How Did Things Get So Bad in Catalonia?

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Will Spain trigger Article 155 of the Constitution?

By Don Quijones, Spain, UK, & Mexico, editor at WOLF STREET.

Unless concrete measures are taken to calm tensions between Madrid and Catalonia, one of Spain’s richest, safest and most visited regions could soon be plunged into chaos. With neither side willing for now to take even a small step back from the brink, the hopes of any kind of negotiated settlement being reached are virtually nil, especially with the European Commission refusing to mediate.

Since Sunday the Spanish government has even ruled out dealing with Catalonia’s president, Carles Puigdemont, and its vice president, Oriol Junqueras. In other words, the communication breakdown between Madrid and Barcelona is now complete.

But how did things get so bad in Catalonia?

The answer, to borrow from Ernest Hemmingway’s The Sun Also Rises, is “gradually, then suddenly.” While the standoff between Madrid and Barcelona has been on the cards for years, it’s been brewing so slowly that many people were caught off guard when riot units of Spain’s National Police and the Civil Guard began using brutal violence to prevent people from voting in Catalonia’s banned referendum.

Now, what we have on our hands is a full-frontal clash between two diametrically opposed nationalisms that has roots dating back centuries. The most recent tensions were inflamed in 2010, when Spain’s highly politicized Supreme Court, at the urging of the now governing People’s Party, annulled many of the articles of Catalonia’s recently agreed Statue of Autonomy, effectively stripping the agreement of any meaning. Gone was any chance of any fiscal autonomy. That this happened just as the Financial Crisis was beginning to bite in Catalonia hardly helped matters.

Since then, the Rajoy administration has refused to offer greater fiscal autonomy for Catalonia, or the chance to hold a legitimate referendum on national independence. The argument is always the same: the 1978 constitution forbids it from doing so and it can’t change the constitution, although the Rajoy’s party voted to change the constitution to enable Spain’s bailout of its savings banks while in opposition in 2011.

Catalonia’s regional government, the Generalitat, in the face of such intransigence and seeking to deflect public attention from the brutal austerity cuts it was making, began to take matters into its own hands. Little by little, disobedience became defiance, which gradually evolved into open rebellion.




The Generalitat created its own laws to allow it to hold a referendum on national independence as well as declare unilateral independence in the event of a large enough majority. It’s even set up a parallel tax system that has already enabled 145 state-owned companies to pay their taxes into Barcelona’s coffers rather than Madrid’s.

Now, the spirit of open defiance is spreading to the general populace. Since Sunday’s dreadful violence, local communities have begun locking out National Police officers from the hotels they were lodged in. The Catalan police and firefighters who fought under heavy blows to shield voters from the beatings of Spanish police officers on Sunday are also being applauded in the street.

On Tuesday, in protest at the police violence that marked Sunday’s vote, the Catalan government declared a general strike that brought the region to a shuddering halt. Over 50 major roads were blocked, public transport and shops were closed, fire-fighters and healthcare workers downed their tools and millions of Catalans flooded the centers of towns and cities.

Here’s what what I saw in Barcelona today:

As always, the atmosphere was one of resolute but hopeful indignation. But as alone in Europe as Catalonia is right now, there is little reason for hope. And dashed hope can be a dangerous thing, especially in a region with depression-level youth unemployment (35%).

Even after the brutal attacks on voting stations by Spain’s National Police and Civil Guard on Sunday, the cards remain overwhelmingly stacked against Catalonia’s regional government. The EU refuses to mediate in the crisis, insisting time and again that it is an internal matter. Brussels must abide by the decisions of the Spanish government and Spain’s constitutional court, says Jean-Claude Juncker, the European commission president.

The King of Spain, Felipe VI, speaking in a televised address on Tuesday night, was no more conciliatory. Rather than offering the Catalan government an olive branch or even twig, he admonished it for its “inadmissible disloyalty” and called on the Spanish state to restore constitutional order in Catalonia.

