Bleak future beckons under capitalism

This year in Spain, the sunny summer months were ushered in with the announcement that registered unemployment had climbed to almost 4 million (over 18%). Although the actual figure is no doubt a good deal higher, this figure illustrates the stark reality of life in Spain, one of the world’s worst victims of the capitalist crisis now devastating lives and living standards internationally. Since then, further light has been shed on the dramatic scale of Spanish capitalism’s economic crash. After a decade or so of record growth rates, as bosses and speculators rode the country’s grossly inflated, property-fuelled boom, Spain in crisis has assumed many characteristics of a “sick man” of Europe, with little sign of improvement in the near future. A recently published report by the World Economic Forum’s ‘Global Competitiveness Index’ saw Spain drop behind countries like Brunei and the United Arab Emirates in terms of its economic strength (El Pais, Wednesday 9 September 2009). This statistic, along with the fact that with a near-doubling of unemployment in less that one year, the number of Spaniards out of work is close to the combined totals of France and Italy, has exposed the fundamental weaknesses that lay beneath the relative “success” of Spanish capitalism in the last period. What future beckons for workers and youth as Spanish capitalism stares into the abyss?

The misnamed “Socialist” government of Jose Luis Zapatero has seen its public deficit increase five-fold to €49.7 billion in the first 7 months of 2009. Zapatero claims to have been somewhat ‘stunned’ by the dramatic turnaround in the economic situation. Not sufficiently stunned however, to fail to act with suitable urgency to bail out Spain’s bankers to the tune of €150 billion soon after the onset of the international crisis to save Spanish capitalism from complete collapse.

Mass unemployment

Nightmare of unemployment

But while life remains good for Spain’s bankers - with Spanish bank Santander, for example, using its super-profits garnered during the boom to mop up the remaining valuable assets of British Bank Northern Rock after its nationalisation by the British government – Spain’s PSOE (‘Socialist Workers’ Party’) government have not acted with similar speed to bail-out the hundreds of thousands of families thrown into poverty by the crisis. For the millions of newly unemployed workers, upon whose backs the capitalist boom was built, government assistance cannot be so easily relied upon. This spring, as unemployment began to spiral out of control, almost 1.2 million people found themselves without any unemployment benefit payments, thanks to successive Spanish governments’ refusal to grant the right to subsistence for all unemployed people.

This unfolding situation left Spain boiling with anger, as bankers were bailed out while workers were thrown to the dogs of poverty and unemployment. These were ingredients for a potential social explosion as the rage among workers and youth mounted, and the government knew it. This was also reflected in the actions of the trade union leaders, who albeit impotently, in negotiations with the government and employers, demanded ‘emergency subsidies’ for those unemployed without income support.

The magnificent movement of school and university students in the last months of 2008, who mounted a campaign of strikes and occupations in opposition to the implementation of the “Plan Bolonia” - which pushed forward the ‘market-isation’ of education and threatened to restrict the access of working class youth to third level education – put the idea of a mass, militant fightback on the agenda throughout the wider working class. All of these factors, combined with the fact that Zapatero was discussing with the CEOE (bosses’ federation) about labour “reforms” aimed at further attacking workers’ rights regarding contracts and redundancy pay, led to a situation where, on massive May day demonstrations this year, the demand for a general strike completely dominated.

In the face of this, Zapatero, after initially refusing to act against the pauperisation of millions, announced a special monthly subsidy of €420 payable to unemployed people whose benefit entitlements have run out since January 2009. This measure contains nothing for those among the 14% unemployed at the end of 2008, in a similar position (approximately 500,000) and represents a pitiful amount, when compared with other European countries (Ireland currently offers a universal payment of over €800 a month to all unemployed people over 20) and the real cost of living. Life for Spain’s unemployed millions is a veritable nightmare, which Spanish capitalism seems incapable of dealing with.

