Thursday, January 31, 2013

Spain: The pain in Spain leads many to complain

Picture: Wikipedia

There was a time when Spain was as exotic and unexplored to Brits as Mali; but even now, there is much about the country that the tourist probably doesn't know, and I certainly don't. CIngrams has taken up my suggestion of a piece on the Spanish experience of the Great Financial Crisis, and for me it stimulates many further questions, which I'll put onto the Supplement page.

He begins by looking at the local protests:

The 15-M ‘movement’, which started at the time of the local elections in 2011 (held on the 22nd of May) mainly consisted of the usual young, hairy types who like to think that they can change the world by shouting slogans. They began peacefully, and in most places they continued peacefully, and the arguments they made were, on the whole, valid criticisms of the cumbersome and opaque electoral system, which multiplies parliaments and civil servants at many different levels, which gives members of those parliaments no incentive to represent the people who vote for them, as they owe their position entirely to the often unknown party controllers, to whom they must be loyal. Parties are state-funded and you cannot choose, and sometimes do not know, who you are casting your vote for. That is decided by the party.

Some of their complaints were about the banks, and showed a certain ignorance of economics typical in the young and those who have not yet worked for anything of their own, but I found them to be approachable, peaceful, not stupid, and I wondered if the government would actually start to take them seriously at some point.
Noises were made, but nothing much happened. As usual. What tends to happen is that these protests, even when based on good ideas and conspicuously peaceful, are taken over by the usual suspects, or fade away to nothing. Both of these things happened. The Occupy movement was quiet different from the 15-M, and the original purpose and form was lost, and just fizzled out.
Once the government started to recognise the gravity of the situation and actually do something rather than make political noises, it started by doing the wrong things, then attempting the impossible. They decreed, back in 2009, a programme of digging holes and filling them in again, in an attempt to pretend unemployment was lower than it was. Some useful work was done, but much of was a waste of money. They raised VAT, in an attempt to bring in some very short term income, while depressing commerce and investment in the medium term. Only a politician would think that a good idea. They also got rid of as many contracted personnel as possible, in order to reduce their wage bill. Something they were, at the same time, trying to stop other organizations from doing.

Civil servants in Spain have jobs and pensions for life. They cannot be laid off if they become unnecessary, and they are extremely difficult to sack even for laziness and incompetence. Whenever I have to deal with the civil service the difference I see between them and similar workers in the productive economy is enormous. (I could go on about this for hours. Forces self back to point.) So there are two ways the government can reduce its wage bill. One is to terminate the contracted staff, that is those who are not full‘funcionarios’, or who work for companies hired for specific projects. These are mainly building works working on roads and public buildings. The local and national governments here threw many thousands of them onto the dole when the money really, really ran out.

The second way is to reduce the salaries of the permanent workers. Incidentally, the idea of giving public employees unbreakable contracts for life comes from the 19thC and was intended to stop incoming governments from sacking most of the civil service and filling it with their friends. But a solution to a specific problem of corruption when the civil service consisted of only a few thousand people at most, has been allowed to continue until the present day, when there are over 4 million people whose wages are guaranteed with our money. There has never been the political will, or courage, to touch this system and there probably never will be. It is possible though that it will slowly be allowed to wither, at least by governments of the right, and most public employees will indeed be on contracts which can be ended when they have done what they were hired for. I am not too sanguine, however.
The early protests were led by the Civil Service unions, for this reason. They got little sympathy from the public because with 4 million unemployed (it’s nearer 5m now) and a similar number unable to reach the end of the month and with the possibility of losing everything at any moment, the public felt that people with a salary for life had little to complain about, even if that salary was a bit less than it used to be.

The unions see it as a good excuse to increase their standing with their members and attack the new, centre-right government. The new opposition suddenly claims to have all the answers it couldn’t find when it was in charge. Everybody complains, but everybody expects someone else to get them out of trouble. That is human nature, but it makes the problems worse, and more difficult to solve.
The trade unions regularly appear on the streets, waving flags and shouting slogans that express their grievances and suggest some solutions. They achieve nothing, of course, but it adds to the circus of life. They have not normally been violent except during the national strikes they called in May and November last year. These were poorly supported but in the larger cities the far left makes sure they are noticed and make the evening news, by giving their members permission to break things and attack people. This is for their own political ends, and is not going to solve any of the social problems that exist.

Beggars are also appearing on the streets. Not the usual drug addicts and gypsies, but ‘normal’ people were clearly once working families and who’ve tried every other way they can think of of making ends meet. This shows that, despite what I say in the next paragraph, there are problems much more serious than ‘the government isn’t giving me as much as I would like’, which you hear from most people.
People don’t realize or have forgotten what it is that makes an economy work. So many people now believe that government spending isthe economy, and that banks are evil, that it will be hard to re-create a country where hard work, investment, successful businesses employing people, are recognised as good things, to be encouraged and aspired to. The Chinese immigrants are now doing what the Indian and Pakistani immigrants did in Britain forty years ago. They are taking over small shops in large numbers, working long hours seven days a week, offering people things they want, when they want them, at good prices, bothering no one and making sure their children study hard so they can be doctors and lawyers and won’t have to spend 12 hours a day in a little shop. The number of people who routinely moan about this as though it were a bad thing shows that the recovery will take a long time. It doesn’t occur to them that they could do it themselves. It’s too hard for them, so they want someone else to do it. They then seem to assume that they themselves should somehow earn more for not doing it than the people who do actually do it.
Similarly, there are many immigrants from South America and Eastern Europe (The non-gypsies and non-gangsters) who are working very hard at what the local people don’t want to do. Most domestic cleaners, carers for children and the elderly, and many agricultural workers and bar staff, for example, are now immigrants, and have been for some years. Some unemployed people would jump at the chance to look after the elderly or work long hours in a bar, but most wouldn’t, and anyone with any kind of qualification fails even to understand the question.

It’s going to be long, slow and messy.
Extract reproduced with the kind permission of the author.

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