9

The PP had its best results ever in the 2011 general election and Mariano Rajoy became PM (presidente). The PP’s campaign was designed around Zapatero’s mishandling of the economic recession and his implementation of cutbacks. Rajoy’s electoral pledge was to improve the economic situation, create jobs and stop the austerity measures.

9.1      ECONOMY: BANKING CRISIS. MORE AUSTERITY MEASURES. SOCIAL INEQUALITY. ECONOMIC RECOVERY

As a result of the bursting of the housing bubble and the recession that ensued, unemployment soared. It reached close to 26% by 2012. Many families who could not afford their mortgage repayments any longer were evicted from their homes. As a consequence, banks accumulated a portfolio of ‘toxic assets’, that is, properties that had been repossessed and that they could not sell due to the stagnant property market. They started to run out of liquidity and the government had to resort to public money to rescue them, but it was not enough. The worst case was Bankia, where a hole of €23 billion was found. In 2012 the government had to request a credit from the EU amounting to €100 billion. Although the government was adamant this loan was not a sovereign debt ‘bailout’, as in the case of Ireland, the consequences were the same. The loan was to be repaid by the taxpayers, not by the banks which had been rescued.

Rajoy, had to implement a harsh austerity policy in order to reduce the public deficit:

• Introduction of ‘copago’ for pensioners. Until then pensioners had had free access to medicines. This measure meant they had to pay 10% of the price of all their medicines with a maximum of 10 euro.
• Restrictions on health care for undocumented migrants. Their health cards were withdrawn. Only pregnancy care, children’s health services and emergencies remained free.
• Cutbacks in education: increase in the number of students per classroom, longer teaching hours for teachers, increase in university fees and reduction of university grants.
• Funding for research was slashed.
• Retirement pension cuts.
• Cuts on social benefits.
• An increase in taxes and VAT.

The government also embarked on a series of labour reform programmes whose main objective was to create a flexible job market. By adapting labour conditions to the needs of the market the unemployment rate started to decrease slowly from 2013 onwards. More temporary contracts with lower salaries became available. A new term entered the employment market: zero-hour contracts, and a new concept entered many people’s lives: precariousness. A person can be in employment and still find it difficult to cover their and their families’ basic needs. Paid sick leave and paid holidays seem to be no longer a right, but a luxury.

In Spain and many other countries, the crisis hit the middle-class, the people with low incomes and the jobless hardest. NGOs and charities started to warn about an increase in inequality, exclusion and marginalization that was threatening to break the social cohesion achieved in Western Europe in the heyday of the welfare state. For the first time in many decades queues outside food banks and soup kitchens became a common sight. Citizens looked at politicians with suspicion. Many did not agree with the way they had to shoulder the banks’ mismanagement whilst executives, shareholders and the wealthy, in general, not only did not get punished but became even richer. In Spain protests organised by the ‘mareas’ and other civic platforms were a regular occurrence and in 2015 Rajoy’s government decided to confront these displays of civil discontent by introducing one of the most controversial laws since the advent of democracy in Spain: Ley de Seguridad Ciudadana (Public Safety Act), widely known as ‘Ley Mordaza’ (‘Gag Law’). This law established hefty fines for the organizers of these protests and severe penalties for protesters confronting police officers on duty and demonstrating outside politicians’ homes or public buildings. Taking and disseminating images of police officers during demonstrations are also penalised and police statements are always taken at face value. The critics of this law consider that it contravenes the fundamental democratic right to freedom of expression.

In 2014 Spain started to come out of the recession, but the austerity measures have taken their toll and the future is still very uncertain.

9.2     MAKING PEACE IN THE BASQUE COUNTRY

A singular ‘peace process’ took place in the Basque Country. Its singularity lay in the fact that it was driven by the political party that had supported ETA for decades, Batasuna. With the PP in government, trying to engage in a dialogue to end the violence in the Basque Country was futile. The PP prided themselves on having a hard line against the organisation aiming at a its total defeat. Also, several associations of ETA victims had become significantly influential and were very vocal against establishing any kind of dialogue with ETA or reversing any of the harshest penitentiary measures implemented against ETA prisoners, such as dispersion, once the 2011 ceasefire was in place.

