blame him for doing so given that it seems to work?  

The campaign against the austerity measures so enthusiastically embraced by Mas and company has been effectively destroyed by his suceess in turning it into an issue of Cataluña versus Spain. Some polls have shown Mas getting the majority he wants and others have shown him falling short, there is no consistent picture. What does seem evident is that there will be a significant collapse in support for the PSC, Catalan wing of the PSOE. Although this will also undoubtedly be attributed to nationalist issues as well it really forms part of a broader national pattern. This is all terribly flattering to the governing Partido Popular, some polls have even suggested the extraordinary outcome of the PP becoming the second biggest party in a region where its supporters have occasionally been able to fit in the largest model in the SEAT range. 

As in Galicia, where the PP lost a significant number of votes but won a larger majority on a smaller share, the collapse in the socialist vote makes the PP look stronger because of their ability to mobilise more of their core vote. For the other parties it looks like there will be some revival for Esquerra Republicana (ERC), who have resolved their attempts to combine left wing and nationalist politics in a faintly ridiculous way; they now consider themselves to be left wing in the national parliament and nationalist when playing at home. Another beneficiary of disenchanted left wing votes could be Iniciativa per Catalunya, although much of the traditional socialist vote looks destined for abstention The results, as usual, will not be known before 20:00 Madrid time. The results widget, courtesy of El País.

Regional Election Results For Galicia And The Basque Country 2012

I did toy with the idea of continuing wordless blogging and just post the results widget from El País. The results will start coming in after 20:00 Spanish time.

Both of the regions voting today belong to that select group of comunidades autonomas in Spain (along with Cataluña and Andalucia) that set their own electoral timetable instead of having a common voting day. Neither Galicia nor The Basque Country have made it through the full four year term, although the reasons for early elections are different.

The outgoing Basque government had no choice but to call elections after the Partido Popular withdrew their support for the minority administration led by the socialist Patxi López. The expectation for today's election is that 'normal service' will be resumed and that the nationalists will sweep the board, probably taking the first two places. A return to nationalist rule would probably have been the case even without the fall in support for the two big national parties (PP and PSOE) provoked by their management of the crisis. The legalisation of parties linked to ETA's political wing means that the full nationalist vote will be reflected in the results, unlike the previous election.

This will leave Patxi López free to become the 'continuity' candidate for national leadership in the PSOE when current leader Alfredo Pérez Rubalcaba finally gets the message that he is not the future of his party. López will be in an even stronger position if the Catalan socialists get a drubbing in the forthcoming elections there. Carme Chacón almost beat Rubalcaba to the leadership but she will be damaged by a bad result in Cataluña. The next time a leader is elected there will be other contenders. 

The effect of ETA's continuing truce and the legalisation of their political wing changes the balance of power in nationalist circles. The conservative PNV has always dominated the nationalist vote but now they are in competition with a strengthened rival. The margin between the PNV and Bildu will be important for the balance between those satisfied with regional autonomy inside Spain and those who favour a push for independence.

In Galicia the reason for early elections is simply political expediency on the part of the PP. The party has decided that with the economic situation continuing to deteriorate and the with the threat of imminent EU intervention to prop up Spain's finances, there is less political cost in bringing the elections forward. The PP may even conserve their majority in the Galician parliament, the PSOE shows little sign of electoral recovery and the Galician nationalists have been in disarray. If it comes off, the PP will feel fully vindicated in their consistent strategy of putting the party interest before anything else. 

Barring surprises, the distribution of the vote may not change very much. What will be important is turnout, a big decline will be seen as something of a vote of no confidence in the big two parties. Some recent national opinion polls show them with little more than 55% support combined, when in happier times for Spain it would have been more like 80%. Some disenchanted voters will vote for the smaller parties, but many may simply opt for abstention. 

Then, with the elections out of the way, perhaps Spain's government will come out of hiding although Rajoy's administration seems to have decided that is the best way to weather the storm. The decision on whether to ask for an EU rescue doesn't just depend on the electoral timetable, but as with the case of Andalucia earlier this year we have seen that the PP has no problem with concealing their intentions for electoral benefit. No-one in that party believes in falling on their sword for the greater good, power and the opportunities it presents are too tempting. As for those who suffer the consequences of this, ¡que se jodan!

Miss Me Yet?

