Spain and Portugal’s right shun austerity and Brussels – for now

It’s easy to see parallels between the governments of Spain and Portugal of recent years. José Luis Rodríguez Zapatero and José Sócrates were both fresh-faced Socialists when they took power in 2004 and 2005 respectively, promising social reforms as well as economic stability. Both were voted in for second terms before running aground on the challenges that arose following the world economic crisis.

Like their Socialist counterpart in Greece, Georgios Papandreou, both men have been forced by circumstances to repress their political instincts and introduce heavy spending cuts and painful reforms. In Portugal, where the economic outlook is worse, the opposition’s withdrawal of support for a latest round of cuts has brought about the resignation of Sócrates. In Spain, Zapatero is reeling from the damage high unemployment and the recession have dealt his image, but congressional pacts mean he should survive until the 2012 elections.

An interesting dimension to these situations in both countries is that in each case, the conservative opposition has opposed the full program of cuts being proposed by the left-leaning government. Portugal’s PSD backed Sócrates, but only to a point; Spain’s PP has not overtly backed Zapatero on the economy at all. Perhaps this is not altogether surprising, given how public opinion opposes steep austerity, everywhere from Athens to London. But in both Portugal and Spain, the PSD and PP can expect to be in power soon, facing the kind of nightmare decisions that have tormented their countries’ Socialist administrations in recent months.

When the fact that Sócrates and Zapatero have each been acting with the endorsement of the EU is thrown into the mix, it’s hard to see where the PSD and PP would turn once in power. Embrace popular anger at the cuts, thus shunning Brussels’ recommendations (and, in Portugal’s case, inviting a bailout)? Or continue down the road of austerity?

The Popular Party’s Mariano Rajoy has not laid out his economic plans in detail. Only a few weeks ago he expressed admiration for the strident action of David Cameron in Britain. But more recently, he has appeared to distance himself from Brussels-approved reforms. Zapatero’s plans, he told supporters in Toledo on Sunday, “create more and more unemployment, more problems, less pensions, more cuts.” Logically, this would suggest the PP would neither cut pensions nor introduce more cuts. Perhaps even more ambitiously, Rajoy pledged he will more than halve the jobless rate “to below 10 percent”.

A more likely scenario is that in Spain, at least, the opposition party is in fact planning some stiff austerity, albeit in a different slightly way to the Socialists (for example, through more strict controls on spending by autonomous communities). In Portugal, which is a good deal closer to the abyss, the margin for manoeuvre is that much tighter. The PSD may not want to be austere in opposition, but it’s going to have to be once in power.

Traditional economic ideology has been touted as one of the obvious casualties of the current crisis, but in Iberia, the political right is going to have little choice but to revert to type when it comes to spending public money.