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Spaniards Set to Throw Out Ruling Socialists (Update: Spain Turns Blue)

Can the conservative Popular Party save the country with the highest unemployment rate in the industrialized world? PJ Media turned to the experts ahead of Sunday's election. Update: Spain Turns Blue

by
Aaron Hanscom

Bio

November 19, 2011 - 7:00 am

Spain’s conservative Popular Party (PP) is poised for a historic victory in Sunday’s general election. PJ Media asked a distinguished panel of experts on Spain for their thoughts before Spaniards head to the polls.

José Guardia, a former supervising editor for PJ Media, has a J.D. from Barcelona University. He is a political analyst with a two-decade experience in online media, technology, and internet businesses as an executive, consultant, and entrepreneur. Guardia’s website is http://jm.guardia.name.

Soeren Kern is the senior analyst for transatlantic relations at the Madrid-based Grupo de Estudios Estratégicos/Strategic Studies Group. He graduated from the School of Foreign Service at Georgetown University in Washington, D.C. Kern writes the “Europa! Europa?” column for PJ Media.

Roger Senserrich has a bachelor’s degree in political science from Universitat Pompeu Fabra, Barcelona, and a master’s degree in social studies from the Universidad Autonoma de Madrid. A Spanish political blogger and founder of Politikon.es, Senserrich works as program coordinator at the Connecticut Association for Human Services (CAHS), managing a state-wide benefits access program and coordinating the social media effort.

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PJ Media: The conservative Popular Party (PP) is poised for a historic win in the general election on Sunday. How much of this is due to enthusiasm for the PP rather than disgust with  President José Luis Rodríguez Zapatero’s ruling Socialist party (PSOE)?

Guardia: It is both. On the one hand, surveys say that about 1.5 million voters will change their choice from the PSOE to the PP, which is a lot and, particularly, unprecedented. On the other hand, Zapatero’s party has been bleeding votes on the left, especially since the passing of the austerity plan in May 2010. Many of his former supporters will stay home or vote for other smaller leftist parties.

How big each of the factors will be is impossible to know for sure until the votes are counted, obviously. My forecast is that the Socialist party will end up being hurt more by former voters choosing other alternatives on the left and, especially, by those abstaining, rather than from a shift to the Conservatives, though the latter will be remarkable.

Kern: Spain is split down the middle between the political left and right, although Spanish society leans just enough to the left so that left-wing parties normally have a slight edge at the polls. Conventional wisdom holds that the PP usually only wins if the PSOE screws up. Because the PSOE clearly has political ownership of the current economic crisis in Spain, the PP will benefit at the polls this time around.

Nevertheless, there is little enthusiasm in Spain (either on the left or on the right) for the PP candidate, Mariano Rajoy. He is widely viewed as having the aura of a loser, having lost two previous elections against the PSOE (in 2004 and 2008). The only reason Rajoy is the PP candidate in 2011 is because of the idiosyncratic nature of the Spanish political party system, which operates on patronage and clientelism.

In other words, Rajoy is set to win on November 20 by default, because he is the only alternative to the PSOE candidate. However, should Rajoy be perceived as having failed to lead Spain out of the economic crisis before the next general election cycle in 2014-2015, the PSOE would probably be favored to return to power.

Senserrich: The election can be explained by a single, dramatic number: 22.6%. That’s the unemployment rate in Spain right now, and the economy is showing no signs of growth. Mariano Rajoy is many things, but he is not the kind of candidate that generates any significant amount of enthusiasm.

He really does not need it, though, Although the current economy is not just the Socialists’ fault (some structural reforms have been repeatedly postponed for decades), voters are in no mood to show patience or understanding.

PJ Media: Does the PP presidential candidate, Mariano Rajoy, have a viable plan for brining Spain out of the economic crisis?