Zapatero

Zapatero’s ‘band aid’ measures

As well as the above concession, the government has also launched numerous public works schemes. €8 billion has been given to local authorities for this purpose, in a desperate attempt to stop the avalanche of unemployment. The fact that this stimulus, which has employed around 410,000 people, only managed to stem increases in unemployment for 2 months, gives a picture of the massive scale of the crisis.

However, this measure’s aim was not to create lasting, socially useful jobs, but was merely intended as a temporary ‘band aid’ for embarrassing soaring unemployment figures. Workers have been taken on with short-term contracts and employed in mainly small-scale infrastructural repair projects, only to be thrown back into unemployment when the work is completed. The next months will see many thousands go through this experience, pushing unemployment even further upwards, towards 20% and 5 million.

Capitalism divided?

These measures have aroused much criticism, most importantly from workers and youth outraged by their insufficient, temporary character. However, sections of Spain’s capitalist elite have also raised criticisms of Zapatero’s handling of the crisis. In El Pais, on Monday 7 September, Bob Traa, who heads the IMF’s Spain desk, was quoted, raising doubts about the potential effects of the government’s actions on “increasing the country’s growth potential”. On the above mentioned public works schemes, he stated, “the benefits will be short term, but the €8billion debt will be permanent”. This position has been echoed by the right-wing opposition party, the PP (Partido Popular), whose campaign in the recent European elections centred on the party’s belief in the need for greater “austerity”. Gerrardo Diaz-Ferran, the head of the bosses’ organisation, CEOE, warned on 21 September that the government’s plans to increase capital gains tax (while leaving untouched the system of ‘1% tax investment funds’ used by the super rich to avoid taxation) represented a “serious error” – again advising “austerity” in place of the measure (El Pais, 22 September).

In a way, the above criticisms of PSOE’s response to the economic crisis follow a certain logic. Zapatero’s band-aid measures have been implemented at the expense of a colossal increase in the public deficit. They have not been combined, as yet, with any measures which will meaningfully increase state revenue, apart from the reversal of a €400 annual tax rebate, which will hit the poorest families hardest. This does not make Zapatero a champion of the working class, or crusader against the rich, as he has recently sought to portray himself. The bankers’ bailouts and the hundreds of thousands scraping by with no means of subsistence, render this claim laughable. Zapatero and PSOE have their sights on massive attacks on workers and the poor in Spain, in order to bridge their deficit at their expense. PSOE, the PP and the entire Spanish capitalist establishment are essentially united behind their plans to make workers and young people pay for the crisis.

PSOE’s policies contributed to the crashing of Spain’s economy in no small way. Zapatero helped to nurture the speculator-driven, construction-based economy which has imploded so dramatically. This economic model was organised around the bosses’ desire for a cheap, poorly regulated labour market and low corporate taxation. The vast majority of jobs lost in the last year in Spain, particularly in the construction industry, resulted from short-term contracts not being renewed. This is the legacy of PSOE’s ‘socialist’ policies! This situation has also greatly exacerbated the problems of the unemployed, due to the pitiful redundancy entitlements this layer of workers are entitled to, if they are entitled to anything at all.

The real basis for the limited ‘band-aid’ measures taken by Zapatero has been the latent threat of the majority taking matters into its own hands and moving into militant struggle. Such a situation, dreaded by the government, is also the last thing the main trade union leaders, still tied into ‘negotiations’ with the employers, want. When labour relations talks broke down in August, it was abundantly clear that the bosses would not accept anything less than savage attacks on living standards. Across-the-board wage cuts, the easing up of labour laws and the erosion of established redundancy rights for workers on better, long-term contracts, was set out as their bottom line.

Metalworkers protest in Vigo

Explosive situation

Spanish workers have clearly demonstrated that they are up for a fight. But the leaders of Spain’s two main trade union federations the UGT (General Workers’ Union) and CCOO (Comisiones Obreras) have proved incapable of translating the palpable anger of workers and youth into concrete action against the ravages of the crisis. Just last weekend, workers at the Opel car plant in Zaragoza, in the north east, held a determined rally of over 15,000, in rejection of the sale of the company to Canadian giant Magna - which has ear-marked the plant for massive job losses - threatening strike action to stop the company’s plans. This protest represents the first initiative taken to fight Opel bosses’ attempts to slash production, at the expense of over 10,000 workers, across a number of European countries.

