The International Writers Magazine: From our Spanish Correspondent
Three Deadly Sins in Spain
Once again the world kicks off the new year with more horror stories. France has to send in troops to Mali because of a new surge of Islamic terrorism and Algeria follows suit by similar thugs taking over a natural gas plant that ended up short of a total massacre of hostages including many European workers that lost their lives. Spain’s woes continued as usual despite the respite of the end of year holidays that started at Christmas and ended in the first week in January.
* Image: Map of Corruption in Spain
The Three Wise Kings’ national cavalcades triumphantly handed out sweets to crowds of thousands of screaming children that lined the streets of most towns and cities. However, a long term, undercover, yet well-known menace raised its ugly head in brute force and has shaken the nation hitting the very heart of the present government. Massive corruption within the ruling Conservative Party (PP) has been disclosed.
It really started in February, 2009 when the left wing newspaper ‘El Pais’ uncovered a massive network of bribery and corruption that was codenamed ‘The Gürtel Case’ that stretched across several autonomous regions, including Madrid and Valencia, governed by the conservatives. Although a parallel to ‘Watergate’ the filth that was brought to light was a conglomerate of firms grouped together designed to obtain ‘favors’ for all kinds of private investments, business deals and public work projects across the country that were in the hands of the PP by offering all kinds of illicit bribes through undeclared cash and other handouts. The most notorious one that hit the press for months was that of a set of several highly expensive tailored suits that were given to the President of Valencia, who eventually resigned and was summoned by the authorities. Although he appeared before the courts this particular trial was dismissed, as no proof could be presented before the judges. The complete case was in the hands of the notorious Judge Baltasar Garzon who drove Margaret Thatcher mad during his pursuit of the Chilean Dictator Pinochet. Many heads rolled including prison sentences but none of the ‘Top Brass’ of the party were ever convicted.
It had dwindled to a mere murmur in the media, that is until last month when Luis Barcenas’ name - the treasurer of the PP for twenty years - hit the headlines with a new personal scandal of laundering none other than 22M Euros into Swiss bank accounts and off shore tax havens. Once again the ‘El Pais’ newspaper started having a field day with a daily feature of developments as this character, now before the courts tried to explain away his massive fortune accumulated over the 20 years’ service to his party. He had resigned as treasurer in 2009 but continued as a member of the Spanish Senate. The newspaper finally hit the jackpot. Sr. Barcenas declared before the judges that among other bizarre transactions he had paid the salaries of hundreds if not thousands of party members in two monthly amounts, one totally legal and the other in envelopes with up to 15000 Euros of non-traceable cash. This had been going on during all the time he was their treasurer. Boy, did this create a stir across the country!’
Although we still have the Urdangarin case, the King’s son-in-law, up for similar accusations of corruption that is threatening the Spanish Monarchy – I reported this last month – this new scandal has virtually opened Pandora’s box and the Spanish journalists of all political colors are searching through the rubbish bins of the country and piecing together all the cases of corruption that have been going on from central government, through to the autonomous regions and down to town council level. There isn’t a political party that has not got mud all over its face to put it mildly. So much so that there is a sarcastically designed Google map of Spain listing most of all the cases that has come to light over the years. Obviously the levels of money vary but it is still a real horror story that the rest of the European political hierarchy not only hasn’t heard of, but has ignored as they continue to praise – including at the latest Davos shindig - the Spanish government’s efforts to control excessive public spending.
The money has been used in all kinds of bribes but mainly as favors to contractors and other entities for ‘services’ rendered. The details would be the basis for a completely separate essay. You can imagine the impact that all this is having on the citizens of Spain that are not only suffering from the economic crisis but have now lost complete faith in their democracy that was instilled in them since the end of Generalissimo Franco’s dictatorship over 30 year ago. Sure, corruption has been the name of the game here and elsewhere for decades and centuries but never to the degree of national and total audacity as disclosed publicly in the last few weeks. As one long term unemployed said, ‘how can we trust our leaders to overcome our hardships if they are stealing behind our backs regardless of the crisis?’ Simple but direct that leads me onto the next deadly sin - unemployment.
Spain has all but hit the 6M unemployment figure, the second highest after Greece and shows no signs of abating. Over 55% of the young generation, a great deal are highly qualified just cannot find a job. This did hit the limelight at the Davos Economic Forum as all the members muttered under their breath at the conference, ‘it’s a problem that has to be resolved.’ How? Like the theme song in ‘Midnight Cowboy’, ‘…everybody is talking about it… but can’t hear a word they’re saying!’ The Communist trade unions continue with their usual rhetoric threating more strikes and demonstrations that lead to nowhere. Every single political sector of the opposition that has a say right down to the insignificant counselor of a small town is voicing concern and anger against the government, but offering no sensible solutions to the problem.