Bullshit And Bulerías In Bankia

It's now over 3 weeks since I last blogged on the subject, but the crisis over the bailout of Bankia rages on. As each week passes we learn more about the colossal disaster that the bank has become. The amount needed to save Bankia seems to rise almost every day and the disastrous handling of the issue by the government came dangerously close to provoking a run on deposits in the bank.

More than just being another episode in an ongoing financial crisis, the Bankia situation does show every indication of being a full blown scandal. How is it that a bank which announced profits of millions of euros and which was still talking of making new acquisitions just a couple of months ago has been revealed to be a wreck with such enormous losses? 

The government is doing everything it can to avoid any kind of investigation into what has happened, criminal or otherwise, and is getting some help from the PSOE. The PP have tried hard to put all the blame on the outgoing governor of the Banco de España, who does deserve his share of criticism. But then we are still left wondering what exactly Rodrigo Rato and friends were doing in return for the millions they took out from presiding over the bank?

As usual in these situations it's the little people who take the hardest hit. Given the lack of interest from the big investors, Bankia mobilised its whole commercial network to sell shares to its own customers. I know personally of one case where €3000 was simply deducted from an account without consent in return for what would now be a virtually worthless shareholding. The 'mistake' was of course corrected, but I wonder how many other cases there were.

The PP have blocked the possibility of parliamentary investigation, even though they could easily use their parliamentary majority to convert any investigation into a circus. What should be happening is a full criminal investigation to examine what really happened inside the bank. Best wait for that sitting down, as the Spanish like to say.

It says an awful lot about the way this government operates that the announcement of how much public money Bankia needs was made by the newly appointed president of the bank, with a figure way above anything which had been suggested by government ministers. Then there is the (deliberate?) confusion over the way in which the bank will be rescued. True to their ideology, the government is making it fairly clear that there will be no general public benefit in return for €19,000 million of help.

The only response to criticism of their handling of the crisis has been attempts to distract public attention. Anything will do, the spat with Gibraltar, the chorus of whistles that greeted the national anthem at the Spanish cup final. All with the help of servile newspapers who find day after day that Bankia is not a significant enough issue to make the front page.

Spain's government is being crushed by the weight of its own mediocrity and inability to respond to the situation. After Mariano Rajoy's surprise press conference the other day, there are now not so many criticisms of his refusal to explain events. Because it has become evident that he doesn't have an explanation to offer, merely a collection of recycled cliches. The problem with this government is that they have the capacity to make the outcome of the crisis even worse for Spain because of their determination to politically manipulate the situation the country faces.

Some will be happy at the suggestions that the EU is now demanding even more cuts in return for possibly relaxing a budget target that nobody seriously believes to be achievable in the first place. However, the argument that this is a crisis of public debt looks more and more frail every day. It's about public resources being used to prop up the private sector. There are some absentees from the list of those accused of mismanaging the banking crisis, because those who control Spain's biggest banks have been instrumental in driving the disastrous strategy. Happily, not everybody is taking this situation lying down.

 

Rato Leaves A Sinking Ship

The news yesterday that Bankia is going to be bailed out by the Spanish government has put the stability of the Spanish banking system back at the centre of the country's ongoing crisis. In the process the government has managed to simultaneously create a certain degree of nervousness about the safety of deposits with Bankia as well as significant outrage over the proposed bailout - which could involve as much as €7000-10000 million of public funding. We don't yet know how a government which previously claimed it would use no public money to bail out the banks is going to manage the turnaround, Friday is the bad news day. The commitment on no public bailouts is now just another of those broken promises which sees virtually nothing remaining of the few concrete commitments that Mariano Rajoy made prior to the elections.

The surprising part of the announcement was that it came coupled with the removal of Rodrigo Rato as Bankia's president. Rato, at least until yesterday, was regarded by Partido Popular supporters as an economic wizard; based on him having been economy minister at the start of Spain's economic bubble. More recently he has just cashed in nicely on running the bank which holds a huge amount of devalued construction related assets and bad loans. Thanks of course to Rajoy's decision to place him as boss of Caja Madrid, Bankia's main component. Which makes it even more significant that such a powerful figure in the PP should be removed by a government of the same party. Because he was removed, it seems. The situation is made even more ironic by the fact that the move against Rato was spurred by a critical report from the IMF, Rato having been director general of that body until he walked away from that job before the shit hit the fan.