The Basque Nationalist Left (Batasuna) had nurtured close international contacts for decades and, once they concluded that senseless violence had gone too far and that politics should take over, they resorted to these contacts to make progress. The 2011 Aiete Conference in San Sebastian was one big step that had produced a permanent ceasefire that looked very solid. Dozens of Basque politicians and other citizens threatened by ETA, who had to live their daily lives in the company of bodyguards, could now lead a normal life. An International Verification Commission for the Ceasefire in the Basque Country (IVC) was established. In 2014 the IVC travelled to the Basque Country and confirmed that ETA was willing to put their arms beyond use. Rajoy’s government considered the IVC with suspicion and hostility. The IVC members found it hard to believe that a government who was being offered a peaceful way out of a long and bloody conflict was unwilling to make any moves to facilitate it. Regardless of the government’s attitude and despite further arrests of ETA members taking place, the organisation went ahead with this unilateral peace process and in 2017 disclosed the location of their weapons caches in the French Basque Country. The French police confiscated 3.5 tonnes of arms and explosives. In 2018 ETA announced its full dissolution.

The conflict is not entirely over. There are some 260 prisoners dispersed in Spanish and French prisons, some of them suffering from serious or terminal illnesses. There are also around 300 Basque refugees and exiles living abroad. The French government appears to be open to a review of the situation of ETA prisoners in their territory, but Spain is finding it difficult to take any political action that might infuriate the associations of ETA victims.

Meanwhile, Basque society is coming to terms with the suffering and damage caused by decades of violence. Unsurprisingly, there are different, and frequently opposite, views when it comes to the nature of the conflict, who can be considered a victim and whether the Basque Country has a right to decide on the issue of independence.

9.3     THE CATALAN CONFLICT EXPLODES

The Basque Country and Catalonia are the two territories in Spain that have harboured fluctuating aspirations for independence for decades, if not centuries. Whilst in the Basque Country those aspirations turned violent, Catalonian nationalism seemed to run smoothly within the political arena.

By the early 2000s, the Catalan government (Generalitat) considered that the 1976 Statute of Autonomy needed upgrading and, during Zapatero’s mandate, they embarked on drafting a new statute that would have to be approved in both the Catalan and the Spanish parliaments. Control over taxes was one of the most important issues that the Catalan government wanted to reform. The Basque Country and Navarre have full fiscal control since the Transition, due to a specific arrangement based on legal charters of old, known as ‘fueros’. This was not the case with Catalonia, that had the same fiscal arrangement as the rest of the autonomous regions; that is, most taxes within the region were collected by the State, which would then finance the needs of each region. The draft statute approved by the Catalan Parliament in 2006 fell short of the aspirations of some nationalist parties but managed to establish that 50% of the VAT would be collected and administered within the region. Since all regional autonomies are entitled to the same fiscal treatment, with the exception of the Basque Country and Navarre, this reform was applied to all of them. The draft statute moved to the Spanish Parliament for consideration and was approved after having curtailed some of the articles already approved in Catalonia. This was the beginning of the breakdown in the so far cordial relationship between Catalonia and Madrid. To add insult to injury the opposition party PP took the document to the Constitutional Court, which eventually ruled that 14 articles were unconstitutional and vetoed the use of the term ‘nation’, referring to Catalonia, everywhere in the document except in the preamble.

The economic crisis unleashed in 2008 acted as a catalyst for the conflict that was to unfold. By 2012 Catalonia, immersed in debt, had to be bailed out by the Spanish government. Catalonia is the region with the highest GDP in Spain and many Catalans concluded that Catalonia was contributing far too much to the Spanish coffers and that Catalan income was leaving Catalonia to benefit other regions. On 11 November 2012, the Diada (national day of Catalonia), a million and a half Catalans marched on the streets of Barcelona, as it is typical on this date, but this time clamouring for independence.

The following year the Catalan National Assembly (a civic platform founded in 2012 to promote Catalan independence) organised a human chain running 480 Km from north to south in Catalonia in favour of independence.

Until 2013 the pro-independence movement in Catalonia was a grassroots mobilization that was gathering momentum. In view of the situation, the Catalan government at the time, in the hands of the conservative nationalist party CiU, decided to get involved in the movement for independence, especially since Scotland was organising an independence referendum for September 2014. Unlike in the case of Scotland, the Spanish Constitution firmly establishes the indivisibility of the Spanish state and, therefore, any referendum on independence is illegal. Nevertheless, the Catalan government organised a symbolic consultation (banned by the Constitutional Court) for November 2014. Two million people out of six million on the electoral register voted. The result was 80% in favour of independence.

