The program (available here in English) seems to us to correctly, if unconsciously, identify the problem facing Spain - too much foreign debt causing a collapse in internal demand - and to outline a reasonable, we believe, long term course of action to remedy it. In short form, the country cannot afford to repay all that money with internally generated earnings.
Essentially, the PP intends to foment this end of attracting money from abroad by:
1). Making Spain a more inviting place to in which to invest by simplifying paperwork, by undermining the anachronistic two-union dominated, Franco-era monolith of collective wage negotiations and by reducing impediments to workforce reorganization;
2). Providing incentives to companies willing to enlarge themselves beyond the circled wagons of the Spanish family business - so that they can then avail themselves of the ample assistance to be made available to firms wishing to sell their production internationally.
One way or another, be it through increased exports and foreign investment or through default and bailout, the money must come from outside. Running with the hands down winner of the last few years, the currently too small to carry the load export sector, is the appropriate course of action.
It's also interesting how the party attempts to deal with the banking/real estate morass. As if to write off internal growth for the foreseeable future, the platform proposes reducing the tax burden on personal savings - which are defined so as to include principal residences. Encouraging hoarding in a recession is more than a touch pro-cyclical, but tracing a direct tax route from term deposits to home purchases will eventually take some load off the banking sector.
The chart at the top shows the age distribution of employment over the last number of years. A change of regimen is probably not going to be very well accepted by those in the middle. But at either extreme - the fortunate oldest because they're set up and about to retire anyway, and the unlucky youngest because the current plan just isn't working, resistance might be less than imagined.
On a personal level, voting for a party that is a coalition of about a dozen groups, ranging from pure franquista to modern centrist, united only by their being not-left pains the writer considerably.
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7 Comments:
Horses for courses, I guess, but you get to wear the blinkers.
I don't get a say, but if the PP actually do what their education manifesto on first reading appears to say then I may be able to save quite a lot of school fees.
Horses for courses - sure wish Id remembered that one when I was thinking of a title.
Charles - how much do export today of your olive oil vs the peseta era?
How much of that has to do with currency value.
I just cannot see, very likely because I am blind, how exporting can become a major venture with the euro how it is.
Manufacturing is virtually gone from this country.
Olive oil's a bad example in one sense. Most of the country's production is and has always been "exported" - in bulk to Italian bottlers for re-export.
It's a good example in the sense that the main problem may not be the euro, labour costs or anything else economic. My personal theory is that it's a country of homeboys that lose their swagger and start cowering once they drift south of 95th Street, so to speak. Hence, sell cheap to people who don't fear the ultramar.
Proof's in the pudding, Ole Miss. It's the only large EZ country able to come remotely close to keeping up with Germany on an export share basis.
"homeboys that lose their swagger and start cowering once they drift south of 95th Street..."...that was pretty good.
Actually, even though I love that 95th street expression and find it true mentality-wise, I think it is misleading (yet I'm pretty sure that is not intentional).
The homeboys only try to get their piece of the cake. There is little more to Spanish politics than those who are in administration trying to get the most cash benefit out of their position for themselves and their cronies.
If geographic distance does not fool me, I think to observe that this attitude is not afar from the one taken in the US; the main difference being that the US goes to wars about it.
Ayyy, the power of the metaphor.
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