The whole Bankia situation stinks, and exposes in the process some of the false narratives that are used to justify the less well off sectors of Spanish society paying the brunt of the economic crisis. We were told that the fusion of the regional savings banks (the cajas) and their conversion into banks was a necessary step to clean up the mess left by the end of the construction boom. The cajas were bad because they are not run by professionals, was the story. Some story, because Bankia is now a bank resulting from this fusion process and all that has been created is an even bigger and more expensive monster. By the way, if things get really bad then don't expect the fund supposedly guaranteeing deposits to help account holders. That money has already been systematically ransacked to pay for a series of pointless fusions. 

What makes things worse is that Bankia has already received significant public funding, in addition to what would turn out to be very expensive state guarantees if the bank were to go under. Funny, isn't it, that when we are told no money is available for public services the situation changes so quickly when it's the financial sector that comes calling? Especially when we were repeatedly assured that the problems were being solved. Don't go asking about the regulatory role of the central bank. Spain's Banco de España has been largely absent as banks and cajas have struggled to survive. Largely because the governor of this institution, Spain's highest paid funcionario Miguel Ángel Fernández Ordóñez, has been far too busy in recent years lecturing ordinary Spaniards on how well they have been living and why they need a good labour market reform to sort that problem out. 

But at least we don't need to feel too sorry for Rato, he usually manages to land on his feet. It seems fairly likely that the economic terms of his departure will not be those set in the latest labour market reform for getting rid of employees.  It was his economic model that failed and led the country into this crisis, the structure of the banks makes little difference to the outcome when the dependency of the whole sector has been on building ever greater numbers of houses year after year based on the assumption of endless credit. Bankia is still stuffed full of PP appointees and the solution adopted to allow them to continue in their comfortable positions is unlikely to be favourable to public finances. In this situation it is Rato that has been left, perhaps to Rajoy's satisfaction, looking like a greedy banker.

A Communication Problem

It's become a common feature for almost all governments with popularity problems to blame their troubles on poor communication rather than their policies. Spain's government is no exception to this, with the governing Partido Popular preparing a publicity campaign to attempt to justify Spain's disastrous economic course. Many of the PP's own supporters are deeply unhappy with some of the government's decisions, perhaps not surprising when you consider that Rajoy's administration has now broken almost every promise that the PP made before the elections. Party supporters are left trying to defend everything which they so loudly opposed when in opposition. 

There is another aspect to the PP's strategy. The last few weeks have seen a growing chorus from government friendly media for something to be done about the state television company RTVE. Not having much of a democratic tradition means that Spain's right is unable to understand how a state owned broadcaster isn't directly supportive of their government. Any report which smacks too much of pluralism or which doesn't toe the party line is automatically accused of anti-PP bias. The right wing got their way last Friday, as the government changed the law concerning the appointment of RTVE's governing body so that they can put the corporation under their control.

It would be going too far to describe RTVE as being independent, but the situation that existed until Friday at least meant that a single party couldn't impose their political control. Zapatero's administration had changed the law in such a way that that two largest national parties had to agree a consensus candidate for the presidency of RTVE, and neither party could have an outright majority on the governing board. That goes out of the window now, if there is no agreement on a consensus candidate then the government can impose whoever they want with their parliamentary majority. The pretext of austerity has been used to remove representatives of organisations like the unions from the board, allowing the government to appoint the majority.

This threatens to return us to the Aznar era, when RTVE news delivery was kept under tight political control. Although it's unlikely that news bulletins will begin, as they invariably seemed to do in Aznar's time, with the words "el presidente del gobierno ha dicho". Rajoy still seems to be averse to any kind of communication at all, although a more government friendly broadcaster will no doubt show the great leader delivering declarations without of course experiencing anything so uncomfortable as a journalist asking him a question he hasn't been prepared for. This is a move towards the Telemadrid model of television as a political tool, and those RTVE journalists who have demonstrated worrying signs of independence will now be wondering what future they have.

Despite the moves to control RTVE, it's still unlikely that Spanish television will be the chosen platform for breaking the really bad news. For that sort of thing you really need to be a reader of the Frankfurter Allgemeine, or perhaps occasionally the Wall Street Journal. Economy minister Luis de Guindos announces the government's measures first to overseas media, and then eventually the government gets around to telling the Spanish people what is about to happen to them. The latest example was with the additional health and education cuts which were announced first in the German paper. At least the sick can be reassured that when they have to pay more for their medicines it's really just a problem of communication.

