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Home > English > Alternatives International Journal > 2012 > March 2012 > Economic Crisis in Spain: A History of Mismanagement and Inequalities

Economic Crisis in Spain: A History of Mismanagement and Inequalities

Wednesday 29 February 2012, by Geneviève Lavoie-Mathieu

Despite having one of the largest economies in Europe Spain’s economy has stalled and national unemployment is on the rise. Over 5 million people in the country are currently out of work, a level of unemployment higher than any other European nation.

The situation is a result of a long history of political and economic mismanagement. According to Federación de Asociaciones de Centros para la Integracion y Ayuda de Margin (FACIAM), an organization aimed at curbing homelessness within Spain, the current situation is a culmination of years of public funding cuts which were carried out at higher rates than other European countries that have comparable revenues.

In the mid 1980s and early 1990s, after two decades of working toward reducing national inequities, the Spanish Socialist Workers Party (PSOE) began to move the country in the opposite direction.

Although it claimed to be committed to socialist policies, the PSOE attempted to liberalise the capitalist market economy while distancing itself from trade unions.

After Spain joined the euro zone in 2000, the PSOE cut public spending, weakening Spanish citizens’ social security. Today, Spain remains one of the lowest ranked countries in terms of state expenditure on unemployment benefits, public services, and tax relief.

At the peak of the financial crisis in 2008, Spain’s GDP per capita was comparable to the average EU-16 country, but its public spending on social services represented 59% of the average EU-16 country; a decrease from 2004. This worsened the situation of those citizens living in or on the edge of poverty, further deepening national inequalities.

In this context, immigration became a popular scapegoat. The economic growth preceding the economic crash had created a demand for labour which could not be met by Spain’s ageing population and low birth rate. Then, the country’s construction sector underwent a boom, creating employment opportunities that specifically attracted Latin Americans, Maghrebis and West Africans; immigrants became integral to the Spanish society and economy, and after 10 years, came to account for 10 percent of the national population.

During the economic crisis following this boom an anti-immigrant attitude developed and rose throughout Europe. Opposition parties began to emphasize the need for “blue cards” along with measures reinforcing the country’s borders.

Further, the national budget devoted to integrating immigrants was reduced by 29.5 percent, and EUR 5.2 million of Spain’s budget was dedicated to assisting the return of immigrants to their countries of origin. As well, reforms outlined in the ’Ley de Extranjería de España’ (Law on Immigration) made it harder for immigrants to reunite with their families with fines for assisting undocumented immigrants and increased maximum detention time from 40 to 60 days.

The reforms send a message which the Asociación Pro-Derechos Humanos de Andalucía (APDHA) has described as being dangerous, discriminatory, and false: portraying immigrants as a principal cause of the country’s economic crisis.

Yet it is immigrants, especially non-European immigrants, who have born disproportionate hardship throughout Spain’s economic crisis, facing high rates of unemployment, social vulnerability and being increasingly pushed into lower socio-economic groups; the country’s unemployment rate for Spanish-born workers is 17.38% and 30.67% for foreign-born workers.

The crisis made immigrants more vulnerable. Over 17 million people nationwide visited FACIAM help centres and shelters. Of these, many were immigrants (52.8%), women who suffer from domestic violence (16.4%), and people with drug and/or alcohol dependencies (24%).

The Female Perspective

In this economic context, the gender divide has risen to the fore.

As a result of increasing numbers of men losing their jobs, more families have come to depend on solely women’s salaries, which is on average 22% lower than that of male workers. This is in part due to the fact that women constitute the majority of part-time and temporary workers because of their familial obligations.

However, the economic crisis has altered the traditional Spanish socio-economic model in which men are viewed as the primary breadwinners and women are seen as peripheral. As men face lay-offs, there has been an increase in the rate of women’s participation in the labour market.

Yet government cuts within the public sector and social services will disproportionately affect women; within the education, health and social services sectors women constitute the majority of workers.

The Spanish government’s continued ignorance of vulnerable populations when dealing with unemployment is partly responsible for the reproduction and reinforcement of social inequalities in Spain. The recent mass protests nationwide also demonstrate Spanish people’s frustration and discontent with their exclusionary society that denies equal opportunities and refuses to ensure equal access to public services and social resources. To emerge from this crisis Spain must focus on redistributing wealth, reducing social inequities, and implementing policies that fight poverty and social exclusion.