Five hundred years of crisis

Spain has frittered away its chances for economic development for the second time. The first was after it discovered the Americas in 1492, and the second was after it joined the European Union in 1986. The anti-economic thinking that has dominated Spain is rooted in its history and culture.

Published on 1 June 2012 at 16:10

What's wrong with Spain? Back in the reign of Prime Minister José María Aznar (1996 -2004), it was the poster child of the EU when it came to growth. One hundred and fifty billion euros in structural aid poured from Brussels into the fourth-largest economy in the euro area.

But instead of flourishing factories, abandoned capital spending projects scarred the barren soil of Andalusia and Castile, and now lie as dead as the castle ruins from the era of El Cid. Both times and places reveal an anti-economic social model that has distinguished Spain for half a millennium.

In modern times Spain has experienced a self-imposed isolation that ended only in the 1960s, when dictator Francisco Franco opened the borders to tourists. Spain thus stumbled late into the modern age, 'excited and hasty like the guest who arrives last at the banquet and gorges to make up for lost time', wrote Juan Goytisolo in his 1969 essay 'Spain and the Spaniards’, which still rings true today.

Twenty years later, and with the same eagerness, Spain began to dispense the manna that fell from the sky in the form of EU structural aid. However, rather than investing in a productive society, it wanted to belong to the EU as quickly as possible, to modernise itself – which meant, above all, to look modern. The money was hurled into the housing market. Initially it was hurled usefully, later – fired by Aznar's ultra-liberal land policy – in a frenzy.

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The triumph of the anti-economic thought, however, had already started back in 1492. Spain had not only discovered America, it had also defeated the last remnants of Arab rule in Granada and in the coming centuries would drive Muslims and Jews out of Spain. Both those groups were responsible for trade and commerce. The Spanish noble, however, detested work, which was forbidden to him by a bizarre code of honour, and saw his God-given task only in soldiering.

Back to the Inquisition

The wealth from the colonies flowed through Spain like liquid gold. Central Europe got rich off Incan gold, while Spain's noblemen wasted away on ruinous estates, the ‘latifundia’.

For three hundred years the Inquisition hunted out heresy in anything that looked like productivity. Anyone who researched, tinkered or read ran the risk of ending up being burned at the stake.

After the Inquisition ended the hostility towards progress lived on in Spain’s nationalist Catholicism; the secular age was unable to break through the crust. Only in the Basque Country and Catalonia did industrial structures emerge. Connections were sought – but disabled at the same time. A railway network was laid, but in a different gauge than in France, in order not to come too close to Europe. From then on it was said that Europe ended at the Pyrenees.

Only the beginnings of a dynamic, mercantile, politically conscious middle class emerged in the 19th Century – along with an anarchist movement that was stronger in Spain than anywhere else in the world. That movement has got a new lease on life in the Indignado movement, gathering at the Puerta del Sol in Madrid, whose members are united by outrage over capitalism, but who do not come together as a group.

Triumphant in the thirties, Anarchism was crushed by Franco’s rebels in the Civil War. Under Franco, Spain was catapulted back to the Inquisition. To keep the peace after the war Franco deliberately promoted stasis – or immobility. With housing and financial support he made most Spaniards property-owners and so laid the groundwork for the speculative boom of the future.

Cold Protestant efficiency

While Spain overcame the political upheaval following the end of the dictatorship in 1975 with flying colours and created a permissive society, economically it remained stuck in the late Middle Ages.

Many Spanish newspapers and blogs are still dominated by the self-centred rhetorical gesture and timid partisan bickering. Parochialism forbids Castilians or Andalusians from watching too closely the productive Basques or Catalans, while, conversely, the latter steadfastly refuse to share their talents with the rest of the country.

For Spaniards, writes Goytisolo, a task to be done is less about the material gain than the fact of their personal involvement in it. But the Anglo-Saxon markets, drilled in cold Protestant efficiency, did not give Spain the time to make this commercially useful. The required conversion to a practice-oriented education and research is now held fast in forced austerity.

So long as Europe hesitates to tear down the border of the Pyrenees through targeted assistance in the modernisation of the economic and educational system that is already underway, Spain must seek refuge in a national characteristic that, according to Goytisolo, has always hampered its ascent: frugality.

Spaniards know what it means to weather a crisis. They have been doing it for 500 years.

From Spain

“We have robbed our children of their future”

“Now that the cows are getting skinny we’re starting to grasp the scale of the disaster, the responsibility for which lies on our shoulders,” writes editorialist Isabel San Sebastián in ABC – the shoulders of “the leaders of the past thirty years and those of us too who accept, by act or omission, in an ominous silence that’s ignorant or complicit, the model they imposed on us,” she accuses. For her —

We have behaved as if all Spain was floating on an oil field, and yet we’re a poor country. The dramatic growth of recent years has been based on credit and generous donations from Europe, not on our actual ability to pay the bills for the highways, high-speed rail, universities and other spectacular facilities built for the glory of those in office at the time who cut the ribbons. [...]

Brussels is now demanding as a sine qua non for continuing to finance us that we get the runaway spending of the autonomous regions under control, because that has become a bottomless pit. But who is going to risk putting a finger on the major problems? We are seeing the tip of that monumental and foul iceberg of theft, deception, mismanagement and corruption that were the old savings banks, converted into caves of Ali Baba and the forty thousand thieves appointed by all the political parties and trade unions who have stuck their hands into the till. [...]

This crisis won’t be resolved in one year, nor in five. It’s here to stay, because the damage caused to the credibility of this nation, and hence its ability to grow, is immense. It means we’ve robbed our children of their future.


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