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Catalonia-Spain September Update: The Gift of a Thistle

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People are finally starting to take notice of the political tsunami that is forming in Europe. People that matter: market makers, fund managers, traders. They are coming to realize what some of us have been saying since 2010: a storm is coming, and its twin foci are Scotland and Catalonia.

It begins in Scotland, where a YouGov poll last weekend gave the “YES” vote a narrow 2% margin over the pro-union crowd[1]. Panic gripped Whitehall as well as markets; the pound slipped against the dollar (1.3%) and the euro (1%) while equities also suffered, especially for firms based in Scotland[2]. The short-termism of markets had caught traders napping. Even as the finger-pointing began, British politicians struggled to respond to this unexpected and unwelcome development. In a rare show of solidarity, the leaders of the three mainstream parties cancelled the traditional Queen’s Questions in Parliament and immediately flew to Edinburgh[3]. David Cameron, Ed Miliband and Nick Clegg are together the three worst people to convince Scots to stay in the Union, and Edinburgh is not even the center of the “YES” vote, but there they were, wiping their teary eyes as they pleaded with their countrymen to vote “NO”. Good luck with that.

yougovpoll

Yet despite the Westminster Trio being their own worst enemies, there is every indication that this is an overreaction. It is true that the “YES” vote has been gaining momentum, but this was to be expected in the run up to so important and emotional a referendum. More importantly, the YouGov polling method leaves a great deal of doubt regarding how representative it actually is. It was an open online poll, which by its nature lacks a statistical control or validity. These types of polls skew heavily towards certain demographic segments as well as favoring activist groups, who are more likely to take the time to participate. The poll results also removed all of the “undecided” voters who by no means are guaranteed to vote for independence. This favors the “YES” vote; it underrepresents the older demographic in the pro-union vote as well as the potentially conservative nature of undecided voters.

And indeed a new poll by Survation[4] shows the “NO” vote holding steady with a 6-point margin, the same lead it has had for over 2 months. Alistair Darling breathed a sigh of relief last night; but the referendum is still up in the air. “NO” can still go down in flames if they misplay their hand.

Scottish Forecast

At this point, however, I believe that “NO” will win the day on September 18th with a slightly greater margin than 6%. This opinion is based on my belief in the turnout of the underrepresented pensioners, who don’t show up on polls, but who grew up in a United Kingdom and aren’t keen to see their Social Security fund redenominated into Scottish pounds. It is also based on my belief that the undecided voters are by nature risk-averse (else they would have decided already) and that they will split heavily in favor of what they know, which is Union. In the end, this brief surge of the “YES” campaign may actually hurt the cause of independence: it will be just frightening enough to galvanize the lazy and undecided unionists on referendum day and ensure their turnout.

If the “NO” vote wins as I predict, David Cameron, the United Kingdom and Europe will have dodged an enormous bullet. Not for the Scots themselves: I have no doubt that after a rough transition period, Scotland could become another Celtic Tiger. But the implications for the rest of the world would be more dire. A Scottish exit would greatly enhance the possibilities of a British exit from Europe. David Cameron’s government would probably fall, potentially to be replaced by a radical Tory-UKIP alliance. Does anyone care to guess what Prime Minister Farage’s first policy decision would be?

A UKIP government and Brexit would not only be damaging to Europe as a whole; it would further isolate Germany from the “Club Med” nations. More importantly, it would give wings to Marine Le Pen’s National Front, which is already the most popular party in recent polls[5]. In any direct election Ms. Le Pen absolutely browbeats the hapless Mr. Hollande, whose popularity among his countrymen is only slightly above that of Adolf Hitler, and there is no other French politician capable of touching her. Far from thinking about the consequences of a British referendum on the EU in 2017, we may be looking at the disintegration of the European Union as early as 2015[6]. And the French internal dynamics won’t go away with the Scotland referendum.

faragelepen

Catalonia-Spain Endgame

If Europe dodges the first bullet in September, there will be no time for anyone to catch their breath: in November, the Catalans propose to emulate the Scots and go to the polls on an independence referendum from Spain. Even before then, September will be a rollercoaster month for the Catalans:

  • Today is not only La Diada, the closest thing the Catalans have to a national holiday, it is the 300th anniversary of the fall of Barcelona to the forces of the Bourbon king during the War of the Spanish Succession. Yes, the same Bourbon king whose descendent sits uneasily on the throne of Spain today. More than half a million Catalans[7] have signed up for a pro-independence rally today, topping the approximately 400,000 that turned out last year. The celebrations will be charged to say the least;
  • The pro-independence Catalans are also charged by the situation in Scotland; a “YES” vote there would provide a huge boost to the separatists in Catalonia as well. Lots of Catalan calendars have a big red circle around the 18th of September;
  • Even a Scottish “NO” victory is unlikely to diffuse the situation, though it may dampen enthusiasm for a time. Mariano Rajoy is right about one thing: the Scottish and Catalan situations are totally different, though not in the sense that he means. The fact that Scots are able to peacefully assemble and decide on their future is the best reason for them to stay in the Union; the fact that Catalans are being denied the same right and are being threatened with legal actions, political isolation, police repression and martial law is the best reason for them to get out;
  • Things really get interesting on the 19th of September – they day after the Scottish vote, the Catalan Parlament will vote on a law that will authorize the Generalitat to organize the referendum. This will be a direct political and legal challenge to the authority of the Spanish state which has already said that the referendum is illegal. Mariano Rajoy must respond to this challenge or face a revolt of his own backbenchers. At the very least, the Spanish government will ask the Constitutional Tribunal to declare the Catalan vote null and void; a request that will be fast tracked and a verdict delivered post haste.

That is the minimum that will happen. Rajoy could theoretically have any Catalan legislator voting in favor of the measure charged with fomenting secession, which is still illegal in Spain. I think there is a high probability of this happening once the Tribunal delivers its predictably pro-government verdict. In order to avoid tumult at this time, however, the government would still use the velvet glove: legislators would be told that they are under investigation and possible indictment by official letter rather than by police escort.

The government’s policy is now reasonably clear: Mr. Rajoy said this week that he has a plan prepared to deal with the situation, though he gave no details; [8] and Deputy PM Soraya Sáenz de Santamaría has echoed this by affirming that no referendum will take place in November. [9] In a nutshell: they have no intention of entering into any negotiation or making any concessions until the Catalans unconditionally give up on their “right to decide”. And even if they do give up on the referendum, there will be no negotiation or concessions.

The government has decided on a hardline, with escalation to be progressive and in response to continued efforts by the Catalans to organize their referendum. There are a number of indications that this is so:

  • The aforementioned statements by the head and deputy head of the governments;
  • The Spanish Navy has dispatched a warship to Barcelona to wave the flag during the 11th of September celebrations in a not particularly subtle reminder of who has the guns and the monopoly of violence;
  • The Spanish government has recently purchased at least Euro 1 million in new riot gear and water cannon for their police; [10]
  • This equipment is being used to outfit nine newly formed special detachments of riot police that will be stationed throughout Catalonia in the coming days and weeks. [11]

A government supporter could easily say that these are simply logical and reasonable preventative measures to ensure domestic tranquility in agitated times, and that is perhaps so, if one is willing to give the government the benefit of the doubt. If it were occurring in Venezuela or Nigeria, the headlines would read differently: “Government Crackdown”. Without going so to such an extreme, a similar response in Ferguson to far more modest protests than what might be in store in Catalonia has resulted in a denunciation of the State of Missouri by Amnesty International and Human Rights Watch for violations of human rights.

chaos

The government will continue to pursue legal actions against pro-independence Catalans in government, business and society in general. I would expect the top leadership of the pro-referendum parties to be investigated and possibly charged with fomenting secession or sedition; and the pressure will mount the closer we come to November 9th. If Artur Mas and his government act upon the referendum law that will be passed by the Parlament, he too will be charged with dereliction of duty, fomenting secession and malversation of public funds. This is a logical strategy: decapitate the Catalan leadership prior to the organization of the referendum rather than wait until the ballot boxes are already in place and you have to fight through crowds of civilians to get at them.

