Don Quijones — Spain Just Lit a Fuse Under Catalonia — its Richest Region

But while jailing Catalonia’s elected government may be justifiable by Spanish law and will probably go some way to placating the more revanchist elements of the Spanish public, it will also further inflame tensions and polarize divisions within Spain’s north eastern region while doing yet more damage to the tattered image of Spanish democracy in the rest of the world. It also risks exacerbating economic uncertainty and instability in Catalonia, Spain’s richest region.

Just when things appeared to be returning to some semblance of normality as local people and the region’s political parties turned their attention to the regional elections scheduled for December 21, Rajoy, his government, and the judges they help appoint just lit a fuse under the region.…

Spain’s central bank yesterday warned that the current crisis could, in the worst case scenario, end up shaving 2.5 percentage points off Spain’s GDP in the next two years....

In short, Spain’s economy is perhaps not as robust as recent growth figures may suggest. Unemployment, already at 17.1%, surged by 58,000 in October as the number of highly seasonal tourist-dependent jobs began shrinking. Market-entry salaries are 14% lower than they were in 2008.

Worse still, the economy’s recent show of strength was based on three main pillars: consistently low global energy prices, the large-scale diversion of tourists from geopolitical hot spots like Turkey and Egypt, and dirt cheap public debt resulting from Mario Draghi’s massive binge-buying of euro zone sovereign bonds. And all of these pillars are beginning to show signs of strain. As tensions continue to rise in Catalonia, the economic uncertainty digs in for the long haul.

Shades of the civil war that brought fascist Franco to power? Is history rhyming?

Wolf Street
Spain Just Lit a Fuse Under Catalonia — its Richest Region
Don Quijones

Bill Mitchell — Europhile Left deluded if it thinks reform process will produce functional outcomes

A recent twitter exchange with some Europhiles who believe that it is better to wait for some, as yet unspecified, incremental reform process for the Eurozone rather than precipitate exit and the restoration of currency sovereignty was summed up for me by one of the tweets from Andrew Watt. In trying to defend the abandonment of sovereignty and make a case for continuing with the so-called reform dialogue, he wrote (October 27, 2017): “Unemployment in “periphery” was v hi before €. Fell rapidly. Then rose sharply, has now fallen somewhat. So picture very mixed.” I found that a deeply offensive claim to make and responded: “It is not a mixed picture at all. Youth unemployment has never been as high. Greek unemployment was never > 12%. Now > 20% indefinitely.” I also attached a graph (see over). I think this little exchange captures the essence of the delusion among many in the Left that we document in our new book – Reclaiming the State: A Progressive Vision of Sovereignty for a Post-Neoliberal World (Pluto Books, 2017). The Europhiles maintain a blind faith in what they claim to be a reform process, which when carried through will reduce some of the acknowledged shortcomings (I would say disastrously terminal design flaws). They don’t put any time dimension on this ‘process’ but claim it is an on-going dialogue and we should sit tight and wait for it to deliver. Apparently waiting for ‘pigs to fly’ is a better strategy than dealing with the basic problems that this failed system has created. I think otherwise. The human disaster that the Eurozone has created impacts daily on peoples’ lives. It is entrenching long-term costs where a whole generation of Europeans has been denied the chance to work. That will reverberate for the rest of their lives and create dysfunctional outcomes no matter what ‘reforms’ are introduced. The damage is already done and remedies are desperately needed now. The so-called ‘reforms’ to date have been pathetic (think: banking union) and do not redress the flawed design. And to put a finer point on it: Germany will never allow sufficient changes to be made to render the EMU a functioning and effective federation. The Europhile Left is deluded if it thinks otherwise.

Bill Mitchell – billy blog
Europhile Left deluded if it thinks reform process will produce functional outcomes
Bill Mitchell | Professor in Economics, University of Newcastle, New South Wales, and Director of the Centre of Full Employment and Equity (CofFEE)

Pepe Escobar — The Spanish Civil War, revisited

Backgrounder on Spain and Catalonia.

The intractability of the political problem is that Catalonia – the most European of all Spanish regions and historically in favor of republicanism and federalism – contests the very essence of the Spanish system. To scrap this outdated constitution – written immediately after Franco’s demise and drenched in amnesty for Franco-ists – is as important as self-determination. To say that the Bourbons face a legitimacy crisis is a major understatement.

Madrid’s actions on Referendum Repression Day – led by a Franco-ist partisan of torture, infamous General Bum-Bum – could not but revive the memory of Catalonia as the key anarchist/republican hub during the Spanish Civil War; the Civil Guard in itself represents the memory of Francoism. It’s understandable how separatists prefer to discard the historic/ financial heavy load when they see the impossibility of a true modernization of Spain.

