Spain at Crossroads as New Generation Threatens Rajoy Old Guard

  • Economic recovery may have come too late for government
  • Four major parties poll between 17% and 28% in final survey

The Spanish Election Taste-Test

Spaniards go to the polls on Sunday in an election that’s likely to redraw the political map as a new generation of leaders seeks to break up the two-party system that’s ruled for the past three decades.

The economy is motoring again after a six-year slump and yet polls show Prime Minister Mariano Rajoy is set to lose about a third of the support that gave him a record majority four years ago. Voters have been angered by a wave of alleged corruption, an almost 700 billion-euro ($760 billion) jump in public debt after the bank rescue and joblessness still above 20 percent. Above all there’s just a growing sense that Spain needs a fresh leadership, whatever it may stand for.

Mariano Rajoy

Photographer: Jorge Guerrero/AFP/Getty Images

“So many people want change,” said Sebastian Balfour, emeritus professor of Spanish studies at the London School of Economics. “But they are not entirely clear what kind of change they want.”

It’s a theme of discontentment that has played out from Athens to Ottawa this year as electorates revolted against the old guard by turning to new faces, whether the radical anti-establishment Greek Prime Minister Alexis Tsipras or Canadian premier Justin Trudeau and his youthful optimism.

After Franco

Rajoy, 60, is the last of a generation of leaders who grew up under the dictatorship of General Francisco Franco and cut their political teeth during the early years of democracy.

Of Rajoy’s rivals, Podemos leader Pablo Iglesias, 37, was born weeks before the democratic constitution came into effect. Catalan lawyer Albert Rivera of Ciudadanos is a year younger, while 43-year-old Pedro Sanchez heads the Socialists.

Pedro Sanchez, Pablo Iglesias, Albert Rivera and Soraya Saenz de Santamaria

Photographer: Denis Doyle/Getty Images

The incumbent People’s Party and the opposition Socialists have governed Spain in turn for the past 33 years and one of them will still probably lead the next government in Madrid. The key is with whom. Final polls before the pre-election blackout on Monday showed the four main parties winning between 17 and 28 percent.

The PP and Rajoy “have done a good job when it comes to the economy, but they’ve lacked empathy -- they’ve been too scared to face the the people,” said Javier Delgado, a 51-year-old lawyer shopping in a market in downtown Madrid. “Sunday’s election is going to spell the end of the two-party system. It’s as simple as that.”

Old Model

Under the old model embodied by the prime minister and his party, senior officials and the executives at former state-owned monopolies and construction firms forged a cohort of insiders running the country.

Further down the pyramid, older workers enjoy permanent contracts and, along with pensioners, dominate property ownership. During the campaign before the Dec. 20 vote, Rajoy raided the social security reserve fund for 7.8 billion euros to pay the annual Christmas bonus for the pensioners who make up the core of his support. He also promised to eliminate income tax for those who work beyond retirement age.

“This is a country that is still run by a small number of very large businesses for the benefit of a small number of very large businesses,” says Ken Dubin , a political scientist at the Lord Ashcroft International Business School in Cambridge, England. “There is a lot of pressure to really rethink a lot of things.”

Outside that protected circle, 4.9 million Spaniards remain unemployed more than two years after the recovery began and another 2.2 million workers are living in poverty as Rajoy’s labor reform channels younger workers into temporary, low-paid jobs, part of his strategy to drive down costs and make the economy more competitive.

The talisman for the disaffected outsiders is Podemos, an anti-austerity party that brings together the theories of political scientists like its leader Iglesias with the energy of the young protesters who camped in the center of Madrid in 2011. Podemos wants to spend an extra 25 billion euros a year to create jobs and raise the minimum wage.

After the Vote

The pro-market Ciudadanos, like Podemos, is fighting a national election for the first time. Its young professionals look like insiders, yet Rivera, a former corporate lawyer, argues the country needs a wholesale transformation to break open the barriers of privilege. He wants to increase competition, cut red tape, strip back layers of regional government and make sure the checks and balances on officials work properly.

While Rajoy tells voters not to put the economy at risk by embracing political ingenues, Sanchez and his Socialists are trying to split the difference between an ageing, working-class base and the urban progressives seeking reform.

From that mix, the party leaders, potentially with the counsel of King Felipe, will have to negotiate a governing alliance to take the country forward.

“We need to make a great leap forward to make the economy more innovative, more entrepreneurial,” said Federico Steinberg, an economist at the Elcano research institute in Madrid. “The growth model that brought us this far is no longer enough.”

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