The Crisis in Catalonia & What I Saw in Our Neighborhood in Barcelona

As separatist region is rocked by violence, businesses sound alarm.

By Nick Corbishley, for WOLF STREET:

Two of Catalonia’s biggest business associations, Foment de Treball and Pimec, have called for calm and dialogue after ten days of non-stop political and civil unrest in the separatist region of Spain. At a gathering of almost 450 Catalan business people and executives on Wednesday, the two associations called for a political solution to what they described as “the grave conflict we are living through in Catalonia,” a region that is riven down the middle by the question of independence.

A key passage in the event’s joint manifesto hinted at why the crisis shows no sign of abating: “It is the responsibility of politicians, and not the justice system,” to find an “effective and decisive” solution to this conflict. Unfortunately, political dialogue and negotiation have been sorely lacking in relations between Barcelona and Madrid for a number of years. And there’s little sign of that changing.

As general elections approach, Spain’s main political parties, with the notable exception of the left-wing Podemos, are hardening their stance toward the Catalan separatists. For its part, the separatist government in Barcelona is doubling down on its calls for independence. If the elections on November 10 deliver enough votes for the triumvirate of Spain’s right-wing parties (the People’s Party, Cuidadanos and the far-right Vox, whose support appears to be growing) to form a coalition, they will crack down even harder on Catalan nationalism, which is likely to fuel even stronger pro-independence sentiment in the region.

A little more than two years have passed since more than two million people in Catalonia voted in a banned referendum to leave Spain. On that day, the separatists were given a harsh lesson in the raw power of state violence. Now, tensions are flaring once again, after Spain’s Supreme Court’s decision to sentence nine pro-independence politicians to up to 13 years in jail on charges of sedition and misuse of public funds sparked protests across the region. This time, the violence is coming from both sides:

On Monday, Oct. 14, the day the sentences were announced, thousands of protesters surrounded Barcelona airport, preventing many travelers from catching their flights and leading to over 100 flight cancellations. The police used tear gas and rubber bullets (whose use has been banned in Catalonia since 2013) to try to disperse the crowds.

On Tuesday and Wednesday, Oct 15 and 16, pockets of protesters, mostly young, engaged in pitched street battles with riot units of local and national police forces in the Eixample district of Barcelona. Scores of dumpsters were burned and other forms of vandalism committed. There were also clashes between neo-fascists and pro-independence supporters.

Here is a short video I took from our balcony. Multiple fires are burning on Passeig Sant Joan, a busy thoroughfare in the Eixample, as protesters are hurling bar-chairs and bar-tables, stones, and bricks at passing police riot vans.

On Friday, Oct 18, a general strike was called, the main highway between Spain and France was blocked as well as many others, and hundreds of thousands of marching pro-independence supporters converged on Barcelona from the surrounding regions. More than half a million people gathered for a peaceful demonstration on Passeig de Gracia. Close by, on Via Laietana, riot units of Spain’s national police clashed with protesters, resulting in dozens of injuries. One police officer was hit in the head by a brick hurled from a balcony and is still in critical condition.

In my neighborhood (Eixample Dreta), rioters tried to burn the last remaining dumpster (out of six) on our block, but a handful of thirty- and forty-something local residents, all pro-independence, put their bodies between the rioters and the dumpster. A tense exchange ensued as the rioters tried, in vain, to convince the local residents to let them torch the dumpster, while above them residents on their balconies either egged them on or tried to dissuade them. It wasn’t long before the neighbors themselves were shouting at each other.

Then violence dissipated. But roads and train lines continue to be blocked and spontaneous protests continue to sprout up across the region on an almost hourly basis, all made possible by encrypted social networks such as Telegram.

Saturday afternoon, Oct 26, another mass demo was held by pro-independence organizations that, again, went off without incident despite being attended by almost half a million people. But in the evening violence did flare up once again in a few places, as pockets of protesters, clashed with riot police units.resulting in dozens of injuries. These are the scenes that played out in the media cycle this morning in the rest of Spain.

Today, Sunday, Barcelona hosted yet another mass demonstration, this time by Spanish unionists, many of whom were bused in from other parts of Spain, including Valencia, Madrid and Zaragosa. Even so, the march was much smaller than the pro-independence one a day earlier. Given that attendees include government ministers and the leaders of the right-wing Popular Party and Cuidadanos party, security is incredibly tight right now. As of writing (2.30 p.m. on Sunday) a tense calm reins in the city. But with some of the more radical factions of the separatist movement holding counter demonstrations just streets away, there is a risk that  violence could break out between the two opposing sides.

As each day goes by, the risk of damage to Catalonia’s economy rises. One sector that’s already being affected is the tourism industry, which generates more money than any other regional sector in Spain. The governments of the UK, France and the U.S. — three countries that account for roughly 40% of all foreign visitors to Catalonia in an average month — have already warned their citizens about the risks of visiting the region.

