On the new clothes of the Spanish economy, where’s a child to tell the truth when you need it?

Hobbes, what Spain needs now, is the child in the crowd that that the emperor is walking down the street fully naked, and tells the truth. But they do not listen.

Today, it was the turn of the FT.com (Spain’s recession: After the fiesta). Paul Preston is considered one of the top specialists in the Spanish Civil War, and now it seems it takes the Financial Times to state the obvious. What is wrong with Spaniards that need a foreign voice to see reality as it is or was? Even El Pais, the leading left-wing Spanish newspaper, needs to quote the FT to comment on the matter. 

It was said that 40 years of autarkism made everyone wary of “Made in Spain” labels, but it seems that 20 years of growth fuelled on EU cohesion funds and lots of cheap money have made them believe that they are smarter than thou. How wrong they are.

I lost hope in Spain long time ago. I don’t really see it existing in the 21st century. I really don’t. Don’t get me wrong, Italy, Greece, America… à mon avis, pretty much any Western economy based on manual labour will disappear. Manufacturing workers just look the other way when faced with almost 4bn hands that came in to the global markets in the last 10 years. They shouldn’t.

The FT article says:

Almost every chief executive, orthodox economist and rightwing opposition politician in the country concludes that the only way for Spain to emerge stronger from the crisis – indeed, to survive it within the confines of the eurozone – is for it to improve productivity and competitiveness by adopting structural reforms. By that they usually mean that employees could be hired and fired more easily and cheaply and wages would be set by companies rather than entire industries.

“Improve productivity and competitiveness by adopting structural reforms.” Wishful thinking. A closer look to the Spanish social fabric will show you that it would be easier to promote interracial, interreligious marriage in the Gaza Strip.

See, as Spaniard, I think that that the problem lays in the Spanish (Latin?) spirit. They’d rather drown together than save some of them. They dress it as camaraderie, social awareness, but it is not, it is just envy, short-termism, and hatred for other’s success (ever wondered why convertible sales are proportionally higher in rainy UK than in sunny Mediterranean countries? Think of having your car used as a waste bin).

The going got tough, that’s a fact. UK and US manufacturers have been trying for months:

1. Lay off temporary or contract workers
2. Stop production to lower stocks
3. Negotiate salary reductions
4. Making workers redundant.

The whole idea of the sequential approach is to maintain highly specialised workforces and ensure the survival of the company in the long run.

The problem in Spain is that the lack of flexibility in the job market makes hiring and firing too expensive for the company leading to the final bankruptcy of the company in the current conditions.

When the recession or depression turns, the surviving businesses will grow stronger. But in the case of Spain, there will be no Phoenix to be born again from the ashes.

Is that selfishness or stupidity? I try hard, but I really don’t know. Last year I wrote a post on a similar attitude in Italy (On Alitalia’s trade union lack of realism and long-term vision), but I cannot understand why anyone would trade 4 months of full salary and employment in exchange of 1, 2 or a life unemployed.

When things get back to normal, flexible work markets will be back. Life is not about how fast you run or how high you climb but how well you bounce.

If nobody does, I will cry it out:  But he has nothing on!!



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