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An update on Spanish politics

Politics is often a topic of conversation among Spaniards, but also among many expats in Spain. Here is an attempt to explain the current situation in Spanish politics.

Mariano Rajoy and Pedro Sanchez.

Mariano Rajoy and Pedro Sanchez.

After the election on 20th of December 2015 Spain is in a political stalemate. A new election was held on 26th of June 2016 and resulted in a victory for the conservative party Partido Popular, but the victory was not enough to break the unclear political situation.

Thus Spain is now being managed by a caretaker government with limited powers. The government can not adopt new laws and they don’t have the mandate to submit a budget proposal for 2017. Without the budget Spain can not establish the expenditure ceilings contained in aid packages from the EU. In that case, the country is threatened with huge fines and withdrawn aid packages. (But new signals from the EU suggests that there is an understanding in the EU for Spain’s situation regarding the budget.)

On Friday Partido Popular leader Mariano Rajoy failed to get a majority in a confidence vote in the parliament. Rajoy who had made an agreement with the center liberal party Ciudadano, needed a majority of the votes cast, which he didn’t get. Spain therefore seems to go against its third parliamentary election in one year. According to the existing regulations, the election will be held on Christmas Day.

Albert Rivera, Ciudadanos. Photo: Carlos Delgado.

Albert Rivera, Ciudadanos. Photo: Carlos Delgado.

The agreement between PP and Ciudadanos entails stringent measures against corruption while the judicial system will be freed from political control. Corruption was a major reason why the new political parties Ciudadanos and Podemos grew and got seats in parliament in the elections last December.

Socialist Party PSOE could have helped Rajoy, but did not. But PSOE with their leader Pedro Sanchez plays for high stakes. If the Socialists are seen as the main culprit for the political paralysis to continue, it could strengthen both Podemos and Partido Popular in the next election.

Ever since democracy was reintroduced (In November 1976 general elections were announced, and two years later a democratic constitution was introduced) after Francisco Franco’s long dictatorship, Spain has had a two-party system in which the Conservative and the Socialists have been alternating in government, but this was radically altered in the election on 20 December 2015.

Pablo Iglesias, Podemos. Photo: Podemos.

Pablo Iglesias, Podemos. Photo: Podemos.

The next opportunity to get out of the deadlock will be the 25 September when there is a regional election in Galicia and the Basque Country. Rajoy is hoping that the Basque nationalist party PNV will be forced to cooperate with PPs Basque branch and then Rajoy can count on the support from PNVs five MPs. In that case only one abstention from the opposition would be required to give the Government confidence.

The politicians and the political parties now have a few weeks to take responsibility and give Spain a government. King Felipe VI reiterated earlier this week his earlier call for a compromise. There is also no guarantee that a new election would resolve the situation. According to the constitution, there are no limits to how many new elections that can be held.

Spain is not the only country in Europe which has been without a government. Belgium has the world record. In 2010-2011 Belgium was without an elected government for 589 days. Let’s just hope that Spain will not break that record.

Growth after all

Spain currently has 3% growth without a government.Gridlock in parliament means Spain has only a caretaker government. Voters face a third general election in quick succession later this year, but in the meantime the economy is moving along quite nicely.” writes CNN Money. The past 15 months the country has had a growth of three percent, a strong improvement since the country’s banking crisis four years ago. “Not only has the economy been on autopilot, but it’s gotten a boost from the fact that fiscal policy is looser than it otherwise should have been” said Stephen Brown, an economist at London-based Capital Economics told CNN.

See also: The Spanish election (from the election in June 2016)

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