The Rajoy administration will be happy to comply. For years it has been threatening to trigger Article 155 of the Constitution, which allows the central government to force a region to obey laws when disobedience “gravely threatens the general interest of Spain.” In the next day or two, it will no doubt get the chance.

The article has never been used and no one has a clear idea what its consequences would be. One glaring flaw in the plan, however, is that Catalonia’s government stopped obeying Spain’s constitution some time ago. Even after King Felipe’s stern warning tonight, Puigdemont continues to insist that he will declare unilateral independence in the coming days.

As such, for Madrid to unseat an elected regional government that no longer obeys it in a region where it has alienated over half of the local population, it will need a lot more manpower than it had on Sunday, especially if it follows through on recent threats to arrest Puigdemont and other Catalan politicians for sedition. And if the regional police force, the Mossos d’Esquadra, allies with the pro-independence parties, it will also need more firepower too.

And that could mean sending in the army. In other words, the once unthinkable — the sight of Spanish tanks rolling down Avenguda Diagonal and Gran Via — could soon become a reality, in 21st century Western Europe. But don’t worry: as the EU says, it will only be an internal matter. By Don Quijones.

It isn’t just about what happens on Sunday; it’s about the ensuing days and weeks. Read… Catalonia’s Dark Days Ahead




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  71 comments for “How Did Things Get So Bad in Catalonia?

  1. Oct 3, 2017 at 7:58 pm

    No pasaran.. Never did I think this could happen again but it now seems certain. All Catalonia has left is the general strike and if they strike they better be prepared for a long one.. I hope they take page from King and refuse violence and let the world come over to them..

    • Joan of Arc
      Oct 3, 2017 at 9:10 pm

      I have only one thing to say to a bunch of bickering Spaniards:

      “Come on people now
      Smile on your brother
      Everybody get together
      Try to love one another
      Right now” – The Youngbloods, 1967

  2. michael
    Oct 3, 2017 at 8:16 pm

    And so the choices are few. Jefferson said “the tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.” My best wishes for Catalonia in this time. May the tyrants be the fertilizer.

    • Marty
      Oct 4, 2017 at 2:39 am

      Hear, hear.

      • TJ Martin
        Oct 4, 2017 at 8:47 am

        I’ll second that as the Radjoy administration slowly devolves into a blatant Franco like mentality

        Ahhh .. fascism … neofascism what ever …. despite all that history teaches us it continues to raise its ugly head … even here ( US )

        • d
          Oct 4, 2017 at 3:27 pm

          “I’ll second that as the Radjoy administration slowly devolves into a blatant Franco like mentality ”

          ???????

          Reverts to its roots would be slightly more accurate.

  3. Tom Stone
    Oct 3, 2017 at 9:55 pm

    “There are two infinities….”, to answer your question.
    Spain may well find out how important the consent of the governed is in a Society where laptops are common.

  4. Nick
    Oct 3, 2017 at 10:11 pm

    This reminds me of Quebec in 1995 — I don’t think that Canada would exist today, if Ottawa had sent in English goons to beat up voters in Montreal and Quebec City. I wonder what actual calculus was used in Madrid to decide that a fist was better than a kiss, here?

    • B
      Oct 3, 2017 at 11:02 pm

      The calculus used is the same as most places, to keep the money flowing to the top in a fashion consistent with recent history. Independence will not solve Catalan unemployment, it will only shift who at the top gets the money. Unfortunately the people of Catalan will suffer physical violence for this and the EU will watch and point to it as a warning to other regions who dare break away from a national entity.

      • IwasGnarth
        Oct 4, 2017 at 7:27 am

        ‘National entity’ of course being a convenient unit of government the the EU Commission will of course disband as soon as it becomes expedient to do so. Ask the British.

    • Cynic
      Oct 4, 2017 at 4:19 am

      To the ruling PP party – founded by people who were part of the Dictatorship – there is no hesitation about that: a fist, boot and a lie are always the first options.

      Their voters are simply lapping this up: on the Right-wing news sites, they are only disappointed that the Catalans haven’t been given more of a kicking and the [politicians thrown in jail. Even the old Liberal/Socialist paper El Pais is joining in.

