Here we are, reporting from the sunny costa of austerity.
Spain, in case no-one has noticed, is having the odd financial problem.
This is partly because, to put it extremely simply, they borrowed lots of money from the German banks who are now clawing it back.
Thank you Angela. It was exceedingly kind of you to lend Spain money for development of flats and houses that no-one had a rat’s chance in hell of selling because no-one had the money to buy.
Lecture Spain on overspending and speculating when you were funding it? And now you want the dosh back? Interest free? No, I doubt it. Just make sure everyone in Spain suffers for your greedy German bankers. Great European spirit of community there.
Just to be clear, this money-lending and property speculation has been going on since we arrived, some eleven years ago. So it’s not a clear-cut political issue, ie blame Aznar and the Partido Popular, or blame Zapatero and the Partido Socialista. It’s really, just blame all parties, all banks, and all greedy people.
In the meantime, what is happening in Spain? Well in the north of Spain, miners from Asturias, Léon and Aragón have spent the last few weeks marching 400kms to Madrid, in a gesture reminiscent of the famous British Jarrow march to London in the 1930s, over a similar distance.
According to Revolting Euorpe:
8,000 mineworkers will lose their livelihoods and a further 30,000 jobs will be affected indirectly if the 64% cut to government mining subsidies, from €703 million to €253 million, goes through.
Spain’s miners, who walked off the job at the start of June, are the first major group of workers in Europe to go on indefinite strike against the austerity measures that wreaking havoc across the Continent.
The cuts by the right-wing government of Mariano Rajoy are in breach of a five-year Plan for Coal agreement signed between government and unions last year.
They are due to arrive in Madrid today for a demonstration in the capital on Tuesday against the savage cuts to the coal industry. Anybody British remember that? But it wasn’t due to austerity measures back in the 80s in the UK, it was due to destroy-the-union measures.
Meanwhile, what was happening on the Costa del Sea Fret? No-one gave a shit. Everyone piled into their new coche and went down the beach, as you do in Andalucía, home of the poverty-stricken agricultural worker.
That’s not quite as flippant as it sounds. When Partner was busy buying two packs of San Miguel, two jars of capers and a bag of dog biscuits, he was chatting to one of our neighbours.
She’s Swiss and speaks perfectly good English. He’s Welsh and doesn’t really speak very good English although his Spanish is ok. Either way they chatted in Spanish about work. Was there enough in Gibraltar? Yes, for a few weeks. There’s nothing here, she said.
Miners on strike in the north of Spain, people without work for years in my village, holiday makers with bright shiny new coches enjoying summer on the beach. Who does the austerity hit?
Who’s going to fret?
And for those of you who complain about Pippa’s blog not being updated – a quicky picky of him waiting to get on the road.
roughseasinthemed 
I’m actually not sure that I’m suppose to “like” a post that discusses a sad situation. I appreciate the post though, because I know less than nothing about European politics. And, as always, I love the pics — especially Pippa. (I don’t complain that Pippa’s blog hasn’t been updated lately, but you know Ralph…whine, whine, whine…)
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I know, I do have lots of pix for his blog that I really need to do, but I keep needing to do all the other blogs too. Too too many blogs!! I’ve been wanting to do an update on the Spanish situation for a while and the contrast between people sunning themselves on the beach while striking miners walked to Madrid…..
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As we know, greed is at the bottom of so many of the problems on the planet. Why someone needs millions a year to maintain their life style while others eek out a so called “living” on pennies a day is an “interesting” (for lack of a better word) fact and a mystery to me. I still believe that population is the problem and the solution. Two to three billion souls is what the planet can support both physically and monetarily. Now how that is accomplished is the problem.
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Compulsory spaying and neutering perhaps, like dogs and feral cats?
Very controversial ground, and rather smacking of nazi eugenics. Or would it be selective?
Of course, I’ve virtuously done my bit by being child free – perhaps I could sell my allocation of two children per couple (for example) to someone who wants four?
Or would it be: homelesss, indigent poor people – no children. Those with meagre qualifications – one child, but only if they could support it without state aid. Your average degree might be able to manage two – but again no state aid, for either schooling, allowances or even cheap/free bus fares. Having children would become rather expensive if people had to pay school fees.