A regional election took place in 2015. The pro-independence coalition Junts pel Sí won the election. Carles Puigdemont took office as the Catalan First Minister. The relationship between the Spanish government led by Rajoy and the Catalan government became strained to the limit. Rajoy refused to have any communication with Puigdemont, despite the latter’s requesting a meeting repeatedly. From this point onwards the Catalan government (a coalition of the main nationalist parties), the Catalan National Assembly and the Catalan cultural association Òmnium worked on a road map to make possible a unilateral referendum, which was finally scheduled for 1 October 2017.

In the run-up to the referendum Catalan society became divided between feisty defenders of an independent Catalan republic, angered anti-independence protesters and bewildered spectators of a situation that was getting out of hand. Nearly 4,000 companies moved their headquarters out of Catalonia. The Spanish government braced itself for the coming referendum by deploying 10,000 extra police and Guardia Civil officers to the region and confiscating ballot boxes and papers.

On 1 October the illegal referendum took place. Ugly images of police brutality against the voters went viral around the world and portrayed the Spanish government as having lost control of the situation and having to resort to undemocratic practices. The Mossos d’Esquadra (regional police force) and the Catalan government fire fighters tried to protect the voters.

According to the Catalan authorities, the turn out for the referendum was 43%, with 90% voting in favour of independence. A few days later First Minister Puigdemont delivered a speech in Parliament assuming the mandate to declare an independent republic but suspending the declaration to facilitate a dialogue with the Spanish government. The pro-independence crowd waiting outside the Parliament moved from exultant joy to deep disappointment in a matter of seconds.

As a result of the declaration, the Spanish government imposed direct rule on Catalonia deposing Puigdemont and his government and dissolving the Catalan Parliament. The head of the Mossos d’Esquadra was dismissed from his post, despite having been praised recently as a hero for the way the Mossos handled the jihadist attacks in Barcelona and Cambrils the previous August (see below). Puigdemont and other members of government were charged with rebellion, sedition and misuse of public funds. Puigdemont fled to Belgium. The Deputy First Minister and leader of the left-wing nationalist party ERC, Oriol Junqueras, and others were arrested and taken to prison. New regional elections were scheduled for December 2017. The pro-independence liberal coalition Junts per Catalunya won and Puigdemont was re-elected with the votes from the pro-independence left-wing party ERC. Since he was exiled, Quim Torra became First Minister.

In 2019 the Supreme Court tried 12 Catalan politicians and leaders involved in the organisation of the referendum. They were given prison sentences ranging between 9 and 13 years. The sentences triggered days of protests in the streets of Catalonia.

9.4      THE END OF THE TWO-PARTY SYSTEM

On December 2015 a general election was due. Rajoy’s PP obtained the largest number of votes (28.7%) but lost 64 seats in Parliament and was unable to form a government. The Socialists (PSOE) came second (22%) but they also suffered losses, 20 seats fewer that in the previous election. Two new political parties had contested the election this time and had reaped excellent results, especially the left-wing Podemos (We can), which obtained 20.7% of the votes and 69 seats. The other newcomer was the centre right Ciudadanos (Citizens) with nearly 14% of the votes and 40 seats. This result heralded a new era in Spanish politics. The two-party system was giving way to a multi-party system in which governability would only be possible through alliances and coalitions between parties. Decades of disappointment with the two major parties, involved in a string of corruption cases, had paved the way for new parties led by a younger generation.

Ciudadanos (Cs) was founded in Catalonia in 2006 to confront Catalan nationalist parties. Its leader is Albert Rivera. Cs performance in regional elections was poor until 2015 when they became the second largest party in the Catalan Parliament winning 18% of the votes. Since 2015 they have also become an important player in general elections. Cs have often claimed that they are neither left not right, but their political manifesto falls into the centre-to-right spectrum, and it is not very different from the PP’s. Their economic ideology is strongly neoliberal, favouring free markets and a minimum intervention on the part of the State in economic matters. Their view of Spain is as a centralist nation-state. They oppose Catalan nationalism and, at times, have spoken against the regional arrangement in place in Spain since the Transition.

