Posted by: Dirk | April 28, 2016

1,610,900 Spaniards live in households with no jobs

According to Spanish media, the number of Spaniards living in households where none of the members has any job stands at 1,610,900 (source: El Mundo, original data at INE). This is a very sad story. As Reuters reports, unemployment in Spain has ticked up in the first quarter. Even though this is typical for winter, the unemployment rate still stands at 21%, which is a dangerous level. Given all the talk about Brexit one wonders what Spanish voters would do if they were confronted with the question of Spexit. If a country cannot guarantee jobs for its population, how is political stability achieved? The answer is difficult to find, but probably the country’s institutions needs to be rearranged so that mass unemployment can be addressed.

Spain, which is facing new elections soon if nothing surprising happens, will have to find political solutions for political problems. One indication of what might work is the recent increase in economic growth that came with a higher government deficit, as reported by Reuters. Perhaps more government spending could help any economy where the private sector does not and cannot spend enough to achieve full employment?

On a personal note, I find it odd that the social problems resulting from austerity policies get almost no media coverage unless there are elections, the government breaks the deficit rules or the government is threatened with bankruptcy. In the US, “the” dictum for presidential elections is “It’s the economy, stupid”. Why do European politicians, why does European media think that we’re different?

At the end of February, I had a discussion on the political consequences of austerity politics. I couldn’t get myself to come up with even one single head of state who did austerity policy and got reelected inside the usual rhythm of elections. Tsipras of Syriza in Greece was re-elected, but that was hardly a year after he came to power. German chancellor Merkel got reelected, but she didn’t do austerity policies at home: the black zero (a balanced government budget) has been achieved by higher tax income, not lower spending. Ireland and Spain both had governments that did not win reelection lately, and I can’t think of a country in the euro zone where the government cut spending and got reelected in the period of 2008/09 till today.

Since new political parties can be created from nothing, we’ll see more new parties entering the European policy space. Whether they have any good strategies remains to be seen.


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