|
| Spain set to vote for Rajoy as crisis claims fifth leader |
| Bloomberg / Madrid Nov 20, 2011, 00:43 IST |
|
Spaniards may hand the biggest majority in three decades to opposition People's Party leader Mariano Rajoy as polls suggest Europe's debt crisis will push a fifth government from power.
Rajoy will win as many as 198 of the 350 seats in Parliament in tomorrow's federal elections, the largest majority any Spanish government has secured since 1982, polls show.
Set to inherit a 23 per cent jobless rate and the highest financing costs since Spain joined the euro, Rajoy has pledged to deepen spending cuts and overhaul the economy after a four-year downturn.
Spaniards already bearing wage cuts and frozen pensions are due for a further squeeze on spending in exchange for Rajoy's pledge to create jobs.
The vote comes with government borrowing costs near the level that pushed Ireland, Greece and Portugal to seek aid, and Rajoy said he hopes the country won't need a bailout before the new government takes over.
"Hopefully the next government won't just pursue austerity but also liberalizing reforms to spur economic growth," Fredrik Erixon, head of the European Centre for International Political Economy in Brussels, said in a telephone interview. "Freeing up the labor market is crucial and has gone from being badly needed to being desperately needed given the jobless rate."
POWER VACUUM
Most opinion polls show Rajoy and the PP with at least a 15 per centage point lead. Even if Rajoy does clinch the majority that polls predict, Spain faces a power vacuum of as long as a month before the new government is sworn in.
Spanish law doesn't allow Parliament to resume any sooner than Dec. 13, with the new government not voted in until the following week.
Rajoy is wooing Spaniards by making employment the focus of his campaign.
The PP says it will cut "superfluous spending," without giving details, and promises a "restructuring" of the financial system, without saying what this will involve. Traditional supporters have abandoned the ruling Socialists after Prime Minister Jose Luis Rodriguez Zapatero, who's not seeking re-election, slashed wages and changed labor laws to favor employers as part of the deepest austerity measures in 30 years.
"We've never seen such pessimism in Spain about the economy," said Ismael Crespo, a political scientist at the Fundacion Ortega-Maranon research institute in Madrid and former head of the state polling unit. "Spaniards are conscious that this government needs to have an outright majority to avoid situations like Greece and Italy and get things done quickly."
JOINING THE EURO
Rajoy is also campaigning on the PP's track record of shepherding Spain into the euro in 1999. The PP-led government eliminated a 6.5 per cent budget deficit in the eight years it ruled through 2004, and reduced the gap between Spanish and German borrowing costs from 300 basis points to seven.
That gap widened to more than 500 basis points yesterday, before bond-buying by the European Central Bank pushed yields down to 6.79 per cent with a spread of 483 basis points.
"Spain wants to be in the euro," Rajoy, 56, said in an interview yesterday with Onda Cero radio. "The euro brings with it obligations and commitments, the first is not to spend what you don't have. Spain will do its homework, as we already did in 1998."
WOO BACK VOTERS
Zapatero, with his popularity at a record low, decided not to run again and the Socialist candidate, former Deputy Prime Minister Alfredo Perez Rubalcaba, has tried to woo back voters by pledging new taxes on bankers and the wealthy. Rubalcaba, 60, has also promised to make changes to the electoral system in response to nationwide protests by the so-called "indignant ones."
While the two candidates offer opposing solutions for Spain's stagnating economy, both are former deputy premiers and education ministers who have also fought the Basque terror group ETA as heads of the Interior Ministry. They both sport gray beards, and are older than Zapatero, who came to power aged 43 in 2004. Rubalcaba, who has a doctorate in chemistry and is a former sprinter, served under former Prime Minister Felipe Gonzalez. Rajoy, a civil servant, worked for former Prime Minister Jose Maria Aznar.
|
|
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
Content Guide