Simiocracia

Mariano Rajoy, the man who proudly proclaimed in January that he would always show his face and never hide from the crisis, left today's Spanish senate session by the back door to avoid having to answer any questions from journalists. This on a day when Spain has again been battered by the markets, to an extent that has previously provoked the dreaded EU "rescue" for other countries. All of which comes the day after an increasingly panicky government tried to placate the markets by throwing them a bone in the form of €10,000 million worth of additional cuts in Spain's health and education services. Because, as we all know, health and education services cause tremendous problems for a modern, 21st century, economy. Just as they did in the 19th century. These are services which have gone, in the space of just 3 months, from being "untouchable" to being top priority for cutting. The PP made very few concrete commitments, but they have already broken almost all of them.

Rajoy seems to have very quickly achieved the difficult task of making Zapatero look like a far sighted, long-term strategist by comparison. Those who so freely accused Zapatero of constantly improvising are now all over the place, although they maintain their ideological focus. Hence the offer of cuts in education and health in response to all the attention focused on the financial sector and its dodgy finances. The latest cuts figure was announced yesterday buried in the third paragraph of a press release, and with no indication of any sort of where the cuts are to be made. It's had no effect of any kind when it comes to improving Spain's situation, nor was it ever likely to. But now the government has created a situation where the cuts will have to happen, or they will be punished for not doing them.

This seems like a suitable time to recall how little Spain's public services have to do with the crisis here, which is above all a problem of construction related private debt. From the creator of the admirable Españistan we now get Simiocracia.

via Graham Hunt

A Budget Which Will Change Nothing

One of the comfort blanket beliefs of Partido Popular supporters as they finally start to come to terms with the true nature of Spain's crisis has been that their government is doing things properly and that the reward for this has been a decline in market pressures on Spanish bonds. Well they've just lost their blanket. Today's not very successful bond auction shows that once again it's the turn of Spain to be pushed a bit further along the path which the Irish, Portuguese and Greeks have already taken. The recent lull in such pressure has had everything to do with the "barra libre" policy adopted by the European Central Bank in terms of giving huge sums of money to the banks whilst of course doing nothing to help the countries most affected by the debt crisis.

But surely the Spanish government is doing everything asked of it, supposedly what the markets want? Leaving aside the almost incidental 0.5% difference between the deficit target the Spanish government wanted, and the one they have been given by the European Union. The much vaunted labour market reform, which is already helping Spain progress towards 6 million unemployed, and now a budget which aims to slash 3.2% off the deficit in a single year. It is always either too little or too much. Usually the former, but once it becomes clear that Spain's chances of economic recovery are being fatally crippled by these measures then the excuse for making it ever harder for the country to finance its debt will become the poor prospects for economic growth. It's this wonderful Catch-22 that allows the roulette wheel to keep on spinning. 

So the idea that slashing public spending to cut the deficit is going to let Spain escape is lacking any credibility. Even less credibility can be given to the arguments from the government that this lays the basis for economic recovery. Apart from this, it's extremely unlikely that the government will get anywhere near the deficit target this year. I haven't seen one serious analysis of Spain's situation which suggests it is possible for the government to achieve such a big reduction of the deficit in the midst of a recession. The government doesn't believe it, hence their strenuous efforts to change the target for this year. The combination of spending cuts and tax increases announced in the budget is the minimum amount (a mere €32,000 million) needed to get to the target, but the downward spiral that these cuts set off is more likely to increase the deficit than reduce it. 

The IMF estimate of a 1.7% GDP decline for the Spanish economy this year is already outdated. Revisions of these estimates are almost monthly events these days. With the latest measures announced in a budget that was delayed for electoral reasons, it is reasonable to start thinking in terms of a 2.5-3% decline for 2012. If, as may well happen quite soon, the response to the failure of the first package is more of the same then it becomes distinctly possible for this provoked recession to match that which we already saw in 2009. Even some of those who blindly followed the dogma and assumed this madness was bound to work are now revising their positions when faced by the bleeding obvious. Not that they acknowledge the shift.  All this pain to achieve nothing but further destruction of productive capacity can in the end only be justified with a narrative that distorts reality beyond all recognition. 

