From Franco to Freedom

In this year’s northern spring, I indulged myself in the pleasure of returning for a while to Spain, where I had squandered many marvellous months of my youth in the early 1960s. That was when Franco Spain had emerged from the traumas of the Civil War (1936–39), the isolation during the Second World War and its aftermath, and fifteen years of great penury. As I was studying Spanish at university, I had all the excuses I needed to run off regularly to a country that fascinated me.

With hindsight, I know that I discovered Spain during a new, exhilarating beginning when Spaniards tasted a new freedom and prosperity. The old Falangist leadership—including the caudillo “by the grace of God”—had handed most of the powers of government and managing the economy to a bunch of technocrats who were free-marketeers at heart. Franco, ever the pragmatist, had abandoned the concepts of rural autonomy, protectionism and state ownership, and with it many former political allies. The new political elites, along with many opinion leaders in the press and the academies, were inspired by the re-emergence of West Germany under Adenauer and France under de Gaulle. They eagerly embraced the advice of the OECD, which Spain joined in 1961, to liberalise foreign trade and capital movements. Tourist visas were abolished. And the foreigners who invaded the Mediterranean coast spread trendy ideas and the concept of consumerism.

When I first visited rural Spain, there were pockets of Third World destitution. Many of the unemployed left to work beyond the Pyrenees. The Americans set up a few air bases, and diplomatic relations with Europe offered new respect and equality. By 1960, Spain had lost its pariah status.

The new technocratic regime, which had close ties with Opus Dei, inspired confidence. The quality press became surprisingly open. Although no one would have been allowed to sing the praises of communism or attack the official view that the caudillo had finally broken the long cycle of political violence and instability, public debate on other matters was wide-ranging and seemed to me very intelligent. The hard times of the recent past had sobered the people. Fanaticism was out; hope in building a better future was in. I met numerous people in university departments, in the village on the Alicante coast where I ran a bar, and hitch-hiking across the country; and no one echoed the fanatic noises that had been so dominant in public life in the late nineteenth and early twentieth century. Most accepted Franco as a lesser evil, even if they muttered about the executions, forced-labour camps and harsh repression of the 1940s.

There was some opposition to the unilateral liberalisation of the economy. Conservative, long-protected industrial interests were disappointed that they had lost clout with the leadership. I recall an article in a commercial magazine that spoke with sinister foreboding about foreign interests wanting to convert Spain into a “mere orange and tourist economy”. If there were union interests that held similar views, they were not heard.

The liberalisation of the early 1960s was a rip-roaring success. Spain’s industry grew faster than any other in the OECD except Japan’s, with real national income zooming ahead between 1961 and 1973 by 7 per cent per annum. The Spanish “guest workers” soon returned home from France and Germany with new ideas, concepts of democracy and a bit of start-up capital. Even in remote parts of Spain, you could get your Beetle or Merc repaired in a workshop whose boss had good German and technical competence. The tourist boom spread along the coast, creating jobs and new hotel colonies. With hindsight, it is easy to bemoan the concreting of the Mediterranean coast, but it was probably rational to sacrifice that pristine but poverty-stricken asset for the new, nationwide prosperity.

While living for a while with a prosperous, educated family in Madrid, I was thrilled to discover the lively cultural offerings, the new music, theatre, films and the boisterous scene of bars, studios and clubs. It is possible that my memories are coloured by the experience of a youth from the German provinces, but the thrill at the new cultural flourishing of the early 1960s was also shared by my friends in Madrid. And the historical statistics are proof of the new economic beginning under the dictatorship that had eased the reins.

Can One Explain Spain to Anglo-Saxons?

And forty-five years later, a two-month stay in Seville during the spring allowed me to re-acquaint myself with Spain, the most visited and still least known country among the major European nations. The country has changed like no other in Europe, and mightily for the better. Admittedly, it is not easy to explain one’s enthusiasm for the Spanish to an Anglo-Saxon audience. The reason is probably not so much the Armada or Trafalgar—after all, who came out the better? It is rather a cultural gulf between two intensely self-centred, insular, even arrogant civic and political traditions that have for centuries been rivals. Both had long kept apart from “Europe”, across the Channel and across the Pyrenees, and both had built great empires.

Compared to the Anglo-Saxons, the Spaniards—though much more reserved than the Italians (never confuse the two!)—are more emotional, spontaneous, given to exaggeration of hope and love. And they are less wowserish and more tolerant of the foibles of others. Yet, they are also more intolerant of other human foibles, such as neglected dress, dusty shoes and a poor postura—Spaniards do not slouch! As John Hooper in his excellent recent book, The New Spaniards, pointed out, there is also a cruel streak in the Spanish character, inherited from the Arabs who ruled parts of Spain for longer than the Christian rulers have since the reconquest.