The sector was only just beginning to recover from the fallout of the last crisis. In 2018, the number of overnight stays at hotels in Catalonia fell for the first time since 2008. Now, it faces a brand new crisis.

As a whole, Catalonia’s economy has, until now, weathered the political storms better than many had thought. This is a region that has seen more than 5,000 of its biggest brand names move their headquarters to other parts of Spain in the last two years, albeit only on paper. At the height of the last crisis, its two main banks, Caixabank and Banco Sabadell, suffered a deposit run that ran into the tens of billions of euros, much of it fomented by the central government in Madrid.

Yet the economy is still growing, albeit more slowly than before. Between 2014 and 2017, Catalonia’s GDP grew at an average annual rate of 3.2%, two decimal points higher than Madrid’s. In contrast, last year Catalonia’s economy grew by 2.6%, while Madrid’s, hands down the biggest beneficiary of the mass exodus of Catalan companies and bank deposits, grew by 3.7%. This year, Catalonia’s GDP is on target to grow by just 1.9%, one decimal point less than Spain’s economy as a whole.

For now, the ratings agencies see little cause for concern in this latest flash point. As long as the unrest does not become chronic, the threat to the economy is minimal, they say. But for it not to become chronic, a negotiated solution, or at least some form of dialogue between the two sides, is needed. And the chances of that happening grow slimmer by the day. As for the European Parliament, it refused to even discuss the matter when it was tabled for debate by the Green Party this past week.

On the ground, businesses and the associations that represent them are sounding the alarm. They fear that the longer this conflict drags on, the more entrenched and radicalized both sides will become. Eventually, investors, particularly from overseas, will begin to get cold feet. As action begets reaction and repression fuels further polarization and radicalization, it’s only a matter of time before local businesses begin to feel the effects, if they aren’t already. By Nick Corbishley, for WOLF STREET.

“An unforeseen crisis.” Other headwinds intensify too. Read…  Just Weeks After the Collapse of Thomas Cook, Spain Launches First Bailout of its Huge Tourism Industry

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  65 comments for “The Crisis in Catalonia & What I Saw in Our Neighborhood in Barcelona

  1. Iamafan
    Oct 27, 2019 at 2:19 pm

    In Barcelona, when will it hit the Ramblas or the cruise ship areas? Local shop owners in key cities where there are mobile demos must be nervous. Not a good time to be a tourist.

    • MC01
      Oct 28, 2019 at 1:55 am

      I am yet to hear of a single airline that cancelled or even reduced flights to Barcelona. The El Prats airport is the usual chaos, as are the tourist parts of Barcelona.
      Basically business as usual.
      However…

      Spain is nowhere near as cheap as she was just five years ago. The Real Estate Bubble 2.0 is sending lodging costs up (even for the AirBnB crowd) and food and drinks are getting pricier. In short that inflation which officially doesn’t exist is starting to bite at tourists’ wallets.
      It’s the same dynamics that has already started to play out in Italy but it will probably take another year or two for the decline to be palpablein Spain as in Italy: tourists from Northern and Central Europe are quietly but steadily shifting to Croatia, Turkey, Egypt, Tunisia etc.
      Another problem Spain has in common with Italy is that it’s getting way too crowded. Sure, Spain has far better infrastructures than Italy, but what’s the point of being on vacation if the place is more packed than a tin of sardines? No such problem in Tunisia with the brand new tourist resorts in the middle of nowhere.

      • nhz
        Oct 28, 2019 at 6:12 am

        RE on the Spanish costas deflated after the financial crisis but it always remained relatively expensive IMHO, and started inflating again thanks to ECB ZIRP/NIRP policy. But only on the costas and some hotspots like Madrid, in much of the (inner) country RE prices are much lower, relatively unchanged compared to ten years ago and the market is close to dead. I noticed totally ridiculous RE prices in Croatia and similar Mediterranean locations that are popular with tourists and RE speculators already five years ago, and I’m sure it is even worse now. None of this makes sense, it’s bubbles everywhere and when they pop the politicians and banksters quickly invent new incentives to blow new bubbles.

        • MC01
          Oct 28, 2019 at 6:30 am

          I checked some prices in the interior of Spain (that’s where the good hunting and mushrooming are) for my uncle when I was there three weeks ago.
          I had so much fun with the fanciful and completely made-up valuations and some of that stuff was in such bad shape it was probably abandoned during the Carlist Wars. Unless the owners are just joking you get no value for your money with those hovels. “What happened to the roof?” “It caved in years ago, I don’t know exactly when; the owners only come and check the property once every few years. They live in Bilbao now.” “And they want €225,000 for this?” “Yes, that’s their final price”. I didn’t bother to ask if that ruin was used as a collateral for some crazy loan.
          As I said, fun times.

