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opinion
Text in which the author defends ideas and reaches conclusions based on his / her interpretation of facts and data

Divergence/convergence

Spain is slipping further from the European average, and there is no sign that this is going to improve

Joaquín Estefanía

When asked about the antipathy generated by the troika, the director of the European Stability Mechanism, Klaus Regling, is careful to point out that he is speaking as an economist. "It is true that the troika is very unpopular. As an economist that seems to me unsound: the recipes of the troika in Europe, and previously those of the IMF in Asia and Latin America, are the right ones to get back on a sustainable path. [...] Greece has made considerable progress, but this process must continue."

It is as if there had to be this contradiction between what you think as an economist and what you feel as a citizen. But whether looked at from one point of view or the other, there does exist a certain unanimity to the effect that the IMF's recipes in other parts of the world, from the 1980s onward, caused an economic catastrophe and had a notable effect on democratic regression in wide areas of the planet. As for the political practice of the troika, we see the results it is now producing, beginning with Greece, the land Regling mentions: 21 straight quarters of recession, two bailouts worth 240 billion euros, a haircut for part of the debt, 27.4 percent of the active population unemployed, 3.8 million Greeks (36.4 percent of the population) in poverty and deprivation, 30 percent of the population excluded from access to public healthcare... And the experiment must go on!

Last weekend Ireland technically emerged from the bailout it entered in November 2010, essentially because of the situation of the country's banks, which created a public deficit of 30 percent. The Irish authorities are pleased to recover their economic sovereignty, if the fact of remaining under the tutelage of two annual inspections by the "men in black" and having to continue with an austerity policy can be called economic sovereignty. After three years of budget adjustments to the value of 18 percent of GDP, a public debt of 125 percent of GDP, an unemployment rate of 13 percent (which might be higher had some 200,000 people not emigrated) and drastic wage cuts, Ireland says it is returning to normality. Portugal, whose politicos are swaggering because the year now ending has not been worse than 2012, has doubts about a second bailout (after that of April 2011, of 78 billion euros), with a permanent worsening of living standards for the majority, and an unemployment rate near 16 percent.

The Irish authorities are pleased to recover their economic sovereignty

And what of Spain, which underwent a different kind of intervention from the above three countries, consisting of a 100-billion-euro line of credit to save its collapsing banks? The landscape after the battle has just been summarized by the European Commission's statistics office. Per capita GDP, which is the indicator most used to determine whether the economic breach with respect to the rest of European countries has widened or narrowed, fell in 2012 to 96 percent of the EU average, which means that the so-called real convergence with those countries has returned to the levels of 1998. During the Great Recession, Spain has regressed 14 years. In 2002, Spanish per capita GDP was greater than the EU average, and in 2007, the year prior to the crisis, Zapatero boasted of having surpassed Italy and daydreamed of catching up with France.

But Eurostat now publishes a degree of general wellbeing in European societies, an indicator which measures overall household consumption, including goods and services consumed, whether paid for by families or provided by the state - through public services such as health and education - or by charity organizations. Well, here Spain is even further from the European average (92 percent), and there is no sign that this figure is going to improve.

For the time being, the dark side of the economic austerity policies is stronger than the good angel. Let's not fool ourselves.

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