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Subject: Spain's Bills Fall Due After a Festive Year; Gonzalez Vows to Keep Pace in
Date: Fri, 20 Nov 92 04:42:00 EST
Message-ID: <46.1992Nov20.044200@AmeriCast.com>

Spain's Bills Fall Due After a Festive Year; Gonzalez Vows to
Keep Pace in Europe<By Eugene Robinson<Washington Post Foreign
Service=

MADRID - After a year chock-full of games and gala commemora-
tions, Spain is like a party-goer with a hangover - snappish,
disoriented and unpleasantly surprised at being told that the
bill is due.

Spain has mounted a successful Olympic Games in Barcelona, a
much-visited world's fair in Seville and marked repeatedly the
500th anniversary of Christopher Columbus's voyage. It has hosted
world leaders and cultural lions, unveiled massive public works,
inaugurated a major art museum. Everything glittered in 1992.
Everything hummed.

But now, Spain is waking up to a harsher reality. The economy is
practically dead in the water, unemployment is on the rise, and
the Socialist government of Prime Minister Felipe Gonzalez is
warning that the heady days of the late 1980s, when the poor got
richer and the rich bought yachts, are done.

"It's time to go to the dentist," said Jose Juan Ruiz, the offi-
cial in charge of international affairs for the Economy and Fi-
nance Ministry. "You can tell people it's going to be good for
them, but you can't tell them they're going to enjoy it."

Gonzalez, who has ruled for 10 years and is expected to seek
reelection next year, has decided to impose economic discipline
in an attempt to keep pace with Germany, France and the other
"core" hard-currency nations in the European Community's drive
toward monetary union.

Against the backdrop of a global economic slump, this means a
jobless rate already twice that of Spain's neighbors will rise,
workers accustomed to big raises each year will have to settle
for less, businesses will fail and public spending for roads,
schools and other improvements will be curtailed.

It also means that what some observers see as an already glum,
morning-after Spanish mood may turn even surlier. Government of-
ficials acknowledge concern that recent allegations of corruption
- some involving monies spent for the 1992 festivities - may be
creating widespread public mistrust.

"People are very discontented, and I think it's because expecta-
tions were completely unrealistic," said Cayetano Lopez, rector
of the Autonomous University of Madrid.

"It was believed that all desires would be met, all wants satis-
fied.  That was irresponsible on the part of both the people and
the politicians. But this is a very worrisome thing for a young
democracy - a lack of confidence and credibility in the political
system," Lopez added.

Newspapers and weekly magazines are filled with accounts of local
officials accused of taking bribes or kickbacks for public pro-
jects, and the press is focusing on the millions that were spent
on the Expo 92 world's fair in Seville. The case that has at-
tracted the most public attention, however, does not involve
allegations of corruption, but rather what might be called
wretched excess: Miguel Boyer's new house.

Boyer is a former economy minister, a leading light of the gen-
eration of Socialist officials who came to power with Gonzalez -
and came to symbolize a freshness and idealism of the 1980s. Like
many of his comrades, he eventually left government, went into
the private sector and enjoyed the fruits of the Spanish economic
miracle.

Late last month, the magazine Hola!  ran photos of the new house
that Boyer has built for his bride, Isabel Preysler. The 44-room
mansion includes a huge indoor swimming pool and a heated dog-
house. That a Socialist member of Gonzalez's inner circle would
live so ostentatiously, and with a woman once married to heart-
throb singer Julio Iglesias, prompted a angry accusations that
the socialist dream had foundered.  Gonzalez and his government
had come to symbolize the flowering of a nation after decades
under the stultifying rule of dictator Francisco Franco.

With the economy growing at up to 5 percent a year, the govern-
ment was able to fund vast new projects in education, infrastruc-
ture and social welfare. Gross national product nearly doubled
between 1986 and 1991. Gonzalez defined a new kind of Spanish
"socialism," - based on free-market principles but with a human
face. "We've had at least seven years of a real boom," said Agus-
tin Valladolid, an Interior Ministry official.

Writers, artists and filmmakers produced what came to be called
The Movement It was just a matter of time, it seemed, before
Spain shrugged off the effects of its long isolation and caught
up to the rest of Europe.

"Everything seems easier," said Mercedes Alcober, a spokeswoman
for Gonzalez, "when you have money." He  remains the dominant
political figure, with no real challengers. But his popularity is
at it lowest levels ever, and a recent poll taken for the newspa-
per El Pais found that 54 percent of respondents considered the
political climate bad.

The government and its backers are touchy about the bad press.
Alfonso Guerra, vice chairman of the Socialist Workers' Party,
said last week that criticism by "financial groups, the media and
intellectuals" amounted to "questioning the democratic system."

Despite the recent progress, Spain remains substantially poorer
than its neighbors. Per capita income is just 80 percent of the
European Community average, and unemployment is nearly 18 per-
cent. The government predicts growth of just 1.5 percent this
year - higher than some European economies but nowhere near
enough to close the gap with more prosperous nations to the
north.

Gonzalez has decided that Spain cannot afford to be left behind
in the drive toward European union, and so he has committed the
country to a painful process of making the economy "converge"
with those of Germany and France. This involves strict controls
on government spending and the money supply, and sharply reduced
inflation.

Ruiz said wage increases that averaged 8.8 percent this year will
have to be slashed, and labor laws will have to be changed to
keep layoffs from falling unfairly on younger workers. The
government projects that unemployment will rise next year to
nearly 20 percent, with overall growth of 1 percent.

Britain, by contrast, decided that economic union with the rest
of Europe was not worth swallowing such bitter medicine and in-
stead has apted to promote growth. But the government here seems
convinced that Spaniards are more committed to the European ideal
and will make needed sacrifices.

"We have been left behind by the European train so many times,"
Ruiz said. "When you are left at the station, you lose. This has
been our story since we lost the empire centuries ago, and now we
have another chance."

No other political party has the standing to challenge the So-
cialists, and no other politician has the standing to challenge
Gonzalez. Organized labor provided a focus of opposition for a
time, but the unions' power seems to be waning.

But Lopez, the university rector, worries that Spain's recent
progress has been too superficial to provide a steady foundation
for the sacrifice that Gonzalez demands.  Businessmen still spend
more time trying to get new tax breaks than trying to make their
products better, he said.

There is no tradition of mobility that would allow people to move
to regions that offer better opportunities.

"The changes need to go deeper," he said. "Spain is still a coun-
try in the process of inventing itself."<02:37 11-20C9999-----

Copyright 1992, The Washington Post.  This story is from the
Washington Post's Capitol Edition On-Line and is not to be ar-
chived or redistributed.

For more information, send-email to American Cybercasting Cor-
poration (usa@AmeriCast.COM)