      There is little conception of civil liberties as the guarantor for all, in Spain: party politics comes first. Seeing your enemies screwed is the greatest of pleasures…..

      • RR.
        Oct 4, 2017 at 4:53 am

        A few Religious Thinkers openly rebelled against the idea of Hell.
        The reason being that so many took joy in the thought that all
        those who disagreed with them would endlessly burn for their
        willingness to disagree.
        In the land where the Inquisition Flourished, should we wait for
        sympathy from those in Madrid, for those in Catalonia that disagree with them???

        RR.
        (And thank you Mr. Quijones,
        For Your Excellent Work.)

        • Cynic
          Oct 4, 2017 at 8:08 am

          Good point: as late as the Civil War, the people in our part of Spain actually had the restoration of the Inquisition as a war-aim…..

  5. Mark
    Oct 3, 2017 at 10:20 pm

    If people of Catalonia voted YES , respect that vote and let them go.
    Isn’t that what is democracy about?

    • MC
      Oct 4, 2017 at 3:43 am

      Fuck democracy, that only works when it is aligned with the right kinds of interest, big brother knows best. Otherwise, send in the tanks.

      • Alistair McLaughlin
        Oct 4, 2017 at 9:00 am

        It’s only democracy when the vote goes the way the ruling elite needs it to go. If not, it’s called “populism”, which, we’re told, is very very bad.

        Exhibit A: A rejection of Brexit would have been held up as a shining example of democracy of the highest form. A model for the civility and progressiveness of the New Europe. The Brexit victory, however, was and still is denigrated as the knee-jerk reaction of small-minded populist bigots.

        See how that works? Vote how you’re told to vote, and all will be fine. All animals are equal, but some animals are more equal than others.

        • IwasGnarth
          Oct 4, 2017 at 12:15 pm

          Exhibit A. How succinct. How accurate. In the end, though, the denigration and possible non-delivery is likely to really wind up the second* stroppiest population in the developed world.

          * I believe the French presently hold the title.

        • fallingman
          Oct 6, 2017 at 9:21 am

          Exactly. Perfectly said.

  6. R Davis
    Oct 3, 2017 at 11:39 pm

    I have followed these events for a while now – when they told of rubber bullets & batons being used on defenseless people – but this is not about Catalonia’s independents – the seeking of independence is an escalation of ‘deliberate’ misunderstandings on the part of the Spanish political arena.
    If anything, Spain’s heavy handedness has caused the peoples of Catalonia to dig their heel in. – a further escalation.
    It might be helpful to bring in an independent negotiating team to help talk things through – heated talks only end up in disaster.

  7. Realist
    Oct 4, 2017 at 12:01 am

    My guess is that the popularity of Rajoy’s PP and their partner is increasing elswhere in Spain and in that case Rajoy’s actions are logical. Can DQ tell anything about this aspect of the mess ?

    • d
      Oct 4, 2017 at 12:29 am

      “My guess is that the popularity of Rajoy’s PP and their partner is increasing elswhere in Spain and in that case Rajoy’s actions are logical.”

      Yes but that short lived popularity ( it will be very short lived in rajoys case).

      Will turn to Aggressive rejection, once the rest of Spain, see where this Dictatorial idiot, has taken them. rajoy can amend the constitution, to do what he wants, but not what others want. that is oppressive hypocrisy.

      Drunker and co, are also loosing serious public points by refusing to even send unofficial mediators to “talk to the parties” Separately.

      Spain has only just managed to get the Basques Basically disarmed.

      The shooting will start in Catalonia again soon, as all other options are being taken from the oppressed.

      Those old ladies, being unnecessarily beaten by rajoys oppressors, have grandsons, who will be far from happy about it.

      • Cynic
        Oct 4, 2017 at 12:25 pm

        The Catalans are for some reason far more intelligent than the Basques.

        Even the Barcelona anarchists appear to have promised to behave themselves so as not to give Rajoy any propaganda advantage, which is miraculous!

