Conservatives in Spain are celebrating a landslide victory in today's national elections.

Continue reading the main story

Related Stories

What's the matter with Spain?

Metro symbol of economic crisis

Q&A: Spanish general election

 

Spain's centre-right Popular Party (PP) has won a resounding victory in a parliamentary election dominated by the country's deep debt crisis.

 

With almost all the votes counted, the PP, led by Mariano Rajoy, is assured of a clear majority in the lower chamber.

 

The Socialist Party, which has governed Spain since 2004, has admitted defeat.

 

Mr Rajoy, who is expected to tackle the country's debts amid slow growth and high unemployment, said he was aware of the "magnitude of the task ahead".

 

He told supporters there would be "no miracle" to restore Spain to financial health, and that the country must unite to win back respect in Europe.

 

Continue reading the main story

Analysis

 

Sarah Rainsford

BBC News, Madrid

--------------------------------------------------------------------------------

 

The Popular Party had already erected the platform for its victory speeches at its Madrid headquarters by mid-morning. Hours before the polls closed, workmen unfurled a huge, new banner that said "Gracias". Somewhat premature, it was quickly removed.

 

But there was no doubt who would win this race. Left-wing voters have punished the governing Socialist party: it is pretty tough asking to be re-elected when almost five million people are unemployed. So the mood over at PSOE (Socialist) headquarters today was distinctly subdued.

 

Here, though, the music is pumping through loud speakers. The crowds have gathered - many wrapped in the Spanish national flag. The PP and its supporters are beginning their party.

 

"Forty-six million Spaniards are going to wage a battle against the crisis," said the 56-year-old PP leader.

 

The PP won about 44% of the votes and the Socialists 29% in Sunday's election, according to near-complete official results.

 

The PP is expected to take about 186 of the 350 seats in the lower house.

 

As the results were announced, jubilant, flag-waving supporters danced outside party headquarters in central Madrid.

 

Socialist Party spokesman Jose Blanco congratulated the PP on its victory.

 

The BBC's Sarah Rainsford in Madrid says the right is headed for its biggest win since the end of the Franco dictatorship in 1975.

 

Parliament is expected to meet next month to confirm Mr Rajoy as the new prime minister.

 

'Sacrifices ahead'

 

The new government will have little time to show results and people are bracing themselves for a new wave of spending cuts, our correspondent adds.

 

Over the past week, borrowing rates have risen to the 7% level which is regarded as unsustainable. Unemployment stands at five million.

 

 

PP leader Mariano Rajoy: "We can only go forward if we all go forward together"

 

Miguel Arias, the Popular Party's campaign co-ordinator, said Spain was "going to make all the sacrifices".

 

"We have been living as a very rich country," he told BBC News.

 

"People are used to a very high level of public services and it takes time to them to acknowledge the realisation that we now are a poor country, that we have lots of debts and in order to pay them back we must reduce public expenditure and then we must recover the confidence of the markets."

 

Outgoing Socialist Prime Minister Jose Luis Rodriguez Zapatero was not standing again at this election.

 

His successor as party leader, Alfredo Perez Rubalcaba, has accused Mr Rajoy of planning severe cuts to health and education.

 

"Spain is at a historic crossroads," he told reporters in Madrid.

 

Correspondents say many are angry with the Socialists for allowing the economy to deteriorate and then for introducing tough austerity measures.

 

Spain's is the third Eurozone government in as many weeks whose fall has been attributed to the debt crisis.

 

The socialists in Greece and Silvio Berlusconi's Italian conservatives have also been swept from power.

 

Earlier this year, the governments of debt-stricken Ireland and Portugal also fell.

----------------------------------------------------------------------

 

This is not good for Spain.. As the people that really need the help will even suffer more... this summers protest camps and the marches that supported them will seem like a gathering for a summer prom.

Sounds like the citizens just wanted change, but the change they get might not be the change they want or need. I can't understand why one would try to cut spending when the economy is weak, when there are so many unemployed. It seems more logical to increase spending and offer tax breaks to the working classes, in order to stimulate the economy, and then pay back some of the debt during the economic expansion which then follows. Even the well heeled benefit when economies grow, this all makes so little sense to me. But the global economy is tied together as well, and if the rest of our houses are not in order, wonder what effect that will have as well.

I'm with you Bart, this conservative party's austerity measures might do just that - swell the ranks of the unemployed in Spain, and create more unrest. If the debt crisis is extreme, then someone might be wise to lend to Spain so the economy will expand and rebound, otherwise as one economy slips, one wonders if the rest will too..

Chuck, you can't have consumption without production. That's the problem with socialism - it's a temporal imbalance of consumption. Economic growth only happens when people are incentivized to invest in production (factories, hiring workers, etc).

