Spain: In The Footsteps Of Greece

By Author: PAOLO BRERA
Total Articles: 62
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Did you say Greece? But Greece has only 3% of EU GDP, a possible default would not have a major impact on the euro. California, say, produces 19% of the GDP of the United States, is open by default, and with all this, no one thinks that the dollar is in trouble for this, nor that the State has the moral capital is going to Tinseltown leave the dollar and give itself its own currency, the schwarzeneggherio.
Do not say, Greece, then. Say, perhaps, Spain. "It is clear that certain attacks are directed against Greece in general ... against the euro after Greece, there are Portugal and Spain," said Prime Minister Papandreou Iórghos greek, pledged to fight the ghosts of devaluation and the 'Euro exit from the crisis evoked Greece. Only in Ireland the economic crisis has hit hardest in the Iberian country. The data on which it is clearly seen is that of unemployment: that is, the Spaniard who was a walk: and fun, as was believed to specify a trade unionist interviewed by TV, "no por falta de oportunidades por Pereza up" not lazy but because they lack the opportunity. Since the crisis, since mid-2007, workers who do not have ...
... a job and were looking for two million and a half: in 2009 alone, unemployment has increased by 1,118,600 units to arrive at the figure of 4,326,500 . This is a wire less than 19% of the workforce. A percentage disastrous. At the end of January, the Socialist prime minister, José Luis Rodríguez Zapatero, has submitted an austerity plan that encompasses the state, regions and social security. The state budget remained in surplus until October 2008, but from that month onwards have opened the floodgates of spending. Last year, the deficit was on 11, 4% of GDP. The project of the Government expects to cut expenses by half a percentage point of GDP this year: "The aim is to bring the deficit to 3% of GDP in 2013," said Vice-President económica, Elena Salgado. This is the request of the European Union and the magic minute phrases waiting for financial markets. Salgado added: "We want to give citizens confidence that we will do what we do." At the cost of moving from one moment to the next two years the retirement age, 65 to 67 years. A measure that saves a lot to the social security but does not seem to do much to curb youth unemployment, which is the most acute problem in Spain. Factors behind the crisis are clear. I had three mainstays of the economy: tourism, construction and availability of the rest of the world to Spain to pay the money to invest. The property sector has fallen as in America and dragged in the fall construction. Tourism has slowed. As for foreign investment, Spain has lost its AAA rating and global credit crunch has had a profound effect on the ability of Spanish debt. A recent report by McKinsey considers the Spanish economy more than ever at risk of deleveraging among the major economies in the world, even more than Britain. In fact the Spanish is very high debt to GDP, excluding the public sector, but it is precisely by multiplying hours trying to hold together the cabin.
Ultimately, the problem of Spain and then to almost all the West: consumption and wages are too high to compete with the economies of more recent industrialization. It would take a great inflation, but this is because Spain is not included in the Eurozone. Failing this, the Spaniards could work harder and / or with greater efficiency without an increase in salary. Easy? Not too much. And immediately, impossible: we want to invest in production facilities and human capital. And then we must do as Germany: lower wages, increase working hours, and thus bring down wholesale prices. Everything is a matter of distributive justice will not be easy to digest for anyone. The alternative however is to cement a growing underclass of unemployed people in society to become fast enough a subclass of unemployable. We can resign from a deterioration in living standards, given that the economy does not produce that keep the level of recent years. You may think that the new conditions induranno many immigrants from moving part of the problem in their countries of origin. The government of Madrid is probably aware that there are other ways. But like any government that depends on the votes of the electors, can not say it clearly.
Paolo Brera
Photo: Jose Luis Rodriguez Zapatero