Spain: Following in the footsteps of Greece

Fight Racism! Fight Imperialism! 229 October/November 2012

On 6 September, German Chancellor Angela Merkel met Spanish President Mariano Rajoy to discuss the Spanish crisis and issue instructions to her counterpart. On the same day, the European Central Bank (ECB) agreed to buy unlimited debt of any eurozone member which requested financial aid; ECB President Mario Draghi stated that any recipient would be subject to ‘strict conditions’. Four Spanish Autonomous Communities have already requested funds from the central state. It is only a matter of time before Rajoy’s cabinet is forced to request a new bailout. JUANJO RIVAS reports.

A Dutch newspaper has reported an agreement between the ECB and IMF to lend €300bn to Spain, with the IMF imposing the conditions and supervising their fulfilment. The conditions agreed in exchange for aid in June involved reducing the public sector deficit to 6.3% of GDP this year, 4.5% in 2013 and 2.8% in 2014. Inevitably, this will lead to new cuts and the further dismantling of public services, provoking more resistance from a people enraged by so-called ‘austerity plans’.

Having agreed the June €100bn package, European leaders are planning a broader bailout for Spain. As part of the EU imperialist plans, the intention is to develop a fiscal pact to deal with Spain’s sovereign debt crisis. This will have immediate destructive consequences for the provision of social services. Spain will follow the same downward spiral as Greece, where the EU imperialist agenda has proved disastrous for the vast majority of the population.

Part of the fiscal pact has involved Spanish banks borrowing money from the ECB at a 1% interest rate, and then re-lending it to the central state at 6%. As a result, the amount of public debt held by Spanish banks has increased from 12.4% at the end of 2010 to 32.3% in mid 2012. The next step is the creation of a state-run ‘toxic bank’, which will exchange cash for unwanted ‘toxic assets’, mainly properties built during an enormous speculative bubble. Banks will get the cash they need and the ‘toxic bank’ will absorb the loss of assets that on the balance sheet are valued well over the real market prices. Then, the ‘toxic bank’ will either wait until property prices rise to their book value, or, more likely, will split the stock of properties into lots to sell to foreign investment funds. In that case, poor families that lost their homes and are paying taxes to rescue the banks that evicted them will have to rent from European investment institutions the houses they cannot now afford. Spain would again follow Greece, where the ‘men in black’ are already controlling similar processes directly from the Greek Ministry of Economy.

The last few months have seen brutal anti-social measures implemented, such as a 3% increase in VAT, job cuts in the public sector and frozen or reduced wages for many workers. Next is a direct attack on basic human rights to reduce the deficit. Overnight, at least 150,000 immigrants have lost their health care cover; the government has decided that being a resident is not a sufficient condition to be entitled to medical treatment. An indeterminate number of families lacking basic resources have lost subsidies for their children to receive school lunches.

However, the Minister of Education has clearly stated that there will continue to be public funding for private religious schools that segregate students by gender. This shows that some cuts will not take place if they involve challenging the extreme conservative and right-wing ideas held by Rajoy’s People’s Party. For example, the Minister of Justice wants to restrict the right to abortion even in cases of foetal abnormality. Furthermore, well-respected journalists have lost their jobs in state-owned television channels, to be replaced by presenters whose views are much closer to those of the government.

In mid-August, members of the Andalusian Union of Workers (SAT) loaded dozens of trolleys in two supermarkets, left without paying and distributed basic food products amongst families at risk of hunger. Most of the media condemned the action, labelling the unionists as ‘looters’. Some have been arrested. This symbolic action was led by the mayor of the town of Marinaleda in Seville, a socialist municipality with 30 years of history in land occupation, co-operativism and collective decision-making through people’s assemblies.

On 15 September, unions and a range of social movements called for a march to Madrid to rally at a Social Summit. Farmers, miners and workers from all sections of society arrived in the capital on a fleet of about 900 buses to join four contingents that took over the city centre, involving more than 600,000 people. Two days later, an underground and railway strike against privatisation and fare increases caused chaos in Madrid, with 120 kilometre-long traffic jams on the surrounding motorways.

The Autonomous Communities of Galicia and Basque Country have called a general strike on 26 September, before regional elections in October. The crisis has led to a marked increase in nationalism, not just in the new Basque social movement but also expressed in vast demonstrations in September in Catalonia. Part of this nationalism comes from anti-capitalist activism. However, it also involves expressions of chauvinism by regional elites which have to implement austerity plans and cuts in basic services.

Resistance continues everywhere, and hundreds of teachers and students have boycotted the official opening of the school year, heckling politicians and making it impossible for them to deliver their speeches. This practice has spread and many official events are interrupted and politicians silenced by roaring multitudes.

Also, police forces are growing uneasy as some activists have called for crowds to surround Congress on 25 September. Social e-networks are starting to discuss occupying Congress to call for a Constituent Assembly. In response police have tried to infiltrate preparatory meetings, carried out searches, and on the 15 September march arrested three people carrying a banner that read ‘Occupy Congress 25S’. Their growing concern and repression in the last months is a sign that resistance is stepping up and taking on more challenging goals.