 

If Spain really does shrink the public sector (I doubt they will significantly, but we'll see), then the result will be fascinating to watch. It would be a beautiful real-world experiment in the effects of freedom. Too bad the Euro will likely collapse regardless...

Chuck, you can't have consumption without production. That's the problem with socialism - it's a temporal imbalance of consumption. Economic growth only happens when people are incentivized to invest in production (factories, hiring workers, etc).

 

If Spain really does shrink the public sector (I doubt they will significantly, but we'll see), then the result will be fascinating to watch. It would be a beautiful real-world experiment in the effects of freedom. Too bad the Euro will likely collapse regardless...

>>

We gave the wealthy huge huge tax breaks here Jay, and what happened? Nothing. The rich put the money where they could get the best return; into the so-called consumer banking sector, lent to the workers who could barely get by, and sent the jobs elsewhere. And they socked it away elsewhere, so little was spent on goods and services, and the economy tanked. All the hoopla here about the rich needing tax breaks to invest in the means of production to stimulate the economy, and that did not work. So I don't buy it. Offer the money to the workers in the form of jobs and better wages and tax breaks, tax the wealthy more, and then if Spain still has the production of goods and services desired, the economy will grow. Even better, if the global economy grows, then all our economies will grow.

I would rather not look upon the well being of my fellow man as something of a living laboratory. If the public sector is shrunk during a time of economic recession, spending will shrink and the effects could be a deeper recession or worse. The only way I could imagine that actually working would be to give big tax breaks or even bonuses to the working class men and women so they could spend or invest in Spanish goods primarily, and if the global economy does the same, then it may be safe to purchase imports, as the exchanged money will give another country's people a chance to spend on the Spanish goods they desire, increasing production and good paying jobs across borders.

But Austerity in hard times = harder times. Spending during hard times = better times. Best to put the money into the hands of the working classes, for they actually bolster production when they purchase: makes factories expand to meet the demand, the best way to invest in factory infrastructure is by increasing profits from greater production levels via greater consumption levels. How and what we consume needs to be made efficient, greener, renewable in short, since we have to consider what is essential for life itself to be sustained.

The rich put the money where they could get the best return; into the so-called consumer banking sector, lent to the workers who could barely get by, and sent the jobs elsewhere.

 

I agree with this.

 

Governments have guaranteed the banks a higher return on lending to themselves (by buying sovereign debt) than they could normally get from making loans to average citizens. After all, governments can never go bankrupt - they just raise taxes or print money. The people are at a disadvantage when it comes to competing with governments for loans.

 

Think about how bad regulations and taxes must be in order for a Chinese worker 5000 miles away to be able to produce something more cheaply than you can! That's with all the costs associated with shipping and importing added! Wow!

 

Eliminating the minimum wage causes factories to be built here at home, and jobs to become available. Prices for the goods manufactured in this way fall drastically.

 

I would rather not look upon the well being of my fellow man as something of a living laboratory.

 

Neither would I! That's why I advocate leaving people alone.

 

How and what we consume needs to be made efficient, greener, renewable in short, since we have to consider what is essential for life itself to be sustained.

 

Look into liquid thorium reactors, you might be pleasantly surprised.

I agree with this.

 

Governments have guaranteed the banks a higher return on lending to themselves (by buying sovereign debt) than they could normally get from making loans to average citizens. After all, governments can never go bankrupt - they just raise taxes or print money. The people are at a disadvantage when it comes to competing with governments for loans.

> I'm recalling what Richard Wolff mentioned in one of his lectures. He mentioned that when the wealthy got their huge tax breaks, that instead of investing in infrastructure in factories and the like, they put it into consumer loan "products" which were the most lucrative - to lend to the very workers who couldn't get by on wages that were not increasing & jobs which were leaving, enticing them further into debt. And since we went into debt from giving the wealthy huge tax breaks, then our elected government decided to sell bonds, especially to the Chinese who saw them as secure, safe investments with a good return. But this is off the subject, except that the global economy is now so interwoven, that as one goes up or down, so do all others. I just hope the Spanish government doesn't copy what we've done, that would be a huge mistake.

Think about how bad regulations and taxes must be in order for a Chinese worker 5000 miles away to be able to produce something more cheaply than you can! That's with all the costs associated with shipping and importing added! Wow!

> Or rather how the utter lack of regulations in places (think air quality, water quality, and the like) allows for an artificially low price for goods, along with low wages, making Chinese goods competitive on the backs of poor Chinese workers and on the lungs and waters of China. Regulations often improve efficiency, and offer a way to improve overall wellness, something which cannot be measured monetarily. That, and when a nation puts a lot of effort into offering incentives and tax breaks to the companies there, the company see even lower costs, but the costs are then born by others.

Eliminating the minimum wage causes factories to be built here at home, and jobs to become available. Prices for the goods manufactured in this way fall drastically.

