- Interview by
- Eoghan Gilmartin
Within two months of taking office in mid-January, Spain’s left-leaning coalition was plunged into an unprecedented national crisis as the country became one of the first epicentres of the Covid-19 pandemic in Europe. Since declaring a state of emergency on March 14, the fragile alliance between Prime Minister Pedro Sánchez’s Socialist Party (PSOE) and the radical anti-austerity alliance Unidas Podemos has come under sustained pressure from various sides. The Spanish right wasted little time in politicising the pandemic – with Partido Popular leader Pablo Casado accusing Sánchez of seeking “a constitutional dictatorship” with his use of emergency powers.
The Spanish establishment has also launched a campaign of lawfare against the coalition, which has seen elements within the judiciary and security forces seeking the indictment of government officials. This has resulted in senior figures within the Guardia Civil (including the commanding officer in the Madrid region) being removed from their posts after a legal report containing numerous false claims and fabricated data was submitted to a judicial investigation looking into the decision to allow the Women’s Day march to go ahead on March 8th. The march has become the centre of anti-feminist conspiracy theories peddled by the extreme-right Vox party.
Further pressure was applied when the employer’s association, the CEOE, suspended talks with the government in mid-May after PSOE, Unidas Podemos and the Basque party Bildu announced an agreement to fully repeal the 2011 neoliberal labour reforms. In response, PSOE quickly walked back this commitment and since then Sánchez has sought to pivot back to the centre. In particular, he has realigned his fragmented parliamentary majority so as to also include the liberal rightest Ciudadanos party – leaving him less reliant on more progressive forces like the Catalan Esquerra Republicana (Republican Left).
To analyse this rapidly changing political landscape and the outlook for the Spanish left, Eoghan Gilmartin sat down with ex-Unidas Podemos MP Manolo Monereo. Described by Pablo Iglesias as one of his “political fathers,” Monereo has been a key intellectual on the Spanish left for more than three decades. Disagreeing with the decision to align the party with PSOE, he chose not to stand in the 2019 election. Now he believes the next six to nine months will decide the fate of Europe’s only left-wing coalition.
Avoiding Zapatero’s Fate
You recently described the PSOE-Unidas Podemos coalition as “a conjunctural alliance” that had been conceived for very different conditions to those of the post-Covid landscape. How has this uneasy alliance faired in terms of dealing with the crisis?
Yes, this government was conceived for another moment – one which was meant to be defined by a certain stabilisation after the previous crisis decade. The idea was that the coalition would overturn the worst neoliberal reforms and austerity measures inflicted on Spain since 2008. Yet even in January, the implications of this strategic wager had not been fully thought through from the perspective of Unidas Podemos. Many of us on the left were warning that a new recession was coming and that if we entered government as the junior partner during a steep downturn, we would face huge difficulties.
Obviously the pandemic has brought a crisis of another dimension beyond what I or anyone else could have expected. This has brutally exposed the weaknesses inherent in the coalition. In reality what was negotiated between the two parties was not a comprehensive programme for government but rather a series of social policies and how they would be financed. Unidas Podemos knew they could not secure anything more – with Sánchez only accepting a coalition after exhausting all other options. But such a truncated document meant questions such a Catalonia, Europe, legal reform and the judiciary were simply left in the hands of PSOE.
As there is no clear state project or political strategy uniting the coalition partners, they are now left to improvise day by day – negotiating every crisis measure without a clear roadmap. So this is where we find ourselves: in government at a moment of profound change, with internal difficulties mounting, and the likelihood that the promises of substantial economic aid from Europe will largely remain that – only promises.
How do you see these internal differences within the coalition playing out? And now that Unidas Podemos finds itself where it is, what should its plan of action be?
First, we need to distinguish between two phases in the coming economic crisis – similar to those of the 2008 crisis. In phase A, in which we are in right now, we are all Keynesians – with a broad social consensus emerging around expansionary government spending while the economic elites’ agenda struggles to gain traction. Who is going to defend privatisations or cutting spending to the public health services while the state rescues the private sector for the second time in a decade and new popular demands for social justice are emerging?
Within the coalition, however, there are distinct positions. On one side you have the European Commission’s own representative at cabinet, Nadia Calviño. She is Deputy Premier for Economic Affairs but was previously head of Budgetary Affairs at the Commission. She sees her role as being as much to enforce the EU’s red lines within the government as it is to represent the Spanish government in Europe.
