“I’m hearing music from another time” – the Spanish election results

May 27, 2015

“I’m hearing music from another time” The Clash – ‘Spanish Bombs’

The Spanish regional and local election results produced a political earthquake right across Spain with a variety of anti-austerity leftist parties, most of whom were only founded in the last couple of years, making dramatic gains. The political scene in Spain is fragmenting and shifting dramatically as a block of leftist anti-austerity parties, mostly built from the ground up through grass roots community action, are coming from nowhere to win big votes and control of local and regional government. These leftist parties and movements are closely interwoven with the popular separatist movements in Catalonia and the Basque country. Not only is the old political landscape of Spain disintegrating but the country might be in the process of splintering.

This is the sort of political contagion that the EU elites have feared ever since the Syriza victory in Greece. The stakes are high. One of the reasons the EU are collectively taking such a hard position in the negotiations with Greece is because if the Syriza anti-austerity strategy is seen to be working then other anti-austerity parties in other indebted eurozone countries could see a surge in support. If an anti-austerity party were to win in another large eurozone country, such as Spain, then the eurozone could be tipped into another generalised crisis (see the final section below).

The nightmare of the EU elites looms, another anti-austerity government. Spanish Podemos party Secretary General Pablo Iglesias raises a fist to Syriza supporters following a campaign rally in central Athens, January 22, 2015

The results that have grabbed international attention were the performances in Barcelona and Madrid by left-wing platforms which involved high levels of neighbourhood and community engagement as well as backing from traditional and emerging parties of the left. In Barcelona Ada Colau, former spokeswoman for the renowned anti-home eviction network PAH (Platform for Mortgage Victims), led Barcelona en Comú (Barcelona in Common) to victory with 27% of the vote.

In Madrid, a similar political initiative, Ahora Madrid (Now Madrid) won 32% the vote, finishing just behind the ruling right-wing Popular Party (PP). Ahora Madrid is better positioned to govern should it reach an agreement with the Spanish Socialist Party (PSOE).

The People’s Party has already started to manoeuvre to isolate the new lefts parties by seeking a grand coalition with the PSOE to shut out the anti-austerity leftist parties (see this story – Google translation).

The results in Barcelona, and possibly Madrid, were more or else expected. The shock came in the third biggest city, Valencia, where Compromis, a regionalist and left alternative party, polled in second place with 23% of the vote, just shy of PP’s 26%. Opinion surveys just a week ahead of the elections had PP winning 31% and Compromis at 16%. Benefitting from the left majority elected in the city, Compromis can govern with the support of the Spanish socialists and Valencia en Comú.

In the fifth biggest city, Zaragoza en Comun (Zaragoza in Common) won just shy of a quarter of the vote. In Palma de Mallorca, leftist formations MES-APIB and Som Palma got a combined 30% of the vote. In Alacant, Guanyar Alacant won 19% of the vote and Compromis 9%. The crowds celebrating the result there chanted “Not one more home eviction!” when they saw the results.

One of the biggest leftist gains came in Cadiz where two leftist formations won 36% of the vote. In A Coruña and Marea Atlantica (Atlantic Tide) came first with 31%. These are astonishing results for new leftist political organisations which are in most cases barely a year old. Most of these new leftist parties have grown out of community based organisation that developed to resist evictions and cope with the direct social affects of the government austerity programs such as homelessness and hunger. Their deep local roots in communities made them flexible and and able to reflect local cultures and conditions, in sharp contrast to national parties.

The regional elections also produced some big gains for the leftists. One of the most important results came in the Valencia regional elections. There, the infamously corrupt PP collapsed from 48% of the vote to 26%. The PP still finished first but have no hope of governing after the Socialists, Compromis, and Podemos took 55 of 99 seats. This isn’t just a politically significant result. It also has a deep cultural and historic resonance as a party like Compromis – situated ideologically in the Valencian nationalist left – is poised to enter, if not lead, a left coalition government. All this is in the context of the looming September regional elections where Catalans will have the chance to register their support for leaving Spain. On January 14, Catalonia’s centrist President Artur Mas announced an agreement with his nationalist rivals, Esquerra Republicana (ERC), to run separate tickets but with a shared road map towards secession, making September’s vote a de facto referendum on leaving Spain.