In the meanwhile, the government will continue to investigate and discredit everyone it possibly can who is associated with Catalan separatism. The revelations of corruption tainting the Pujol family came at a very convenient time for the government; nor is it a coincidence that corruption or tax evasion investigations are being launched with an intense focus on Catalonia. By painting all Catalans with the same dirty brush, it is easier to discredit and dismiss their call for independence as merely another corrupt and self-serving ploy. After all, according to the Spanish Justice Department’s (Consejo General del Poder Judicial) own statistics, Catalonia is by no means the “most corrupt” region of Spain: Baleares and Andalucia easily take the top two spots by number of open investigations.

Let me make one thing clear: I am not refuting the allegations, nor defending any person or organization. If Mr. Pujol is guilty, he should be fined and jailed. The same goes for anyone else. My only criticism is in the timing and selectivity of these investigations, which are being used as political theater rather than any genuine attempt to clean-up corruption. I would not be surprised if Mr. Pujol is guilty as Cain, or Mr. Mas, or any other Spanish politician: after all, if you look in a sewer, you are going to find rats. Mr. Rajoy himself is accused of knowledge and connivance with a decade long illegal funding scheme as well as taking undeclared sums of money from campaign donors in unmarked brown envelopes. This is the blackest of pots smearing the kettle. Mr. Pujol’s alleged corruption is neither an exceptional, nor even a common symptom of the Spanish political system: it is as necessary and integral as air and water to it. Spain’s political system inherited parts of the Francoist state’s cronyism while adding features of its own, like closed lists and regionally weighted voting, that not only are permissive of corruption they ensure its existence and perpetuation. Make no mistake: Jordi Pujol has more in common with Mariano Rajoy and is more representative of the whole brood than of the man on the street of Barcelona – or of Madrid for that matter.

The argument then goes that, if true, it ought to disqualify Artur Mas from leading the referendum movement, much less the Catalan government. I agree: if Mr. Mas were proven to be corrupt, he certainly should be punished. But indicting him for the current situation in Catalonia is, in my opinion, a plain misreading of the chronology of recent Catalan-Spanish relations, not to mention a repetition of the standard drumbeat of Spanish mainstream propaganda. The mistake that pro-government supporters are continually making, both in Madrid and in London, is in identifying the man with the movement, and attempting to vilify the latter by smearing the former. That is a grievous error. Did Samuel Adams and the Sons of Liberty cause the American Revolution? Or did they exist because the preconditions for their existence were already present?

Artur Mas and Alex Salmond may be expertly taking advantage of and exploiting the situation, but they did not create them. A significant percentage of Scots really do despise the Tories and feel betrayed by Labour; that has not been caused by Mr. Salmond. A significant percentage of Catalans really do despise the Partido Popular and feel betrayed by the Spanish Socialists; that also wasn’t caused by Mr. Mas. It is significant to note that until 2010 there was very little support from outright independence from Spain: that was the decisive year when “catalanistas” made up their minds to get out of Spain. It was when the Partido Popular, then in opposition, launched a blatantly and offensively anti-Catalan campaign and got the ultra-conservative judges of the Constitutional Court to overturn large portions of the reformed Catalan Estatut after it had been approved by both the Spanish and Catalan parliaments.

Add to that the fact that the Popular government isn’t even complying with the portions of the Estatut that weren’t overturned, and you have a situation where “devolution” sounds like a bad joke to these people. We can argue rights and wrongs or just how much this description fits the facts, but the important thing is that it is the universally held perception of pro-independence Catalans, and that again is not Artur Mas’ doing. At the end of the day, it is perception that matters more than facts in these affairs. Mariano Rajoy has been its own worst enemy in Catalonia: he has sown the wind and is now reaping the whirlwind.

mas

All those people who were pro-Catalan but not pro-independence lost faith in the system when the Estatut was shot down; and the way the Partido Popular has conducted itself after winning an absolute majority in the legislature in 2012 has only served to further convince them that the hopes for a favorable reform of the Spanish state and a renegotiation of the status of Catalonia within that state were gone. It convinced them that “out” was not only better than “in”, but that it was the only alternative to a creeping castilianization, starting with Education Minister Wert and his beloved educational reform.  They simply can’t imagine swallowing another PP legislature with more “amiguisimo”, more corruption, more restrictions on abortions, more social welfare cuts, more pernicious reforms, more austerity, more toros, and more double-dealing in bad faith.

