[Spain's Pain] Photo gallery by the New York Times

[Murazor]

Click here.

Mildly manipulative, since the gallery seems to go out of its way to present the image of a failed state in the tradition of South American banana republics (which isn't quite Spain's case yet), but since there has been a surprising lack of commentary here about Spain's critical condition even biased reporting is better than no reporting at all.

[K. A. Pital]

I hardly find this manipulative. If anything, this creates a negative image of Spain's Eurocrat-serving governments which continously fail to address the people's real needs. The Spanish are very qualified workers and I meet lots of them here in Germany. They work on top industrial projects here, in France, elsewhere.

It is the oligarchic corruption which is eating Spain, Ireland and others from the inside, turning them once again into providers of cheap labour at little cost for the "metropoles" of the EU. Especially hideous when you consider that all the expenses of the Spanish government to train and educate these people are in fact being used at zero cost by the immigrant-hungry central nations like Germany.

VAT raises amidst a crisis are a travesty; the poorest of the poor are forced to pay more while the capitalists laugh. No "socialist" has proposed to liberate the working people with incomes below EUR 40000 per year for a family (that is below 20 000 per person) from the taxes.

This does not reflect badly on Spain at all. It reflects badly on the cruel oligarch bastards who caused this shit and still continue to giggle how they tricked everyone into getting more of the same medicine: credit, debt, credit, and more credit to consume...

[Ziggy Stardust]

Now, I don't know a lot about Spain, so I may be way off on this one, but I was under the impression that one of the problems with the ineffective government is that the network of jurisdictions between the federal government and the various states are all over the place. That is, there is a complicated system of semi-independent provincial governments, without really consistent or clear-cut rules for delineating the powers at the federal or provincial levels, which slows even really simple measures down to navigate the bullshit. Is this accurate?

[Murazor]

Now, I don't know a lot about Spain, so I may be way off on this one, but I was under the impression that one of the problems with the ineffective government is that the network of jurisdictions between the federal government and the various states are all over the place.

No, there isn't all that much in the way of jurisdictional conflicts.

The main problem is that the autonomous communities have been given part of the power of the purse, as the Americans put it. This has resulted in the territorial (and to a lesser extent the local) administrations bloating to absurd proportions, with dick-waving competitions of epic proportions between different regions worsening the situation thanks to everyone wanting exactly as much as the guys on the other province and whanot.

Catalonia, for example, has opened a whole bunch of "embassies" all over the world which have done nothing of consequence for the region, cost quite a few pretty pennies and won't be closed as long as it can be helped, because they are full of relatives of the regionalist politicians.

[K. A. Pital]

I think with an epic construction crunch of the proportions shown here (and the guy's just a witness, I'm sure the numbers would be impressive too) the "miscommunication" between regions and the central government is the smallest of all problems.

[Murazor]

I think with an epic construction crunch of the proportions shown here (and the guy's just a witness, I'm sure the numbers would be impressive too) the "miscommunication" between regions and the central government is the smallest of all problems.

Do not understimate the sheer scale of the regional nonsense.

Example:



That would be Valencia's City of Arts and Sciences, a complex of museums that was supposed to bring a great deal of money by attracting tourists.

Only the construction has gone a bit overbudget. As in it has gone from a 328 million euro project (in 1999) to a 1.4 billion euro nightmare (as of June 2011). Also, it doesn't make money. It loses it. Buckets of it. So the autonomous government has had to invest a further 720€ millions in the last ten years.

[CaptHawkeye]

How about Cuidad Real International Airport? A 28,000square foot airport with major airline routing that now sits totally abandoned in the middle of central Spain. The damn thing cost 1.1 billion Euros to build, and no one thought to negotiate with major airlines about ensuring the routes and emplanements BEFORE the stupid place was built.

The airport was privately built, so the problems may have been born of corporate rather than Federal incompetence.

[Murazor]

How about Cuidad Real International Airport? A 28,000square foot airport with major airline routing that now sits totally abandoned in the middle of central Spain. The damn thing cost 1.1 billion Euros to build, and no one thought to negotiate with major airlines about ensuring the routes and emplanements BEFORE the stupid place was built.

The airport was privately built, so the problems may have been born of corporate rather than Federal incompetence.

Oh. We have public ones, too.

Castellon Airport, a 150 million euros airport, has no regular activity, either. But then, it was built for the greater glory of Carlos Fabra, a notoriously corrupt local leader of the PP, who put a 25 meters statue of himself right outside the airport.

Also, the father of the congresswoman who shouted "fuck them" back in July, just after Rajoy announced cuts to the unemployment benefits.

[Starglider]

But then, it was built for the greater glory of Carlos Fabra, a notoriously corrupt local leader of the PP, who put a 25 meters statue of himself right outside the airport.