    • Cynic
      Oct 4, 2017 at 4:26 am

      Exactly correct: the PP was losing votes due to corruption and austerity, hence the invention of the Right-wing Ciudadanos party to catch defectors and the disillusioned – like Macron’s new party in France – and this whole affair will now give them a tremendous boost.

      When a large % of voters are content to vote for cynical authoritarians, descended from a Dictatorship, who line their own pockets blatantly and have no concern for mass unemployment and poverty, a democracy is in very deep trouble.

      This is the problem in Spain: they were never thrown out and humiliated, but re-grouped to form the ‘democratic’ PP.

      Nor was the army reformed and the paramilitary police – the Guardia Civil – disbanded, so they have all their old tools at their disposal and a moronic electorate t0applaud.

      • d
        Oct 4, 2017 at 4:55 am

        Their day or reckoning may be approaching.

        You can not behave as they did in Catalonia the other day, and remain part of the Eu and Euro-zone for long

        Just as dippy tippy from Athens, got the pants scared off of him in private, over his withdrawal from the Euro referendum, so to will Spain be given the Eu and EZ Hard word, in private.

        I see Spain heading to another election 2018.As rajoy has already been told, he has no/not enough, support for his 2018 budget.

        I dont Advocate the Breakup of Spain. Calling rajoys handling of this issue, inept, is extremely complimentary.

      • 2banana
        Oct 4, 2017 at 7:01 am

        Are you talking Venezuela?

        ++++

        When a large % of voters are content to vote for cynical authoritarians, descended from a Dictatorship, who line their own pockets blatantly and have no concern for mass unemployment and poverty, a democracy is in very deep trouble.

      • Gershon
        Oct 4, 2017 at 8:02 am

        When a large % of voters are content to vote for cynical authoritarians, descended from a Dictatorship, who line their own pockets blatantly and have no concern for mass unemployment and poverty, a democracy is in very deep trouble.

        Well said. Only a debased and amoral sheeple vote for corruption and crony capitalism, which virtually all oligarch-captured Establishment political parties and candidates exemplify. Of course, voting for power-hungry, cynical con men masquerading as populist-nationalist saviors usually doesn’t work out so well, either.

        • Cynic
          Oct 4, 2017 at 12:22 pm

          In Italy and Spain at least, people low down in the chain vote for corrupt and cynical politicos who in fact despise them, because at every level of the system they have things to hand out – jobs, contracts, etc.

          The cousins of an Italian friend were delighted with the free tickets they got for good seats at Milan Opera as one of the benefits of working for Berlusconi’s party…..

  8. Justme
    Oct 4, 2017 at 12:40 am

    Should not ALL of Spain be asked to vote in a referendum as to whether the Catalonian subset of the country should be allowed to secede? It seems to me that this would me the *democratic* way of going about it, and probably also the constitutional way.

    Personally, I plan to secede from the country, state and city I live in. That way I don’t have to pay any taxes. Who says I can;t? My region of one says so! Winning! Yes, /sarc.

    • d
      Oct 4, 2017 at 3:19 am

      “Should not ALL of Spain be asked to vote in a referendum as to whether the Catalonian subset of the country should be allowed to secede? It seems to me that this would me the *democratic* way of going about it, and probably also the constitutional way.”

      NO.

      NEVER.

      This guarantees a NO vote.

      As the rest of spain will vote against it’s “milch cow”, in Catalonia, leaving.

      The model used by Scotland, is the way.

      England, Ireland, and Wales, had no voice in that. “DEMOCRATIC” referendum.

    • Smingles
      Oct 4, 2017 at 11:44 am

      There’s quite a lot of political and philosophical writings on the topic of secession if you’re interested– who gets to declare it, why, etc.– particularly from the 17th and18th century (e.g. Paine, Locke). Much of it was the basis for US own declaration of independence.

      “It seems to me that this would me the *democratic* way of going about it, and probably also the constitutional way.”

      No country would ever let a region or territory– one that offers valuable resources– go voluntarily or “democratically.” The US would still be British, as would half the world. I don’t think you thought that one fully through.