Guardia: He does have some interesting ideas — on taxation, support for entrepreneurship, and labor reform (which is sorely needed) — though in my opinion these ideas don’t go as far as they should, at least on paper. Rajoy has been calculatedly ambiguous, revealing only what really needs to be revealed and nothing more; the example of the UK’s Cameron‚ who was riding high in the polls until he detailed his plans‚ scared Rajoy away from being too explicit. So it’s difficult to know in advance.

And at the same time, it’s important to realize that Rajoy won’t have much leeway here. Some measures need to be taken ASAP, more or less; and some others will be “dictated” by the EU, which is just as good for Rajoy: he will be able to minimize the backlash using that fact as an alibi.

Kern: No one knows the answer to this question for sure, although it does seem unlikely that he has developed a comprehensive plan. Rajoy has been ahead in the polls for months and thus has not felt any need to present Spanish voters with an economic plan. Rajoy’s advisors almost certainly have identified some policy measures to be implemented almost immediately, such as providing tax breaks for Spanish industry. But Spain’s problems are truly vast in scale, and are also deeply structural in nature. There is simply no easy fix to Spain’s problems, and things are likely to get worse before they get better. Most economists forecast that it will take a decade or more for the country to recover the ground it has lost.

Senserrich: No one knows for sure. Rajoy has showed an admirable level of discipline this campaign by not telling anyone what he really intends to do. His party has been similarly tight-lipped, with very few hints on their future plans. A few months ago Rajoy did talk about some extensive reforms of Spain’s disastrously inefficient labor market, but he has not provided any further details.

Reading the tea leaves a bit, I think that Rajoy will go big once he is in office. He seems to be getting ready for a fight once he arrives to Moncloa. What I am not sure about is if he has the right plan in mind, as the party seems to be more focused on austerity than on structural reforms

PJ Media: Are Spanish voters willing to hear hard truths about what it will take to turn things around? After all, there was widespread outrage over austerity measures that passed earlier this year.

Guardia: There was outrage, but certainly not as big as in other countries, namely Greece. The truth is that most Spaniards are coming to terms with the fact that it’s going to be necessary to pass some painful measures if the economy is to be fixed. I sometimes joke that Zapatero has been the biggest “factory” of small-government supporters in Spain, a country where there were few. When you talk to people on the street, many now ask: Why have a government with so much power if that power can lead to such big failures? Or, why pay so much money for pensions and health care if at the end of the day these are going to be cut because there’s not enough money? They might as well pay for private retirement and medical services.

The so-called “indignants,” the protesters that inspired the Occupy Wall Street movement, were indeed vocal, but other than in the media they haven’t had much actual impact, or at least they didn’t in March’s local elections. I don’t think they will have a bigger impact this time. And if they do, they’ll either stay home or, even though they lean left, vote for other parties on the left other than the Socialists. This means that they will likely help make the PP’s win larger: due to Spain’s electoral system (halfway between proportional and majoritarian), the number of seats in parliament is bigger if the votes are concentrated in one party than if the same number of votes spreads among several.

Kern: Spain’s problems are deep-seated and above all structural. Spain’s economy is notoriously uncompetitive. Apart from olive oil and wine, Spain exports few products abroad, and even fewer that have much technological value.

One of the biggest problems facing Spain is the central government’s dysfunctional relations with the 17 autonomous communities (there are also two autonomous cities); Spain’s existing political model, which was established in the late 1970s after the death of General Francisco Franco, generates immense waste and duplication and is unsustainable over the long term.

Cultural factors also add to the mix: Spain has a huge problem with corruption, which affects all political parties (PJ Media article here). On top of that, Spain also has a big problem with tax evasion and the shadow economy represents around 20 percent of GDP.

In summary, Rajoy’s leadership abilities are completely untested and he has zero charisma to rally the general public around grand ideas. It remains to be seen whether he and his advisors will have the vision and the fortitude to implement the painful changes needed to get Spain back on track. Any changes to the status quo will be fiercely resisted by powerful interest groups on many levels of Spanish society. The odds would seem to be against Rajoy succeeding in any meaningful way, but if he assembles a team of competent technocrats and advisors to govern Spain, there certainly is hope.

