(Bloomberg Opinion) -- For those who think that the luckiest country is the one with no government, Spain must be some sort of model.
Spaniards will go to the polls on November 10 for the fourth time in four years after the country’s political parties failed to compromise on a workable majority. With Madrid’s star in the ascendancy in the European Union, and the economy still growing much faster than the rest of the bloc, one could be excused for thinking that a resolution to the political crisis is the last thing that Spain needs.
And yet, much like for the rest of Europe, the challenges for Madrid are mounting. The economy expanded less than expected in the second quarter of this year, showing that Spain too is vulnerable to the downturn in world trade and rising global uncertainty. In Europe, France has looked at Spain as a potential partner to reform the bloc, but this cooperation will be harder to sustain in the absence of a solid government. Hopefully, the next elections either produce a clear winner or the country’s political parties finally reconcile their differences.
The last general election held at the end of April did not have to end in a stalemate. Pedro Sanchez took his Socialist Party to a strong first place, but did not win enough seats to govern alone. He could have joined forces with Albert Rivera, the leader of the centrist Ciudadanos party, if the two leaders had opted to paper over the divisions of an acrimonious electoral campaign. Spain would have had a strong, pro-EU government, capable of reconciling Ciudadanos’ reformist instincts with the Socialists’ penchant for greater redistribution.
Rivera was especially to blame. He insisted initially that he would not strike deals with Sanchez. His stance was based partly on conviction but with a dose of opportunism: He probably thought that a new election would see his party make further gains on the right, at the expense of a weakened Popular Party. This week, he made a last-ditch attempt to compromise with Sanchez, agreeing to make way for a government if the Socialists accepted certain conditions, including a promise not to raise taxes on the middle class. But this offer appeared a way to shift the blame for new elections on Sanchez. The latest polls show that Rivera now risks gaining fewer seats in the forthcoming elections, indicating that his strategy appears to have backfired spectacularly.
To be sure, Sanchez has also opted for a high-stakes gamble. He has spent months negotiating with the hard-left Unidas Podemos, but he left the impression that he was never too keen to reach the end of the negotiations. His hope is that he will be able to siphon votes away from Podemos on the left and Ciudadanos on the right to have a shot at an outright majority. If he succeeds, it would be the first time since 2011 that a single party is able to take control of the Spanish parliament without entering into a coalition.
The coming few weeks will show if Sanchez’s bet will pay off. But a more plausible scenario is that Spain’s parties will once again have to build bridges to give the country a government. That would require less animosity among the country’s centrist forces, showing that politicians can indeed be helpful to their country.
To contact the editor responsible for this story: Stephanie Baker at stebaker@bloomberg.net
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Ferdinando Giugliano writes columns on European economics for Bloomberg Opinion. He is also an economics columnist for La Repubblica and was a member of the editorial board of the Financial Times.
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