Friday, 22 July 2011

The stitch-up in Berlin…and the shame in Spain

Further to my last post on the Euro-zone debt crisis, a couple of important developments for some of the protagonists:

First, in yesterday’s summit, “Eurozone leaders draw up radical plan to safeguard Euro” says the Guardian contentedly.

Really? Well, they must be talking about a different plan, because all I can see is a band-aid which does nothing to address the fundamentals, like the moral hazard inherent in the system (in other words, that we give countries no incentives to behave themselves and Portugal and Ireland will probably need another bailout soon as well). We have resolved nothing, and Europe's leaders are refusing to focus on the need for a long-term solution to the Euro’s problems.

A stunning failure of leadership all round: but it is emblematic of the EU’s approach to the problem that the deal was struck, not by high-level discussions involving a supranational institution, but in a cosy carve-up dinner between Sarkozy and Merkel in Berlin on Wednesday night.

And second, talking of stunning failures of leadership, the other news from yesterday was the climax of an extraordinary political drama in Spain, a country in the eye of the debt crisis storm. You may remember that Francisco Camps, the president of Valencia region, was about to enter a legal process which would almost certainly convict him of corruption and probably mean imprisonment. Could things get any worse for the opposition PP?

Step forward PP prime-minister-in-waiting - in theory - Mariano Rajoy, who intervened to negotiate a plea-bargain, allowing Camps to get off with a fine, as long as he pleaded guilty to corruption. He agreed to sign, as did three other compatriots. The shocking things are numerous: that he was not suspended two years ago when this first arose; the failures of the legal system that mean that an alleged crook like Camps should be able to get away with a fine, sending entirely the wrong message to other crooks in Spanish politics; that the leader of the opposition should intervene in a legal trial at all, mainly to try and save own his scrawny neck; and finally that Rajoy should be prepared to allow a senior politician, who was prepared to admit in writing to being a corrupt liar, to stay on in his job as President of Valencia.

The final twist was then that at the eleventh hour, Camps reneged. He decided to resign as President and try and clear his name, although there seems precious little chance of that happening. For Rajoy, the problem is solved; but no-one can consider this a success. As the El País editorial described it: "not very honorable". That's a big understatement: the whole episode is shameful for a supposedly advanced democracy.

All in all, this sordid little affair means that there may well not be a change of government in Spain next year after all; that the Spanish have increased their already-considerable contempt for politicians; and that the economic problems which have festered under the PSOE will continue to get worse.

But hey, good job the Eurozone is in such safe hands, eh?


  1. The Spanish political situation in Valencia is deeply saddening. It is worse than so many African democratic dictators. I know politics doesn't create many "easy" decisions, but some of the leaders have allowed too much outright corruption on their watch... and some of the decisions are "easy"... but "hard" ;-)

  2. Indeed so. I suspect that voters will punish the PP for this, or at least I hope they will. I'm shocked that any party leader can think it acceptable for someone who is prepared to admit to lying and corruption to stay in post. And I say that without any kind of partisan feelings.

    It is also illuminating that Judge Garzón, the man who helped put away Pinochet and who was the first to instigate the investigation, instead of being lauded for his zero tolerance of corruption is being hounded by an over-politicised judiciary. There remains the possibility of a serious miscarriage of justice there - as a New York Times editorial highlighted some time ago - which would throw into doubt the independence and fairness of the entire judicial system. A tragedy for a country which developed democracy so effectively over the last forty years.

    But that's for another post...


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