Asia Times
The Spanish Civil War, revisited

Pepe Escobar

Pepe Escobar — The future of the EU at stake in Catalonia

Fascist Franco may have been dead for more than four decades, but Spain is still encumbered with his dictatorial corpse. A new paradigm has been coined right inside the lofty European Union, self-described home/patronizing dispenser of human rights to lesser regions across the planet: “In the name of democracy, refrain from voting, or else.” Call it democracy nano-Franco style.

Nano-Franco is Spanish Prime Minister Mariano Rajoy, whose heroic shock troops were redeployed from a serious nationwide terrorist alert to hammer with batons and fire rubber bullets not against jihadis but … voters. At least six schools became the terrain of what was correctly called The Battle of Barcelona....

Asia Times
The future of the EU at stake in Catalonia
Pepe Escobar

SouthFront Thousands Protest In Barselona Over Police Violence During Catalan Independence Referendum

State fascism rearing its ugly head again in Spain?

SouthFront

Thousands Protest In Barselona Over Police Violence During Catalan Independence Referendum

lkb22

Independent
Spanish anti-separatists in Madrid protest with fascist arm salutes while singing far-right song

Natasha Salmon

Reuters
Serbia accuses world of double standards over Catalonia and Kosovo

More paradoxes of liberalism.

Sputnik International — Hasta la Vista Euro! The Rise of Spain's Alternative Currencies

The past few years have seen the growing popularity of social currency in Spain, where ordinary people are ditching the euro and exchanging services and products using an alternative currency.…

Sputnik International
Hasta la Vista Euro! The Rise of Spain's Alternative Currencies

France24 — Spain's conservatives [sic] win general election, but fail to get a majority

Spanish elections delivered a hung parliament for the second time in six months on Sunday, adding to political uncertainty in Europe after last week’s shock Brexit vote and piling intense pressure on Spain’s warring politicians to form a government.

Acting Prime Minister Mariano Rajoy’s centre-right People’s Party (PP) again emerged with the single biggest bloc of seats but fell short of a majority, leaving the euro zone’s fourth-largest economy at risk of another lengthy political stalemate.

Spain in political limbo.

France24
Spain's consernatives win general election, but fail to get a majority

Jorge Amar & Scott Ferguson — Podemos & the Limits of the Neoliberal Order

In the wake of Syriza’s disappointing challenge to the Troika’s punishing austerity politics in the Eurozone, leftists around the globe are now turning their eyes, and hopes, to Podemos in Spain. Podemos grew out of the 15-M, or Los Indignados anti-austerity protests back in 2011. The organization took myriad local government seats after forming as an official political party in 2014. And as of the national parliamentary elections held in December of 2015, Podemos has emerged as a viable third-party counterforce to Spain’s historically two-party neoliberal government. During the recent elections, the ruling and conservative People’s Party (PP) lost 64 seats, while the opposing Spanish Socialist Workers’ Party (PSOE) hemorrhaged 20 seats. Podemos, by contrast, earned 69 seats, coming in just 300,000 votes behind PSOE and securing roughly 20% of the votes within the Spanish parliament.

Commentators have dubbed Podemos’ upset of Spain’s two-party system a political earthquake, while the international left is characterizing the battle ahead as source of great hope and an opportunity to bring real change to Europe. Here, however, we dampen the leftist enthusiasm now surrounding Podemos, putting pressure on what we argue to be the party’s under-theorized and rather conservative program for economic change. Specifically, we offer a critique Podemos’ commitment to so-called “sound finance,” as well as the tax-and-spend liberalism upon which its proposed solution to Eurozone austerity is supposed to hinge. But we also suggest a more promising way forward: that Podemos join forces with the fifth-ranking Unidad Popular party. Unidad Popular’s primary economist has turned to the heterodox school of political economy known as Modern Monetary Theory (MMT), coming to see what Podemos takes to be economic truths regarding the Eurozone as neoliberal myths that should be overtly politicized and rejected as such. By collaborating with Unidad Popular, we conclude, Podemos stands to not only issue a serious threat Eurozone austerity, but also help spur the dismantlement of the neoliberal order on the whole.

This is a significant post worth reading in full. The fist part is about Spanish politics but the second half is about applying MMT to the Spanish economy. Bill Mitchell seems to be making an impact there.

flassbeck economics
Podemos & the Limits of the Neoliberal Order 
Jorge Amar & Scott Ferguson

Don Quijones — Next Banking Scandal Explodes in Spain

Wealth redistribution in progress.