And Spanish officialdom at the coalface operates very differently from what we are used to. Whereas an Australian or British civil servant is an individual with delegated decision-making powers and a tradition of common sense, the petty official in Spain is a subordinate bound to strict enforcement of rules decreed from above. He is likely to be rigid and unyielding because he fears being sacked when an inspector discovers a lapse in dutiful enforcement. The bureaucracy (the word and the institution are Spanish inventions) is only tolerable because government is smaller and can often be bypassed.

Much in the uneasy relations between Anglo-Saxondom and the Hispanic world is also sheer ignorance. Who in Britain or Australia is taught that Cervantes virtually invented the modern European novel? Who has read the splendid Renaissance comedies and dramas of Calderón de la Barca, Lope de Vega and all the other contemporaries of Shakespeare? Who knows the liberal writings of the great Spanish humanists of the fifteenth-century Salamanca School, who preceded John Locke and David Hume? OK, their legal and economic teachings were anchored in Catholic humanism, and Anglican Britain was not receptive. And who knows that the Catalan citizenry imposed a common-law constitution (Usatges) on their Counts in the early eleventh century, ages before Magna Carta; and that the post-Napoleonic parliament of Cadiz invented the word liberal in its modern meaning of individual autonomy under small, rule-bound government?

As someone who grew up in Germany, but who, in his youth, acquired great admiration and affection for both British and Spanish ways, I have always been bewildered by the aloofness of those two European traditions towards each other. And maybe I should not now try to explain to Australian readers what I find so attractive and fascinating about Spain. Thus, I swore long ago not to defend bullfighting vis-à-vis foreigners, who think it is an unfair sport, because the bull always dies and the matador but rarely. After all, Hemingway, in his classic Death in the Afternoon, explained that the corrida de toros is not like a soccer match. It is about testing the valour of the toreros in overcoming their fear in the face of aggressive, raw force, and the elegance in coping when confronted by a wild beast. It is dangerous, and the aficionados know it. They know the strict ritual and can tell when a torero lacks courage and fumbles.

And so it is with many other rituals of Spanish life. Come informed and educated, leave your prejudices at home, and you will find much that may not be quite politically correct, but is most inspiring. I was probably lucky to get immersed in Spanish mores at an impressionable young age, and lucky now to discover that this education still kept doors open to the world of Hispanidad (Spanish mores).

A Much-Changed Nation

As of 2007, Spain is a nation of 46 million modern, classy and ebullient Europeans, whose affluence is comparable to Britain’s and equals the EU’s average. The 250 kmh AVE train from Madrid to Seville (and soon to Barcelona) may be a symbol, but Spanish Railways, once a laughing stock of European railwaymen, are run much, much better than, say, BritRail or the New South Wales rail system. The motorways are excellent, and so are many urban services. The Spaniards are hard workers, though at times a bit disorganised, and therefore modern Spain works well.

On the whole, one observes less political correctness than further north in Europe, although the current Socialist regime of José Luis Rodríguez Zapatero and many local bureaucracies are trying hard to spread the PC virus, behind an outward appearance of being in the Blairite mould. The Zapatero government is also busy, in the finest social-democratic tradition, distributing money wherever problems emerge, though the welfare state is by far not as developed in Spain as elsewhere in Europe or Australia. This is why one sees many locals working in menial, low-paid jobs, where other Euro-peans rely on foreign labour or modern machinery.

Since the transition to a free electoral democracy thirty years ago, Spain has gone through cycles of political preference and economic management that would seem oddly familiar to Australians. The Socialists led by Felipe González, who got elected in 1977, conveyed the feeling to the populace that—after many years in the wilderness—“it was time”. They benefited from the fact that the recently legalised Communist Party, led by civil war “dinosaurs” who had just returned from long exile in Moscow, was largely rejected by the electorate (they have since metamorphosed into Greens or been absorbed by osmosis into the Basque radical movement).

After 1977, and different from the confrontationist, bellicose “Red Front” of the 1930s Republic, the Socialists could proceed without commitments to the revolution. Nonetheless, they implemented their program with Whitlamesque impetuosity and inflicted much legislative disruption after the years of gradual, cautious reform and liberalisation during the final fifteen Franco years and the cautiously bridge-building Adolfo Suárez, whom the King had appointed after Franco’s death in 1975. He is the real hero of the Transition to democracy.

After 1977, González’ socialist-Keynesian policy produced record high unemployment and inflation, which even exceeded what Australians suffered after 1972 and into the 1980s. This led to the election in 1989 of the conservative government of José Maria Aznar, who reined in the public spending follies, reduced the tax burden, prepared Spain for joining the euro, and shared a good measure of Euroscepticism with Margaret Thatcher, one of his heroes. The government’s Euroscepticism was used to extract massive EU subsidies, but—different from other recipients of Brussels largesse—Spain was soon able to show impressive results in terms of new infrastructure and improvements in backward areas. Under Aznar, the country returned to reasonable economic health, which was soon widely taken for granted.