> Slavery was abolished in the 1865, I don't want to go back to that. We need to all rise to a higher standard, all the workers of the world, not slump to ever lower wages and conditions. I'm not buying it - workers had to struggle to attain a descent living standard, let's not go backwards. And if it takes more well-written trade agreements, then so be it. But in Spain's case, it sounds much the same - it seems austerity is for the workers, excesses are for the well-heeled.

 

Neither would I! That's why I advocate leaving people alone.

 

 

 

Look into liquid thorium reactors, you might be pleasantly surprised.

I would rather not look into a reactor, lots of radiation inside those things! What can be accomplished with energy efficiency is astounding, I believe we could achieve a 90% reduction in energy demand simply by doing things smarter and more efficiently. Then, wind, solar, biomass, and geothermal become enough to do what we need and then some - room for expansion!

The problems with nuclear are many, and not just from the reactor issues, but from mining issues, waste issues, intermediate vessels getting hot from the radiation. and when that's run out, then we have to switch anyhow, so I see little point in using exhaustible resources.

Spain's solar gains are tremendous, they could put lots of citizens to work increasing their solar power facilities, increasing the production of solar power units, manufacturing the components, and the like.

 

 

Sounds like the citizens just wanted change, but the change they get might not be the change they want or need. I can't understand why one would try to cut spending when the economy is weak, when there are so many unemployed. It seems more logical to increase spending and offer tax breaks to the working classes, in order to stimulate the economy, and then pay back some of the debt during the economic expansion which then follows. Even the well heeled benefit when economies grow, this all makes so little sense to me. But the global economy is tied together as well, and if the rest of our houses are not in order, wonder what effect that will have as well.

I'm with you Bart, this conservative party's austerity measures might do just that - swell the ranks of the unemployed in Spain, and create more unrest. If the debt crisis is extreme, then someone might be wise to lend to Spain so the economy will expand and rebound, otherwise as one economy slips, one wonders if the rest will too..

 

At the risk of not wanting to sound too much like David Cameron spending money that isn't there is the reason why we wre in this crisis. It's completely irresponsible governance. Former Labour cabinet member here in the UK, David Miliband said a few months back that the left has no answer for the economic crisis - a sly dig at his own party, but it does seem to prove the case. It seems the left can only provide primitive arguments on tax.

Chuck, you have a fear of eliminating the minimum wage, and I understand that. But I'm telling you the "market minimum wage" wouldn't be that much lower than what it currently is. In order to convince people to trade their labor/time for money, an employer needs to make them an offer that exceeds what they could make if they worked odd-jobs themselves - washing cars, growing and selling vegetables, painting, etc.

 

In other words, if I can more-easily make my own toothbrush than work in a factory to earn the money needed for a toothbrush, then I'll choose to make my own toothbrush. The odds this will ever happen in an advanced economy is slim, though, because there are specialists and factories that can produced toothbrushes far more cheaply than I can.

 

If I had to guess, I'd estimate the "market minimum wage" in America to be on average something like 5 or 6 dollars an hour. It would vary by area, of course.

 

At a certain point, it becomes more-economical to hire Americans than Chinese. That point is well above what the Chinese workers make due to the shipping costs and taxes associated with offshore manufacturing.

At the risk of not wanting to sound too much like David Cameron spending money that isn't there is the reason why we wre in this crisis. It's completely irresponsible governance. Former Labour cabinet member here in the UK, David Miliband said a few months back that the left has no answer for the economic crisis - a sly dig at his own party, but it does seem to prove the case. It seems the left can only provide primitive arguments on tax.

> Households need to stay relatively within a budget, expanding household budget expenditures can happen only when there is more real income. But economies are different - spending when there is ample productive capacity sitting idle and workers available makes sense to get the engine of the economy going again. One needs to have the factories and production facilities available as well, so there are real living wage paying jobs available when spending happens, then wages and jobs increase. And as far as primitive, I find the conservative arguments to be positively corroded beyond making even the gears turn.

They're dogmatic in their rhetoric and unfortunately in their approach as well, from what I've seen here.

They might not have wanted the change they have.

Households need to stay relatively within a budget, expanding household budget expenditures can happen only when there is more real income. But economies are different - spending when there is ample productive capacity sitting idle and workers available makes sense to get the engine of the economy going again.

 

But see, leftists never ask a simple question: why is the productive capacity sitting idle? Why aren't workers employed?

 

Government spending puts people to work, sure. But doing what? Running around in a costume in the Middle East? Filling out papers? It's not productive work, and so it doesn't increase the quality of life of people.

 

Labor and production must be directed by prices, not politicians. Prices must be allowed to fall/rise to where they naturally go, not interfered with by laws, taxes, and regulations. When the prices are right, people will work again.