Her position is largely indistinguishable from that of Spanish capital: the government must inject huge amounts of money into rescuing the private sector and forget about negotiating social and labour reforms until after the worst of crisis is over. On the other side you have Unidas Podemos whose ministers realise that now is the moment for such reforms. They will get done now in this moment of exception – when the normal rules of the Eurozone are suspended and the elites’ position is somewhat weakened – or they won’t be done at all.
This is because after, in phase B, comes the correction when we will see the firm hand of the EU – backed by our capitalist class. One of the European left’s failures has been to conceive of the EU as something external. No, it is key player in domestic politics and it will impose the rules of the game for phase B. It will simply tell the Spanish government that it has a debt to GDP ratio of 120 percent, a deficit of 10/12 percent and that it must implement a ten year adjustment if it is to continue receiving financing.
And so right now there is an opening for a government willing to engage in bold action but it is going to pass very quickly. We have six to eight months in which to pursue an agenda of serious tax and labour reform as well as thinking about things like a public investment bank. We have public opinion on our side – with a broad consensus in favour of reinforcing public health and education as well as seeking greater tax justice. Yet the political will to pursue such a path does not seem to exist at cabinet and my fear is Calviño’s position will ultimately triumph.
In particular her likely election as the head of the Eurogroup [the institutional body that brings together Europe’s finance ministers] would represent a qualitative change in the balance of power within the coalition.
Where is Pedro Sánchez in all this? How is he positioning himself in terms of these internal differences within his government?
Sánchez has few principles but is a very flexible operator – with his political thinking largely defined by a tactical opportunism. If this has meant that the left has never been able to fully trust him, it has also generated suspicions amongst the economic elites. The dominant bloc of power in this country does not trust him because they cannot be certain what his project is and fear the extent of Podemos’ influence over him. In particular they are concerned that certain social reforms will be implemented in the coming months that later then become irreversible, such as with the Guaranteed Minimum Income programme that was passed in early June [and which will assist 850,000 vulnerable families].
In response, there has been a major offensive against the coalition in recent months. It has concentrated on delegitimising Unidas Podemos and Pablo Iglesias through a vicious campaign of fake news and manufactured controversies that have also involved elements within the deep state seeking to criminalise the party’s leadership. But the actual objective for the ruling elites is less that of Iglesias’ scalp. This is seen as only a means to ensure Sánchez’s acquiesce later on at “the moment of truth” when he will be expected to repeat the experience of former Prime Minister José Luis Rodríguez Zapatero in 2010, i.e. to fall in line and implement the structural reforms that the EU demands.
Before this challenge, Sánchez’s response has been to seek social consensus. He has also fallen back on his old tactic of variable alliances as he tries to balance various actors off against each other. He is going to try to keep his coalition with Unidas Podemos together for as long as possible, because at least for now it is his best bet at surviving politically. At the same time, he is also reassuring the ruling elites by keeping Calviño close – championing her candidacy for the head of the Eurogroup – while also seeking the parliamentary support of the right-wing liberals in Ciudadanos. Ciudadanos is the true party of the major Ibex 35 corporations and its pivot back to the centre gives Sánchez the option of further diluting the weight of Iglesias in the budget negotiations.
If this happens in the autumn, and fundamental reforms are not passed, Unidas Podemos are going to be left with a difficult decision – to stay in or leave the government. Why stay if it cannot secure serious concessions from the PSOE? For example, in relation to the repeal of the 2011 labour reform that massively limited the bargaining power of trade unions, it is clear Calviño will insist on restricting modifications to largely cosmetic changes.
Recent developments do suggest Unidas Podemos are struggling to generate influence within the coalition. It looks like the budget negotiations after the summer will be the decisive test in this respect. But surely the collapse of the coalition would represent a disaster for the Spanish left after five years of institutional engagement.
Yes, I hope I am wrong and there is still time for the government to change course. But, at the same time, we must be clear about what it means to govern as junior partner to the PSOE.
There is, however, also a further difficulty facing Unidas Podemos. Its options are further complicated by the fact that its voters are the most passionate supporters of the coalition according to the polls. Iglesias in particular has spent the last year convincing them that it is the best of all possible governments and so to break with the PSOE in the near future could cost it dearly electorally.
The party’s leadership no longer seems to have any strategic plan that stretches beyond its presence in this government. Through sheer audacity Pablo was able to take advantage of the conjuncture and force PSOE to accept a coalition but then what? Here we reach the limits of Iglesias’ idea of politics.