Let me again be clear: I am not agreeing with nor refuting any of these arguments.  I am repeating the arguments as I have heard them[12] and stating that this is the universally held perception of those who favor independence. And in this business, it is perception that matters, nothing else.

None of this is attributable to the nefarious machinations of the Machiavellian Artur Mas. If anything, Mr. Mas was late in getting on the bandwagon; he only became a real supporter of Catalan independence in 2012, when ERC ate his lunch during the Catalan regional elections.

Catalan Forecast

I believe Spanish government efforts to head off the referendum at the pass will ultimately fail. They may indeed corral the Catalan political leadership, put Mr. Mas under house arrest, jail the pro-separatist legislators and set up a Rump Parlament: but in the end, the Catalan civil society is sufficiently organized and sufficiently determined to continue organizing the referendum anyway. Mr. Rajoy would be faced with the choice of jailing not just a few dozen politicians who demonstrably disobeyed government and court orders to cease and desist; but hundreds of civilians volunteers who would continue working on preparing the referendum independently. He might hesitate at something that smacks so closely to fascism. But eventually, when it becomes apparent that 9N2014 will continue, he will have to order in the police brigades, and I believe he will do it.

Mr. Oriol Junqueras of the Esquerra Republicana believes it to. He called for widespread, peaceful civil resistance and disobedience to any intervention by authorities of the Spanish state[13]. The wording was deliberately vague; Mr. Junqueras doesn’t want to also be charged with fomenting insurrection. Yet it may come down to that: police batons and water cannon against linked arms, flesh and bone. Just how long and successful such resistance could prove to be depends on many factors, but there is no example in history of passive resistance being dealt with passively. Skulls will be broken, people will be hospitalized, and the risk of escalation exists.

I previously published an analysis of possible end-game scenarios in which I argued that the probabilities of conflict outweighed any potentially peaceful, negotiated outcomes. I would now revise those estimates of violence and repression upwards:

endgames

If Catalonia goes, the continued existence of a Spanish state becomes an open question. Just as the Scottish vote might unleash nationalist drives in Wales and Northern Ireland, a successful Catalan secession opens Pandora’s Box in Spain. The Basque National Party (PNV) is keeping very quiet, but there is little doubt that Catalan success will lead to Euskadi holding its own independence referendum, as they tried to do in 2008. If both Catalonia and Euskadi become independent, there is the possibility that Galicia, which has its own latent nationalist movement, would also seek equal status. There is an excellent economic reason for this. Galicia, Extremadura and Andalusia are all significantly poorer than the Spanish mean, and would easily qualify for European Regional Development Funds – assuming they are allowed back into Europe. Staying in Spain means no European funds and no intraregional transfers from the Spanish central coffers either, precisely because Catalonia really has been a large net contributor to those transfers. So which side is the bread buttered on? Stay in Spain and go take a siesta? Or become the Republic of Andalucía and live off the fat of the EU funds? For the PSOE elites in charge, it may be a no brainer. And that is another argument for Andalucía in particular: the rest of Spain is very much pro-PP, while only Andalusia remains in the hands of the Socialists. Even if only Catalonia secedes, what are the chances of the PSOE ever regaining power? Unless the Partido Popular disintegrates, which may well happen if Rajoy lets Catalonia go without a fight. What seems inconceivable today becomes very easily conceivable once we go down the rabbit hole.

America’s Perspective

The most frequent question put to me by my Spanish and Catalan readers is: what will the United States do? What will be their attitude?