I don't see how any left-thinking humanist could object to that, dotting the landscape with giant statues of the Great Leader is one of our most hallowed communist traditions.

[Sea Skimmer]

How about Cuidad Real International Airport? A 28,000square foot airport with major airline routing that now sits totally abandoned in the middle of central Spain. The damn thing cost 1.1 billion Euros to build, and no one thought to negotiate with major airlines about ensuring the routes and emplanements BEFORE the stupid place was built.

The airport was privately built, so the problems may have been born of corporate rather than Federal incompetence.

Much evidence suggests that entire project was an investment scam from the get go, as the local officials who approved it and spread nonsense about what a success it would be, also happened to own the company that built, it with investor funds. They never actually had a plan or intention to operate it.

[CaptHawkeye]

That's the only reason I can think of that people would not do some of the most basic, common sense actions prior to building such a facility. IE: Malicious intent to steal from people. Seems that the other, smaller airport in this topic was probably done for the same reasons by local politicians.

This may seem like a ridiculous question, but was Spain honestly better off under Franco? Or are hopelessly corrupt politics actually a part of his legacy?

[Stark]

Even before Franco Spain was fucked; arguably it's been more or less fucked since Isabella.

[CaptHawkeye]

Oh totally. Their were certainly no good guys during the Civil War. What with the Republican government starting the war off depopulating villages.

[K. A. Pital]

Oh totally. Their were certainly no good guys during the Civil War. What with the Republican government starting the war off depopulating villages.

You choose a fascist government instead of a short-lived republic? I guess that's an option, but I hardly see any reasons to make such bold and stupid generalizations. Republican government "started the war"? Really? Over all of Spain, the sky is clear - that's what started the war, and it wasn't the Republican government, it was the fascist putchists.

This may seem like a ridiculous question, but was Spain honestly better off under Franco? Or are hopelessly corrupt politics actually a part of his legacy?

Franco centralized corruption, much like Marcos in the Philippines or Sukharto in Indonesia. But corruption was there. Spain was better off in some ways during the Franco period due to reasons which aren't necessarily connected to Franco and his rule (though with the killings of teachers, child kidnapping by the Catholic church and so forth I'm not sure it was a good period either). Back in the 1960s the economy was much more local, and the poisonous seeds of globalization were yet to bear the fruit.

I don't see how any left-thinking humanist could object to that, dotting the landscape with giant statues of the Great Leader is one of our most hallowed communist traditions

I'm sorry, but Carlos Fabra isn't Abraham Lincoln. He isn't even the current President. Or Prime Minister. Or - okay, a former ruler of the country. He's a local nobody. That'd be like erecting the statue of the mayor of Vladivostok - sheer nonsense. So I guess you wanted to make a pun, but it is a double pun - under democracy and capitalism, inside the European Union's "most successful" nation (and Spain was treated as a "European tiger" before 2008) a local boss can erect himself statues as if he was the ruler of a nation.

And why would any capitalist object to what happened in Spain? It is not as if they left the ravaged, debt-stricken nation with pockets empty. No, they left them with pockets full, as the case of 1,1 billion Ciudad Real Central Airport proves sufficiently:

"The only profit in this airport was the building of it”
Carlos Otto Investigative Journalist

"You might think the airport failed because of the crisis, but I am convinced that the shareholders never thought it (the airport) would work. The only profit in this airport was the building of it," says local investigative journalist Carlos Otto.

The official bankruptcy report for the airport seems to back this up. It says:
"The loans taken out were enough to cover the construction phase but no thought was given to the investment needed to make the airport function as a business."
Banks approached by the shareholders for further loans said they didn't think the business model for the airport was viable, the report says.

It goes on: "The construction itself of the airport provided the first profit for the investors because they signed contracts with their own construction companies."

And it's not like private investors did not like debt. They love it.

That would be Valencia's City of Arts and Sciences, a complex of museums that was supposed to bring a great deal of money by attracting tourists.

Only the construction has gone a bit overbudget. As in it has gone from a 328 million euro project (in 1999) to a 1.4 billion euro nightmare (as of June 2011). Also, it doesn't make money. It loses it. Buckets of it. So the autonomous government has had to invest a further 720€ millions in the last ten years.

This is just downright stupid. Museums are lossy ventures. That's economics 101. They are meant as facilities for education of the people, their cultural improvement, et cetera. They often never have to operate at a profit. This museum looks like a Future City which doesn't really belong - a huge nation like China might have easily supported such a grand project, but a small municipality? A city of science does not bring money, it is meant to popularize science - they shouldn't have planned on getting lots of money from it from the start.

