The State of Emergency in Spain

The stupidest parlour game in Spain consists of predicting how long our crisis will last, as if the country were predisposed to tolerate an unemployment rate above 20% for another decade. We are not witnessing an ordinary stagnation, in the vein of Japan’s lost decade, but rather a prolonged emergency. The terrible crisis on Europe’s periphery is not politically sustainable. That even Greece’s far-right LAOS party abandoned government instead of approving further austerity should give us pause. The technocratic governments of Italy and Greece are a warning that status quo threatens liberal democracy.

Conditions in Spain are dire, and are getting worse. Even positive developments abroad (a Hollande win, a red-green coalition in Germany in 2013, a relaxed ECB) will be insufficient to solve the drastic situation in Spain, let alone Greece or Portugal. Our present institutions are incapable of resolving Spain’s three crises (the well-known economic crisis, its judicial crisis, and a less visible crisis of nationalities) in a satisfactory manner.

The crisis of unemployment is by far the most important issue for the citizens of Spain. The PP government is committed to further austerity; an attempt at an internal devaluation. Their proposed labour market reforms are the perfect excuse for demolishing the power of the already diminished trade unions. Their programme of unceasing, unflinching austerity has been discredited by economic reality. But what is hard to fathom is the belief that Spain’s economy will regain its vitality by paying retail clerks now earning 800 euros a month a paltry 600 euros. If low wages were the road to export success, Haiti would be an economic powerhouse.

The misguided attempts to reduce Spanish real wages are directing attention away from a more pressing issue: Spain’s private sector is too indebted. Our financial and real estate sectors comprise a zombie economy. Nothing is worth what the official sector claims. If the issue of excess private debt is not resolved, credit will not flow and the economy will not grow fast enough to restore employment to a sufficient level. Absent a profound restructuring of private debts (probably combined with a return to the peseta and a currency devaluation), this private debt mountain will continue to asphyxiate Spanish economic activity. We can either imitate Iceland or continue along the Greek path that leads to a total social and economic breakdown.

When PSOE and the PP modified the constitution in August to impose a poorly thought out debt brake, they specified that the top spending priority for the government would be to satisfy its obligations to its creditors. To propose any sort of default implies a break with the constitutional order.

Fixing the sorry state of Spain’s legal framework is generally not seen as an equally urgent matter, but this does not diminish its importance. Spain’s modern constitution was negotiated in a context where the military still had its guns on the table. The Spanish transition to democracy successfully reformed this undemocratic military but left the components of Franco’s justice system free to reproduce themselves. Presently, we are can contrast how corrupt PP politicians and the King of Spain’s son-in-law go pathetically unpunished – in Madrid, the Balearic Islands, and Valencia – with the removal of crusading judge Baltazar Garzón from the bench. With the PP’s 60% majority in the Spanish senate, they are now able to name a majority of judges to the Constitutional Tribunal directly. Their justice minister is moving to consolidate this advantage via other means. As with Hungary, both the rule of law and the separation of powers is under attack in Spain. Again, a profound democratic renewal of the constitutional order is required if Spanish democracy is to rest on more solid ground.

The third crisis takes the form of a growing tension between a belligerent, centralizing Spanish nationalism and the different peripheral nationalisms. Spain’s deficient constitutional framework complicates solving thorny regional issues. The composition of the justice system is such that the parliamentary resolution in Spain’s Congress combined with a Catalan popular referendum on a new Statute of Autonomy was unable to alter the federal framework: PP judges were able to topple both a popular and parliamentary majority in highly irregular circumstances. Combined with the new context in the Basque country, where the democratic forces close to ETA have now been legalized, and it is clear that the national question is far from being solved. Regional independence and the dissolution of the Spanish state is not the answer; this does not mean that the current federal configuration is not a problem. Unless resolved, the regional status quo will continue to destabilize Spanish politics.

Full employment, respect for the rule of law, and a new federal settlement are all modest demands. Zapatero campaigned on all three issues over the course of his career. But the PP will guarantee that Spain sees none of the above, while consolidating its institutional hold over the country as things get worse.

Counting on a change in the parliamentary majority, just three months removed from the PP’s crushing victory, will amount to too little, too late. We must not permit a belief in the automatic tendency for parties to alternate in power to obscure the need to reconstruct the alternative and carry out a second democratic transition.

Therefore, the most audacious prescription for Spain is also the most reasonable: we require a Constituent Assembly – a constitutional and institutional tabula rasa, in other words – if we wish to exit the slump quickly.

The crisis threatens to leave a generation of young Spaniards with nothing. The answer is to return to a politics where everything is up for grabs.