The United States will do nothing; as if the President and State didn’t have enough to worry about with a revanchist Russia invading Ukraine, the collapse of Syria and Iraq, the rise of ISIS, the war in Gaza, the simmering tensions in the South China Sea and the ongoing nuclear negotiations with Iran. This will be viewed as a European matter to be dealt with by the Europeans, and may God grant them wisdom not to muck it up too badly.

A disinclination to get involved does not imply a lack of interest. The US will be watching developments very closely. Put simply, the US will fundamentally oppose any weakening of NATO at this time that it is trying to reinvigorate the alliance to oppose Russia and ISIS. In that sense, the US will be far more concerned with Scottish independence than with Catalan independence.

For one thing, the United Kingdom is simply an immeasurably more important ally than Spain. Not only does the UK have a larger and more experienced military, better suited to deploy with and fight alongside the American military, it has proven to be a more dependable ally. Mr. Rajoy did himself no favors by refusing any role for Spain in the coalition against ISIS in last week’s NATO summit. “Quid pro quo” is an operating principle in international relations; so why should the United States now go out of its way to support so fickle and choosy an ally? US-Spanish intelligence collaboration in the Maghreb is certainly a consideration; but the US does not depend on Spanish assets, having its own very good relationship with Morocco. If Catalonia breaks off from Spain, the US isn’t likely to care, so long as the event doesn’t lead to a Eurozone collapse. If anything, a recent Atlantic Council study [14] indicated that an independent Catalonia might be a net contributor to Mediterranean security.

Scotland, on the other hand, would likely be a security free rider according to the same report. The North Atlantic is no longer as critical an area as it was in the days of the Cold War, when the GIUK gap had to be closed to Soviet submarines so that the US convoys could reach Europe, but an independent Scotland would still splinter the UK military establishment and leave it much weaker than it is today. A number of critical aspects of the UK defense program would then be in doubt, beginning with the sea-based nuclear deterrent based in Faslane, Scotland, but extending to the Royal Navy’s ability to continue to build and operate then new Queen Elisabeth class carriers that will allow Britain to project power far beyond her borders. The weakening of the key US ally, who has backed us up through thick and thin, and at very high cost to themselves, is not going to be looked upon favorably.

The US would also be worried that the break-up of the United Kingdom might cross the Atlantic and lead to the break-up of another of our key partners and cornerstone allies. What if Scottish independence leads to Quebecois independence? The integrity of the North American defense alliance and of NAFTA could have a devastating effect on our national and economic security.

There is a final, psychological element at stake here. The West now finds itself in conflict and competition with a new set of ideological foes. The end of the Cold War did not “end history” as Francis Fukuyama wrote triumphantly in the 1990’s; it was merely a pause before a new cycle of competition began. The competition is no longer between capitalism and communism; it is between liberal democracy and “illiberalism”. That is a catch-all phrase that attempts to encompass such widely disparate regimes as Viktor Orban’s “illiberal democracy” in Hungary, Recep Tayyip Erdogan’s “Ottomanism” in Turkey, Vladimir Putin’s “romantic authoritarianism” in Russia, China’s “anything but communist” one party state, and a growing number of authoritarian reactionary states in the Middle East, Asia, Africa and Latin America. The great tide of democratization that swept over the world in the 1990’s has peaked; it crested in 2008 with the Great Recession and the Russo-Georgian War. It is now fast on the ebb.

illiberaldemocracy

Those enemies of liberal democracy are rubbing their hands together in gleeful anticipation. There is a reason pro-Kremlin bloggers come out strongly in favor of Scottish independence: Vladimir Putin would love to see one of this key opponents weakened and distracted by the very forces of liberal democracy that are so often thrown in his face. The situation in Catalonia is also to his liking: it is heads I win, tails you lose. If Spain concedes that Catalans have the right to self-determination, then Mr. Putin will point out the hypocrisy of not conceding those same rights to the people of Crimea and Eastern Ukraine. If Spain violently represses the Catalans, Mr. Putin will point out the hypocrisy of the European Union and its commitment to peace and democracy. Either way, Mariano Rajoy is Putin’s new best friend.