Those with two degrees, may be allowed three or four. But that’s just basing it all on qualifications assuming that we might end up with a more intelligent world, whether we would or not is another matter. Perhaps it should be based on type of skill – eg lawyers, doctors, engineers – but not historians or zoologists, who are rather useless in the scheme of things.
My solution tbh would be more on the lines of redistribution of wealth. I see no reason why people should have half a dozen homes in different countries (says me with two), spend half their time lolling around on expensive yachts, owning a string of racehorses, dressing in furs and diamonds, while people are starving elsewhere.
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One of the great pleasures of being rich – I say from imagination, not from experience – is having all those people in rags below you. You can use them as cheap labour, despise them for their stupidity, lack of initiative, etc., in short, feel superior because you’re so clever with your multimillion bank account, and you can set up charity foundations and feel righteous and good for giving them handouts. In other words, with all that plus the ermine and pearls, the rich are not going to favour any redistribution of wealth scheme, and since they control the parliaments and congresses of our pseudemocracies, a violent revolution would be the only way to accomplish this goal – and we’ve seen what happens as the result of such events, and besides that, I smell rain in the air but I don’t smell revolution. In fact, I don’t think any intelligent proposal for straightening out the dire world situation has the least chance of prospering because power is almost exclusively in the hands of morons. It’ll all be sorted out with the Fourth World War. (-Fourth, you say? -Yes, the Third has already happened, and is till in progress – a World War on the installment plan that began in 1948.)
Anyway, your analysis of what’s caused the Spanish problem, simplistic though it be, is dead on, as far as I can tell.
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You’ve read all the comments, the analysis wasn’t in the post :D I like people who read comments before they reply. You’ve also reminded me of a post on Clouds about ragged trousers that I MUST write.
A great comment though, especially, the rain but not revolution. Of course not. Europe is past revolting and America isn’t old enough yet.
No, I didn’t query fourth at all. I know the third has happened. Insidiously.
As for Spain, I speak from an Andalucían perspective. Not el norte or elsewhere. But thanks, interesting to hear your view too.
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Thnx to your blogs I’ve been paying [more] attention to Spain’s mentions in the news. While Australia isn’t in the same boat (yet) I can see similarities. News-wise there have been large staff lay offs, several large firms (linked to construction) gone under due to varying combinations of creative accounting, financial over extending, lack of credit insurance, financiers calling in loans… Who does it impact on most? Same as in Spain, the poor bastards at the bottom of the food chain. The govt has bailed out a couple of sites as they will be ill-affected if the work isn’t completed but for everyone else, bad luck. If Spain has any handy tips on austerity measures, they might want to share. Meanwhile we’d all better get to sunning ourselves while we can ;)
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I’ve not written about Spain for a while, mainly because I’ve not been back, and I like to add a current picture! But I have been reading about the miners, and the proposed budgetary cuts to welfare, eg education, health, and other state aid – which as you rightly point out – affects those who can afford it least.
The Spanish are pretty resilient, but in my part of Spain, Andalucía, it’s an odd part. Traditionally poor, largely agrarian, with the land owned by rich families. But then the tourism started up and down the coast, and with it came construction and foreign money, not just holidaymakers, but people from Northern Europe who wanted to live in the sun, which totally changed the balance on the coast.
Where I live is different again. In the old town of my village, everyone owns their own house. They have acquired a tiny piece of land on which they build one, two or more houses for themselves and their children. Someone in the family will live in the camp and grow veg, so you will never starve. Not rich, sometimes poor, but able to survive and weather out the bad times.
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That’s our worst case scenario plan for TA – our tiny block with veges & chooks, along with our neighbours – where we as you say “Not rich, sometimes poor, but able to survive and weather out the bad times”, even dire financial or actual disaster. Not as crazy as those doomsday groups who have been on the TV adverts lately… just practical. I’m not sure we’ve seen the worst of it yet…
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It’s not actually a bad life. Not having a mortgage around your neck makes one hell of a difference. In our village, most of the plots are totally family based – would drive me and Partner up the wall, but it’s a way of life there. Our neighbours are pretty good (re my comment on your farmers’ market post) but it’s not the same as having family to rely on. Our WCS is having to rent out one of our properties, not sure which…. certainly can’t sell Spain at the moment given the climate :D
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I am not an economist but surely it must have occurred to someone somewhere that Spain (and not just Spain of course) was borrowing too much money and that when it came to paying back the loans they wouldn’t be able to afford it. It’s not very different to an individual maxing out on credit cards and then not having the cash to repay. Who is most to blame? The borrower for lack of self control or the lender for making it too easy? A bit of both I suppose and I’m not sure I can take the populist view right now and entirely blame the bankers or the Germans. I remember when I had my first bank loan (about 1975, to buy a Hillman Avenger) I had to sit down with the bank manager and assure him that I could afford the repayments. It must be obvious to everyone, man-in-the street, politicians and bankers that if you spend more than you earn one day there will be a day of reckoning!