Much of the damage to be caused by the cuts is still to be revealed, almost half of the cutbacks have to be made by the regional governments who are the authorities responsible for education and health services. The way the government has presented the new budget makes it all seem relatively painless, but hidden in the details are measures which can only make life harder for many. Despite the talk of a general percentage cut across ministries, some of these are doing much worse than others. International aid has been brutally slashed, public works investment takes a huge hit and the money spent on scientific research is also heavily cut. Out the window goes the budget dedicated to assisting job seekers, and that which assisted young people in finding somewhere to live. We wouldn't want anyone to start thinking that Rajoy's government has an economic model in mind that isn't based on cheap labour, concrete and tourism. 

The government claimed that it has no intention of cutting public sector salaries, although the decision to freeze these is in effect a cut in living standards. Not that prices are likely to fall as a result of the budget, RENFE will have to fill the gap left in their funds with significant fare increases for trains. Both the public television service and state support for the cinema industry are seeing significant reductions. Support for the most vulnerable who receive support for being dependent on others for their care has also been cut back. Some measures are a bit perplexing. If the government intends to maintain unemployment benefits as they claim then it is odd that they have assigned less money for this purpose at a time when the numbers of the newly unemployed have been increasing again. 

The sacrifice is far from equally shared. The royal family gets a reduction of just 2%, something the king will probably forget to mention next time he makes one of his "we all have to pull together" speeches. The interior ministry also gets off lightly, those police helicopters, rubber bullets and gas canisters are expensive and are needed to dissuade people from protesting against their situation. The defence budget also came out relatively well. Then comes the star proposal. A tax amnesty for those fraudsters who pocketed so much of the profits from the boom years. They can now regularise their situation paying just 10% with no questions asked. Not that many of them will, the way things are going they almost certainly have their euros stashed outside of Spain. Meanwhile, the honest taxpayers who have had their income tax increased earlier this year are left paying a much higher percentage than the crooks.

Rajoy's Andalucian Hangover

They say the champagne was ready to be opened in celebration on Sunday at the headquarters of the Partido Popular. Such was the confidence that they would win Andalucia's regional government with an overall majority. That's what the opinion polls prior to the final week of the campaign had all indicated, and it is said that the private polls in the last few days before voting also carried the same message. This was going to be the jewel in the crown following the conquering of power at national level, Spain's biggest regional government and the last remaining bastion under majority PSOE control. Not only that, but the popular mandate to be gained in Andalucia was going to be used as vindication for the agressive policies of the government - proof that the Spanish understood the need for tough measures.

But it didn't work out. Sure, the PP emerged as the largest party in terms of votes, something they had never achieved before in Andalucia. Barring dramatic events, it's not enough. They are 5 seats short of a governing majority and the PSOE can govern again if they obtain the blessing of Izquierda Unida (IU), who doubled their representation in the Andalucian parliament. When a similar situation occurred in Madrid in 2003, 2 of the PSOE deputies were 'persuaded' not to support their party in the crucial vote but in this case such a solution would be a bit more challenging. Despite the attempts by the PP to spin the result as victory their faces betrayed them and the party at their headquarters never got going. They entered the week of a general strike and what promises to be an extremely tough budget without the trophy they had hoped for.

For once the abstention didn't come from the voters on the left. At least not all of it. The PP lost around 400,000 votes in Andalucia compared to the general election, whilst the PSOE made a timid recovery from November's disaster and some of their former disillusioned supporters turned further to the left and opted for Izquierda Unida. The regional president, José Antonio Griñan, has seen his decision to give Andalucian voters a taste of the PP in office vindicated. Had the election coincided with the general election Griñan would almost certainly have been booted out. Now the question is what sort of agreement Griñan can make with Izquierda Unida. 

IU have already made it clear that they favour keeping the PP out of power. It's very unlikely that there will be a repeat of the situation that occurred in Extremadura last year where relations between the PSOE and the local IU leadership were so bad that the latter permitted the PP to take office. Such a situation is unthinkable now, with a PP national government implementing aggressive right-wing policies. Even so, IU should play hardball over their support, it can't be a case of business as usual. Andalucia has some possibility of demonstrating that alternatives exist to destructive slash and burn economics, and IU should not sell their support cheaply. The option of letting the PSOE govern in minority seeking approval for their measures shouldn't be discarded. 

