With March 4 Cortes vote set to fail, Spain may have run out of coalition options
Socialist leader Pedro Sanchez is trying to secure enough support to win a vote in the Spanish parliament on March 4 and form a left of centre coalition government. However, this seems currently unlikely, and a fresh election in June is the most probable outcome.
On 24 February the leaders of the Socialist (PSOE) and Ciudadanos (‘Citizens’) parties made a surprise announcement, declaring that they had signed an agreement to form a “reformist, progressive government” ahead of a vote of confidence in the Spanish parliament (Cortes) on 4 March.
In response, the other party negotiating with the PSOE – the leftist Podemos (‘We Can’) – announced that they would not support the pact. This leaves the PSOE-Ciudadanos block with only 130 votes out of 350 votes for next week’s voting. So where does that leave Spain if PSOE fails – as expected – to gain the extra 46 votes needed to form a coalition government?
After the inconclusive elections in December, the conservative Partido Popular party (People’s Party, or PP) of current Prime Minister Mariano Rajoy was given the first chance to form a government. The PP’s only likely partner was Ciudadanos, but the two could not reach the threshold of 176 seats in the Cortes. In late January, Spain’s King Felipe VI then gave Pedro Sánchez the opportunity to form a coalition government. A general mood of anti-PP sentiments provided the PSOE leader several options, but an agreement on several thorny issues has so far been elusive.
Spain’s December 2015 general election result. Source: BBC
What are the issues?
To various degrees, all centre and left of centre parties oppose austerity. Spain was hit particularly bad by the financial crisis, and although a trend of positive growth and more jobs has continued after the election, unemployment levels are still very high.
Spain’s prolonged unemployment crisis. Source: Eurostat
Both Ciudadanos, considered the most liberal and centrist of the main protagonists, and Podemos, the ideological cousins of Greece’s Syriza, are new insurgent parties who want a democratic renewal and demand reform of what they see as a corrupt establishment.
While these principles would be acceptable to Sánchez, who earlier berated Rajoy in a televised debate over the PP’s alleged charges of corruption, there is one issue he is unwilling to negotiate on: an independence referendum for Catalonia. Podemos publicly supports a Catalan vote, the PSOE opposes one, while the very existence of Ciudadanos is based on its founders’ hostility to separatism in Catalonia.
As part of the PSOE-Ciudadanos agreement, a package of constitutional reform – not a referendum – was on the table to address grievances in the region.
Spain’s GDP growth continues. Source: Bloomberg
Other EU leaders will be keenly watching how events unfold. A referendum for Catalonia would provide yet another headache for the EU, having only just navigated a similar poll in Scotland and with the Brexit vote looming in June.
If the socialists can form a coalition government, the calculus in Brussels and Berlin will again shift. It would leave almost the entire southern and eastern rim of Europe in some sort of dispute with Germany and general EU policy. Spain would add its voice to the anti-austerity chorus, having been one of the ECB’s best behaved pupils under the Rajoy government.
Are there any coalition options left?
Sánchez failed in his first attempt to win an absolute majority in a vote of confidence on 2 March. If the second vote, this time seeking a simple rather than absolute majority, on 4 March is – as predicted – also a ‘no’ there may be some frantic negotiations still left to pursue. If they fail then a new election will be called.
The only perceivable options that remain are a ‘grand coalition’ including the PP and a combination of the PSOE and Ciudadanos. The strength of animosity towards the ruling party, however, makes this unlikely.
The other possibility is that the PSOE concedes a referendum over Catalonia and forms a government with Podemos and therefore receiving the tacit support – through abstentions – of Catalan nationalists in the Cortes. Again, this seems a long shot.
Fresh elections
If a new vote is called, probably for June, what will have changed? Recent opinion polls show Spanish voting intentions have not significantly altered since December, with the exception of a possible increase in support for Ciudadanos. Corruption allegations mount for the PP and this may dent its share of the vote. It might also mean the party fields a different candidate as its leader, as Rajoy’s reputation is becoming increasingly tarnished.
This all leaves the question: what was the purpose of the PSOE-Ciudadanos gambit?
It may be that Pedro Sánchez hoped, mistakenly, that it would encourage Podemos to join a coalition. The make-up of the agreement could also be significant. Sánchez and Ciudadanos leader Albert Rivera set out five areas of cooperation, which may convince voters that the two parties have a positive vision for Spain and can cooperate in government. It also provides both the PSOE and Ciudadanos with the opportunity to blame the PP and Podemos for obstructing their proactive attempts to form a government.
Expect plenty more posturing in the coming months.