        • Xabier
          Oct 28, 2019 at 6:38 am

          I’m looking to buy a house in the Basque Pyrenees, out of family sentiment, nostalgia, etc.

          But I find that people are clinging on to the old valuations in the teeth of reality – a totally dead market, properties on sale for years….

          Happy to buy cheap and lose on it, as it’s a beautiful region and I have no direct heirs to worry about, but not expensive when there is no real demand – many of these properties must fall into ruin eventually…..

          Meanwhile, in town, rents are just going up and up.

        • nhz
          Oct 28, 2019 at 7:29 am

          @MC01:
          agree that asking prices are often pie in the sky, and yes often these are “investment properties” (inherited maybe) from people who live far away in a big city and seldom visit. But from what I hear the much cheaper properties outside the cities don’t sell either.

          It is difficult to say what is a realistic price after decades of rampant speculation all over Europe. But rural prices that I see in the Spanish interior are often 5-10x lower than rural prices in Netherlands, which seems cheap to me with incomes maybe 30% lower in Spain (in both cases, local facilities like shops, schools will be close to zero).

        • RagnarD
          Oct 28, 2019 at 1:19 pm

          FWIW
          I was just packbacking from Zagreb to Dubrovnik (Croatia) and got 3 different AirBnbs (split, Korcula, Dubrovnik) for $25/night. Some with bathrooms better than my 2000 era condo in USA. And what’s cooler is I booked Them on the fly… that is I made the reservation after arriving on the the ferry 12:00 noon and was in the room by 1:30pm.

        • char
          Oct 28, 2019 at 7:49 pm

          @nhz Rural prices in the Netherlands? There are no rural places in the Netherlands, just very low density areas of the city with a farming purpose as you always be within an hour drive of a medium size town (exurb). In Spain rural can mean more than a two hour drive to a town. So you are comparing the Dutch exurb prices with the Spanish rural prices which unsurprising are much lower.

        • nhz
          Oct 29, 2019 at 4:59 am

          @ char:

          I’m talking about small villages in Spain (older ones, not recent developments) that are 10-30km drive from big cities with good quality roads in between, e.g. in Castilla y Leon. This is similar to the rural locations in my area where public transport is almost non-existent and good shops, schools etc. can also be a 10-20km drive away. The difference is possibly that rural property in my part of Netherlands is now “vacation/investment property” (which is mostly hype if you ask me) while in interior Spain such spots are hardly attractive to tourists and investors.

          If a town with good services is 2 hour drive away I agree that this is totally different from anywhere in Netherlands, but that’s something else. The few examples I know in Spain are either deserted, or they give away the houses for free to migrants who want to start living there … I think those homes are worth practically nothing.

  2. Citizen AllenM
    Oct 27, 2019 at 2:47 pm

    I guess a apartment on the Ramblas will be cheap once again after they lose the next civil war. Interesting the fracturing alliances of right and left in this debacle.

    Of course, rioting is one way to solve the over tourism issues, except those pesky soccer rioters might just start showing up for the fun.

    So much anger over the courses of capitalism these days, one should just wait until it begins to boil at home.

  3. AdamSmyth
    Oct 27, 2019 at 2:59 pm

    Not winnable by either side. Hard to fathom out if its a political war or an economic one – work that out and you have the basis for negotiation.

    • Kiers
      Oct 27, 2019 at 4:08 pm

      True. It’s often BOTH! A carve out for puigdemont and money to go with it.

    • JoAnn Leichliter
      Oct 27, 2019 at 4:23 pm

      This separatist movement has been going on for over 200 years. I do not know all of its history, but its root is ethnic.
      Catalans have a separate culture and speak a different language. So–it is unlikely to disappear any time soon, certainly not in my lifetime.

      • Francisco
        Oct 27, 2019 at 5:16 pm

        Around 10% of the population in Catalonia is from Africa and South America, another big percentage has roots in many other regions of Spain. Reason for independence is simpler than that, they just want to be richer. There is plenty of manipulation and corruption too. But you are right is not going to disappear, it is just going to make the life of 90% of the people much harder, on both sides.

        • Suzie Alcatrez
          Oct 27, 2019 at 9:47 pm

          I think Europe will eventually split down to the neighborhood level. With people nervously eyeing the people who live down the road.

        • alex in San Jose AKA Digital Detroit
          Oct 28, 2019 at 3:13 am

          Susie – sounds like the Balkans when Yugoslavia fell. It was street-by-street.