The Andalucian result has had an important psychological impact. The PP had behaved in recent weeks with incredible arrogance, very much as if they were the "dueños del cortijo". Even though their victory in November was as much a result of rejection of the previous government rather than support for full blooded right-wing policies, the government has behaved as if they have popular support for everything they want to do. Just as they did when Aznar got his majority in 2000. Now things don't look quite so simple, and the honeymoon is over for Rajoy. With Andalucia, and possibly Asturias, in opposition the political panorama changes. 

The result in Asturias has been overshadowed by that of Andalucia, but it is also interesting. The PSOE emerged as the largest party, with the right-wing vote split between the PP and FAC, the formation of the renegade Cascos. The PP came third in the region whilst the decision by Cascos to call another election has not done him much good. Today's count of the emigrant vote has also changed the outcome with the PSOE gaining an extra seat at the expense of FAC. This leaves the PSOE combined with IU on level terms with FAC and the PP. The casting vote could lie with the solitary representative of UPyD who have previously stated they would support the party with the most votes in such a situation. Their principles, such as they are, may yet be put to the test in Asturias.

Regional Election Results For Andalucia And Asturias 2012

I haven't found much time for blogging recently, but at least I can maintain this blog's tradition of posting election results from Spain via the handy widget from El País. Both Asturias and Andalucia are voting today for their regional governments, although the early indications on participation suggest that many people in both regions are not that enthusiastic about casting their vote. The participation figures released earlier today showed Andalucia 10 points down on the previous elections, and Asturias 8. The received wisdom is that low participation favours the right, as their voters are usually less likely to abstain. 

Most of the attention will focus on the Andalucian vote, where the governing PSOE face a serious possibility of losing power after 30 years of uninterrupted control. Affected by the reaction against Zapatero's government, by weariness after so long in power, and by a serious corruption scandal, the PSOE will regard just a failure by the Partido Popular to obtain an overall majority as a major success. The Andalucian vote would have coincided with the national elections if Zapatero hadn't decided to go for an earlier election. 

The PP will obtain a huge boost if they win Andalucia, their candidate Javier Arenas has been a serial loser of elections in this region. It will give them unprecedented power in the country, as they already control a clear majority of the other regions and form part of a governing alliance in others. Apart from anything else the Andalucian election has been the primary reason why we still don't know what cuts the national government intends to implement in order to attempt to meet the crazy deficit reduction target for this year. With the elections out of the way then reality will come rushing up fast behind. 

Asturias is holding elections just 10 months after the previous ones. This is a result of the failure by the former PP secretary general, Francisco Álvarez Cascos, to form a stable government there following his victory in May last year with his breakaway party. Cascos represents everything that is bad about Spanish politics, although it's very unlikely that he will do as well today as he did last year. The region could still be left without a stable government as it is not likely that any single party will win a majority. No further elections are allowed for at least a year if deadlock is the result, and as Asturias is one of those regions that doesn't set its own election date any government that results will have no more than three years in power.

Managing The Deficit

All seems to be calm. Mariano Rajoy announced last week that the Spanish government was relaxing its deficit reduction target for 2012 and....virtually nothing happened. There have been some token noises of disapproval from Brussels but nothing yet which seriously suggests that Rajoy's apparently unilateral move hadn't been quietly agreed with those who are really in control of the Spanish economy. We'll have to wait and see how events develop, but if I was running the show in Brussels and wanted to allow a couple of countries to relax slightly their targets without encouraging everyone else to do the same, then this is probably how it would be done. It even allows Rajoy to pretend to be in charge.

Rajoy's justification for the move was of course the massive overshoot on last year's deficit target. There is understandable suspicion about the 8.5% deficit figure from last year. Much of the responsibility for this lies with the regional governments who, oddly enough, were more or less on target at the end of the third quarter only to veer wildly off it in the final three months of the year. Given that most of these governments are now controlled by the Partido Popular it is suspected that the figures have been manipulated to exaggerate last year's deficit. There are obvious political benefits in doing this. Firstly, it permits the PP to apportion more blame for the deficit onto Zapatero's government whilst at the same time bolstering their case for relaxing this year's target.

Politics is everything with the deficit at the moment. Despite being persistently asked by the EU to present a budget for 2012, the government has managed to defer this until after the Andalucian elections later this month. Then will come the really bad news. If anyone thinks that the pressure is off because of the change to the deficit target then they could not be more wrong. The government still needs to deliver as a minimum another reduction in spending equivalent to that which they already announced at the beginning of the year. These are cutbacks that go way beyond anything that Zapatero's government was required to deliver in order to try and cut the deficit by 2.7% in a single year.

