Spain austerity plan scrapes through parliament

[Joanne98]

Source: Reuters

Reuters) - Spain's governing Socialists won approval for a 15 billion euro ($18.4 billion) austerity package by a single vote on Thursday, but the narrowness of the victory raised doubts over the government's ability to steer the country through an economic crisis.

The razor-thin majority piled pressure on Prime Minister Jose Luis Rodriguez Zapatero, who has been forced to ditch his party's traditional alliances in pushing through spending cuts and labor reforms as markets fret Spain could suffer a similar crisis to Greece but on a larger scale.

The prime minister called off a scheduled trip to Brazil on Thursday, as an end-May deadline loomed for an agreement with unions and business on wide-ranging labor reforms -- a key policy demand by international markets.

Unions met Thursday and warned that they would call a general strike if the government goes ahead with changes to labor market rules without their consent, saying there were still big differences with business on the reform.


Read more: http://www.reuters.com/article/idUSTRE64Q54T20100527

[provis99]

1. I must be left wing...

if a Socialist party is looking suspiciously right-wing to me. The only austerity package I'd settle for in Spain is one that taxes the poop out of corporations, rich people, and British immigrants avoiding British taxes by living in Spain.

[liberation]

2. The irony of it all...

Spain has actually a rate of debt smaller than either the Germans and French, and specially the UK. And they actually reformed their banking system to prevent crisis like the one we just went through (and are still going through).

However, their economy is too dependent on foreign investment, thus they have to play through the loops some people want socialized countries to go through in order to not have their debt ranking demolished. Financiers figured out how to have complete control with a power based on what it amounts to pretty much nothing but placebo. It is fascinating.

The socialist party in Spain has been always been more of an awful collection of professional politicians, united more by their hatred of the old guard (Franco et al) that their interests in actual leftist platforms. The current Spanish president is an example of that: he has had ZERO actual real world management/achievement experience, other than his life long membership in the party. He is an awful politician, a remarkably bad manager, and he is so detached from the reality of the country, that he has lost most of the confidence of large sectors of the population. The Spanish president has a knack for picking the wrong fight, at the wrong time, while completely ignoring or right out surrendering those "fights" he is supposed to take upon. The current Spanish government looks more like a collection of kids playing politician, than an actual collection of adults in charge. Some of the pet projects they are proposing as policy are just monumentally laughable.

Apparently hubris and incompetence are not exclusive realms of the right.

[naaman fletcher]

3. "And they actually reformed their banking system to prevent crisis like the one we just went through

Actually, they have a massive banking disaster going on right now.