Senserrich: It is hard to know. The Conservatives are likely to win a very large majority this Sunday, but it is hard to say if that will amount to a mandate. Voters will be voting against the Socialists, not endorsing the bold policies that Rajoy so far has refused to put forward, so any reform plan can prove a tough sell. In addition, the far-left parties are likely to increase their support at the expense of the Socialists, creating a loud, active opposition block against reform.

The current situation, however, is clearly unsustainable. Unemployment is sky high, economic growth is non-existent; most voters probably understand by now that this is not the time for playing it safe. My guess is that we will see some outrage and some protests, but that they are not likely to be widespread at least during the first few months.

If the euro-zone mess persists and the economy shows no signs of turning around by early 2014, however, all bets are off.

PJ Media: What were some of Zapatero´s biggest policy failures?

Guardia: Without question, the economy, which ultimately is what will bring his party down. First, Zapatero spent two years not only denying there was a crisis to begin with, but labeling anyone who suggested there was one as “antipatriotic” and eager to see the country hurt, and boasting against all evidence that Spain’s banking system was the world’s most solid. Which means he didn’t take any measure when doing so would have been relatively harmless. Then, when he finally recognized there was a crisis, he went fully Keynesian, believing that merely throwing money in half-baked plans with no accountability would change the situation by itself. He treated the financial crisis as some sort of natural catastrophe where you need to take palliative measures and clench your fists while you wait for the situation to get better on its own. So he failed to make real reforms and spent the budget’s “silver bullet” (at that time, public debt was relatively low) without success. Then in May of last year, when the debt was spiraling out of control, he had to follow the orders of the EU, Obama, and China to rein in the spending no matter what, which he did with the faith of the converted. But it was a day late and a dollar short.

There were also very important failures in foreign policy: the unilateral withdrawals from Kosovo and, particularly, Iraq; his approach to Europe which has driven Spain into irrelevancy; his coziness with non-commendable regimes such as Cuba, Venezuela, and even Iran. And on the home front, he didn’t match his self-described tolerant attitude, prone to dialogue, with facts. He pushed socially divisive policies (abortion, gay marriage) without reaching out to the other side, which a statesman needs to do even if that other side is wrong. He also reopened old wounds that were thought to be healed (the Civil War). As a result, the levels of political tension have been the highest since the transition to democracy after Franco’s death.

Kern: Zapatero will always be remembered for bringing Spain to the brink of economic collapse.

But Zapatero’s biggest failure has been his blind devotion to an insidious, leftist, post-modern, globalist political ideology (PJ Media article here) that fatally removed him (and millions of naïve Spanish voters) from reality and led his country to ruin.

Zapatero came to office thanks to Islamic terrorists who attacked Spain just days before the election in 2004. He interpreted his electoral victory as a mandate to turn Spain into the most socially left-wing country in Europe. Zapatero’s deep-seated hatred for the Roman Catholic Church led him to pursue social changes that have been so radical in scope and so rapid in execution that he has left Spain morally bankrupt. Moreover, his fierce antagonism to the Judeo-Christian roots of Western civilization led him to pursue a partnership with Islam that will have repercussions for generations to come.

Zapatero also introduced a post-modern political discourse that stubbornly refused to call reality as it is (PJ Media article here). The concomitant refusal to take responsibility, especially in the economic sphere, has left Spain in ruins.

On the foreign policy front, Zapatero has destroyed Spain’s credibility in international affairs. Zapatero abandoned Spain’s allies in places such as Iraq, Kosovo, Haiti, and elsewhere. He also realigned Spain’s key relationships away from the United States and toward Cuba, Iran, and Venezuela.

