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5 "Tells" that the Stock Markets Are About to Reverse

This Spanish Spring is the Real Thing

Politics / Spain May 27, 2011 - 05:27 AM GMT

By: Patrick_Henningsen

Politics Best Financial Markets Analysis ArticleGiles Dexter writes: It was perhaps inevitable given its long associations with, and geographical proximity to the Maghreb, that Spain should be the first European country to be swept up by the wave known as the “Arab Spring”. Protests have been raging across the country since May 15th, and like previous rumblings in Greece, this Spanish Spring will likely send a new shockwave through the EU.


Indeed, a wave of discontent has arrived this month in Spain. People tend to forget that Spain had its own oppressive dictator, the 30′s Fascist survivor who steered clear of Hitler’s madness and instead ground down and impoverished his people with years of economic stagnation until the late 1970′s – El Caudillo himself, the Generalissimo Franco.

When Franco’s “democracy” finally came to Spain, it was a third world country in all but name; largely agrarian, with poor infrastructure and little manufacturing. Visiting in the early 1980′s, one was struck by the high levels of subsistence and unproductive employment – there were rows of men waiting to shine shoes, the disabled stood on street corners with lottery tickets pinned to their lapels, while street vendors peddled second-hand toys.


THE REAL DEAL: This ‘Spanish Spring’ is no minor affair.

Helped by generous EU grants and loans, Spain modernised rapidly and the sheer process of liberalisation opened doors. Media, creativity and the arts flourished in the 80′s and 90′s and Spain felt good about itself –politically and sexually liberated from the past at last. But still, their manufacturing sector never produced anything significant enough to prove a balance of trade. The explosion of tourism meant that shops and bars were busy, but barring booze, provisions and tourist paraphernalia, little of any scale or substance purchased bore the mark “Made in Spain.”

ECONOMIC MOUSE TRAP

An entirely false sense of prosperity engendered by their own infamous construction bubble is at the root of Spain’s subsequent economic collapse, with the by-product that the Spanish coastline has been completely and permanently ruined by the plethora of “Urbanisations” and “Apartamentos” that litter the once scenic Corniche. While thousands were temporarily employed as builders, surveyors, plumbers, estate agents and the like, their prosperity was only intermittent. But it had to end sooner or later. The market became completely saturated with identical apartments, few with any sense of place or purpose, bar enabling northern Europeans to soak up sun and sangria. Now the buyers have all gone away, thousands of flats and villas lie empty, unfinished building projects litter the edges of town centres and what have they got? Very little.

Franco’s failure to build a technological base in the mid 20th century, exacerbated by his democratic successors squandering of the opportunities afforded by EU membership, mean that Spain has very little to fall back on. Unemployment among the young now stands at a staggering 45% – that’s millions of people with little or no chance of finding serious work. Needless to say, even basic social security for that many people is expensive, the few with employment subsidizing the masses without. The property speculation bubble has also meant that chronic inflation has also set in over the last decade, challenging the affordability of many basic goods and services. It’s a recipe for political and social and unrest, with the added catalyst that dozens of Spain’s elected officials are being indicted for charges of corruption.

THE FLASH MOB MOVES NORTH

Thousands are now camped out in central Madrid along with 60 other sites nationwide, creating temporary cities of the dispossessed. The mainstream media in Britain and the West have chosen to largely ignore this phenomenon, perhaps because they fear that “it could happen here”.

UNEXPECTED: With all eyes on North Africa and the Middle East, no one expected an Iberian revolt.
This century, Spaniards have moved to the forefront of alternative culture, the shackles of convention and Catholicism that governed their parents and grandparents lives permanently binned. They seem to realise more than any other western nation that the dog and pony show of replacing the “left” party with the ‘right” endlessly is little more than a hypnotic charade. They have taken the “Arab Spring” a step further by rejecting the periodic plebiscites that the West clings to as its claim to democracy, instead starting to demand real change – to economic structures, to political representation and even to the way we treat each other.

At the camp in the “Puerta del Sol” in Madrid, free food is handed out. What’s being demanded is a new society, not just papering over the cracks of the old one. The movement itself has no single leader or figurehead; all decisions are made by consensus at general assemblies, held twice daily. Hundreds, sometimes thousands, attend the meetings, with no decision taken until every single person is in agreement. This is real synarchy in action, the genus of genuine political change and it should be applauded. It represents a major challenge to the old order of “representative democracy” focused on personality and privilege and is arguably the most significant grass-roots political development since Paris in 1968. There is a sense of optimism, and let’s hope it lasts.

Remember, Spain was at the forefront of western thought in the early 20th century and it nearly transformed, albeit temporarily, into anarchist state, before Franco turned it backwards into a textbook fascist state.

At one point last week, an electoral committee assembled by the government declared the protest camp “illegal”. But even though there were strong rumours of an impending police “clean-up” operation, and seven riot vans gathered at one side of the square, protesters have remained at all times in a defiant spirit.

“If they take us from the square tomorrow, the only thing that they will get is that they will make us stronger and we will come back stronger,” says 22-year-old Juan Martín. “We want a new society. This one doesn’t work anymore.”

Editor Patrick Henningsen

21st Century Wire

© 2011 Copyright Patrick Henningsen - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


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