      • Stevedcfc72
        Oct 5, 2017 at 11:02 am

        Agreed Smingles, the British were far more interested in the Caribbean Islands, a lot more valuable resource there at the time.

    • mitch
      Oct 4, 2017 at 4:02 pm

      justme has hit the nail on the head! being an american, i cannot fathom spanish politics. it APPEARS to me that if all the nevertrumpers and hillary voters decided that new york should secede and hold a vote that does just that, than everyone should go along with that because…democracy. notice i chose new york. does this example have any validity in this situation?? i would love any historical instruction on this matter without hysterical partisanship if possible.

    • Justme
      Oct 4, 2017 at 8:47 pm

      I read some stuff in a foreign newspaper, and it appears that the proper procedure would be to enact a change in the Spanish constitution, to allow Catalonia to secede, followed by a referendum. That would be the only legal way. If Catalonia cannot garner the votes to get Spanish Parliament to enact constitutional change, they have no legal basis for their action. The constitutional court of Spain already has ruled that the current referendum is not legal or binding.

      As far as the US versus the British Empire (England) in 1776, that was a case of a faraway colony declaring independence, using as grounds that they paid taxes but had no representation in the British parliament. “No taxation without representation”, was the slogan. Not sure the analogy with Spain/Catalonia is very strong. In any case, the US secession ended with with war. Is another war, this time between Spain and Catalonia, really a good idea?

  9. raxadian
    Oct 4, 2017 at 2:30 am

    So, the eurozone is fracturing, first the UK and now this…

    • d
      Oct 4, 2017 at 2:47 am

      The UK is not and never has been, part of the “Euro-zone”.

      It would be Fair to say multiple fault lines are staring to appear in both the Eu, Brexit and other issues, including Spain.

      And the Euro-zone, Greece, Italy, Spain (With now Multiple issues).

      I would However Guarantee that Drunker and his Eurotrash Dictator backers in brussels still don’t see The coming disasters, they have brought to the Eu and Eur by Orchestrating brexit and attempting to force punitive terms on England, in Brexit.

      The levels of Arrogance and Hubris in brussels, are astounding.

      • Oct 4, 2017 at 8:21 am

        Who is “Drunker and his Eurotrash Dictator”

        Please use their correct last names. Descriptors like you’re using will get your comment blocked.

        • Jim Graham
          Oct 4, 2017 at 4:33 pm

          Thank you…..

    • Realist
      Oct 4, 2017 at 7:33 am

      Correction, the eurozone is equal to Euroland, UK has got nothing to do with Euroland.

    • IwasGnarth
      Oct 4, 2017 at 7:40 am

      The UK has never been in the Eurozone. If it had been, the task of leaving the EU would be even more difficult than it already appears to be. Hotel California comes to mind.

    • Gershon
      Oct 4, 2017 at 8:03 am

      All bullish, as long as the central bankers continue with their deranged money printing and asset purchases.

  10. d
    Oct 4, 2017 at 3:28 am

    http://uk.reuters.com/article/uk-europe-stocks/european-bourses-dip-as-spain-banks-suffer-from-catalonia-crisis-idUKKCN1C90PG

    http://uk.reuters.com/article/uk-spain-politics-catalonia-banks/spains-economy-minister-says-catalan-bank-clients-business-have-nothing-to-fear-idUKKCN1C90N9?il=0

    Markets are slowly starting to take this seriously, and react accordingly.

    All these public “nothing to worry about” statements, indicate, LOTS to worry about.

    There is also some weakening in the Eur. Attributed to the “Spanish problem”.

    Perhaps the Markets, may catch a “Spanish Flu”.

    The last “Spanish Flu” AKA “Spanish Lady” was very nasty.

    It traveled the whole globe.

  11. Cynic
    Oct 4, 2017 at 4:29 am

    Don Q is writing some of the best articles on Spain, principally because he understands the past of the country very well, and the extent of the corruption -moral and financial.