They've changed a completely unattainable target for one that is just simply unlikely. The reason being that once you start making savage cuts to hit a deficit target then the effects of these cuts on tax income and economic activity in general mean that you have to cut even more just to try and hit the same target. This is the full application of what we can call, in a bid to assist future historians investigating the disaster, The Cycle of Stupidity. So in addition to the headline cuts figure to formally meet the reduction target, there will be an extra hit. The total cuts figure in the end could still be close to the €40,000 million that was seen to be necessary to meet the previous deficit target. The overall reduction if last year's budget target had been met would have been less than the one we will still get this year. Even though it's very unlikely to work.

I still see some occasional talk of growth resuming in the last quarter of this year and you have to seriously question the judgement behind this. With the government now accepting the IMF's estimate of a 1.7% decline in the economy, and bearing in mind that these estimates change for the worse every few weeks at the moment, just where is that growth going to come from? It would be nice to think that Rajoy's shift on the budget meant that common sense had finally told, but it seems to be only a tentative step towards dealing with reality. Bear in mind that job losses don't really cease until you get to around 2%+ growth and 6 million unemployed in Spain is now looking inevitable. But not, of course, unavoidable. 

Waiting For The Great Leap Forward

Spain's ruling party, The People's Party, held it's 17th Congress last weekend as hundreds of thousands of Spaniards took to the streets in an unprecedented show of defiance to the hardline regime. The congress saw the re-election of Kim Jong Rajoy as party leader. Regime mouthpiece PPravda reported that Kim Jong Rajoy, normally referred to as the Dear Leader, was endorsed by an overwhelming 161% of party delegates. The paper compared this to the previous congress in 2008, when the party's leader only received the support of 142% of those attending. 

Speeches at the congress focused overwhelmingly on the dire economic situation of the country. Kim Jong Rajoy, in his acceptance speech, warned the country of hard times that lie ahead before leaving to take his afternoon nap. A controversial policy of sacking 80% of the Spanish workforce was presented to delegates as an important measure to assist job creation, under the slogan "We must first destroy in order to create". A new four year plan to revitalise the moribund economy was also presented. 

Bold new production targets have been set for key industries, notably those producing tear gas canisters, rubber bullets, police batons and other crowd control materials. Other key modernisation policies include the mandatory use of shackles in the workplace. Party officials pointed out that these shackles were made from highly resistant plastic rather than the more traditional iron. Another sign of the country's technological prowess, they claimed. Important changes were also announced for workers salaries. Delegates at the conference unanimously supported a motion describing the monthly salary as an outmoded, petit-bourgeois concept. 

One notable absentee from the congress this time was Francisco Camps from Valencia. A hero of the previous congress, which was held in Valencia, Camps has since fallen into disgrace following the discovery of unspecified irregularities at the Number 4 Suits R Us factory. Kim Jong Rajoy left almost immediately following the congress for talks with the regime's key allies in the Eurobloc Pact. German and French leaders provide occasional assistance to prop up Kim Jong Rajoy's regime under the strict condition that the only beneficiaries of this aid should be the banks.

Gallardón The Moderate

When Mariano Rajoy announced his new government in December there were some who chose to see it as a selection of moderate, almost technocratic, ministers. The reality is that Mariano made his ministerial choices on the basis of loyalty to Mariano above all other considerations; apart from the now obligatory inclusion in a senior position of a banker. Only two months later, the idea that this is a moderate administration is already very difficult to sustain. Take the case of the justice minister, Alberto Ruiz Gallardón. As mayor of Madrid he was of course rightly famous for having bankrupted the city and for having won a gold medal for failed Olympic bids. But he was also seen as a centrist politician capable of reaching out to those voters who disliked the fundamentalist, taliban wing of the Partido Popular. 

The trick worked well for quite a few years, but it was just a trick. Gallardón's mask started to slip before he made the leap to national politics, the papal visit last summer saw him enthusiastically joining the competition to hand over as much of Madrid as possible to the Pope and his pilgrims. Now installed as a minister, it is Gallardón who will steer through what promises to be a thoroughly reactionary abortion law reform. Quite possibly taking us back to the position of the 1980's when women wanting an abortion and health professionals could never be absolutely sure that what they were doing was legal. Just the sort of precarious ambiguity that suits the PP on issues like this. 

