Stoking up the tribal fires

In the last two days the regional government of Catalonia, the Generalitat, has shown us a deplorable example of bad political and economic management, which is harmful to Spain as a whole and thus to Catalonia, because it creates an ugly image in the eyes of the EU and the markets. On Monday, with no explanations, the regional government announced its decision to suspend payment, for the month of July, to private but publicly subsidized hospitals and retirement homes — most of those in Catalonia being of this type.

On Tuesday the head of the Catalan economy department, Andreu Mas Colell, not only declined to attend the meeting of the central government’s Fiscal and Financial Policy Council, this being a meeting where, he said, “everything is decided beforehand;” but the Generalitat also blamed its budgetary troubles on the central government, which “has not kept to its commitments.” Andalusia also failed to attend, citing the meeting as “pointless.”

The line taken by the Generalitat presided by Artur Mas is a political maneuver, simple and age-old — though effective, to judge by his CiU party’s continued popularity in the polls — which consists of stirring up Catalan public opinion against the central government, and, as a derivative effect, against the governments of other regions.

The fact is that Mas and Mas Colell have so far been unable to come up with an economic and financial solution for Catalonia: which, like the rest of the regional governments, is suffering from a slump in income and an uncontrolled burgeoning of social expenditure.

This failure is due to the imprudent handling of Catalan finances (similar to that now coming to light in other regions) for more than 20 years. With the added factor of runaway indebtedness; and if the Liquidity Fund does not bail it out, the Generalitat may default on its debt.

Instead of accepting their responsibilities, and trying to remedy past and present errors, Artur Mas and Mas Colell are hiding behind the alibi of the government’s “unkept commitments.” This hospital nonpayment is not the first in Spain, or even in Catalonia; the worst aspect is its arbitrary, unilateral character. No one has deigned to explain why it is necessary to cut off funds to healthcare facilities, instead of suppressing other expenditure. This preferential suspension clearly suggests a political maneuver, at the cost of the citizens, to work up the (erroneous) idea of the central government’s breach of promise, stir up CiU’s own voters, and stave off the threat of a central-state intervention in the Catalan accounts: with the objective of a tax-sharing “fiscal pact,” which, in the present conjuncture, seems a daydream.

Catalonia needs the central state to avoid default, which proves that it has lost all credibility in the debt market. This is the decisive factor that Artur Mas ought to be thinking seriously about, instead of stoking up the familiar tribal fires of Catalan fiscal independence.