Catalonia: a regional poll becomes a plebiscite on independence

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It is a regional election, but it drew the attention of Obama, Merkel, Cameron and Juncker. Foreign banks and corporations are watching the event closely, and prudentially some are halting investments in Spain “waiting out the storm.”

Sunday 27 September Catalans are going to the polls to elect the regional parliament. The outcome, however, could have an impact beyond the borders of Autonomía Catalunya. All contending parties have been forced to focus their campaign on an issue imposed by two of the seven major parties: Catalonia’s secession. Should they win, Junts pel Yes (Together for Yes) and CUP would work toward a unilateral declaration of independence within 18 months.

Tensions between the richest region of Spain and Madrid are as old as the history of the Iberian Peninsula, but over the last 10 years the quest for independence from Spain gained momentum, at times under the flag of conservationism, at times under that of the left, or both as is happening now. Artur Mas, leader of the secessionist conservatives explicitly talks of plebiscitarian elections.

The traditional parties, the governing Popular Party and the Socialist Party, along with one of the emerging political forces, Ciutadans, don’t want Spain to break up. The other major Spanish new grouping, Podemos, in coalition with the Greens and United Left favors a referendum. “We do not want Catalonia to leave Spain (…) We understand that you Catalans want to get rid of Rajoy [the prime minister], but if you stay, we’ll kick him out together,” said Podemos leader Pablo Iglesias.

The arguments of the separatists are both economic and of cultural identity. The Catalans hold much of their culture and language, and many Catalans do not consider themselves Spanish. The pro-independence side gathers its strongest support in the province rather than in Barcelona or in the peripheries, where emigration from the Southern regions was massive after WWII. Their children, however, were born and raised in Catalonia, and feel less ties to the rest of Spain as represented by Madrid.

As an independent state, they say, Catalonia would retain about 17 billion EUR – or 9.5% of the GDP of Catalonia – in taxes to be allocated for public works or health or education. Catalonia has important ports, invested on the pharmaceutical and biotechnology sector, attracted automotive manufacturers such as Audi (it remains to be seen if it would remain in the event of secession), produces advanced technology like Albertis’ satellites (which may remain) and is a breeding ground for start-ups.

These economic arguments are put forward be from the conservative bourgeoisie as from the middle class and the workers who paid a high toll to the crisis. “We give to the Spanish state far more than the state gives us back. If independent we would have more jobs,” says Jaume Soler, a small business owner in the construction industry, who is not concerned about the risk of the so-called ‘”frontier effect”. According to Canadian academics McCallum and Helliwell, establishing border raises prices by 40%, and reduces exports significantly, thus decreasing production and hence GDP by 20%. Catalonia, a region rich above the Spanish average would become a nation poorer than that same average, according to their theory.

On Wednesday evening, in a televised debate, Foreign Minister Jose Manuel Margallo reminded leading independent Oriol Junqueras of all the economic risks, including unemployment, which secession would bring. In an independent Catalonia unemployment could rise to 37%.

Little is known about the independentistas economic program. This is partly because among them coexist very different ideologies, from those who want to leave the EU, the euro and NATO to those who do not want to quit them.

It is “a happy Arcadia where these fine people do not fear the flight of investors and capital, nor the queues at ATMs or capital controls,” reads the editorial in the newspaper El Economista. “They do not give a thought to the fact that they may lose the passport that allows them to move freely as Europeans, or that an independent Catalonia would have no access to ECB’s funds, and would be forced to finance itself with their junk-grade sovereign bonds.” The major Spanish banks, including two based in Catalonia, warned about the financial and economic risks of secession, while the governor of the Bank of Spain spoke of “insecurity, uncertainty and tension.”

“EU treaties would not apply anymore,” said the spokesman of the European Commission, Margaritis Schinas. It is unchartered territory for European institutions, among which ECB, as well as for others such as NATO, but it reflects widespread drives – and risks – from Scotland to Greece. A divided Spain, and therefore a weaker Spain, would also hinder America’s defense and security strategy in the European continent. Barack Obama president told the Spanish King that his country is “deeply committed” to its relationship with a “strong and unified Spain.”

Since the Spanish Constitution does not provide a legal frame for a region becoming independent, many observers are forecasting a scenario in which Catalonia obtains a new status with even greater autonomy. The process would in any case be a thorny and lengthy one.

The writer Juan Goytisolo, questioned by El País, summed up what is happening: “A collision between trains, between immobility and a madness aiming at essentiality.”

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