Iberia’s Spanish stalwart!

A cheery welcome to you dear reader! Thank you for your gracious perusal of my blog!

This will be the first article to appear dedicated entirely to the political situation in Spain since my adoption of this fascinating and often quixotic land as my home. As I write, I’m listening to La Isla Bonita by Madonna for added inspiration.

Since I arrived last summer, I have been struck by the similarities politically between Spain and the UK. Both are facing separatist challenges in Catalonia and Scotland. They are both governed by dominant conservative, right wing governments who prioritise austerity measures in handling their respective economic challenges and both have seriously weakened and divided left wing political parties.

However, I’m going to park the comparison for the time being and talk about Spain. Last month the long serving Prime Minister, Mariano Rajoy, was re-elected the leader of his governing Popular Party (PP) at a special party congress with a thumping 96% of the vote. He faced very little in the way of serious challenges to his iron grip on the Party. A phlegmatic, dour and stolidly stubborn man this unprepossessing politican has seen off many of his internal and external opponents and outlasted the predictions of many. Whether that is due to his and his advisers’ political skill or the self destructive tendencies of the opposition is a subject of much debate.

This crowning coronation as head of PP is a far cry from his situation a year ago. Faced with an inconclusive December 2015 election and questions about his political strategy  even some within the often obedient PP were beginning to raise concerns about his continued leadership of the country and Party. I’m fortunate in having spoken to a wide cross section of Spanish society, from investment managers and scientists to lawyers and students, and the general consensus is one of contempt and suspicion of not just Señor Rajoy but the political class in its entirety.

It often surprises me how weak and lacklustre the opposition PSOE, Podemos and Ciudidanos parties have been in taking on the Spanish leader. They had a golden opportunity following December elections but failed to make the compromises necessary to form a viable alternative to PP. Famously the PP merely sat back and watched, and the mercurial Prime Minister was able to return back to office in a following election last June.

However, the ECFR (European Council on Foreign Relations) think tank, based in Madrid, recently dubbed him the ‘Merkel of the South.’ Undeniably he has survived in office for what passes as a long time in Europe nowadays (he has been in office since 2011) his counterparts in the U.K., France, Portugal, Italy, Greece and Poland have all chopped and changed. Only the previously referenced Chancellor of Germany, Angela Merkel, has been around longer. He has plotted an economic course based on orthodox   Adam Smith inspired policies on economic growth and taxes. This fiscal discipline has arguably brought Spain stability and solid GDP figures. According to the latest data from the Bank of Spain, the GDP growth rate for 2016 was 3.2%, matching the 2015 statistics. Favourable low oil prices and buoyant tourism figures were seen as key contributors to this success El Pais, the respected Spanish newspaper, reported.

When Mr Rajoy took power in 2011, the economic crisis was biting hard and thanks to generous giveaways and largesse the previous Spanish government had been forced to begin talks with the IMF and European Central Bank for a fully fledged bailout of its economy. This, fortunately, did not come to pass but Spain still had to accept financial assistance for its banks from the European Stability Mechanism (ESM)  and take harsh public spending cuts and carry out tax rises to stave off a Greek style crisis. In this the Spanish Prime Minister can take some credit but it has come at a great cost for classroom sizes and the provision of doctors.

I will now elaborate a little further and show you that all is not rosy in Spain. Whilst overall unemployment is coming down, although it remains a shocking 18.2% (the second highest in the EU after Greece) youth unemployment in Spain is chronically and persistently high. Eurostat, the EU’s official statistics office, highlights an eye watering 42% of Spain’s youth remains out of work. The increase in tourism numbers should be welcomed but it must be noted that the jobs in this sector are often highly seasonal with little security and few long term prospects for educated graduates. The remedy for this shocking and truly wasteful situation is for serious labour market reforms, which include opening up the job market for young people and making it far more inclusive for them, in particular whilst they study. Unfortunately, given that the ruling party relies heavily on the older generations for votes it is unlikely to hurt its core constituency and undertake this fundamental reform any time soon.

Aside from the economy Spain also faces a D-Day moment with the constantly grumbling Catalan nationalists this year. The authorities based in Barcelona plan to hold a referendum on independence in September. Not only have the federal government in Madrid and the EU given a firm no to the plan but the Constitutional Court in Spain has also ruled it is a flagrant violation of the Spanish Constitution and declared the poll illegal. The Catalans seem determined to single mindedly pursue this disastrous course and the latest numbers from the regional government show that 45% support secession and 46% are against. The Spanish government strategy has been uncompromising and that is understandable but to really pull the rug from underneath the carpet of the Catalans it might worth calling the bluff of the secessionists and avoid making them into some form of martyrs. The polls show the government in Madrid might actually win such a high stakes gamble.

The last point I want to address is the international profile of Spain. Since the Eurozone crisis hit in 2008 Spain has been a pygmy on the international stage. Long again the Spanish government had established an Alliance of Civilisations which aimed to bridge the gap between the Western and Islamic worlds and Spain hosted several summits to this affect. It also remained the EU’s main point of contact with Latin America, via its Ibero-American Summits organisation. It has since, justifiably I feel, focussed attention on restoring its economy. However, with populism on the march in Europe and America, and the distractions of critical European elections in France and Germany (possibly Italy) Spain has a unique chance to help lead Europe. Mr Rajoy is charmless and drab but those could be qualities when held up against the unstable likes of Donald Trump. The appointment of Alfonso Dastis, a former Ambassador to the EU, shows Mariano Rajoy recognises this, and in subsequent telephone calls with the new US President Señor Rajoy has offered himself as an interlocutor between the US and Europe. It remains to be seen however, if the Spanish leader can rely on his still fragile minority government too keep him in power beyond the next year, let alone provide the much needed and testing leadership that we currently need in Europe.