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Ah, the old car analogy compared with government spending. I’ve had this discussion before so I’m well up on it! I’m not an economist either but I do consider comparing government debt and politics with a household budget to be a little simplistic.
But, to continue in that vein….. If I couldn’t afford the car, I would walk, bus or cycle, rather than take the bank loan. And in fact, that is what I did until I had saved up the money for my first car. This is where the analogy falls apart. That doesn’t impact upon anyone apart from me. The whole issue with government – and local government – spending, is that they are providing public services as you well know, not buying a car for one person and relying on a regular income to fund the repayments. There are also other motives – power, re-election, personal agendas about what people want to push through, local and national status.
However, back to the car loan. Let’s say for whatever reason, you had come out of work. But the bank (which had borrowed money to lend to you) doesn’t take back the car. You are allowed to keep it, and default on your payments until you get another job, because you are a favoured client. The bank needs to get the money from somewhere though, so they snatch the pushbike from the kid down the street who bought it second hand so he could do his paper round and not be late for school, or the pram from the woman who has just had a baby so she now has to carry it everywhere, or…. it’s not the ones who have done the borrowing or lending that are directly affected, it’s someone else. As EllaDee above pointed out.
What have the miners in the north of Spain done? Have they invested in construction companies that can’t sell properties? No. Have they authorised a lavish programme of public expenditure, a war in Iraq or whatever? No. But it’s their jobs that are not just on the line, they will be gone. Because of someone else’s fiscal speculation.
I think people switch off to austerity measures ( a new term which will no doubt find its way into the OED if not there already ) so I didn’t want to write too much, but I suppose I had better at some depressing point!! Although I don’t think I can match the gloom of your Greek pal. Yet.
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I take your point and agree in part but remain convinced that as a consequence of living in a capitalist society that we are all collectively to blame. We all wanted what the Germans have but we didn’t really want to work for it and now we don’t like the pain of debt repayment. It’s a shame though that some sections of society get more badly hurt than others. I don’t know the answer but I do know how to collect rubbish so I am off to work!
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I don’t know. I don’t think I’m willing to take part in your collective guilt-fest thanks all the same. I still haven’t bought a DSLR due to uncertainty about work (aka when it’s going to finish rather than if – his not mine I hasten to add), he hasn’t bought a satnav for the same reason, we’re still sleeping on the 25-year-old thermarests on the floor etc etc..
I don’t think I wanted or want what the Germans have whatever that might be (I did have an Audi A4 as a lease car once). Back to one of the comments on Clouds, I think, about Germany might have lost the war but it didn’t do them any harm. And who doesn’t want to work for it? I might not now, but I have done in the past. As for Spaniards they work crazy hours. I don’t think they have heard of an eight hour day including lunch break. Nine at the minimum. Shops – 9-2 and 5-9, construction 8-6 (hour’s lunch) – but A is working 8-5.30, with half an hour’s lunch so no difference there. Protestant work ethic will never die…..
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bold and straight to the point. i am so disgusted with our own politicians riding around in blue mercedes limos while the rest of the country is living on pasta and potatoes.
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Nothing wrong with pasta and potatoes – our staple diet too. But I take your point. Someone has to suffer and spend less money, but not the ones in charge. And certainly not the bankers.
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I think there was an extra complication with Spain IMHO. Around the middle of the last decade the Euro rose in value, from about 60p to 75p. This hit many of the retired Brits who were living in Spain on a fixed income based on sterling very hard, and many were forced to sell at whatever price.