Tensions around the Catalan independence issue are running very high. Just this past October on the Valencian national holiday, Compromis members were subjected to sustained buse by Spanish fascists who consider Compromis a Catalan fifth column (see the video below). The ruling PP fuels this hatred, having shut down the only public Catalan language channel in Valencia, RTVV, and blocking the signal of Catalonia’s public TV channel. Thousands in Valencia celebrated both the regional and city results, and the unemployed RTVV workers were among the joyous crowds.

httpv://youtu.be/U9WzK8iSgMI

 

In Navarre, there was an equally if not greater defeat of the ruling political order. The conservatives of UPN (Navarrese People’s Union), which has governed for most of the last two and a half decades, had their worst result since 1987 – 27% of the vote. Crucially, a number of leftist and Basque nationalist parties now hold a majority. One of those parties, EH Bildu, is a left-wing, pro-independence party that was at one point outlawed by the Spanish government.

One of Bildu’s main figures is one of the most prominent political prisoners in Europe today, Arnaldo Otegi – jailed for his purely political efforts to organize a party of the Basque pro-independence left. Bildu participating in government in Navarre is one of those worst case scenarios for the Spanish right that may play out in the coming days.

Finally it is worth noting the gains by the CUP (Popular Unity Candidates) which is a formation of the Catalan far-left but is strategically committed to the prioritisation of municipal politics, despite making the leap in 2012 to the Catalan parliament. Sunday’s elections were a big result for CUP, winning 374 seats in city councils, making it the fourth-largest formation in Catalonia. It also entered Barcelona’s city council for the first time, winning 7.4% of the vote and three seats.

Ada Colau of Barcelona en Comú has expressed her interest in working with CUP, which can deliver some essential votes on her more left-wing policy ambitions such as stopping home evictions and aiding families who can’t afford utilities. CUP’s success in Barcelona and in other cities shows that the choice between Catalan independence and leftist ambitions is a false one: those in CUP would argue the two go hand in hand.

How all this will pan out is not yet clear. The earthquake has only just happened and the old buildings are still in the process of collapsing. A lots depends how the Spanish Socialist Party (PSOE) responds. If it agrees to work in a grand coalition with the PP it could shut out the leftist – for the time being – but would probably suffer further erosion of its support as result. Alternatively it could throw in its lot with the new spectrum of leftist parties, which might well also mean further erosion of its support.

The political economy of the election results

Currently yields on most eurozone bonds, bar the Greek ones, are at very low levels. This follows the so called Draghi ‘put’ which was when in July 2012 ECB President Mario Draghi said “the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough”. The ECB then began a program of Outright Monetary Transactions (OMT). Billed as necessary for safeguarding the monetary-policy transmission mechanism and ensuring a common monetary policy, this involved the ECB pledging unlimited purchases of sovereign debt in secondary markets for applicant countries, subject to fiscal conditionality as judged appropriate. This was followed earlier this year by the beginning of a multi-year ECB sponsored program of Quantitative Easing (QE) which would amount to a total spend of €1.1 trillion by its end in September 2016.

Stripping away the financial gobbledygook this means that the ECB and the eurozone central banks are buying up government government bonds, not directly from governments but from financial institutions that are holding them (banks, pension funds etc), and this in turn drives up the bond prices and drives down yields which makes refinancing the debts of eurozone countries like Spain and Italy much cheaper and thus makes their debt burden sustainable.

However if Greece is pushed into Grexit and/or anti-austerity parties were to make dramatic political gains the market could easily spook and drive eurozone bond yields up again, and this could make refinancing government debt very expensive very quickly. In which case there would be once again a generalised crisis of the eurozone.

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