  12. Stevedcfc72
    Oct 4, 2017 at 4:35 am

    Hi Don Q,

    Aside of everything going on at the moment, as mentioned by you last week the Spanish Banks shares are now taking a beating.

    In an interesting point which has been raised today is that the ECB are bringing in tougher rules to make the European banks recognise NPL losses sooner rather than the drip feed of losses which they’ve been getting away with for far too long in their accounts.

    What’s your thoughts not just for Spanish Banks with reference to this but also European Banks who are sitting on huge losses.

    Regards
    Steve

    • Gershon
      Oct 4, 2017 at 8:08 am

      Not Don Q, though he may well be my brother from another mother. Since the ECB has been instrumental to the can-kicking and “extending and pretend” that has deferred the financial reckoning day in the EU, it is doubtful these “tougher rules” will have any real teeth, or enforcement, or independent honest oversight and auditing. That would go against everything the ECB stands for.

      • Stevedcfc72
        Oct 5, 2017 at 4:00 am

        Hi Gershon Quijones lol,

        Completely agree with your comment about extend and pretend.

        The ECB have an issue though which HAS to be addressed and that’s the fact that I still don’t think they know truly how many more European banks are effectively insolvent, the amount of true losses hidden within the accounts.

        Examples as we know recently, Popular and the Veneto Banks.

        They’re currently looking at the Greek Banks again.

        Best Regards
        Steve

  13. Don Quijones
    Oct 4, 2017 at 5:16 am

    Hi Steve,

    Tbh, I hadn’t heard anything about these new rules, but I didn’t see a headline somewhere in Spain’s business press about how the Bank of Spain sees the current banking regulations in Europe as more dangerous than before the crisis. I wouldn’t be surprised if it had something to do with the new rules you speak of. I’ll try and hunt down the article.

    In the meantime, the shares of banks in Spain, in particular the two big boys in Catalonia, are in free fall. And Spain’s risk premium just soared over 130 basis points. In other words, the tensions on the street and in Spanish institutions are beginning to leak into the markets.

    Thanks for the heads up.

    DQ

  14. michael Engel
    Oct 4, 2017 at 5:55 am

    The people voted “yes for ghetto Catalonia”.
    Sentiment rule.
    The pendulum in Europe, now, swing for separation.
    – Who will recognize Catalonia as an independent state.
    – Who will trade with Catalonia, invest in Catalonia, or buy RE.
    – Who will defend Catalonia.
    – Who will visit Catalonia, or spend money in camp nou, when Messi will be gone and there will be no more Real Madrid vs Barcelona.
    All Spain / Rajoy have to do, is to do NOTHING and let reality set in.
    In a similar sentiment, over a year ago…..”yes” for another great ghetto.
    Some northern European states might consider it as a necessary phase to from the new shape in Europe and become dominant.

    • 2banana
      Oct 4, 2017 at 7:06 am

      Well, who trades with Bosnia, Slovenia, Croatia, Estonia, Ukraine, etc.?

      These and more were countries that broke away from their “mother” country.

      People will trade and invest if there is money to be made.

      Catalonia is know for industrious and hard working people.

  15. marco
    Oct 4, 2017 at 9:00 am

    Hemingway knew ….. Now we know what “What Ever It Takes” means. The
    same thing as it meant in 1940).

    “Was there ever a people whose leaders were as truly their enemies as this one?”

  16. discwrites
    Oct 4, 2017 at 9:15 am

    Ok, so in about 3 years Germany invades Poland then.

    Oh no wait, that was the previous episode.

    I had little sympathy for Catalan independentists, but the Spanish government is doing all it can to change my mind.

    Even Italian Communists supported the Hungarians in 1956.

  17. Bobber
    Oct 4, 2017 at 9:39 am

    So would Catalonia walk away with part of Spain’s national debt burden? How do they plan to sever financial ties? Should be interesting.

    • Oct 4, 2017 at 10:26 am

      Yes, that’s why separations, even if both parties agree to it, are so complex and not easy to pull off under the best of circumstances.

  18. DK
    Oct 4, 2017 at 9:58 am

    Will succession really improve the lives of the average Catalonian ?