Money was cheap, and the Spanish builders, financed by the banks, kept on building housing complexes for people to live in, despite the availabilty of 5 year old homes quite cheaply making the new ones near impossible to sell. The builders defaulted on their loans, and the Spanish banks which had loaned them the money were left holding near worthless property, whilst owing German and other banks vast amounts of money, that they had borrowed on the international markets to fund their loans to the builders.
Typically, one way governments can get out of these messes is by devaluation, making their exports more attractive and imports less so. Sterling for example, devalued signifcantly, in November 2007 a pound was worth 2.1 US$ but by March 2009 it was worth less than 1.4 US$. That perhaps is the problem with the Euro, it is the currency of Germany essentially, and its current market value represents the performance of Germany; other countries have to try and make do.
I wish I could see a light at the end of the tunnel.
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Interesting perspective. We tried to buy in Spain before the Euro figuring it would escalate prices – it did.
We’ve seen it go from 1.70 (euros to the pound) some years ago to nearly like for like. Back up to 1.24 this weekend.
But I don’t agree. If you have no mortgage, and you do have an income you cut your cloth.
The Brits – and everyone else – who are selling, are the ones with no guaranteed income. Trust me. I live here :D The pensioners who want to sell are the ones who fear for their health care because the NHS is suddenly wonderful (yes?).
Secondly, the newer homes are far cheaper than the second-hand ones. No way I would be selling my place for 100K, which is what you can buy a dirt cheap flat for.
The blunt truth is, it was the old property speculation that didn’t work. Poulson in a different way. Or basic gambling really.
Your funding analysis is correct but the property market in Spain is going nowhere whether new or old. It is just slumped.
Devaluation? I remember that. Called decimal currency wasn’t it?
The Euro was originally pegged at the dollar though, and since the dollar has dropped a little and the deutshcmark that no longer exists has risen….
I was an advocate of Europe and the Euro years ago. Now??
Meanwhile we go to the beach. Well, they do, I avoid skin cancer.
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I’m very much an advocate of the EU as a single market, even though some of the regualations are at best daft. The Euro, whilst a lovely idea, was always flawed by the lack of fiscal union.
I remember the stability pact of I think 2000, which determined what percentage of GDP governments could borrow. The first country to break it was Germany, followed quickly by France. No wonder the thing has gone to pot.
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I’m no longer sure what I liked about the EU!! My crazy sense of history probably. I thought single currency was great.
But living here and pretending everything is the same is honestly a crock of shite. For want of a more intellectual argument.
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Seems like Spain has done what happened to the American people a few years back with a few of our Biggest Bankers.. Qualify people then sell them expensive homes they neither can afford nor ever have the chance to. Anything to sell homes.Then what happens, the job market goes sour, people (who actually know if they make $2000 a month, and their mortgage is $1500 a month) somethings not going to get paid and it;s always the mortgage. So Big banker forecloses on all of those homes and then there is another problem. Too many houses and the people can’t pay their loans..
Our planet can be down right stupid at times..
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Funnily, we were well over extended when we bought our first house. A loan from my parents to whom we paid interest, and a max loan from the bank. A free butler’s sink from someone’s garden, a £25 cooker, and no furniture. I did insist on a washing machine as hand-washing is not my best skill!! The mortage always got paid. Dust sheets at the windows. No carpets. So what? Need to eat and a roof over your head, no more.
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I’m with you on that. Food and shelter are “must haves” and the rest are luxury items. You would (or would not maybe) be surprised how many people here in the States waste money..
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I think these days I fail to be surprised about how people spend their money, I just pulled some trousers on to go visit a neighbour and see his flat – and – how many holes in my trousers?????? The top was rather chic ZARA though and who cares about the leggings? Maybe they never saw as my trousers weren’t the main issue….. Money, ie block costs were. Life huh, just life.
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I started reading with a big smile on my face at your post title, but it got lost in the political debate. Interesting reading. I have Polish family who live a bit like your villagers, subdivide their property and cultivate their plots. Aunt Lusia grows the BEST potatoes!
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Ah, no-one grows potatoes on plots near me. Although I used to in the UK. In Spain it is always tomatoes, peppers, courgettes, aubergines and beans (runner beans but not scarlet).