Senserrich: Labor market reform. The Spanish labor market is incredibly inefficient, burdened with complex regulations, a huge array of contracts, and exceptionally clumsy severance pay rules. The Socialist government seemingly understood this, and spent huge amounts of political capital negotiating a reform with the labor unions and business associations. Once the talks broke down, and with the looming threat of a general strike, Zapatero decided to try to appease the unions with very limited, completely harmless, deeply misguided reform. The unions went on strike anyway, so the government ended up taking a huge hit from the protest while failing to deliver any significant changes at the same time.

This was, sadly, a familiar pattern. The Socialist government has been surprisingly competent cutting the deficit, but they have consistently ended up watering down structural reforms when confronted with any significant opposition. Zapatero’s biggest falling has been to his unwillingness to tackle some of the most obvious structural deficiencies of the Spanish economy, while focusing on short-term cost cutting measures that are a result, not the origin, of the country´s economic woes.

PJ Media: Authors such as Mark Steyn and PJ Media’s own David P. Goldman have all but declared Europe dead, largely because of demographic trends. With Spain’s 1.2 fertility rate, is there any reason to be optimistic about the country’s long-term future — even if the PP wins a  large parliamentary majority on Sunday?

Guardia: It’s always difficult to do that kind of long-term prognosis. And while the birth rates have been low for quite a few years, immigration (particularly from Latin America, with a shared language and cultural background and higher birth rates) has been providing “new blood.” Even Islamic immigrants have integrated themsevles fairly well, at least so far. And among nationals, pardon the pun, demographic trends can change in nine months, one couple at a time. What I mean is that if the economy starts to improve, and especially if people start realizing that the social security system will “give” them back much less than they paid for, they may start having more kids so that those kids can take care of them when they are old. Just like in the old days, in fact.

Kern: The biggest enemies of Spain are the Spaniards themselves and the biggest problems ailing Spain are not economic, but rather spiritual and cultural.

In the spiritual realm, most Spaniards have abandoned their Judeo-Christian roots in exchange for a post-modern narcissistic hedonism. A reflection of this is that most Spaniards do not believe in the future enough to want to pass it on to the next generation. A consequence of this is that Spaniards are not having enough children to maintain the population at stable levels.

For many years, the birth rate in Spain was 0.7 percent, the lowest in the industrialized world. In recent years the birth rate has climbed to around 1.2, thanks to the infamous “baby check” whereby the Socialist government bribed Spaniards into having children by offering to pay them 2,500 euros for each newborn baby. Now that economic crisis has ended the “baby check” scheme, birth rates are likely to drop once again.

In the cultural realm, corruption is a major impediment to generating confidence in the future. Moreover, the pie of opportunities in Spain is relatively small, and those who already have their piece of the pie are reluctant to share it with others. This makes it difficult if not outright impossible for new talent to break into Spanish business and politics. As a result, some of the most talented young Spaniards emigrate to the United States or the United Kingdom. This creates a brain drain and in turn institutionalizes a mediocrity at all levels of Spanish society. It also explains why Rajoy could end up being the PP candidate in November 2011, after having lost so many times before.

On balance, the future for Spain does not look bright. It remains to be seen whether the current economic crisis becomes a catalyst for fundamental change, or an excuse to stay entrenched in the old ways of doing things.

Senserrich: Demographics are indeed a problem in the long term. Spain’s situation is less urgent than Italy’s or Germany’s (demographics is one of the main reasons behind the German push for austerity), but it is something that needs to be tackled before the end of the decade. In any case, nothing can be done before the economy turns around; with youth unemployment in the 40% region, increasing birth rates is all but impossible.

In any case, Spain has a significant opportunity going forward: immigration. The country is a very attractive destination for other Europeans, to the point that becoming the Florida/Sunbelt of Europe is a viable strategy. In addition, the country so far has been surprisingly welcoming to immigrants from outside the European Union, especially Latin America. The old cultural ties and affinities with the old colonies, as well as the shared language, make integration much easier.

Update: Spain Turns Blue

Aaron Hanscom is the managing editor for PJ Media.
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