Wolf Street
Next Banking Scandal Explodes in Spain
Don Quijones

Don Quijones — With Impeccable Timing, ‘Economic Miracle’ in Spain Unravels

The European Union on the verge.

Wolf Street
With Impeccable Timing, ‘Economic Miracle’ in Spain Unravels
Don Quijones

telesur — Podemos Walks Away from 'Incompatible' Deal with Socialists

Spain could go without a government for several more months after talks broke down when Podemos, or We Can, canceled negotiations with the Socialist Party on Wednesday.…

telesur
Podemos Walks Away from 'Incompatible' Deal with Socialists

system failure — The European industry of sell-off public property

Just like Michael Hudson predicted.

the unbalanced evolution of homo sapiens
The European industry of sell-off public property

system failure due to insufficient evolution?

Wolf Richter — Italy’s Banking Crisis Spirals Elegantly out of Control

The EZ crisis is moving to Spain and Italy.

Italy, the Eurozone’s third largest economy, is in a full-blown banking crisis. Four small banks were rescued late last year. The big ones are teetering. Their stocks have crashed. They’re saddled with non-performing loans (defined as in default or approaching default). We’re not sure that the full extent of these NPLs is even known.

Wolf Street
Italy’s Banking Crisis Spirals Elegantly out of Control
Wolf Richter

Spain’s two biggest bankruptcies ever, Bankia (2011-2012) and Abengoa (2015-?), share one thing in common: their auditor.

In both cases, the New York-based big-four firm Deloitte was responsible for making sure the financial statements fairly represent the financial position and performance of the companies, and that they conform to the accounting standards. Turns out, the accounts were as crooked as they come.

Both companies ran aground. Investors in the US and Spain got bilked. The US government got stiffed. And now it seems the auditor may actually end up paying a hefty price for having “seriously” infringed Spain’s account auditing laws.

Deloitte About to Pay for its Spanish Sins?
Don Quijones

Previously posted about Spain

Prelude to a Nightmare (Feb 5)
Don Quijones

Don Quijones — our Things that Keep Spain’s Senior Bankers Awake at Night — Prelude to a nightmare

The specter of Creditanstalt looming over Europe? Just how much is the banking system a house of cards. If a big bank goes down, we may find out if Creditanstalt and Lehman Bros. are any indications.

Wolf Street
Four Things that Keep Spain’s Senior Bankers Awake at Night — Prelude to a nightmare

Don Quijones

Bill Mitchell — Spain in limbo but has not rejected austerity

Summary of the fault lines built into the structure of the EZ. The only practical way to reject austerity is either to change the rules, or for countries to exit the zone and return to issuing their own currencies.

So when a political party claims to be anti-austerity but then supports the nation remaining within the monetary union with all the pernicious and unworkable rules that go with that, then we know the political leaders are lying and trying to pretend to be progressive rather than neo-liberal (lite or otherwise).

Bill Mitchell – billy blog
Spain in limbo but has not rejected austerity
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

David F. Ruccio — Country on the verge of an economic breakdown

Spain.

Occasional Links & Commentary
Country on the verge of an economic breakdown
David F. Ruccio | Professor of Economics, University of Notre Dame

Rise of MMT in Spain.

Got this from a dedicated reader of this blog. Please support (repost, etc) if you feel inclined.

Asociación Para el Pleno Empleo y la Estabilidad de Precios (APEEP), or Association for Full Employment and Price Stability in Spanish, is a non-profit organization that is devoted to raising awareness and disseminating Modern Monetary Theory amongst the Spanish public. APEEP believes that full employment and price stability are compatible if public policy is conducted within an MMT framework. The current economic crisis within the Eurozone highlights the need for a Postkeynesian and MMT approach to public policy.

In an effort to bring MMT into the political debate in Spain, they will be hosting Warren Mosler for his presentation of the Spanish translation of his  book “The Seven Deadly Innocent Frauds of Economic Policy” during a one-week tour through Spain, starting with a presentation in Madrid, on the 14th of September; Valencia on the 15th of September; and Vila-real on the 17th of September. They have previously hosted Randall Wray and will next be Hosting Bill Mitchell.

