At last…..Spain

There’s that song, you know, it starts with “at last”….I can never remember the rest, but the tune gets in your head.  Those are the words that came to mind with this article.  As I have written extensively on this blog, the EU austerity policies are a disgrace for those imposing them, and a travesty for the depression era living standards being experienced by the millions in Europe at the receiving end.  These policies are nothing more than a wealth grab by the wealthy.  All credit to the author. 

Ambrose Evans-Pritchard is one of the better writers on issues in Europe.  Less so elsewhere.  Pithy, insightful, and old enough to know what’s best.  

In this article, about as clear as you can get on the macro issues in Euro zone, he writes of the statements of the Spanish Premier Mariano Rajoy.  In that he “point blank” refuses to comply with the Euro enforced austerity measures.  

Ambrose E-P writes in The Telegraph:

In the twenty years or so that I have been following EU affairs closely, I cannot remember such a bold and open act of defiance by any state. Usually such matters are fudged. Countries stretch the line, but do not actually cross it.

With condign symbolism, Mr Rajoy dropped his bombshell in Brussels after the EU summit, without first notifying the commission or fellow EU leaders. Indeed, he seemed to relish the fact that he was tearing up the rule book and disavowing the whole EU machinery of budgetary control.

He is surely right to seize the initiative. Spain’s economy will contract by 1.7pc this year under his modified plans and unemployment will reach 24pc (or 29pc under the 1990s method of counting). To compound this with manic fiscal tightening – and no offsetting devaluation – is intellectually indefensible.

There comes a point when a democracy can no longer sacrifice its citizens to please reactionary ideologues determined to impose 1930s scorched-earth policies. Ya basta.

What is striking is the wave of support for Mr Rajoy from the Spanish commentariat.

This one from Pablo Sebastián left me speechless.

My loose translation:

"Spain isn’t any old country that will allow itself to be humiliated by the German Chancellor."

"The behaviour of the European Commission towards Spain over recent days has been infamous and exceeds their treaty powers… these Eurocrats think they are the owners and masters of Spain."

"Spain and other nations in the EU are sick and tired of Chancellor Merkel’s meddling and Germany’s usurpation – with the help of Sarkozy’s France and their pretended "executive presidency" that does not in fact exist in EU treaties."

"Rajoy must not retreat one inch. The stakes are high and the country is in no mood to suffer humiliations from a Chancellor who is amassing all the savings of Europe and won’t listen to anybody, as if she were the absolute ruler of the Union. Merkel and the Commission should think hard before putting their hand into the sovereignty of this country – or any other – because it will be burned."

This then is the fermenting mood in the fiercely proud and ancient nation of Spain in Year III of depression, probably the worst depression the country has seen since the 1640s – or have I missed a worse one?

As for the "Fiscal Compact", it is rendered a dead letter by Spanish actions.

Gracias a Dios. If the text were enforced, the consequences would be ruinous. It enshrines Hooverism in EU law, and imposes contractionary policies without the consent of future parliaments – including any future Bundestag. Indeed, it probably violates the German constitution.

But it won’t be enforced in any meaningful sense because the political realities of the EU are already intruding, and will intrude further. A president François Hollande of France will rip it up.

The Latin Bloc is awakening.

All hail the hero!!  Both the Premier and A E-P.