Princess Cristina – daughter of King Juan Carlos of Spain and the seventh in line to the Spanish throne – has been named a suspect in a corruption case for which her husband is standing trial.
The judge of the case said that there is evidence that the Princess cooperated with her husband, Inaki Urdangarin, who is accused of siphoning off around six million euros in public funds as well as tax fraud through a charitable organisation he was involved in.
At the same time, the Spanish national government is still marred in rumours of envelopes of black money paid to the political establishment. The so-called ‘Caso Bárcenas’ continues and is investigated along with another big political corruption case – the ‘Caso Gürtel’. The governing Partido Popular denies any illegal activity but acknowledges that their funding system needs to become more transparent.
At the other end of the country in Catalonia, the director of a large detective agency was recently arrested as part of a police investigation into the espionage of political parties and business people in a region that seeks the right to vote on independence. It is still unclear to the public who was spying on who, but it seems like the detective agency had many different clients and had plenty of jobs to do.
It sounds like a mad political thriller. But sadly it is every-day news in the Spanish dailies. Depressing for a people that is struggling to overcome their daily economic woes.
Corruption cases have shaken virtually every public institution in Spain and, at a more local level, politicians and other prominent people allegedly been whitewashing money for their own benefit and in a few cases also for foreign mafias.
The economic crisis seems to have had an effect on the boom of corruption scandals. There is no longer money enough for everyone and that makes resentful people spit out the truth about the not-always-so-legitimate party that went on before the financial crisis struck in 2008.
Corruption is not part of everyday life for the citizens in Spain, but it has a big and indirect affect on the citizens and the society as a whole. Corruption has, on the other hand, been a great part of Spain’s hard-hit construction sector and therefore also an important factor in the bidding of public works and at the different levels of public institutions.
It is great that all these scandals are coming out now, it might clean up the system a bit and hopefully make the Spanish citizens demand more and much needed transparency in their democracy. But there is also the danger is that each case fades down with the coming of the next one and that the clean up of Spain’s corrupt politicians will only ever be a scratch on the surface.
The Spanish government approved new “urgent” measures to help needy families facing home eviction. But the measures stop short of changing the Spanish law on mortgage repayment, which some judges find “abusive”.
The measures consist of a two-year moratorium of home evictions of families in especially difficult circumstances and the creation of homes with low rents for those evicted.
The measures are similar to a voluntary code of conduct on evictions set in place in March for the Spanish banks, which had very limited effects. The scope of potential beneficiaries has now been slightly amplified. In order to avoid being evicted from home, the household must make less than 19,200 euro a year and have a child below the age of three, or be a large family – i.e. a couple with three or more children or a single parent with at least two children – or with a family member who is either a victim of domestic violence, or disabled, or has a serious illness.
The rushed move comes after a month of increased attention on the mounting forced evictions in Spain and which culminated with the suicide of a 53-year-old woman who jumped from her balcony as she was being evicted from her family home last Friday. It was the third ‘eviction’ suicide or suicide attempt in Spain in just as many weeks.
One man facing eviction hanged himself at the end of October and the following day another man jumped from his balcony – he survived the fall.
The worsening economic crisis and the record high unemployment rate of 25 percent has only aggravated the foreclosures of family homes and businesses properties when people find themselves unable to pay back their mortgage.
There have been a total of almost 400,000 evictions since the crisis started in Spain and the pace has accelerated in the last few months with around 50,000 in the first six-month of 2012 alone. The numbers also include evictions of business properties and second residence.
There have been several motions against the law on mortgage repayment lately. In October, an internal working paper of seven judges in Spain denounced the legal system of evictions as being “abusive” and called for change.
Last week, Advocate General Juliane Kokott stated in a non-biding report that she believed that the Spanish law on mortgages is “incompatible” with EU law because it does not sufficiently protect consumers from banks.
The Spanish system does not sufficiently protect the consumer against possible abusive clauses in mortgage contracts, because it allows evictions to take place before the debtor can claim damages, Ms Kokott argued. The European Court of Justice is expected to hand down its verdict early next year on a query from a court in Barcelona handling a case on forced eviction.
In Spain, even after being evicted people are liable for repaying large amounts on their mortgage as the value of their property has plunged in the crisis.
The social tragedy has led to an increasingly growing social mobilisation against the forced evictions. Associations such as Stop Desahucios (Stop Evictions) and the Plataforma de los Afectados por la Hipoteca (the Platform for Mortgage Victims) offer advice and human barriers at planned evictions.