Gallardón, who has never hidden his ambition to lead the PP and who prospered under the patronage of eminent Franco-democrat Manuel Fraga, is now perhaps more concerned about winning over those still to his right. So, yesterday, it was Gallardón who led the charge in defence of the brutal police violence we have seen in Valencia in the last few days. Fully equipped riot police beating up school kids has led to some shocking scenes, but the moderate Gallardón sees none of this. Instead he would have us believe, alongside the ever more servile right-wing press, that it is all the work of anti-system radicals intent on attacking the police. Oddly enough, as the riot police were withdrawn yesterday, there was an outbreak of entirely peaceful protest in Valencia. It's almost a perfect portrait of the way that region is being run, kids and their parents who protest about having no heating in their schools get beaten by riot cops whilst the corrupt political leadership who don't pay the heating bills continue to go peacefully about their business. 

It's fairly clear that the new government has let the police off the leash in dealing with any protests against the severe cutbacks being implemented by Rajoy's administration. In Madrid Esperanza Aguirre was threatening to form her own regional police force last year, as the then PSOE administration refused her repeated requests to crack heads in the Puerta del Sol. In compensation for not getting her own private police force (a truly frightening prospect), she instead got one of her people installed as the Delegada del Gobierno in Madrid, the government's local representative. The change is already being noted with the police putting any meetings of the 15M movement held in the Puerta del Sol under intense pressure. 

The excuse for this pressure on protest movements is that such actions have not been authorized by the government. It's a common PP refrain that the 15M activities are illegal because they do not ask for permission. Back in the real world there is actually no legal requirement in Spain to ask those in power for permission to demonstrate - just as well! The Spanish constitution guarantees the right to assembly and there is only a legal requirement to communicate the intention to meet if the event in question affects the use of areas of public transit. Failure to communicate this isn't even a serious crime, the penalty would be a fine. But for the right it's sufficient excuse to send in the riot police, and to use the law when it suits them to use it. Sports fans who come on to the streets to celebrate their team winning a trophy are unlikely to be baton charged by the police. 

Occasionally, very occasionally, the police are forced to account for excesses. With huge media coverage of the violence they used against peaceful protestors in Barcelona last year a judicial case against the senior officers responsible on the day is leading to the possibility of a trial. But will it matter? In 2009 five Catalan police officers were found guilty of mistreatment and illegal detention. Oh, I almost forgot, they were found guilty of torture too. The details of the case are appalling. Last week the PP government pardoned them and they will soon be back on duty 'upholding the law' with no penalty of any kind. How safe does that make you feel? The more you hear the vacuous rhetoric about how we are all equal before the law, and we hear it a lot these days, the less likely it is to be true. Meanwhile, let's not forget that the moderate Gallardón is STILL on the left of his party.

From Vergara in Público:

Body Language

It's not hard to see why Mariano Rajoy's minders are doing their best to keep their man out of public view. Spain's prime minister had his first European summit this week and displayed his absolute lack of communication skills. Not that he practices very much. Say what you like about Zapatero, he knew how to look an audience in the eye and speak to them. Even if he was constantly moving his imaginary box from one side to another. Rajoy always looks as if he can't wait to get away, and as if he has a bad taste in his mouth. 

When he was officially greeted in Spanish by Herman Van Rompuy, who is allegedly someone important in the EU, Rajoy couldn't even muster a smile of acknowledgement. Instead we got the Mariano grimace and that bad taste again. The only time he smiled was when he told the Finnish prime minister that the imminent labour market reform would cost him a general strike. The remark was not intended to be reported and someone had to go and wake up Spain's union leaders to tell them what was expected of them. The outcome is that they are now almost obliged to call the strike, otherwise they'll make Rajoy look stupid!

If you want to know what plans Spain's government has for the economy then you really need to read the foreign press. The economy minister (or should that be one of the economy ministers?), Luis de Guindos gave quite a precise description of the content of the proposed labour market reform to the Wall Street Journal. All of which is curious when you consider that no such description had been offered to the Spanish people, and when the details were supposedly still being thrashed out between employers and unions. It's all part of the game, the content of this reform is said to be part of the letter sent to the Italian and Spanish governments prior to the European Central Bank acting to reduce pressure in the debt markets. We know the Italians got the letter, but both Zapatero and Rajoy have been allowed to act as if they are just deciding themselves to implement these measures instead of being told what to do.