And finally the whole of the Spanish public that has more or less given up, tries to hold on to whatever survival kit each family or individual has hoping that at least it won’t get any worse and that somebody or some outside miracle maker will come and begin to turn the situation round.
For over a year the government has been concentrating on reducing the deficit, sorting out the banking system and keeping Brussels and the IMF happy. Although it is hurting and might even destroy what is left of the middle class, it is reducing some extremely top heavy and useless expenses especially in the public sector. They have cut back on many subsidies right across the board including such untouchables as health and trade unions. They’ve also raised taxes, not to mention the increase in electricity and petrol hitting the country in a not too distant future. Despite some ‘timid’ labour reforms they have still to face the fact that companies are not only not hiring but are actually foreclosing and going belly up. The cost of employment is still very high in comparison to other nations in the European Union. To top it all the banks are still not offering enough credit to small businesses.
Then we have the bureaucracy. Spain, for a plethora of reasons is one of the most difficult countries in the developed world to start an enterprise. A superb 10 minute sketch on YouTube ‘Form 036’ succinctly sums up the problem. However, there is light at the end of the tunnel. Mariano Rajoy, the PM has proposed to introduce a law that will harmonize autonomous regions and town council contracts. What does this mean? Commercial and trade barriers between the 17 autonomous regions that includes 8000 town councils will be eased. If a business entity completes all the necessary legal permits to start a business in say Andalucía it will be valid throughout the country regardless of local autonomous laws including linguistic ones that up until now hampered any entrepreneur trying his luck outside the region. It is yet to be seen how this will be implemented especially as we move on to the 3rd and last deadly sin. Nationalism and independence!
I’ve reported this before. Because dear old Scotland has been given the go ahead to hold a referendum on the right to become a separate nation and obtain independence from the United Kingdom, the Catalans followed by the Basques and very soon the Galicians – although in this case the Conservative Party (PP) that is in power may keep the lid on for the time being – are after the same concession. At the moment the only threat is coming from Catalonia. The Basques are more cautious because they know that Spain and the European Union still have an eye on ETA, the terrorist group that have yet to give up their arms and declare a true cease fire. Meanwhile as their political arm is well entrenched in the region and the Spanish Parliament they can afford to play a waiting game. ‘Let’s see how Catalonia fairs in the battle!’ is on every Basques mind. One point is certain. These two regions are the heart of productive Spain. The country cannot do without them and thoughts from some circles are that these regions cannot do without Spain. This sin is still not taken seriously by the EU especially the Eurozone that could be in danger if the Spanish government cannot control its rebellious regions.
There is one final and very sad point – reported in earlier essays - that hardly hits the European press and affects yours truly as it is in Vigo my own home region and town. It is the plight of over forty thousand small savers that invested between them a total of 1B Euros in the Galician savings bank Caixanova with their life’s savings for a pension on retirement. They were literally swindled and have almost lost everything. The devious scheme was called ‘preference shares’ and had been going on for twelve years. Every day, for over a year massive groups gather outside dozens of town councils and the bank’s offices blowing trumpets, sounding horns, stopping traffic, starting ‘sit ins’ handing out pamphlets and generally screaming blue murder at the culprits. The authorities are trying some patchwork whilst the rest of the country is behind them with their moral support. These people are ordinary and humble citizens you meet in everyday life. They trusted their banker in thousands of branches across Galicia with their savings. Over the years and across the Western financial spectrum I have not read or heard of such massive banking fraud at basic street level.
Although I am not affected personally because my account and money is in the other Galician bank ‘Pastor’ (taken over by the Popular), this may eventually turn into a very serious social problem where nobody can predict the outcome. Will it be the tip of the iceberg or the drop that causes the overflow?
Updates as they happen... Feb 4th Another black month! January unemployment figures rose by another 130,000 reaching a record (nearly) 5M out of work.
© James G. Skinner. February 2013.
Update: This week's Economist (Feb 9/15) has an article on Spain's problems. This is their statement, 'Spain's democracy has given too much unaccountable power to the two main parties'. On the contrary, unless there is an overall majority win in the elections to the Spanish Parliament, (as is the present case of Rajoy's PP party), over the past decades, if in minority, the eventual ruling party has to negotiate (in practice) with the nationalists in Catalonia, the Basque country and Galicia; hence creating all the independence mess that this country is now in. The nationalistic demands have always been met to the detriment of the rest of 'Spanish speaking' Spain. I have written in detail in other essays on this issue. Once again, the Economist is wrong!
Losing Identity in Spain
We’ve got Nationalists, Conservatives, Socialists, Republicans, Marxists, Monarchists – in minority – Ecologists all vying for the imposition of their political agenda in Catalonia.
The Spanish Monarchy 2013
The King of Spain is important to the stability of the country. A few years before Generalissimo Franco died his technocratic government devised a program to transfer power in the smoothest possible way without causing immediate political upheaval