Local police units have also disclaimed their unease of forced evictions, which sometimes come to clashes between police and protesters supporting families destined for evictions. A couple of city councils have even ordered their local police not to assist in forced evictions.
Yesterday’s measures was planned to be a bipartisan agreement between the governing Partido Popular and the Socialist Party in opposition. However, the negotiations failed because the Socialist Party wanted the urgent measures to include a guarantee that there would be a reform of the Spanish law on mortgage repayment – something they themselves refused to do when in power between 2004 and 2011 (and which they have now apologised for).
Spanish President Mariano Rajoy and his government then went ahead approving their own measures. Some argue the government fears that talking about changing the mortgage repayment law could create insecurities on the financial markets – something they want to avoid just before Europe is set to give the Spanish banks an around 60 billion euro cash injection.
As an end note it is worth mentioning that neither one of the two who committed suicide in the last few weeks would have been likely to be affected by the new moratorium on home evictions. None of them fitted the new conditions needed to benefit from the two-year moratorium on home eviction.
They were victims of the social tragedy that is becoming increasingly profound as the economic crisis prolongs.
The result of Sunday’s regional elections in northern Spain has given Madrid a bit of breathing space and support for the austerity measures needed to put the fifth largest economy in the European Union back on track.
But it has also given the conservative government a bit of a headache when it comes to Spain’s continued unity.
Galicia and the Basque Country are both regions in northern Spain, they both held regional elections on Sunday (21 October), and they both have their own language – apart from the Spanish Castellan – Galician and Basque. But that is just about where the similarities between the two regions end.
The past year’s austerity measures taken by the current Spanish government – led by President Mariano Rajoy’s centre-right Partido Popular – got the thumbs up in Galicia.
Partido Popular (PP) has held comfortable wins at the ballot boxes most of the period since Spain regained democracy at the end of the 1970s. But it was feared that voters in Galicia would take their anger of Madrid’s severe budget cuts out at the polls, as it happened at the regional election in Andalusia in March when the Social Democrats defeated PP.
The fears were unfounded and PP has even increased its absolute majority gaining 41 (previously 38) seats out of 75 in the Galician Parliament. The reason for the result has also been given to the sound leadership of Alberto Núñez Feijóo in the previous four years in Galicia.
The election in the Basque Country, however, turned out as expected – or rather, as feared by the government in Madrid. Two out of three lawmakers in the Basque Parliament are now Basque nationalists – 48 seats out of 75.
It was the first ever elections in the region without the threat of armed separatist group ETA, which last year decided to end four decades of terrorism.
The moderate nationalist party PNV was the overall winner with 27 seats, and is set to form a minority government in Vitoria, the capital of the Basque Country, led by Iñigo Urkullu – the likely new lehendakari (leader of the Basque government).
PNV backs further regional autonomy from Madrid, but Urkullu also promised in the election rally to bring a new law on Basque independence to a referendum in 2015. EH Bildu – a left radical separatist party – was the second winner at the Basque election with 21 seats, the highest since it was created in 1998.
In both regions the Socialist Party has lost votes [okay, another similarity between the two regions], which is a severe blow to the Spanish opposition leader Alfredo Pérez Rubalcaba. However, for the Spanish PP government, which is already leading with an absolute majority in the Spanish Parliament, it is a bit of breathing space and a much needed confidence boost to go ahead with further austerity measures.
But Rajoy can hardly relax for long. Spain is in its second recession since the crisis began in 2008; an economic bailout of the country is imminent; another general strike is set for November 14th; and the separatists in Catalonia are expected to win the elections on November 25th.
While London and Edinburgh signed an agreement on Monday (15 October) allowing Scotland to hold a referendum on independence within the next two years, Barcelona said it might look for international help in order to convince Madrid to allow Catalonia to hold their own referendum on independence.
A month ago, Barcelona faced the biggest independence rally ever with one and a half million people on the streets calling for independence from Spain. The following week, talks on a new fiscal agreement between the Mediterranean region and the conservative government in Madrid broke down, leading to the President of Catalonia, Artur Mas, to call for early election on November 25th.
The Catalan parliament then agreed to hold a consultation on independence within the next four years if the majority of lawmakers in the new parliament, following the election, is also in favour of such a consultation. The latest polls show that Mas’ party is set to win with a comfortable majority.
But the response from Madrid has been anything but affectionate on the idea of a consultation on independence, let alone, the potential break-off of the north-eastern region of Spain – one of the most economically productive regions in the country but also heavily indebted at the moment.
