The Spanish government is using the Autonomous Communities as a smoke screen to hide their disastrous handling of the situation, and use the crisis as an excuse to give Catalonia the coup de grace, eliminate its self government and accomplish the old Spanish dream of a culturally uniform state.
Blaming the Autonomous Communities as the main culprit of the crisis is a ridiculous argument since Catalonia only holds 6.5% of the Spanish public debt while sustaining a fiscal deficit of 8% of its GDP every year without which its finances would be very different. The Catalan Government already did its homework and last year cut its budget down by 10% and has announced further 5% cut in civil servants’ salaries this year.
The Generalitat has raised a flag claiming that the State is planning to look for an excuse to intervene Catalonia by starving it from its resources, forcing the Generalitat’s bankruptcy and then coming to the “rescue”, to prove the Catalan government’s “incompetence”.
In the meantime international press and European governments are worryingly buying the Spanish government’s discourse. Instead on focusing on Spain’s real issues.
After last year’s elections it was time for Spain to reform their oversized state structure inherited from Franco’s regime which has the following traits:
- all power centers are in Madrid with a strong breed of privileged public servants
- economy based on former state monopolies, like Telefonica, used as employment agencies for retired politicians and their relatives with a captive market subsidizing them
- an oversized army
- irrational infrastructures spending
- oversized welfare services aimed at keeping Spanish voters happy bringing an illusion of progress
All of this subsidized by the (formerly) richer Catalan countries and the funds coming from Europe. But for the last 30 years instead investing in the modernisation of its economy Spain has created the biggest real estate bubble in the world. Catalan politicians are also partly to be blamed for allowing this to happen. Now the fountain has dried up. After the draining of resources Catalan countries are in a precarious financial situation and the European funds are not flowing anymore.
But even now the Spanish fiesta goes on. Boosting Catalonia’s economy, its most dynamic area, which represents 20% of its economy and 27% of the exports, would be the only hope for the Spanish economy to get out of the crisis Spain is instead ignoring its own laws and bringing it down.
An example, this year 925 million euros are budgeted for the high speed train to Galicia, which would not even make sense in a good economy while refusing to pay Catalonia 978 million euros pending from 2008 and 2009 and announcing a cut of 45% infrastructures budget in 2012 for Catalonia compared to last year, infringing Spanish law.
But the markets are unforgiving and don’t believe that the changes Rajoy is making will put things under control. The intervention of Spain’s government is practically a matter of time.
Why this irrational behaviour?
In practice Spain does not acknowledge Catalonia as Spanish, it is instead treated as a colony from which to extract resources until depletion. It will not hesitate to sacrifice Catalonia to protect its privileges and state structures from the cold of the crisis even at the expense dooming Catalonia’s, Spain’s (and Europe’s?) economy.