Sunday, December 20, 2015

Spain's Voters Rejected Austerity Today


Spain elected a new Parliament today and turnout was high-- something like 73%. But because no party won a majority, it's not clear which parties will form the new government. It does look like the left will control more seats in the lower house of the Cortes. The election was fought over Austerity and the right-wing incumbent government of Mariano Rajoy and his party-- Partido Popular (PP)-- won 123 seats out of 350 (and 29% of the popular vote) but that's a third fewer seats than the 186 they won in 2011, and far from the 176 they need for a majority in the Congress of Deputies.

The second biggest vote-getters were the Socialists-- 22% of the popular vote and 90 seats, but it was the two new parties to whom so many voters turned and who now hold the key to who gets to form a government. Podemos is the non-traditional party of the "new" left and they got 21% of the vote, almost as much as the old line Socialists, and won 69 seats. The fourth ranking party was Ciudadanos, pro-business centrists who won 40 seats and 14% of the vote.

Every European prime minister who has imposed a harsh austerity agenda-- similar to the vision Paul Ryan laid out for America the other day-- has been defeated at the polls. If Rajoy manages to cobble together a coalition, he'd be the first who managed to win two terms. Cuidadanos is the obvious place for him to turn but that would still just be 163 seats, a dozen short.

Rajoy's party still controls the upper house so if the two left-wing parties got together with a couple of smaller regional left-wing parties they could form a government but all their initiatives could be stymied in the Senate. This is all made even more complicated by the fact that the two left wing parties hate each other and the two right-wing parties hate each other. It could take months to form a coalition no matter who heads it.

Today Paul Krugman noted in a NY Times column that austerity hasn't done anything to help Spain's economy or workers, just made the situation worse with unemployment around 22%. Like everyone else following the election returns there he has "no clue how this works out; apparently every possible structure for a new government is impossible, except in comparison with all the others. And meanwhile the euro effectively imposes a straitjacket whatever voters say. But anyway, those getting ready to toast the vindication of austerity after all might want to put the cava back in the fridge."

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