The debate in the Senate between Pedro Sánchez and Alberto Núnez Feijóo showed that the division into two antagonistic blocs, aggravated by the immediacy of the municipal and regional elections, is turning politics into a thunderous and filthy brawl.
And the bipolarization it also commands judgments about the economy. The PP assured that Spain would go worse than bad. And the PSOE resorts to “Spain is doing well & rdquor; of Aznar. The PP has made a lot of mistakes because the war in Ukraine has not caused Spain to fall into recession. Less so in a crisis like that of 2008. But Sánchez, wounded by the blunder of the ‘only yes is yes’ law – which he has saved against the Podemos ministers and thanks to the PP – wants to recover with a housing law which he exhibits as historical and the solution to all ills. And he adds criticism to the “neoliberal” of Rajoy’s PP in a very different context. Spain then had to brutally cut its deficit because -unlike now- the ECB did not finance the debt of the states.
The housing law responds to concerns about the skyrocketing rental prices, but is misfocused because he believes that the solution is to cap prices (always less than the CPI), when the real problem is the scarce supply of flats for rent, public or private. Sánchez promises public social housing, but promising is free, fulfilling…
How is the economy? The data for this week is not bad. GDP grew by 0.5% in the first quarter compared to 0.1% in the euro zone. In the last 12 months, 3.8% compared to the 1.3% European average. There is a slowdown because we come from 5.5% in 2022, but it is not bad at all. And the employment data for the first quarter, although with shadows, indicate that in the last year 368,000 jobs have been created, the vast majority in the private sector.
It is true that this has been achieved with measures such as social assistance, increases in the minimum wage and the revaluation of pensions with the CPI, fair, but with risks for companies and public accounts. So far it has not been like that because growth, job creation and inflation have doped state revenue and the deficit has been reduced more than expected. From 10.1% in 2020 (pandemic) to 4.8% in 2012.
But Spain has promised to Brussels to continue reducing it to 3.9% this year and to 3% -the maximum allowed by the EU- in 2024. ensure the flow of European funds. But it is possible? With luck, yes, but luck is volatile and if the rise in interest rates -or any unforeseen event- reduces growth… But Sánchez prefers to be president and be troubled in 2024 or 2025 than an exercise in prudence that would complicate him even more this difficult electoral year in which the polls, except that of the CIS, They give the PP the winner.
The economy is holding up better than expected. But with problems. Inflation has been reduced from the maximum of 10%, but in April it has risen again from 3.3% to 4.1% and although the core has fallen (to 6.6%), it is still above it. And that of food, the one that punishes the consumer the most, was at 16% in March. That’s why private consumption did not grow in the first quarter and according to a survey by the AECOC (the association of consumer goods companies) Spaniards have reduced their purchases of fish and meat by 40%. Eye!
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The Bank of Spain has recognized that the government’s aid measures contained inflation (2.5%) and boosted activity (1.1%), causing GDP to grow by 5.5%. Despite this, the INE Living Conditions Survey says that in 2022 8.7% of Spanish families had problems making ends meet. It is more than 7.8% before the pandemic. AND Sánchez, who boasts of social policy, must not forget that the neoliberal Rajoy it reduced this indicator from 18.6% in 2013, at the height of the crisis, to 10.4% in 2018.
Not all white and not all black. It depends a lot on the color of the glass with which you look at it. According to the CIS, 64% of Spaniards believe that the Spanish economy is doing badly or very badly. But, curiously, “another & rdquor; 64.5% say that “their personal economy & rdquor; it goes well or very well. Which of these two contradictory 64% is more authentic and true? Perhaps that is the key to the 28M elections.