Bankia and the blame game
Who caused Spain's banking crisis? Does it matter?
By Guy Hedgecoe
The news that former Prime Minister José Luis Rodríguez Zapatero is writing a book about his two terms in office in which he will be “critical of himself, but not others,” according to people close to him, stuck out like a sore thumb given that in Spanish politics, apportioning blame currently seems to be as much a priority as finding solutions to the crisis.
Whether Zapatero does manage to criticise only himself in his book is another matter, but if not, plenty of others are quite happy to point the finger at him.
Last week, Economy Minister Luis de Guindos echoed the Partido Popular-led government’s regular complaint that it inherited an economy in tatters from the Socialists, this time in reference to the disaster-ridden bank sector.
“The lack of decisive action to nip the uncertainty in the bud allowed doubts to grow,” he said, adding that the financial sector should have been tackled “from the first signs of crisis.
Strangely enough, this was a similar diagnosis to that made by ECB President Mario Draghi, also last week. But Draghi aimed his criticism at Guindos and the current Spanish administration, for “underestimating the problem, making a first evaluation, then a second one, a third, a fourth.” This, he said is the “worst possible way to do things.” Touché, Luis.
And of course, while Zapatero keeps quiet and polishes off his memoirs, his fellow Socialists are being anything but coy about blaming the government for the Bankia debacle.
All of which raises the question: who is to blame? With a parliamentary investigation into the Bankia case ruled out at least for now, it doesn’t look as if there will be an officially sanctioned scapegoat.
But if we’re looking for an unofficial one, the Zapatero government cannot avoid shouldering a good share of the responsibility. In 2004, the Socialists inherited a booming economy, albeit one which was overly-reliant on real estate. They made little effort to shift that emphasis until the crisis struck in 2008-09 and even then, Zapatero was in denial. Furthermore, his bank reforms were underwhelming and, in creating merger-monsters like Bankia, somewhat misguided.
Or, we can always go a little further back.
Blaming the Aznar government for this crisis “is like Real Madrid blaming [1950s legend Alfredo] Di Stéfano for not reaching the Champions League final,” was how Rajoy, then in opposition, responded last year to criticism of his former boss’ 1996-2004 administration. But the government of Rajoy’s conservative predecessor José María Aznar did lay the foundations for the housing bubble in the first place (the equivalent, perhaps, of Di Stéfano moving the Madrid goalposts a little further apart ahead of the Champions League semifinal).
The more obvious culprit, if we’re looking at PP governments, is Mariano Rajoy. Underestimating the Bankia black hole, as Draghi pointed out, was costly in itself, as is the uncertainty over how it will be filled. But the delayed presentation of the 2012 budget, moving policy targets and communication difficulties, have only ensured the country remains in the eye of the euro zone storm.
It would be refreshing to hear someone, anyone, stand up and admit poor judgement when it comes to Spain’s banks. Perhaps outgoing Bank of Spain head Miguel Ángel Fernádez Ordóñez will get it off his chest once he’s out of the door. Or maybe ousted Bankia chief Rodrigo Rato? Probably not. In fact, it would be much more refreshing to see the blame eventually apportioned in a serious, official way once the current crisis has been overcome with the help of some unprecedented political consensus between the main parties. On the other hand, we may have to dream on.
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