In response to a perceived debt crisis in Spain, the European Union has imposed harsh austerity policies that have thrown the Spanish economy into a tailspin. Unemployment levels are the highest in Europe: 24.4% over-all and 50% for those under age 25. As unemployment grows, consumer demand falls, causing more businesses to fail, leading to further layoffs. Bankruptcies, evictions, and capital flight have reached record levels. Young people with skills are fleeing the country—350,000 in the past four years. And increasingly, senior citizens share their social security and pensions, however meager, with their children and grandchildren. The Spanish people are “paying for dishes they didn’t break”—a refrain commonly heard in the streets and printed on protest signs. Spain, like the US, had a housing bubble that collapsed in 2007, precipitating the crisis. But while private debt was high, Spain’s public debt was among the lowest in Europe, and the government ran a surplus in 2007.
Then, with the economy in recession in 2008 and 2009, the government faced declining tax revenues and increasing costs for social services. The deficit that emerged was a result of the crisis, not the cause, and the debt grew from 27% of GDP to 65%—still much lower than Germany’s current debt-to-GDP ratio of 81%.
Meanwhile, the leadership of the European Union misdiagnosed the crisis, attributing it to excess public debt and irresponsible government spending in the peripheral countries (derisively termed the PIIGS (Portugal, Italy, Ireland, Greece, and Spain). Only the harsh medicine of austerity could cure the disease of profligacy, the austerians said. In fact, not all these countries were irresponsible and profligate; most of the peripheral countries of Europe had lower levels of spending on social services in 2007.
The already low level of social services in Spain is now being drastically cut. Austerity measures began in 2010 under the Socialist Prime Minister José Luis Rodríguez Zapatero, who in 2010 reduced the salaries of all public workers from 5 to 10%, froze the pensions of retirees, and raised the value-added tax. In recent months the conservative government of Prime Minister Mariano Rajoy, of the “Popular Party, increased the retirement age to 67, eliminated health care for undocumented immigrants, changed labor contracts making it easier to hire and fire, raised income tax at every wage level, raised university tuition by 50-60%, and still more tax increases and budget cuts are on the way.
As Spanish citizens face ever more difficult circumstances, many express bitter resignation. They feel “damned if they do, and damned if they don’t”; staying in the Eurozone means enduring a decade of austerity, but leaving it would bring economic chaos, bank-runs, and a devaluation of people’s savings. At the same time, active resistance to austerity is growing, as people mobilize around concrete issues and work towards building a mass movement. Unemployed workers have organized a protest movement, the “Marea Roja” (Red Tide); teachers, students, and parents who oppose cuts in education have joined the “Marea Verde” (Green Tide); and residents of Madrid opposed to the privatization of water have formed the “Marea Azul” (Blue Tide). Labor unions have also been active in the resistance movement; most notably, the miners of Asturias, who are striking and marching on Madrid to protest cuts in subsidies.
Spain has a long tradition of street protest, and recent demonstrations have been massive. The largest protests have been organized by young people in the 15M (May 15th) Movement, which served as a model for Occupy Wall Street. On May 15th, 2011, tens of thousands of youth occupied the Puerta del Sol, the central plaza in Madrid and remained for weeks before being forcibly removed by police. The movement spread to other major cities as well. In the year since, the 15M movement has been organizing in neighborhoods and towns, holding assemblies and forums, resisting evictions, helping the unemployed, creating workshops and community gardens, and continuing to hold mass demonstrations around demands for electoral reform and economic justice.
The austerians advertised their policies as “expansionary fiscal contraction.” By balancing budgets and reducing debts governments would restore confidence, which in turn would lead to higher investment and economic growth. Now, as evidence to the contrary mounts—as austerity instead pushes economies into a downward spiral—it becomes increasingly clear that this policy driven by a global economic elite that is determined to take full advantage of the global economic crisis in order to slash social services shrink government, cut regulation, and above all, to weaken governments so that markets reigns supreme.
In Spain, the ongoing mobilizations, or “tides,” remain dispersed, but they hold the potential of growing and uniting into a powerful mass movement. And indeed, a broad international mass movement will be required to block the austerian tsunami.