The sea frets are quite rare so lovely when they happen. Although you know the sun will burn through by mid-morning. The politics of the post were because no-one seemed to care down the beach on a hot Sunday with their new cars, that people were marching to Madrid because they were going to lose their job through no fault of their own. I’ve got some different sea fret pix but they may end up on the Landy blog. I’ll see.
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A satrical commentary on the status quo. I liked it.
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Thank you. We live in crazy times.
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I will always find it odd how governments can spend money they don’t have, while we little folks don’t tend to get away with that little issue…and on the other side you have miners walking in protest and folks not getting to eat. Currency serves an odd ritualistic function in our society. I remember thinking as a youngster that life would be so much easier if the govt would simply print off more of that lovely money to go around – a somewhat simplistic and rather ridiculous notion – but it made perfect sense to my unformed brain at the time. The personal plight of the people in trouble is what gets to me, and there is no easy fix. Period.
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Governments and banks both. What struck me was the contrast between striking miners marching to Madrid and the beaches full of happy families enjoying the sun. But pragmatically, why not I guess? It doesn’t cost anything, people take their own food, so might as well enjoy yourself for the weekend. I thought you were going to say that as a child you thought life would be easier when you got older, ie ‘grown up’ – at least that’s what I thought, and how wrong I was!
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I think we do children a disservice by implying that the grown-up world is the one they want to be in – they try so hard to grow up, and end up disillusioned. I’M disillusioned with my grown-up world! *sigh*
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As I * very * distantly remember, I think the reason I wanted to grow up was so that I could do what I wanted and not be told what to do all the time (parents, school). If only I had realised what little control we have over our lives. Childhood isn’t perfect either – passing exams, homework, school friendships – the biggies in life those days. But worrying about where the next meal was coming from, or getting a job, didn’t come into it.
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Control is the greatest illusion ever pulled over our eyes…we spend our childhood wanting it, and our adulthood letting go of our illusory little stock! I didn’t have any food worries either – so many do and will. Sad…
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I was reading about food stamps earlier on another blog:
http://philosophermouseofthehedge.wordpress.com/2012/07/12/bear-ing-in-mind/
I just can’t get my head around the fact that the richest (I think, more or less, as for now) nation in the world, and the most powerful one (again, for now), dishes out food stamps to its impoverished citizens. And not only that, they are asking more people to apply for them. So they can get junk food on stamps?? How screwed up is that sort of thinking?? We are all caught up in global and corporate power :(
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Great post and interesting comments. Loved the 3rd paragraph – (we see that here as banks give money to rich developers)
And the contrast of the new cars at the beach. (I guess the beach is a cheap entertainment – and everyone needs some fun at some point)
But new cars bug me – cars cost so much energy and resources to build – why not make them to last and keep them a long time? Ours are always old, but in good shape from care – and paid for. People urged to buy buy buy and just consume stuff is troublesome.
The food stamp deal is now a political tool to buy votes. While people may need help in certain situations, it should be a hand-up not a hand-out….and certainly should be limited. What has happened here is that a culture of welfare has developed: generations have not worked and relied on government checks: kids see their parents and grand parents and great grandparents just sitting around taking what is given – making no effort on their own. There’s a whole group that feels entitled to it. One graduating senior in high school replied this when asked what he was going to do to earn a living: “Nothing. Only fools work. I’m just going to get a government check.”
Terrible situation. It will be ugly, but this way of thinking cannot go on – there isn’t the money.
Big international corporations and politicians are all rich and happy – and eventually it will have to crash and burn.
(And Mr President, no you do not know how it is…you were a millionaire and still didn’t bother to pay back your student loans until running for office and it came out – guess it didn’t matter to you that some poor child needed that federal student loan money so they could try to go to college.)
It all drives me crazy.
It seems to be the same everywhere
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Unbelievable… In a world where most athletes could buy out Haiti, where private citizens get $500,000 remodels on their homes on a whim, where private jets are given as father’s day gifts, and there are starving people. Something has gone so wrong…
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Thanks to both of you for such thoughtful input. 1) I think the car thing is a whole new post (for Clouds). 2) People in the UK were talking about not working and living off the state 40 years ago 3) We (ie people) are just greedy, selfish, and unthinking. Not all, fortunately. But a lot of us are. And now we are running out of space!!
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