[CaptHawkeye]

I didn't mean "The Republicans started the war" Stas, I meant the way they got things going was rather poorly thought out. The Fascists were worse to be sure, but picking sides on the Civil War was still a difficult affair.

[Simon_Jester]

Oh totally. Their were certainly no good guys during the Civil War. What with the Republican government starting the war off depopulating villages.

You choose a fascist government instead of a short-lived republic? I guess that's an option, but I hardly see any reasons to make such bold and stupid generalizations. Republican government "started the war"? Really? Over all of Spain, the sky is clear - that's what started the war, and it wasn't the Republican government, it was the fascist putchists.

What's unfortunate about the Spanish Civil War is the way the more violent elements of the Republican side took over the tone. Fighting for democracy is not quite the same as fighting for Stalinism.

The Spanish republic before the civil war had been full of political chaos. It remained full of chaos after the war began, and the chaos resolved in favor of the bloody-minded elements.

[Zaune]

I don't see how any left-thinking humanist could object to that, dotting the landscape with giant statues of the Great Leader is one of our most hallowed communist traditions.

You are Richard Littlejohn and I claim my five pounds.

[Thanas]

The result of what happens when people try to manipulate the economy into growth by building up construction instead of focusing on high-tech and other stuff.

[K. A. Pital]

The result of what happens when people try to manipulate the economy into growth by building up construction instead of focusing on high-tech and other stuff.

Thanas, perhaps you don't know but capital naturally tends to go there where profits are maximal. And preferrably easy, which was and remains the case with construction. That's like saying people tried to manipulate the winds and caused a hurricane - a weird position to hold, even though you can generate power from wind, it is also a source of hurricanes regardless of how many rotors you bring up.

[Thanas]

The construction boom was encouraged by the politicians as a way to quickly generate growth. Then the cardhouse collapsed.

[K. A. Pital]

The construction boom was encouraged by the politicians as a way to quickly generate growth. Then the cardhouse collapsed.

But any transaction done in the market makes the GDP grow. So you can't blame them for following the basic imperative - there must be profits and there must be a growing GDP. I mean, everyone expected cheap credit to last. And why would they not? Orthodox economists have explained that the world entered an era of unprecended stability and perpetual growth. The ECB itself peddled this bullcrap down everyone's throat (just as most other international "mutual assistance" instutitutions). Only a few detractors in 2006 or, say, in 1998 would say that in ten years the whole thing will go down.

Of course, the idea of general, widespread and even systemic global crises, as well as the concept of long cycles, was a subject of heterodox economics and derided by the monetarists and most other schools related to neoclassicism. It's a reap what you sow moment.

The only reason why Germany isn't reaping yet is because the contagious effects of Eurozone periphery bankrupcy are actually thus far to a large degree working for the benefit of the German economy. Property prices soar and form a local bubble as Spanish, Greek etc. capitalists move out funds and invest in "safe" assets within the Eurocenter, skilled professionals go work to the center hoping to escape the joblessness in the periphery, giving very skilled and cheap labour inputs. Is this going to last forever? I'm not sure.

[Kane Starkiller]

The best part is Spanish construction bubble is nothing compared to that in China where entire newly built cities are sitting empty. I can only imagine the impact of that bubble inevitably bursting down the line.

[K. A. Pital]

The best part is Spanish construction bubble is nothing compared to that in China where entire newly built cities are sitting empty. I can only imagine the impact of that bubble inevitably bursting down the line.

Spain also doesn't have 1,5 billion people and an economy which almost rivals EU and US. The severity of the bubble is determined by the proportion to the general size of the economy. And sadly enough for Spain construction is a bigger share than for China, unless I remember wrong. But yes, if China's economy suddenly halts due to the collapse of a construction bubble, there won't be a China to solve debt problems for EU and US any longer... they'll be too busy dealing with own fallout.

[Murazor]

The best part is Spanish construction bubble is nothing compared to that in China where entire newly built cities are sitting empty. I can only imagine the impact of that bubble inevitably bursting down the line.

Spain also doesn't have 1,5 billion people and an economy which almost rivals EU and US. The severity of the bubble is determined by the proportion to the general size of the economy. And sadly enough for Spain construction is a bigger share than for China, unless I remember wrong. But yes, if China's economy suddenly halts due to the collapse of a construction bubble, there won't be a China to solve debt problems for EU and US any longer... they'll be too busy dealing with own fallout.

*frowns*

While I cannot vouch for the accuracy of the graph, not having checked the databases myself, I've found a graph referenced a number of times suggesting that China has a potentially graver property bubble than Spain (in relative per capita terms, rather than absolute values).

[K. A. Pital]

Depends on the proportion of cement consumed for factories and for other constructions, but yes, from the looks of it the construction bubble is quite enormous.