At a certain moment after the party’s initial electoral assault, he came to the conclusion that the democratic challenge to Spain’s oligarchic regime, which began with the Indignados movement in the squares in 2011, was exhausted. Yet rather than make the difficult pivot to a strategy based more on a war of position, he ran away from the difficult task of building up the party as an extra-parliamentary force and of seeking social alliances with unions and the movements.
This is the slow patient work of mass politics but instead he took refuge in the idea of governing with the PSOE – that somehow this would resolve all the party’s contradictions. In the end, he was never able to make the transition from Laclau to Togliatti.
The European Straitjacket
Returning to the question of Spain’s relationship with the European Union. You have just published a piece on the subject stressing the danger that this crisis will reinforce existing imbalances between Europe’s core and periphery. How does the political drama being played out in the Spanish state fit into the wider changes at a European level?
In the negotiations over the EU response to the crisis, Germany and the other creditor nations have managed to avoid two key questions being placed on the table: the mutualisation of national debt and most importantly for ordoliberals, allowing Eurozone states to finance themselves directly through the European Central Bank.
It is true that Germany has made concessions, above all in relation to the EU Next Generation plan which will see the European Commission issuing bonds that for the first time will be grants rather than loans that member states need to pay back. But this was a calculated concession – a one-off temporary programme whose figures have been inflated and the economic effects of which will not fully kick in until the second semester of 2021.
Instead, Germany’s focus is elsewhere as it seeks to redefine its place in a new international order, particularly its relationship with the United States and China. Like the other major powers, it has responded to the crisis with a huge injection of liquidity as it seeks to update its production model. The country has directly or indirectly mobilised stimulus funds equalling half of its GDP – something unimaginable for the peripheral southern states.
In this scenario, for Spain to develop a new economic model that is socially and ecologically sustainable, the fundamental obstacle to overcome will be the European Union. The EU is not a public institution infused with solidarity. As we see every day, there are winners and losers defined by relations of domination and dependence similar in many respects to traditional forms of colonization. Yet there are still progressive voices telling us that this crisis is different – that the EU will come to our assistance this time, not be an obstacle.
But the European “manna” is not going to arrive, even if we keep talking about the EU’s “Hamilton Moment”. Funding will be insufficient and will be placed under the control of EU institutions that, in one way or another, will respond to the Franco-German axis. Does anyone really believe that European funds will be used to reindustrialise Spain, to create large public companies capable of competing with the German or French ones? Or that EU policies will serve to expand our social state, promote fairer tax reform and redistribute income and wealth?
At the end of the day, the dilemmas that Southern states faced in the 2010-’11 debt crisis are going to reappear very quickly. Debt is not a problem when it is issued in your own currency – when you have monetary sovereignty – but it becomes an existential drama when it is in a foreign currency, which for all intents and purposes the euro is for Spain. In phase B, Germany and the European institutions will be able to fall back, when needed, on the type of ultimatum that was put to Greece in 2011: choose between austerity policies or crashing out of the euro.
This is why it is so crucial for the coalition to get out ahead of events while the normal rules governing the Eurozone around state aid, etc. are suspended. For example, are we not in a position to create a public bank capable of financing itself like a private financial entity and promoting projects and initiatives to change our economic-social model?
After Zapatero accepted the EU’s austerity package in 2011, the Spanish right won an absolute majority and in turn implemented further savage cuts. Yet if history repeats itself and the current coalition disappoints, the alternative is no longer Mariano Rajoy, who fit much more in the European neoliberal mainstream, but rather a radicalized right-wing under the influence of the neo-fascist Vox party.
Yes, this is the danger. It looks like Vox is consolidating its position as the third largest party in the country – with a core extreme-right vote of 12-13 percent.
These voters will not easily return to the PP, which means any right-wing victory would no longer be a simple rotation between governing forces like under the old two-party system. Instead it would have profound consequences for the quality of our democracy. And when you look at what is happening in Hungry and Poland, we cannot have any illusions that the EU is going to intervene to protect our civil liberties.
The threat to Spain’s existing constitutional regime no longer comes primarily from emancipatory movements demanding “real democracy now” but from those within who claim to defend it. There is now a crisis within the regime, with part of the economic, political and judicial establishment seeking to undermine the current elected government through a campaign of lawfare.
One of the country’s top legal experts Javier Pérez Royo has even described this campaign as basically constituting an attempted coup d’état – which for now has failed. But we are likely to see further moves along these lines in the coming months. The stakes could not be higher.