Two years ago, a more cautious Socialist party was returned to power. For most, this was a surprise. But the Muslim terrorist attack on a Madrid train shortly before the election, the awkward handling of the attack by the government, and a groundswell of public opinion against Spain’s engagement in the Iraq war combined to let the Socialists squeak in. Not unlike the Hawke government, they took care not to repeat the excesses of their predecessors, to avoid expropriation and rely more on “soft socialism”, which—in Spain—now comes with an unmistakable Green tinge and rapidly growing government employment. Public spending and borrowing have gone up—and like France and Germany no one cares about the limits imposed by the Maastricht Treaty on euro countries.

Zapatero’s most visible reforms have been in the non-economic domain: gay marriage, subsidies to the arts, initial softness on immigration and terrorism, positive discrimination on behalf of women and a further “federalisation” of Spain’s Constitution have grabbed the headlines. The provinces now have great autonomy in many areas of governance, which has led to much duplication and a burgeoning of the bureaucracy.

Although I am still betting, as Milton Friedman did, that Italy and Greece will be the first to bomb out of the euro, Zapatero’s inflation policies seem to prepare Spain to become another candidate. The fact that the many overdue economic reforms, which were left unfinished by the Aznar administration, have now been conveniently put on the back burner, has dismayed the European Central Bank. It has lately been very critical of these “non-reform” policies. By now, an economic slowdown, a drop in direct foreign investment, in particular from the USA, and a steep decline in real-estate values herald the cost of Zapatero’s short-termist, happy-go-lucky stance.

The social engineers seem nonetheless bent on going further. Thus, the requirements for the high school leaving certificate are to be “softened” to attain statistics that show greater educational achievement. The history of the Franco years is being officially rewritten. There is even official talk of relocating Franco’s corpse from the mighty underground cathedral in the Valle de los Caídos, which he had built, partly by Red Brigade prisoners, to commemorate the dead on both sides of the Civil War, and to convert that monument into a secular anti-war memorial. Hardliners from the right are also itching to revive divisions, which most had thought buried with the post-Franco accord. Thus, the Catholic Church and the Vatican are now proposing to beatify many of the priests and nuns the Reds murdered in the run-up and early phase of the Civil War. It is heartening to observe that most modern Spaniards reject the old fissiparous demons that did so much to keep Spain backward during the nineteenth and early twentieth centuries.

Officials now try to make you believe that all change for the better only began with the Transition and the Socialist government in 1977. Before 1977, the young are now taught, there was rigid repression, backwardness and poverty. It is at this point that I rebel, given my own experience, as sketched at the outset of this essay. It simply was not so! Franco is one of the few dictators in history whose rule did not end in tears, but who eased slowly out of absolute power, installing genuine liberalisers.

An important part of this strategy was to select the young Prince Juan Carlos of the House of Burbón as the future King and head of state, rather than other, older pretenders who seemed committed to the failed ways of the past. History has proven that this was an excellent choice, because King Juan Carlos has been a moderating, stabilising influence since the Transition and, with his wife and impressive son Prince Felipe, a respected symbol of the New Spain. There are no scandals in the royal family, who are modest and educated role models. There is no loud meddling in the affairs of elected governments—just every now and then perhaps a wise, calming word. Except for a few communist fringe dwellers, everyone in Spain is a monarchist now.

Two Major Issues: Regionalism and Immigration

Two big topics are now dominating Spain’s political debate. One is regionalism and the ongoing devolution of power to the various, diverse regions of this vast country. The other is immigration, a topic doubtless of more interest to Australians.

The devolution of political powers after the centralist rule in the Franco years is widely accepted and supported by the parties of the left and the right. It is a work in progress, though much has been a “federalism of gestures” and top-down remittances (as in Australia), rather than one of self-financing, responsible regional governments. No stable equilibrium has yet been found. In some areas, devolution has bred pressure groups that thrive by demanding more and more.

This is so particularly in Catalonia, a region with a history as separate from Spain as was Scotland’s from England. Under Franco, the left-leaning Catalans were relegated “to the doghouse”. The Catalonian language, once reduced like other European regional dialects to the patois of back-country people, has been revived over recent decades, generating a growing tribe of rent-seeking language promoters. The result is that official signage and government utterances in Barcelona are in a language which most inhabitants do not use or speak in a version dubbed “Catalan Lite”.

It is revealing that, in a city of 1.6 million inhabitants, the readership of the only important daily published in Catalan (Aviu) has fallen below 30,000. Official statistics may indicate a growing acceptance of the language, but efforts by eager officials to replace school instruction in Castilian Spanish are alarming many parents. When recently passing through Barcelona airport, where Spanish is now the third language in official signage, after Catalan and English, I was reminded of similar petty-nationalist games in Brezhnev-era Ukraine. We know what costly consequences that sort of silly nationalism is now having there. Alas, Spanish history forces one to take such parallels seriously.

