These last few weeks if you live in Catalonia you might have seen everywhere around you posters reminding you that the Catalan Generalitat (Government) has issued around 2000 million euros worth of bonds which will yield 4.75% and that Catalans will be able to buy in chunks of 1000 euros, making an excellent opportunity for those with some savings to make a nice profit.
In reality, this shows the dire situation of the finances of the Generalitat. The Generalitat has been sending messages to the population that issuing these bonds is completely normal and that the Generalitat’s solvency is guaranteed, forgetting to mention that the Generalitat has a debt rating similar to Perú (link in Spanish), the worst of all the Spanish “Autonomous Communities”, and much worse than the Spanish one. Only then we realise how issuing the bonds to the general public just a few weeks before the Catalan elections and at such a high interest rate is a desperate move to guarantee the Generalitat’s immediate cash flow.
This happens just a few months after the Conseller Castells and President Montilla assured the Catalan opinion that the new financing agreement reached with Spain is the Generalitat’s best ever financing, forgetting to mention three facts:
- that the best financing we ever had was when we were independent until 1714, before the Spanish invasion and we managed all of our finances and taxes
- that Catalonia suffers a fiscal plundering of approximately 10% of its GDP, publicly recognised by the Spanish Government, which has published data up to 2005 (link in Catalan) and that there’s no other country in the world that suffers a comparable plundering. This plundering has currently been estimated to amount to 22000 million euros in 2009 and equates to approximately 3000 euros for each Catalan citizen.
- that Mariano Rajoy, the leader of Spain’s Partido Popular, the main opposition party, declared on tuesday that Spain will never allow Catalonia to manage their own taxes (and hence reduce the plundering to a bearable level) since Spain would instantly become non-viable (link in Catalan). Therefore implying that Spain’s viability depends on the sustained plundering of Catalonia’s resources.
So, to summarize. The Generalitat is forced to issue those bonds to get 2000 million euros while Catalonia is being plundered 22000 million euros every year by Spain and that the simplest solution to this would be to stop the fiscal plundering that Spain inflicts upon us by achieving independence. On the other hand, we know for a fact that while Catalonia remains in Spain this situation of fiscal plundering of 10% of our GDP is never going to be solved (or mitigated) and that the Generalitat acts purely as a colonial Government hiding the fact that the Generalitat’s finances are in a dire state (and hiding the easy solution to this).
And with the elections coming up in only a few weeks the voting alternatives to achieve independence drastically reduce our voting choices.