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Generational Dynamics Web Log for 22-May-2011
22-May-11 News -- New 'Spanish Revolution' signals electoral change on Sunday

Web Log - May, 2011

22-May-11 News -- New 'Spanish Revolution' signals electoral change on Sunday

EU official proposes forcing Greece to privatize

New 'Spanish Revolution' signals electoral change on Sunday

What started out as a small gathering last Sunday has ballooned into huge protests in Madrid's Puerta del Sol square, with tens of thousands of protests camped out, protesting austerity measures and government corruption. There were also large crowds in Barcelona, Valencia and smaller cities, according to TV Spain.

Protests in Madrid's Puerta del Sol (MarketWatch)

Protests in Madrid's Puerta del Sol (MarketWatch)

The protesters have been peaceful, mostly young people, but including families with small children. The quickly growing size of the spontaneous protests was a surprise to authorities, who declared that they would be illegal on Saturday, the day before Spain's regional elections on Sunday. But protesters ignored the demands to end the protests, and police have allowed them to continue unhindered.

The size of the anti-government protests illustrates how deeply the anger at the government of Prime Minister José Luis Rodríguez Zapatero has grown. Polls show that on Sunday his ruling Socialist Party (PSOE) could suffer important losses to the center-right Popular Party (PP).

But that's not the biggest threat, according to Market Watch. The biggest threat is a "reckoning of accounts" in the various regions, where in some cases the Socialists have been in power for decades. There is evidence that these governments have been hiding significant amounts of debt, so that as new regional governments take power, this additional debt will be revealed.

Spain's economy is already in a precarious position. Unemployment is around 20%, and it's at 42% for people ages 15 to 24, the age group of the principal protesters, who see no hope for themselves in sight, and are referring to themselves as the "lost generation" and "los indignados" (the outraged).

But lack of jobs and a devastatingly poor economy are not the only reason for the protests. "We protest against the political situation that allows more than 100 people who are accused of corruption across the country to stand in the next elections," says one protester quoted by the BBC.

In fact, one PP candidate, Francisco Camps, is likely to be re-elected as head of the regional government of Valencia, and by the end of the year he's likely to be in court facing bribery charges, according to the Toronto Star.

He's just one of many PP politicians caught in what's known as the Guertel scandal. According to a 2009 description by Deutsche Presse-Agentur, PP politicians were given tailor-made suits and other clothing items in return for awards for contracts that paid kickbacks. The corruption network has been named Guertel, the German word for "correa" which means "belt."

As one of Europe's PIIGS countries (Portugal, Ireland, Italy, Greece and Spain), European officials are hoping against home that some miracle will happen, and it won't be necessary to bail out Spain, in the say that Greece, Ireland and Portugal have had to be bailed out. All the European politicians are claiming Spain is completely safe.

But let's recall that European politicians have lied over and over again, and Eurogroup chairman Jean-Claude Juncker recently was quoted as saying, "When it becomes serious, you have to lie," as we reported two weeks ago. By their own admission, it's not possible to believe a word that European financial executives say. They will deny that anything is going to happen until it actually happens. And with a corruption scandal brewing in Spain, "it" might happen to Spain before too long.

Juncker proposes forcing Greece to privatize

One of the many conditions imposed by the EU in return for last year's bailout was that Greece would privatize gas and phone companies, and well as some state-owned banks, and would shut down loss-making state-owned enterprises. But the Greeks have been stalling on doing this, because of public sector union opposition to losing jobs and membership. Eurogroup chairman Jean-Claude Juncker is now proposing to take the decision out of Greece's hands by creating a "privatization agency," independent of the Greek government, staffed by EU officials. "Henceforth, the European Union will escort Greece's privatization program as if we were conducting it ourselves," said Juncker. Wow! That's going to be one bloody fight. Reuters

France signals a shift toward approving a 'rescheduling' of Greece's debt

For the first time, a French official is suggesting that France might go along with the 'soft restructuring' of Greek debt that we've been hearing so much about these last few days. Under this plan, Greece would be given more time to pay off its debts, though it would still technically be a default. French Finance Minister Christine Lagarde, who is being named as a candidate to replace Dominique Strauss-Kahn as head of the IMF, said that France might support a restructuring, provided that the banks holding Greek debt agreed "voluntarily." However, the European Central Bank (ECB) has expressed bitter opposition to any kind of default, since it could trigger a chain reaction that could put all of Europe's financial system in danger. Wall Street Journal (Access)

Iran applauds Spain's anti-government protests

Iran's state-run news service is applauding the Spain protests:

"It can't be ignored that the spontaneous burst of people on the streets draws strong parallels to the North African and the Middle East revolutions, which saw youngsters take a stand, initiating gatherings through social media, overnight camps and defying authorities - some are asking could this be the start of Europe's Tahir Square?"

I have to say that these guys really have balls to say something like that, after Iran's similar protests were turned into a bloody massacre. Press TV

(Comments: For reader comments, questions and discussion, see the 22-May-11 News -- New 'Spanish Revolution' signals electoral change on Sunday thread of the Generational Dynamics forum. Comments may be posted anonymously.) (22-May-2011) Permanent Link
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