“May you live in interesting times,” goes the Chinese saying, and it is not meant as a benediction. The West must live up to its principles: people do have the right to determine their own future, and democratic governments must convince them that the solutions they propose are in fact the best ones. If the arrogance, stupidity and bungling of the out-of-touch elites in London and Madrid so alienate a segment of their population that they actually prefer the risks of separation to continued union, then so be it. That is not the fault of democracy; that is the fault of the entrenched elites and the unresponsiveness of political systems grown atrophied and inflexible. Thomas Jefferson said: “a little revolution now and then is a good thing” and he was right. Democracies around the globe need a shock to the system to clear away the deadwood, spur reforms and political renewal, and return power to the people from the hands of unrepresentative elites.

The Scots and Catalans are about to provide it.


 

Sources and Notes

 [1] Will Dahlgreen  , “‘YES’ Campaign Lead At 2 In Scottish Referendum,” YouGov, 06 September 2014

[2] “Pound falls on fears of Scottish independence,” BBC News, 08 September 2014

[3] “Scottish independence: UK party leaders in No vote trip to Scotland,” BBC News, 09 September 2014

[4] Severin Carroll, “Scottish independence: new poll gives no vote six-point lead,” The Guardian, 10 September 2014

[5] Hugh Carnegy, “Poll shows Le Pen beating Hollande in presidential run-off,” The Financial Times, 05 September 2014

[6] It remains an unlikely scenario as Mr. Hollande is not likely to call for early elections.

[7] David Leask, “Half a million Catalans sign up for pro-independence rally,” Herald Scotland, 10 September 2014

[8] “Rajoy dice que el Gobierno tiene listas “todas las medidas” ante la consulta del 9-N,” Público.es, 08 September 2014

[9] “El Gobierno insiste en Cataluña en que la ley se cumplirá y no habrá consulta «secesionista»,” La Voz de Galicia, 06 September 2014

[10] Ashifa Kassam, “Spain prepares for an autumn of discontent by buying €1m of riot gear,” The Guardian, 08 September 2014

[11] “El Gobierno prepara el envío de diez grupos de antidisturbios a Cataluña con motivo del 9-N,” El Confidencial, 10 September 2014

[12] With the admission that there may possibly be translation and transcription errors and misunderstandings.

[13] Luis B. García, “Junqueras llama a la desobediencia civil si el Gobierno veta la consulta,” La Vanguardia, 09 September 2014

[14] James Hasik, “The Military Implications of Scottish and Catalonian Secession,” Atlantic Council, 26 August 2014

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Discussion

13 Responses to “Catalonia-Spain September Update: The Gift of a Thistle”

  1. Good afternoon,

    I would like to share a link that would confirm num 11 source on newly formed riot spanish police getting ready to act in Catalonia.

    https://twitter.com/jordiborras/status/516956009286619137

    Posted by Jordi | September 30, 2014, 16:34
  2. Hello MR. Betancor

    Violence and repression are quite vague words. Could you define more clearly what you think violence and repression would mean in this case? Incarceration of pro-independece party leaders? “Accidental” death of pro-independece party leaders? Massive incarcerations? Permanent cancellation of democratic rights? Something worse?

    Posted by John | September 15, 2014, 19:23
    • I imagine that the Spanish government would attempt to “contain” the situation using whatever minimum amount of coercion proved successful. Specifically, they would apply a progressive scale beginning with:
      1. Threats of legal action (already in play);
      2. Court order requiring compliance with central government orders for specific actions or non-actions (i.e. repeal/annulment of referendum authorization);
      3. Suspension of privileges (i.e. disbarment of judges, lawyers; loss of employment for certain public officials);
      4. Charges against public officials who disobey court orders;
      5. House arrest of what the government considers to be flagrant offenders;
      6. Arrest and relocation to Madrid for trial of specific flagrant or violent offenders;
      7. State of emergency depending on the scenario of “civil disobedience” called for by Mr. Junqueras;
      8. Martial law, if civilian protests degenerated into planned and coordinated violence.

