The Irish Times
Profligate past overhangs debate about future as Spain gears up for election
Despite four years of cutbacks, tax hikes, PP government still holds poll lead
It has to be the most eccentric roundabout in Spain. On the edge of the town of Navalcarnero, 30km southwest of Madrid, it contains a life-sized Jesus figure, carved out of white marble, on a granite cross.
True to its name, the socalled “Calvary roundabout” also depicts two crucified figures either side of Christ, while the Virgin Mary crouches below and some Roman soldiers look on nearby.
This piece of garish art is rarely seen by most of Navalcarnero’s 26,000 residents, but it cost the town hall ¤212,000. Elsewhere in the town is the more tasteful “Crystal Garden”, a church-like structure of iron and glass designed by American conceptual artist Dennis Oppenheim, which was commissioned for ¤250,000.
For those with more expensive tastes, by the side of the road there is an elaborate bronze sculpture of a bull being dragged away after being killed by a matador. It cost ¤614,800.
All these artworks and many more were bought during the tenure of Baltasar Santos, mayor of Navalcarnero for the Popular Party (PP) from 1995 until spring of this year. Acquired during Spain’s property-driven economic boom, which began in the late 1990s and ended in 2008, these sculptures and other creations were intended to make Navalcarnero a magnet for tourists. But they never came.
Black hole of debt
Instead, it became a black hole of debt and today this small town is ¤200 million in the red. Navalcarnero’s experience over the last decade or so has been more extreme than that of most towns.
But its journey from credit-fuelled spending to crippling debt and crisis makes it a microcosmic version of Spain.
“When we had the property boom and all the land was being sold, that created money, which was frittered away,” says Tomás Márquez, of a Navalcarnero neighbours’ association. “But when the money started to dry up and, above all, the sales of property slowed down, the cuts started everywhere.”
The impact of the bursting of the property bubble and the years of recession and austerity that followed is painfully visible. Next to the town’s bullring, which was completed in 2008 but is only used a few days each year, is an empty plot of land where a new public health clinic was supposed to be built.
“The new clinic has come to nothing,” says José Arquero, another neighbourhood leader. “We’ve also got a huge problem with public transport – it’s amazing that in the 21st century we have such a poor service. The trouble with austerity is that it puts a brake on the economy.”
On December 20th, Spain holds a general election, in which one of the main issues for voters will be whether or not to continue with the policy of deficit-reduction implemented by the PP government of Mariano Rajoy for the last four years. Polls show his party narrowly leading a tight four-way race.
“Sometimes, in order to progress you have to take difficult decisions and you can’t afford to be the nicest guy in the country,” Rajoy told supporters at a campaign event in Pamplona earlier this week, in reference to the spending cuts and tax raises he has overseen.
“After taking those decisions, we can now say that nobody is talking any more about bailouts or bankruptcy.”
The macroeconomic figures do indeed show Spain is recovering, with the European Commission forecasting economic growth of 3.1 per cent this year. Unemployment hit a record high of 27 per cent under this government, but it is now at 22 per cent – marginally lower than when Rajoy took power – and falling.
But while the prime minister insists that the worst is over, the European Commission recently called on Spain to find new savings in order to meet its deficit targets for 2016.
With the euro zone’s fourth-largest economy building a genuine but fragile recovery, there is a huge amount at stake in this election.
“We’re a social democratic party; we’re committed to reducing the public deficit and bringing the public debt under control,” Manuel de la Rocha, head of the Socialist Party’s economic policy, told The Irish Times.
“However, we don’t think that fiscal consolidation can be made at the expense of our welfare state.”
De la Rocha believes socialist governments across Europe have been overly influenced by liberal economic policy in recent years, allowing excesses such as the Spanish real estate bubble to occur. But he hints at a loosening of fiscal policy under a new socialist government, rather than a full-scale reversal of austerity.
“We don’t want a confrontation with Europe,” he added. “We will discuss and negotiate an approach that is realistic, that doesn’t kill our economic growth, that allows us to restore social expenditure.”
The socialists have been vying for the political centre ground with Ciudadanos, a relatively new party which offers regeneration and economic modernisation. Regarding austerity, the newcomer advocates a change of focus, for example cutting back on the country’s often bloated bureaucracy in order to free up spending elsewhere.
“Of course we need [civil servants], of course they need to keep working and we want to save their jobs,” says Begoña Villacis, who leads Ciudadanos in Madrid city hall, in her office. “But we also think that we need to resemble a private corporation a little bit more. A private corporation has to work efficiently because otherwise it will die.”
Few private enterprises have as much debt as Spain. It may not be in as deep trouble as Navalcarnero, but the country’s obligations now total 100 percent of GDP.
Critics of the government also point to the social repercussions of the recent economic crisis, with around 2,000 families still being evicted from their homes every month for failing to keep up mortgage payments.
Such problems are a major concern for Podemos, which burst onto the political landscape in early 2014 with a robustly anti-austerity message that it has maintained during the election campaign.
Divided at core
Pablo Bustinduy, head of international relations for the party, tells The Irish Times Spain’s current economic course is creating a society that is “divided at its core, where inequality is growing, where social exclusion is growing and where the number of millionaires is growing too”.
He adds: “Spain is a rich country; the situation is improving and now it is a matter of what kind of policies, what social model, will we implement in order to distribute the wealth that is being created again.”
In Navalcarnero they are asking the same question. Tomás Márquez laughs as he lists some of the outlandish art that he and other taxpayers have unwittingly financed to decorate the streets of their town.
But his face darkens as he recalls how healthcare and other public services have been dismantled in recent years.
“We’ve suffered a lot here,” he says.
European Commission recently called on Spain to find new savings ‘‘ The trouble with austerity is that it puts a brake on the economy ‘‘ Sometimes, in order to progress you have to take difficult decisions and you can’t afford to be the nicest guy in the country . . . We can now say that nobody is talking any more about bailouts or bankruptcy Spanish prime minister Mariano Rajoy