Podemos was founded in 2014 by leftist lecturers from the Department of Politics and Sociology of the Universidad Complutense in Madrid. One of them, Pablo Iglesias, is the charismatic leader of the party. The party was inspired by the 15M (the ‘movimiento de los indignados’) and considers itself a transversal political movement, that is, its ideology is not explained by the traditional right/left dichotomy. They rather see themselves as a party able to agglutinate people who consider themselves ‘outsiders’ in the current neoliberal system that favours the elites, and want to challenge the established hegemonies in all spheres: economic, social, environmental, gender, race, etc. In any case, in the traditional political parlance, they can be safely considered a left-wing party. They are in favour of increasing taxes for the big corporations and the wealthy, strengthening social services, building a society where women achieve full equality with men and implementing efficient measures to save the environment. Their view of Spain is as a multi-national state.

Podemos entered the electoral arena in the 2014 European Parliament election and, to everybody’s surprise, took nearly 8% of the votes in Spain, winning 5 MEPs. Since then, as is the case with Ciudadanos, they have played an important role when it comes to building alliances to facilitate the formation of a government.

After the 2015 general election, the different political parties were unable to reach any agreement to elect a PM, and a new general election was scheduled for 2016. The new election yielded very similar results, with a slight improvement for the PP. After long negotiations, Mariano Rajoy was finally elected as PM, with the support of Ciudadanos. Between the 2015 general election and the inauguration of Rajoy as PM in 2016, nearly a year (314 days) had elapsed without a government.

9.5      INSTITUTIONAL CORRUPTION AND GOVERNMENT’S FALL

Rajoy’s mandate was to be brief. Although he survived a vote of no confidence registered by Unidas Podemos in 2017 over the corruption scandals the PP was involved in, a new vote of no confidence in 2018, finally ousted him from government. The successful motion was tabled by the leader of the opposition party PSOE, Pedro Sánchez, and was supported by the rest of parties in Parliament with the exception of Ciudadanos, which ironically had condemned the PP repeatedly over its corruption scandals. The vote took place a few days after the Audiencia Nacional (High Court) announced its verdict on the Gürtel Affair, a wide and intricate system of kickbacks-for-contracts, and sentenced several former members of the PP to prison. The court found the whole party had benefited from this ‘system of institutional corruption’.

The Gürtel case was just one of many cases of corruption and misconduct linked to institutions and political parties, especially the PP, for decades that have not even left the monarchy untouched.

In 2011 King Juan Carlos I’s son-in-law, Iñaki Urdangarín, was accused of being involved in the Nóos case. Urdangarín was one of the directors of the Nóos Institute, a non-profit organization providing consultancy services. He was charged with misappropriation of public funds, fraud, tax evasion and trading in influence. He has been shunned by the royal family, but both his wife and former king Juan Carlos I have been tainted by this affair. He was sentenced to 5 years and 10 months and entered prison in 2018.

In 2012 King Juan Carlos was discredited even further by a hunting trip he made to Botswana, which only became public after he had broken his hip and had to be airlifted back to Spain. He was bitterly criticized on ethical grounds by the press, opposition parties and the citizenry in general. At the time Spaniards were suffering the worst of the economic crisis and were bombarded with austerity measures and his pleasure trip did not go down well. Besides, he appeared in a photograph posing in front of a recently killed elephant, which lost him his position as honorary president of the World Wide Fund for Nature. If all this was not shameful enough, his lover had accompanied him on the trip. Despite apologising publicly for his behaviour, the royal institution had suffered an irreparable blow to its credibility. In 2014 King Juan Carlos I abdicated the throne in favour of his son Felipe VI, the current King of Spain.

Another high-profile corruption scandal involved the misuse of corporate credit cards, known as ‘black cards’, by the then president of Bankia, Rodrigo Rato, and other executives of the bank, just before the institution’s fall and bailout in 2012. Rato was a prominent figure in the PP and had been Finance Minister and Deputy Prime Minister in Aznar’s government, and managing director of the IMF (International Monetary Fund). He was tried and sentenced to four and a half years in prison in 2018.

Although the PP is the party with the greatest number of corruption cases being investigated, most other parties, both national and regional, are no strangers to corruption. In recent times, Socialist politicians have been involved in corruption scandals in Andalusia and Galicia, and back in time, under Felipe González in the 1990s, the then Deputy Prime Minister had to resign after a case of trading in influence. The general impression is that corruption and misconduct in public office is endemic to the system and very difficult to eradicate.