Here's the link for the events including time/date/location
- 14th September Madrid: http://apeep-tmm.tumblr.com/image/128253931730
- 15th September Valencia: http://apeep-tmm.tumblr.com/image/128506178765
- 17th September VilaReal http://apeep-tmm.tumblr.com/image/128264249520

Here's the press release for the events containing more details:
http://apeep-tmm.tumblr.com/post/128328711245/press-release-mosler-spain-tour-september-2015

Personally, I think MMT needs to find some new leadership: people who are more charismatic and can advance the movement. I don't mean to throw cold water, but you need charismatic leaders who can get media attention and get a popular movement going.

Ashifa Kassam — Spain puts 'gag' on freedom of expression as senate approves security law

The Spanish senate has voted to push forward with controversial changes to the country’s public security laws, cracking down on Spaniards’ rights of freedom of assembly and expression despite opposition from activists and human rights groups.

Recent years have seen millions of Spaniards take to the streets to voice their dissatisfaction with the rightwing People’s party government, protesting against crippling austerity measures and attempts to roll back the country’s abortion laws. Now the government has hit back with legislation, dubbed the “gag law” by critics, that seeks to limit protests by laying out strict guidelines on when and where they can take place and penalising offenders with steep fines.

The legislation includes fines of up to 600 euros for failing to notify authorities about demonstrations in public areas, even in the case of peaceful protests. Once approved, marches that veer from the approved itineraries could face fines of up to 600 euros.

The fines climb to 30,000 euros for protests that result in “serious disturbances of public safety” near parliament and Spain’s regional government buildings. Unauthorised protests that take place near key infrastructure, such as transportation hubs, nuclear power plants, refineries and telecommunications installations could result in fines of up to 600,000 euros.

The legislation will now head to Spain’s Congress of Deputies, where the legislation is expected to be ratified by the end of the month.Fascism returns to Spain.…

The legislation has been widely criticised outside Spain, including by a panel of five UN human rights experts who, in a statement, noted that the reforms “unnecessarily and disproportionately restrict basic freedoms”.

The Spanish government has repeatedly defended the bill, insisting it will improve public security by targeting the protesters who are prone to violence. “It’s a law for the 21st century,” Spain’s interior minister, Jorge Fernández Díaz, said recently. “It provides better guarantees for people’s security and more judicial security for people’s rights.

Fascism returns to Spain?

The Guardian
Spain puts 'gag' on freedom of expression as senate approves security law
Ashifa Kassam in Madrid

ht Random in the comments

Peter Radford — Spanish Triumph?

It’s all a bit annoying. Really. I have just read the Economist’s article about Spain. The article is titled “Back on its feet”.

Such a title might lead you to imagine that the article is about a triumphant return to prosperity. But no.

Instead we are told that unemployment is down to 22.5%. This is down from a peak of 26.3% back in 2013. Growth, we are told, has ‘sparkled': it rose to an annualized rate of 3.8% in the first quarter and rose again a little further in the second.

Wow.

These are the fruits of severe austerity. They are ‘the vindication of reforms’ the right of center government put in place in 2011.

Double wow.…

The new propaganda is how well austerity is working. Elite chutzpah never ceases to amaze.

Sorry Economist: the story is one of disaster not triumph. It is of lost lives, lost hopes and lost dreams. And those ‘reforms’ are like the leeches of yesteryear: they are the product of economic theories that lack an understanding and empathy for real people.

Let’s all hope that our Spanish friends are tough enough to withstand the damage inflicted by the cure being thrust upon them. And let’s all hope that one day these reckless and violent cures are seen for what they are: inhuman evil.

Yes, Spain is going great — in comparison with Greece.

The Radford Free Press

Spanish Triumph?

Peter Radford

Mehreen Khan — Europe braces itself for a revolutionary Leftist backlash after Greece

A pre-revolutionary fervour is sweeping Europe.

“The atmosphere is a little similar to the time after 1968 in Europe. I can feel, maybe not a revolutionary mood, but something like widespread impatience”.

These were the words of European council president Donald Tusk, 48 hours after Greece’s paymasters imposed the most punishing bail-out measures ever forced on a debtor nation in the eurozone’s 15-year history.

“I am really afraid of this ideological or political contagion”
Donald Tusk

A former Polish prime minister and a politician not prone to hyperbole, Tusk’s comments revealed Brussels’ fears of a bubbling rebellion across the continent.

“When impatience becomes not an individual but a social experience of feeling, this is the introduction for revolutions” said Tusk.

“I am really afraid of this ideological or political contagion.”….

I'm betting the Right to win this, not the Left. There is no Left. It's a myth. The Right is real and they have the swastika tattoos to prove it. Just (half) kidding.

The Telegraph
Europe braces itself for a revolutionary Leftist backlash after Greece
Mehreen Khan