The failure of the trade union movement nationally to organise an effective fightback has not stopped sections of the working class from taking action. In June, the city of Vigo in Galicia saw violent clashes, as police attacked a demonstration of thousands of workers and youth, during an all-out strike by metal workers in opposition to attacks on pay and conditions. Pitched battles lasted two days, with rubber bullets in use by riot police, resulting in over 30 injuries. This represents merely a glimpse of the social explosions which could develop, in the absence of a generalised movement in opposition to the devastation of living standards throughout the Spanish state. All the ingredients of the youth and social revolt which rocked Greece in December 2008 currently exist in Spain

The crisis in Spain has had a particularly sharp impact on young people. More than one in three people between the ages of 16 and 24 are unemployed, as hundreds of thousands of young workers were spat out by the ailing construction industry. In many Spanish towns, the summer saw thousands of youths competing for low-paid temporary seasonal work in the tourism industry. The response of the government to this situation has been to open up a second front in the attack on the future of a whole generation, in attacking public education in the form of the Bolonia reforms, mentioned above. The struggle against it saw the participation of tens of thousands of school and university students, with university occupations holding out for over three months in some universities, such as Barcelona. The failure of the official leadership of this movement to put forward a clear strategy of how to win led to a lull developing after Christmas. There is no question that with a militant strategy and sustained mass action, along with a coherent appeal to the workers’ movement, also enraged by the government’s attacks and a though-out alternative to neo-liberal education, the movement could have succeeded. Nevertheless, this struggle – one of a number of militant youth movements which took place across southern Europe in the last months of 2008 – served as an inspiration to the wider working class, and put fighting back firmly on the agenda. There could be a powerful resurgence of this movement in the course of the next year, as the government attempts to implement the reforms.

The inevitable showdown

Mass protest against Opel sackings

Incredibly, Zapatero said on 21 September that “the crisis in Spain would not be as deep as other countries”! This comment is a reflection of the capitalist nature of he and his government. For them, the steady profits of Spanish banks like Santander signify that fundamentally, all is well. However, on the planet of working people, society is facing collapse. Mass unemployment, destitution and pauperism beckon for millions. A chilling example of this was shown in Barcelona, where the prostitution ‘industry’ saw an influx of new layers of young women, propelled into horrific exploitation by the desperate situation facing them, prompting a crackdown by state authorities.

This situation represents the best that capitalism in Spain can offer millions of people at this moment in time, with no sign of the improvement. As the government’s public deficit widens, the prospect of fresh attacks on workers and the unemployed is on the horizon. The boiling anger that currently exists will not be held in by the lid of the trade union leadership forever. It can truly be said that Spanish society is moving towards an almighty showdown, between those whose reckless domination of the economy caused the crisis, but whose profits are steady, and the victims of the implosion of Spanish capitalism’s 20-year ‘boom’ project.

The pressure which mounted within the trade unions in the period before the summer, with leaders like Toxo, of the CCOO union (now begging for new negotiations with the CEOE), forced to float the possibility of a general strike, is sure to escalate in the future. The trade union leaders missed a crucial opportunity in refusing to follow the lead of Basque trade unions, which organised a successful one day-day general strike throughout the Basque country on 21 May. The power and anger of Galicia’s metal workers, Opel workers, youth and students, and the wider working class, if drawn together in a united struggle, could have a devastating impact and shake the foundations of Spanish capitalism. If a fighting lead was given in the trade unions and elsewhere, massive support could be won for the demand for a one-day general strike, as the beginning of an organised fightback.

