In fact, Spain’s current GDP is only barely at its pre-crisis size of € 1.35 billion in mid-2006. Unemployment is currently at 21%, youth unemployment remains at a stunning 45%, down from 55% in 2013.
A period of constant growth for over 15 years and a boom in real estate had come to a dramatic end with the 2008 Financial Crisis that laid bare many of the shortcomings of the Spanish economy. The following European debt crisis hit Spain with full force and led to massive unemployment especially among young people.
Two big catch-all parties had dominated Spain’s multi-party system since the country’s transition to democracy in 1979: The conservative Partido Popular (People’s Party, PP) and the social democratic Partido Socialista Obrero Español (Spanish Socialist Workers Party, PSOE). In 2008, in reaction to the emergence of the crisis, Spain’s socialist government implemented strict austerity measures aimed at reducing public spending and debt which included salary freezes. The PSOE government was kicked out overwhelmingly in the 2011 elections but the new PP government of Prime Minister Mariano Rajoy continued the course of austerity. The measures failed to stop the increasingly obvious loss of jobs. On top of that, the PP administration got caught in a series of corruption scandals.
The lasting depression and corruption issues sparked a protest movement in 2011 that called itself „Indignados“ (The Outraged). From this movement emerged two new parties: the left-wing Podemos (We Can) and the centrist-liberal Ciudadanos (Citizens). Both parties run on an anti-establishment and anti-corruption platform.
Podemos, the more successful of the two, was created by Pablo Iglesias, a professor of political science at Madrid’s biggest university. Podemos argues fiercely against the austerity measures implemented by the establishment parties or, how Podemos labels them collectively, the PPSOE. While theoretically pro-European Podemos is rallying against the „failed German Europe“ which, in their mind, stands for imposed austerity and the „dictate“ of the Troika of ECB, IMF and Eurogroup.
Ciudadanos was founded in as a regional party in Catalonia in 2006 but took the national stage in 2012. It is led by Albert Rivera, a lawyer from Barcelona. Ciudadanos promises to be a moderate breath of fresh air in the Spanish political system without the ideological baggage of the left wing parties and (so far) untainted by corruption.
The regular general election on 20 December 2015 produced the following results:
Partido Popular – 28.71%
PSOE – 22.00%
Podemos – 20.68%
Ciudadanos – 13.94%
Izquierda Unida – 3.67%
(various minor parties received the remainder of the votes).
Due to the new political parties, neither party managed to gain a clear majority. The Spanish constitution mandates a 2 month deadline for forming a government until new elections become necessary. While Mariano Rajoy’s PP technically won the elections, no other party was willing to form a coalition with them. Moreover, neither of the ideologically probable combinations (PP+Ciudadanos or PSOE+Podemos) would have reached a majority. A grand coalition between PP and PSOE, unprecedented in Spain, was made impossible by PSOE’s change-based platform. Ciudadanos initially refused to take part in any coalition that included Podemos while Podemos produced strict demands for any cooperation with PSOE. PSOE on the other hand was cautious to team up with Podemos as it feared losing its status as the main left-wing opposition party. Rajoy proposed a minority government that would have kept him in office though forced to govern with alternating majorities in parliament. The stalemate continued for several months, attempts of voting both Mariano Rajoy (PP) and Pedro Sanchez (PSOE) into the office of the prime minister failed to reach parliamentary majorities.
After the constitutional deadline had passed King Felipe VI dissolved the parliament and announced new elections for June 26 the results of which are below:
PP – 33.03%
PSOE – 22.66%
Podemos + Izquierda Unida – 21.10%
Ciudadanos – 13.05%
The outcome eerily reminds of that of the December election. Once again, no party managed to win a majority. While the PP surprisingly won more seats than in December it remains far off a governing majority. Podemos teamed up with the smaller left-wing Izqierda Unida party to form Unidos Podemos but failed to win a significantly bigger share. PSOE repeated its result from December. This means that the unfortunate options for forming a working government remain the same. Meanwhile, the animosities even between parties that are ideologically close continue, the assumption of more willingness to compromise is purely speculative. The most likely outcome will be a minority government of the PP led by prime minister Mariano Rajoy. This would by no means be a stable government, but less risky than leaving Spain without an elective government for another six months, until the next re-election.