The economic consequences of regional nationalism may not be readily visible in splendid post-Olympic Barcelona, although its population declined during the 1980s and 1990s. But if you compare declining industrial towns of Catalonia such as Lérida, with its empty shopfronts and grim, grimy streetscapes peopled by idle Moroccan immigrants, with the new industrial and building activity in other regions of Spain, you realise that something is rotten in the state of Catalonia.

An altogether more serious regional problem is the Basque country, where, away from the splendour of elegant seaside cities like San Sebastian, grim and grimy towns are proof of economic stagnation. These are recruiting grounds for the murderous ETA movement. It is tempting to compare ETA with the IRA of ten years ago, but the Basque terrorists rank much higher on the “intransigence scale”, and there is no outside sympathiser like the Dublin government that would exert a calming influence on the hotheads. Despite widespread popular revulsion at the violence, massive public spending in the Basque provinces and a growing abandonment of the softly-softly approach by the Socialists in Madrid in their dealings with the Basque nationalists, there seems no end in sight to the sorry cycle of violence, anti-capitalism, underemployment and lacking private investment.

The other big issue in present-day Spain is immigration, a relatively new phenomenon in this newly affluent country. Since 1977, Spain’s population has risen by 32 per cent, faster than that of most other western European countries, and not much less than Australia’s over the same time span. This occurred during a time when Spain’s natural birth rate plummeted faster than almost anywhere else, to well below replacement level. The big difference has been immigration. By now, 9.3 per cent of the population are reported to be foreign-born, one million of them illegals.

One major source are other EU countries, whose citizens face no obstacles to flocking to the sun and settling in beach colonies, to which they often bring their native butchers, bakers, builders, doctors and car mechanics. Most care little about the affairs of modern Spain; instead, they stay connected with their home countries by the umbilical cords of the internet, Ryan Air and Air Berlin. Most Spaniards seem unworried about this phenomenon, given a great national tolerance of individual differences and disdain for the affairs of the wider community.

The other major source of population growth is legal and illegal immigration from outside Europe. Spain, like Australia, is a front-line state vis-à-vis the Third World. To counteract the drop in the fertility of Spanish women, the government is welcoming migrants with some Spanish background from Argentina, Bolivia, Colombia and other Latin American countries, though many of these new settlers have Andean Indian faces. They fill gaps in the labour market and now contribute mightily to the birth rate.

It is an altogether different matter with three other migrant groups: Muslims from North Africa, some of whom have been caught red-handed in terrorist plots and who resist integration; destitute uneducated black Africans whom people-smugglers deliver to Spain’s shores; and uneducated, work-shy East Europeans, most notably Romanian gypsies. In the last year, no less than 200,000 Romanians, now newly minted EU citizens, have turned up in Spain. And the people and government seem helpless, although growing thievery and drug dealing now appear to feed a wave of popular resentment and mounting pressure on a so-far-tolerant government. The Socialist government has lost its patience with border-jumping North African Muslims and black Africans, quite a few of whom drown before reaching the Canary Islands. They now resort to an “Atlantic solution”, which will make most Australian do-gooders cringe: new arrivals are expeditiously flown back to their homelands. Many are “undocumented”, but the credible threat of the border police to fly them to a country of the police’s choosing works invariably as a truth serum—after all it is a long walk from Senegal to Mali, or Morocco to Libya. Such total lack of political correctness is a good example of the reasons why Anglo-Saxons find it hard to show sympathy towards the Spanish.

Australians and Spaniards may not know all that much about each other. But one thing Australians should know. Anyone who has travelled an hour through the Andalusian countryside will have lost all illusion that European agricultural protectionism can be dented by our trade negotiations. High-price guarantees have induced farm enterprises to invest heavily in endless square miles of new vineyards, olive and orange trees. These investors have trusted the political promises from Brussels and Madrid. They now form a powerful lobby against cheap farm imports from the USA, Latin America or Australia. No European politicians will now have the gumption to terminate agricultural protectionism.

On the other hand, Australian economic prowess has profoundly affected parts of the Spanish economy. When I met an economic historian and he learnt that I was from Australia, he said: “The Australian competition first destroyed our merino wool and dried-fruit markets, and one reason the Rio Tinto mines had to close was cheaper metals from Australia. More recently, Australians have made life harder for our wine producers. And I hear that soon Australian producers will invade the world’s olive oil and cork markets.” He said this without malice, rather in an admiring tone and with a Hispanic shrug, as behoves a genuine caballero.

Emeritus Professor Wolfgang Kasper is an economist. His contributions to Quadrant since 1988 have dealt with immigration, cultural integration and Islam.