Socialist solutions

Capitalism has demonstrated in bankruptcy in the clearest way possible in Spain. Spain’s construction boom has ended, with 1 million unsold houses on the market, and 600,000 families denied affordable housing! As a system based on the economic dictatorship of profit and big business, it is completely incapable of providing stability, employment and decent living standards for the majority. Amongst the millions of victims of the crisis, particularly the young generation, exploited and cast aside by the profit system, a profound radicalisation has and will develop. Arguments for a fundamentally different, socialist society, based not upon the anarchy of the stock market, but on the use of society’s wealth to benefit the majority, can gain a powerful echo in Spain in the present and coming period. Unfortunately, no major political force exists at the present time capable of making the case for a socialist alternative to the chaos and devastation of capitalism in Spain.

The so-called ‘left’ parties in Spain’s parliament have failed decisively to champion the interests of workers, young people and the unemployed against the effects of the crisis and the bosses’ attacks. Isquierda Unida (United Left – a coalition of the Spanish Communist party and a number of small left groups), with 2 MPs in parliament, has disgracefully indicated its willingness to support Zapatero’s anti-worker economic reforms package, including the increase in taxation of the country’s poorest represented by the withdrawal of the annual €400 tax rebate, if it can secure amendments to a number of bills. This craven support for the stewards of Spain’s economic collapse is the opposite of what is necessary at this time.

Isquierda Unida’s failure to counterpose a clear alternative to PSOE and the PP’s capitalist consensus, despite its considerable base in the CC.OO (“communist” union confederation) saw their support virtually flat-line in the European elections of June this year. The massive revulsion that has developed against the actions of the PSOE government, which many workers and youth had huge hopes for when it took power again in 2004, after 5 years of PP rule, could have laid the basis for the rapid growth of a genuinely socialist party, based on the struggles of the working class. However, in the 2008 general election, Isquierda Unida’s vote fell from 1,324,000 to 970,000 (3.77%), illustrating its failure to establish itself as an alternative to those disappointed with PSOE.

In Spain today, there remains a crying need for a workers’ political alternative, which rejects the logic of capitalism in attempting to make the majority pay for the crisis, and fights for genuine socialist change. In the present climate, such a stand, if taken by a major political force, would attract huge support. Such a force does not exist today, but if it did, it could potentially play a role in galvanising and uniting the opposition to capitalism and neo-liberalism that exists in Spain, which has often been expressed through support for a range of left groups, including left-nationalist groups in the Basque country and Catalonia. This was partially reflected in the 100,000 voters who cast blank ballots in the Basque regional government elections in 2008, in response to the betrayals of the capitalist PNV (Basque Nationalist Party) and the banning of various left-wing pro-independence parties through the PSOE government’s latest round of repression.

The Spanish working class has a proud history of struggle, militancy and support for socialist ideas. The transformation of PSOE, once looked to by many as ‘their party’ into a wholly capitalist formation, has provoked disgust amongst wide sections of the working class and trade union movement. The CWI stands for the building of a real workers’ party, with genuinely socialist policies, firmly rooted in the struggles of the working class and young people, which are developing. Such a party could propose socialist solutions to the avalanche of unemployment, poverty, and attacks on workers’ rights and public services. The socialist transformation of society could see Spain’s vast wealth used to drag the Spanish working class and youth out of the gaping abyss which beckons under capitalism.

Our demands for fighting the crisis:

  • No to poverty conditions for the unemployed! For the universal right to unemployment benefits, linked to the real cost of living
  • For a real programme of public works! State investment to create permanent, socially useful jobs with trade union pay and conditions and provide decent public services
  • Fight against job losses! For the nationalisation of industries threatening layoffs and sackings under workers’ control and management.
  • Stop the jobs massacre in the car industry! Nationalise to save jobs and invest in alternative green energy production.
  • For a united one day general strike to begin the fightback
  • Build a real workers’ party to fight for the socialist transformation of society
  • No to the dictatorship of the market! For a socialist society where the economy is planned to meet the needs of all, not for the profits of the rich.

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