Upcoming elections in Spain bring two new parties, Ciudadanos and Podemos, into play.
Spain will hold a general election on 20 December. Significant support for new parties are a threat to incumbent Prime Minister Mariano Rajoy and his Partido Popular (PP), which is seeking another term in office.
Most polls show the PP slightly ahead but projections indicate this will not translate into a majority in the Cortes General, the Spanish Parliament. This could leave open the possibility of a coalition, bringing the main two new parties, Ciudadanos and Podemos into play.
Opinion poll projection, 2 December, 12000 respondents, source: Redondo & Asociados
It’s the economy
The last election, held four years ago, decimated the then ruling socialist party (PSOE). The PP had a clear mandate to reform the sickly Spanish economy: in recession, with soaring unemployment, trade union strikes and in danger of the bond market contagion that had damaged Greece, Ireland, Portugal and Italy. The PP broadly swallowed the austerity pill, cutting spending, weakening employee rights and introducing some liberalization measures.
Voters now appear to be on the verge of giving the government the benefit of the doubt and another term in office. PSOE support, similarly to the SPD in Germany and Labour in Britain, has flatlined around 25%.
The economy has grown faster than other European countries in the last two years but unemployment – although falling – was still an eye-wateringly high 21% in October. Economic indicators over the four-year term have not altered significantly, but the fact that they are moving in the right direction will benefit the PP.
Trouble brewing in Catalonia
The issue of regions agitating for independence has long bubbled under the surface of Spanish politics. The Basque Country is widely known for this reason outside Spain but since the financial crisis that has paralyzed the Eurozone it is Catalonia that has taken center stage.
In the 2011 general election, the Catalan nationalist parties won a majority of votes in the province for the first time. In September this year, Catalonia’s President Artur Mas pronounced that the regional elections would be a surrogate poll on independence. Separatist parties won a narrow combined majority of seats, although the combined vote fraction was under 50%.
Subsequent pronouncements about starting a succession process drew frosty responses from Madrid, where the Prime Minister threatened Mas with court action. The PP is traditionally more hostile to the regions than the PSOE, so a return to power for Rajoy’s party will hasten confrontation over the issue. Whoever assumes power in the forthcoming election, they will need to do a more effective job than the current government of addressing Catalan grievances.
New parties fuelled by austerity and corruption scandals
Enter anti-establishment parties. As well as disquiet over the main parties’ inability to reduce unemployment and turn the economy around, the Spanish establishment has been embroiled in a number of corruption scandals. The most significant is an alleged slush fund involving senior members of the PP and skirts dangerously close to Rajoy himself.
In Catalonia, Artur Mas’s Democratic Convergence of Catalonia (CDC) party have also been implicated in a corruption probe. This has paved the way for the rapid rise of two new political parties. On the left is Podemos (‘we can’) that was borne out of the Indignados protests of 2011. Led by the pony-tailed 37 year old Pablo Iglesias, Podemos made significant gains in May’s municipal elections. Since then, though, the party has lost ground ahead of the general election as support has grown for Ciudadanos.
Ciudadanos (‘citizens’), led by the even younger Albert Rivera (36 years old) is a centrist party that has economically and politically liberal leanings. The party, however, was founded in Catalonia as a response to the region’s separatist movement. In the last few months it has surged in the polls, with some now showing it on level-pegging with the PP and PSOE. This puts Ciudadanos in pole position to call the shots in coalition talks.
A coalition government featuring Ciudadanos with either the PP or PSOE can be expected to take an economically liberal turn, where there is plenty of opportunity for reform. Despite four years of austerity under the PP, Spain lags behind comparable countries in Europe in the World Bank’s Ease of Doing Business rankings (currently 33rd) and the Heritage Foundation’s index of economic freedom.
Spain, Index of Economic Freedom. Source: Heritage Foundation
Rivera, however, is wary not to repeat the Liberal Democrats’ fate after five years in power with the Conservatives in Britain. He said recently, “We know what happened in England and that to enter in a government that doesn’t believe in your changes can lead you to a situation of incoherence and disappointment. We won’t get married with a party that doesn’t believe in change.”
The issue of Catalan separatism, therefore, will loom large in any coalition agreement, and might mean that power-sharing with the PP, rather than the PSOE, is more likely. If a PP-Ciudadanos government comes to power, expect a showdown with Artur Mas and Catalan separatists.
This all means instability for Spain in the short term, at a time when it can ill afford the threat of an unruly dispute over its restive region, or worse, break-up.