    • Cynic
      Oct 4, 2017 at 12:15 pm

      Setting aside economics, if it removes the Catalans from the power of the PP, and enables them to expel the para-military Guardia Civil and National Police, from the point of view of civil liberties their lives would improve immeasurably. Not unimportant considerations.

  19. unit472
    Oct 4, 2017 at 10:41 am

    Not a very convenient time for the EU to have to deal with a crisis. Merkel is not the Iron Chancellor after her parties drubbing in their recent election. If we are to believe the poll numbers, Macron is in no position to take charge. Britain is negotiating its exit and May looks set to be toppled. Jean Claude Juncker’s blood alcohol level may have to be closely monitored to see if he is able perform his duties.

    • d
      Oct 4, 2017 at 3:31 pm

      “Jean Claude Juncker’s blood alcohol level may have to be closely monitored to see if he is able perform his duties.”

      If the tests are conducted in the afternoon it will be more apt to search for blood than Alcohol.

  20. Mary
    Oct 4, 2017 at 10:58 am

    Enlightening series of articles by Quijones. US press isn’t giving the crisis in Spain much coverage, so Quijones’ reporting becomes an especially valuable resource.

    Thanks Wolf. But given your editorial policy of avoiding politics, I am curious about your decision to publish this kind of political commentary. (Not that I’m not grateful.)

    • Oct 4, 2017 at 2:36 pm

      Yes, this is always a fine line. It’s not always possible to bleach politics out of economics and finance. There are some things that political players cannot be kept out of. The conflict over Catalonia is one of them. This isn’t just partisan bickering. The economic and financial consequences – not to speak of the human and social consequences – of that conflict have the potential to be significant and therefore should be discussed here “occasionally.”

  21. Smingles
    Oct 4, 2017 at 11:21 am

    Very interesting times.

    I’ve only followed this loosely– basically read the articles Don Q. has written on the topic here, and whatever has come up in the BBC over the last year, so not very much. Did not have a strong opinion and wasn’t educated enough on the topic to have one anyways.

    As a total outsider with no skin in the game, all I can say is that Rajoy could not have handled this any worse. My understanding is that prior to the heavy handed response from Spain, there was not strong support for independence. At best, maybe 50% of the region supported it.

    The anti-authority/authoritarian in me says “Go Catalonia” but I know it will be a hard road and there will be no winners here in the short run.

  22. John
    Oct 4, 2017 at 1:01 pm

    1930’s?
    It’s been coming a long time
    The EU’s silence is all pervading
    Even Merkel has been weakened.
    Let’s hope sensible Germans are bending the Frau’s shell like

    • Gershon
      Oct 4, 2017 at 7:12 pm

      With the central bankers hurtling us down the road to Weimar 2.0 and a new Great Depression, it does indeed seem like the ’30s. We’ve seen that movie before and know how it ends.

  23. Cal
    Oct 4, 2017 at 2:38 pm

    That parallel tax system might just save them.

    Absolute non-cooperation with Spanish authorities and non-violence with a smile on a regional level would do more to quash Madrid’s control than armed struggle.

    What would the Spanish tanks do? Blow up the tax collection office? Then what? Post a guardia civil in every business to collect the VAT?

    If Europe isn’t doing anything, than Catalonia has no responsibility to pay the Euro denominated debts, nor taxes to other European nations.

    “No taxation without representation…” Where have we heard that before?

  24. mean chicken
    Oct 4, 2017 at 3:24 pm

    “Go your own way” Fleetwood Mac

  25. KONSTANTINOS SP
    Oct 4, 2017 at 3:52 pm

    I can’t be sure, but it seems that the level of despair is not enough to derail Spain into an open civil war. No war has ever started on words grounds. I would expect regional government to keep it lower and lower and Rajoy’s government to blink so everything will stay pretty unresolved for the foreseeable future.