According to the Spanish Constitution it is illegal for the autonomous regions to hold a referendum on independence. That is why Mas wants to hold a ‘consultation’ asking something in line of whether the Catalans wants “Catalonia to become a new state within the European Union.”
Spanish President Mariano Rajoy has no intention of authorising such a consultation on independence in Catalonia. The government “will use all the legal instruments at hand to prevent any illegal action,” said Rajoy’s ‘right hand’ in the governing Partido Popular, María Dolores de Cospedal on Monday.
Justice Minister Alberto Ruiz-Gallardón went further and warned Mas that he could be committing a crime if he calls for a separatist referendum. “If a person commits an unlawful act … then that person will be held responsible”, he said on Spanish television.
Foreign Minister José Manuel García-Margallo asserted on Tuesday (16 October) that the planned referendum in Scotland cannot be applied to Catalonia. “In Spain it goes against, not only, Spanish law, but also against the European by virtue of the treaty of the European Union,” he said according to Europa Press.
“We have to internationalise the conflict,” Mas said about Madrid’s warnings. If the central government denies Catalonia to hold a consultation on its own future, it would be “a very big problem of democratic legitimacy,” he added.
“We will have to go to Brussels to explain that they don’t even let us consult with the people,” he stated. Mas insists that the Catalan people have the right to decide on their own future.
Brussels, on the other hand, has refused to get involved in the “conflict” that has become increasingly tense in Spain, with every TV show, radio programme and coffee break mentioning the latest comments made on the issue of Catalan independence.
“It is indeed not the role of the Commission to express a position on questions of internal organisation related to constitutional arrangements in the member states,” said Commission spokesperson Pia Ahrenkilde-Hansen on Monday, when asked about the Commission’s view on the possible independence of a region in the European Union.
She added that “the Commission would express its opinion on the legal consequences under EU law” only if, for example, Spain asks the European executive to do so.
One Catalan compared the relation between Madrid and Barcelona of that of a father and his teenage son: The more authoritarian the father becomes, the faster his son packs his bags and leaves home, no matter the cost. The more compassionate the father is, the happier the son is to stay living in the parental home.
But the fact is, that the issue of Catalan independence – or ‘further interdependence with the European Union and also with Spain, but with the instruments of a state on its own’ as President Mas likes to put it – is taking a lot of attention away from the core issue of the Spanish economy in crisis. Attention away from the severe cuts Catalonia and Spain as a whole will be facing in the coming months, especially if the Troika arrives in Madrid.
The Spanish government announced new austerity plans squeezing next years budget for some 40 billion euros. It also came out with the results of an independent bank stress test to show international markets that Madrid can control its finances. Seven banks are in need of 59 billion euros to shore up their capital – somewhat less than expected.
The leader of the northeastern region of Catalonia, Artur Mas, called for early elections and the Catalan parliament agreed to hold a referendum on independence from the rest of Spain by the end of the next electoral term.
Thousands of protesters – students, employed, unemployed, pensioners and children – gathered on Plaza Neptuno in Madrid three nights last week to rally against the Spanish government’s many austerity measures. The most radical protesters clashed with police on different occasions leading to dozens of injured and detained.
Meanwhile, the Spanish President Mariano Rajoy was in New York to speak at the United Nations General Assembly, among other things, he called for the decolonisation of Gibraltar. A Spanish tourist caught him on camera walking down Sixth Avenue smoking a cigar.
The picture has refuelled complaints from many in Spain that Rajoy lacks the touch and determination needed to deal with the crisis his country is facing and the hardship many of his citizens are going through. One newspaper commentary read that “Rajoy doesn’t get wet neither in the shower”. In Spanish, to get wet is a synonym for committing oneself to something – to get involved.
The markets are speculating on when Rajoy’s government will ask for a partial bailout from the European Central Bank, which is widely expected. Although the last few austerity cuts have signalled that Spain is getting in line with the economic conditions a rescue would entail, the call for a rescue is deferred. Rajoy once said that there “is no hurry” for such a bailout.
Maybe the request will come after the regional elections in the Basque Country and in Galicia on October 21st, as the stigma of an intervened country could have an effect on the ballots in the two regions (it wouldn’t be the first time. Rajoy waited for the regional elections in Andalucia in March before his government published its first austerity plans). It is also argued that the Spanish government is negotiating “reasonable conditions” that comes with a bailout.
Not taking a decision is always the worst decision and the longer Rajoy hesitates to take the bull by the horn, the more painful it will be. For Rajoy and his party, for the Spanish people, and for Europe.