The Trump Train!

Welcome dear reader,

It’s been a while and I apologise for that. However, now I’ve requested forgiveness it’s time to get on with the show as they say!

So, unless you’ve been living under a rock for the past few weeks you might have noticed a change emanating from the USA. How different it all seemed just months ago, the USA was a beacon of progressive values, with an African-American President and a woman poised to succeed him.

Instead we have the oldest, richest and ‘white-est’ administration in history of the USA. Lead by President Donald Trump and his cronies. For liberals and progressives this is a nightmare. There are a number of points I want to address but I’d like to avoid intruding too much on your precious time dear reader and concentrate on what I consider the more salient points of this new Presidency.

Since it took office the Trump government has been a disaster. Policy missteps included the introduction of a botched ban on Muslims and refugees entering the country. It wasn’t just the idea of this ban that was crazy but the rollout was cack handed and clumsy to say the least. Foreign governments in Europe (most strongly France and Germany and sadly and somewhat belatedly the UK and Spain) and Canada condemned such measures and the European Parliament recently voted to scrap a visa free travel privilege for Americans visitors. As the excellent Young Turks online news show reported the USA already had an average of 18-24 months vetting process for new arrivals, one of the longest in the world. Questions were legitimately raised about the policy, as it targeted only seven Muslim majority countries (like Sudan and Iraq) yet it failed to incorporate notable wealthy Middle Eastern states, such as Saudi Arabia and the UAE, where it is speculated Mr Trump has a network of close business ties. The ban is now in legal limbo after the US courts intervened and suspended the implementation of the ban over possible violations of the US constitution. Chaotic scenes then ensued at airports around the country as officials struggled to catch up with the court orders. The government is now seeking to refine the policy and resurrrect it, however aside from the dubious moral reasoning behind this misguided policy the President has failed to see the obvious economic damage from such a scheme. Kayak, the online travel agency has reported dramatic declines in flight searches and bookings since Mr Trump’s January inauguration, some of about 50% and 30% to key US resorts such as Orlando and Las Vegas. The Global Business Travel Association has stated that the ‘Trump Slump’ has already set in and the USA has missed out on $185 million since January. Oh my goodness!

Alongside this a cloud has hung over Donald Trump’s and the Republican Party’s victory in November and substantive, damaging claims, made not least of all by the FBI, of Russian interference in the process to swing the result Mr Trump’s way. In February, the evidence laid out by the US’s own intelligence agencies claimed its first scalp when the New York Times first reported potentially indiscreet conversations between the US National Security Adviser, Michael Flynn, and the Russian Ambassador, Sergei Kislyak. Mr Flynn swiftly resigned and Mr Trump went on a verbal tirade aganist the media and his own security services for leaking the information. His Attorney General, Jeff Sessions, is now in the spotlight and feeling the heat over similar contacts with the the Russian envoy. He may yet be forced out too, if the opposition Democrats get their way. Mr Trump has not helped his case by equivocating on sanctions against the Russians over their illegal invasion of eastern Ukraine in 2014, and for his often gushing expressions of praise for the Russian leader, Vladimir Putin. This relationship it is rumoured is based on alleged serious conflicts of interest over Mr Trump’s business ties and the speculative allegation of inappropriate sexual behaviour with prostitutes on a trip to Russia four years ago. This has already provided rich materials for late night satirists and comedians, such as Seth Meyers and Stephen Colbert, who have seen ratings for their shows peak in recent weeks. However, aside from the comical angle, it raises some serious concerns for European governments and the potential for Russian meddling in crucial elections in the Netherlands, France and Germany, where nationalists and populists are seeking to ride a wave of poisonous victories which began last year with the Brexit vote in the UK. A great source of shame for me as a nominal Brit.

The other concern is the repeated attacks against the press. Now, they are big boys and girls, and the truly experienced journalists can take the constant jibes about “fake news” by the President in their stride. Indeed, it would be strange to find any Western leader who enjoys the scrutiny the media brings and the media wouldn’t be doing its job properly if the relationship were too cosy.  However, tell tale signs of hostility and contempt for journalists were most vividly on display during the campaign when Mr Trump publicly and disgustingly mocked a respected reporter for his disability. Fast forward a few months and we now have cherry picking of selected right wing bloggers and story tellers (Breitbart and InfoWars comes to mind) for privileged access to the Trump team, and now the more serious barring of long serving and reputable members of the press (such as The Guardian, Buzzfeed, CNN and the BBC) raise serious doubts about the commitment to democracy by the President and his advisers.The First Amendment of America’s cherished Constitiuon has never looked more threatened.

It is not just me or the outside world who looks on with horror, at this car crash Presidency as it unfolds, but according to Gallup (the respected polling agency) 51% disapprove of the President’s job performance, against 44% who approve. This is a historic low for any US President so early into his term in charge of the country! Everybody fasten your seatbelt, the ride is about to get bumpy and lest we forget that we are only a handful of weeks into this “new era.”