  26. grates
    Oct 4, 2017 at 5:27 pm

    catalonia is part of spain the politicians in this región are going to destroy spain after it will be the basques region and then french catalonia then flanders then what scotland maybe quebec.catalonia economy is going to go down.spain is such an amazing place they have to negociate a deal for catalonia to stay part of the country

  27. Gershon
    Oct 4, 2017 at 7:10 pm

    It bothers me when they call corrupt globalist water carriers like Rajoy “conservatives.” True conservatives will always side with their own people against the banksters and globalists, and will not betray the public interest by being corrupt.

    http://news.trust.org/item/20171004112122-805c3

  28. Bobber
    Oct 4, 2017 at 7:34 pm

    The problem with strong federal government is it makes separation difficult or impossible. That’s one more reason to leave power in the hands of local governments.

    It’s like getting married. Who would ever get married if there wasn’t the possibility of divorce when things turn really bad? Nobody plans on it, but there’s a reason why the divorce rate is 50% or higher.

    • d
      Oct 4, 2017 at 8:50 pm

      “It’s like getting married. Who would ever get married if there wasn’t the possibility of divorce when things turn really bad? Nobody plans on it, but there’s a reason why the divorce rate is 50% or higher.”

      The divorce rate is at the ridiculously high level it is.

      As it is to easy, in too many States/Countries.

      The easier it is to get out of something, the less consideration is given, to getting into it.

      Further, for some groups in some society’s “Divorce” is simply a means of earning a living/Increasing ones protected assets base.

      In some county’s the time frames, for large legal asset claims, PROTECTED IN LAW, is 2 years or less.

  29. Stevedcfc72
    Oct 5, 2017 at 4:08 am

    Hi DQ,

    Hope you’re well. As mentioned please find enclosed ECB on NPL’s.

    The interesting one is that banks are expected to provide FULL coverage of unsecured debts after two years. This starts 1st January 2018.

    I could interprete this as the ECB telling the banks they don’t trust them.
    Best Regards
    Steve

    ECB reinforces its NPL guidance for banks

    4 October 2017
    ECB publishes for consultation an addendum to its guidance to banks on non-performing loans (NPLs)
    The addendum sets out supervisory expectations for minimum levels of prudential provisioning for new NPLs
    Consultation period runs from today until 8 December 2017 and includes a public hearing on 30 November 2017
    The European Central Bank (ECB) today launched a public consultation on a draft addendum to the ECB guidance on non-performing loans. The addendum supplements the guidance which was published on 20 March 2017 and reinforces the guidance with regard to fostering timely provisioning and write-off practices.
    The draft addendum specifies quantitative supervisory expectations for minimum levels of prudential provisions for new NPLs. The prudential provisioning expectations will apply to all exposures that are newly classified as non-performing in line with the EBA definition as of 1 January 2018. These take into account the length of time a loan has been non-performing and the extent and valuation of collateral. More specifically, banks are expected to provide full coverage for the unsecured portion of new NPLs after 2 years at the latest and for the secured portion after 7 years at the latest. Furthermore, banks are expected to explain any deviation from the guidance to supervisors. Based on the banks’ explanations the ECB will assess the need for additional supervisory measures.
    It is proposed that the draft addendum will be applicable to new NPLs. With regard to NPL stocks, ECB Banking Supervision has required banks with high levels of NPLs to submit NPL strategies, including their NPL reduction targets, in the first half of this year. Many banks have made notable progress and submitted credible strategies including reduction plans. However, some banks still need to improve. ECB Banking Supervision will continue to closely monitor progress on reducing NPLs, provisioning for NPL stocks and developments with respect to NPL strategies. In addition, by the end of the first quarter of 2018, ECB Banking Supervision will present its consideration of further policies to address the existing stock of NPLs, including appropriate transitional arrangements.

    • Don Quijones
      Oct 5, 2017 at 9:49 am

      Thanks Steve,

      Will definitely look into it.

      DQ

      • Stevedcfc72
        Oct 6, 2017 at 10:06 am

        Sorry DQ one more thing the Italian Central Bank yesterday have already come out saying they are worried by these new rules.

        Wonder who has something to hide?

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