So that’s that then. In the autumn, José Luis Rodríguez Zapatero will announce his decision to make way for his interior minister, Alfredo Pérez Rubalcaba, as Socialist candidate in the spring 2012 general elections. This, at least, is the theory that has taken hold in much of the mainstream Spanish media in recent days, with El Mundo, La Vanguardia, El Periódico and Público all subscribing to it on the strength of reports emerging from the Socialist camp. Qorreo has heard similar reports from sources close to the prime minister, who also say Zapatero has informed at least four senior Socialists of his plans (and not just one, as the prime minister has claimed). Rubalcaba has … [Read more...] about Rubalcaba to mitigate damage as Zapatero goes up in flames
spain economy
Time for a name change for the Socialist Workers’ Party
When the Spanish Socialist Party (PSOE) holds its annual conference this summer, the party faithful’s main task will be to dump its leader, Prime Minister José Luis Rodríguez Zapatero, and replace him with wily Interior Minster Alfredo Pérez Rubalcaba. While they’re at it, they might consider a name change more in keeping with the party’s sharp right-turn over the last year, for which Pérez Rubalcaba can take much of the credit/blame. Times are tough, and they’re going to get a lot tougher. Unemployment officially stands at 20 percent, growth rates are zero, and growing numbers of people are feeling the impact of the government’s austerity cuts. In short, the recession is hitting millions … [Read more...] about Time for a name change for the Socialist Workers’ Party
Time is Zapatero’s enemy as he seeks to reform
The government and the unions are back at the negotiating table. This time, among the issues they are discussing are reforms to the pensions system and the proposal to delay the retirement age from 65 to 67. This willingness to talk is in many ways encouraging. It is a throwback to the days, not so long ago, when the Zapatero government and the unions got on so well it was hard to detect any ideological discrepancies between them. It also hints at political maturity on both sides. But it’s also important to remember that this pensions reform was first mooted in early 2010, as the government scrambled to fend off market hostility and Zapatero started moving away from his centre-left … [Read more...] about Time is Zapatero’s enemy as he seeks to reform
Economy the priority for Catalan election victors
Much has been made of the fact that the CiU nationalist candidate in the Catalan elections, Artur Mas, has said he would vote “yes” in a putative referendum on independence. However, having won the November 28 ballot in resounding fashion, he and his party will be worrying more about the state of the region’s economy than stoking the fires of separatism – at least in the short term. CiU won 62 seats in the regional parliament, up from 48 in 2006 and just six short of an overall majority, enabling it to govern alone for the next four years, although it will need help to push laws through. The governing Catalan Socialists saw their share of seats drop from 37 to 28 and their tripartite … [Read more...] about Economy the priority for Catalan election victors
Spain’s sovereign debt crisis: Round 2
It may look like a replay of last May and June, soaring bond yields and all, but there are some important differences between the current bout of financial market distemper and that of the spring. At face value, it is somewhat worse. The interest rate demanded of the Spanish 10-year bond is about 20 points higher than it was at its most back then, and the risk premium embodied in the difference between the yield on the German bund and the former is 40 basis points greater – in fact at a euro-era maximum. But looking a bit beyond the immediate it is interesting to note that all this activity has not cut into euro exchange rates remotely as much as it did in the spring, that the price of … [Read more...] about Spain’s sovereign debt crisis: Round 2
Spain’s Socialist reshuffle reaches out to left
If Spain’s Socialists manage to engineer an incredible turnaround in the polls and win the 2012 general election, the chances are they will look back at October 21 of this year as the day when the comeback started. Such a result still looks a long way off, but José Luis Rodríguez Zapatero’s biggest Cabinet reshuffle of his six years in power was one of the boldest moves of his career and it looks certain to invigorate a party that was limping along under a leadership with shrinking capital. Zapatero’s seventh reshuffle sees six ministers depart, four new ones arrive, with two changing portfolios and two ministries scrapped altogether. While the scale of the move is noteworthy, the … [Read more...] about Spain’s Socialist reshuffle reaches out to left
A Basque pact to save Spain’s economy
In the spring of 2009, the Basque Socialists (PSE), led by Patxi López, closed a groundbreaking governing pact in the northern region with the Popular Party (PP). It was the first time in the democratic period that the Basque Country was to be governed by non-nationalists and the deal was also remarkable in that it united Socialists with the PP, two parties that on a national level seemed locked in a tribal relationship of mutual antagonism. At the time, many forecast a short life for the new Basque government. This was partly because of the political differences between the two parties in Madrid, but also because of the bitter reaction to the pact on the part of the PNV Basque … [Read more...] about A Basque pact to save Spain’s economy
The strikers who have nothing to protest
There have been a number of signs over the last few months that the general strike called by Spain's two main trade union confederations, UGT and Comisiones Obreras (CCOO), against government economic policy and labour reform is not going to attract as big a crowd as anticipated. The first was that they switched the date of the strike from June to September 29th. The second was when, in late spring, the functionary-specific unions that had invited the leaders of UGT and CCOO, Cándido Méndez and Ignacio Fernández Toxo respectively, to a protest against government pay cuts later declared that neither would be welcome at future demonstrations. UGT and CCOO, it was felt, had attempted to hijack … [Read more...] about The strikers who have nothing to protest
Dark horse Díez races into the limelight
It’s a good time to be an outsider in politics. With the world economy still recovering from recession and politicians struggling to assert their moral credentials, the conditions are ripe for the self-proclaimed rebels to hog the spotlight. In the United States the right-wing Tea Party movement is gathering steam on the back of anger at traditional politicians’ lack of dynamism. In Britain, where an expenses scandal has undermined MPs, neither Labour nor the Conservatives were able to win a majority in the general election. In Spain, Rosa Díez, leader of Unión Progreso y Democracia (UPyD), must be rubbing her hands with glee as she looks at a similarly disgruntled electorate. She … [Read more...] about Dark horse Díez races into the limelight
What now for the “PIGS”?
Spanish savings bank La Caixa recently brought to market a €1-billion issue of three-year cédulas territoriales at 70 basis points over similar sovereign debt. As for the investors – 49 percent of these securities backed by loans to Spanish public administrations were picked up by German or British parties and 36 percent by locals. Given the horrific recent treatment of Greek debt, this benign event probably invites a closer look at the tenets behind the classification of a nation as one of the “PIGS” - as if the mere fact that Spanish sovereign 10-years are yielding approximately the same as when the crisis broke last December, whilst the Italian equivalent pays investors 10 basis points … [Read more...] about What now for the “PIGS”?