      I don’t think the government wants “massive incarcerations” though there may indeed be “dozens” or even “scores” of arrests in the event that the referendum goes forward on a grass roots basis despite government efforts to the contrary. I also very much doubt that the government wants any deaths, accidental or otherwise: I cannot imagine them assassinating Catalan leaders, if only because they don’t want future martyrs. Long jail sentences commuted to house arrest and time served seem more likely. There would be no permanent cancellation of democratic rights, though I can easily imagine a scenario where a rump Parlament passes a new Estatut that is then rammed through the Spanish legislature and would then supersede the old Estatut in a wholly unfavorable way (unfavorable for the Comunidad Catalana, that is). I could also see permanent changes like the assignment of a Brig.Gen of the Guardia Civil over the Mossos, or even their disbandment, depending on their role. There would be a loss of control over Catalan daily life that wouldn’t amount to a loss of “democratic rights” but would in practical terms amount to a curtailment of certain liberties and self-governance.

      A lot would depend, of course, on the course of events. The more the Catalans resist, the harsher will be he penalties: unless they win, of course.

      Posted by fdbetancor | September 15, 2014, 21:09
  3. An excellent post, thank you.
    I just would like to make a precision: according to the ”Guardia Urbana” (the city municipal police) on September 11th 1,800,000 people attended the demonstration. All of them had a t-shirt red or yellow, although not all bought the official t-shirt of the organization (18$ is lot of money in our crisis scenario)
    In other words: 75% of the population of Catalonia were there on 09/11. Making an analogy, it’s as if 80 million Americans have taken to the streets at the same time!

    (Sorry for my English. English is only my fourth language!)

    Posted by Soledat Balaguer | September 13, 2014, 17:54
  4. Excellent article Fernando. Ricard Gene and I spoke to a group of Danish students today in BCN. Very interesting discussion. A student pointed out that if Catalonia secedes, Spain would lose tax revenue and might go into deep depression causing it to ask Europe for a bailout. We agreed this might happen and it would be Spain’s or Europe’s problem. Case closed. I came out of the meeting pro-independence. But on further review: If Spain goes into depression, desperate Spaniards would teem into Catalonia looking for jobs. Catlonia does not have the jobs, schools or infrastructure to handle what could be an immense inflow. Do you think that Catalan independence would unleash a giant wreaking ball shattering shaky Spain but swinging right back in to crash the Catalan economy? I have not heard the Catalans consider this. A lot of people are waiting to see what the Scots do. I say they vote No. At the link is a good reason why: http://www.nytimes.com/2014/09/08/opinion/paul-krugman-scots-what-the-heck.html?emc=edit_th_20140908&nl=todaysheadlines&nlid=28408330#

    Posted by Mark Carr | September 12, 2014, 22:58
    • Thanks Mark, I appreciate the feedback. To take your points in reverse order:

      1. I think the Scots vote “no” by a decent margin of 5% – 8%. I think “yes” has crested while lots of undecided or off the radar pensioners will come out for union. In fact, the YouGov poll last weekend may end up being detrimental to the “yes” team since it’ll scare the bejeezus out of unionists and convince all the lazy ones of the need to vote.

      2. Everything depends on Spain’s attitude; I don’t think their is much danger to either the Catalan or the Spanish economies in the event of a negotiated divorce. In the event of a messy divorce, the risk to the Spanish economy comes from the civil disruption and the potential capital flight from businesses that decide that Southern France is safer than Spain. I don’t see a wrecking ball effect in either case, though I can easily imagine Madrid cutting its own throat by a stupid repressive policy that gets out of hand.

      3. As for immigration, Catalonia needs it as much as Spain does; I don’t see a problem with it. Anyway, if Catalonia gets its wish and goes straight into the EU and Euro, I don’t see massive growth prospects creating a honeytrap for spanish immigrants: for one thing, Catalonia’s main trading partners are Spain and France. Since neither is performing well, there is not going to be a huge market for Catalan goods, and it will take years to reorient the economy away from Spain (if it ever happens, which empirical data says is unlikely).

      The big risk remains violence and repression. The rest is nothing that any sovereign state can’t deal with.

      Posted by fdbetancor | September 13, 2014, 16:32

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