      • char
        Oct 28, 2019 at 8:35 pm

        The Catalan were not happy with the merger of Aragon and Castile so make that 400 years. Catalan, like most regions of Iberia speak a dialect of pig latin. From a Chinese perspective those are all the same language but in my opinion the root of the conflict is not ethnic but a Madrid that is vacuuming up all the jobs/companies/taxes which Barcelona/Catalonia needs to stay a prosperous city. Also a split off Catalonia could much better argue its case in the EU

  4. Oct 27, 2019 at 3:03 pm

    Barcelona today where else tomorrow? 2020/21 will see a Worldwide rising of the people as we head into a Sovereign Debt Crisis starting very soon as governments go bankrupt and I guess the banks also.

    • Ian Bannister
      Oct 28, 2019 at 6:11 am

      You’re absolutely correct in your comment. Look what has happened in Chile, HK and about to happen in Lebanon. Argentina have dumped Macri to return to Peronist politics.
      All the while Gilets Jaune continue their protests in France. There is a growing increase in civil unrest globally.
      The rise of inequality and rising living costs all combined with a sovereign debt crisis just around the corner does not bode well for anyone.

      • nhz
        Oct 28, 2019 at 6:21 am

        Agree, it’s also very interesting how the “free press” (MSM) is reporting about all this. In my country (Netherlands) the press is writing extremely favorably about the protests and riots in Hongkong (after all this is agains bogeyman number 1 or 2, China) and very negative about the protests and riots in Catalonia that have MANY similarities with the HK situation. The Gilets Jaune are not even mentioned here except if they can find some very damaging news.

        Most of Europe has been very quit for decades thanks to every growing government largesse and debt build up. But we are nearing the end of that politically easy road. The riots remind me of the situation in Netherlands around 1980, related to political conflicts about stationing of American cruise missiles and nuclear weapons and a severe housing / speculator crisis. Riots were just as worse as what we see now in Catalonia and HK, and many years later we learned (as was already suggested at the time) that some of the people leading the violent riots where working for the BVD (secret service). BTW, the year after that the Dutch housing market totally crashed – I’m not suggesting cause and effect here, but there might be a relation ;)

        An other interesting observation is that the Dutch MSM is lately providing favorable coverage about mass protests in Netherlands “just like in the seventies/eighties”. But these protests are mostly out of purely egoistic motives like demand for far higher wages for certain privileged groups (apparently that is “good”, but protesting general politics is “bad”).

  5. Petunia
    Oct 27, 2019 at 3:19 pm

    Instability is spreading around the world, Spain, Chile, Ecuador, Hong Kong, Paris. And Grand Inquisitor Shifty will bring it to America with his secret inquisition. Get ready because we are getting closer to 1929-1932.

    • Oct 27, 2019 at 3:58 pm

      Mark Twain might not have said this but it does seem approriate; “History doesn’t repeat itself but it often rhymes.” A repeat of the 1930’s is bad enough but what that era begat ought to scare all of us..

    • FDR Liberal
      Oct 28, 2019 at 12:17 am

      Secret inquisition?

      Depositions are not secret inquisitions. They are held to get testimony under oath and transcribed to be published in an open hearing.

      • Petunia
        Oct 28, 2019 at 9:36 am

        The Shifty Inquisition is being held in a scif, a secure room, what is public or open about that? I wouldn’t trust any “transcript” coming from Shifty and his bunch.

        • Harrold
          Oct 28, 2019 at 10:02 am

          The opposition ( ie Republicans ) are also sitting on the panels.

          Of course, there have been no leaks from the Republican side. It must mean its all bad news.

      • Naivo
        Oct 28, 2019 at 12:30 pm

        You made my day. I’m still crying laughing.

        • FDR Liberal
          Oct 28, 2019 at 7:48 pm

          Naivo,

          I am glad I made your day. Too bad you will be laughing out of the other side of your mouth when the Judiciary Committee votes on Articles of Impeachment after transcriptions are read, open testimony is heard and the indictment is tendered to the White House.

      • FDR Liberal
        Oct 28, 2019 at 2:19 pm

        Re-read my post then read the remainder of this comment, please. After the depositions, transcriptions will be read in open hearings. Moreover, as Harold mentions Republicans are part of listening to the depositions. Mark Meadows, member of the House GOP and former leader of the Freedom Caucus last week remarked that the hearings chaired by Adam Schiff were conducted with the Republicans having as much equal time as the Democrats to examine the witnesses. Meadows is also part of the hearings chaired by Schiff.

    • Unamused
      Oct 28, 2019 at 7:14 pm

      And Grand Inquisitor Shifty will bring it to America with his secret inquisition.

      Aren’t you glad your POTUS has nothing to hide? He’s above the law and can’t be investigated, you know, and can ignore the Constitution, which is pretty phony anyway.

      • Petunia
        Oct 28, 2019 at 9:02 pm

        So far a lot of false accusations and no evidence to support any of the hoaxes.

  6. Xabier
    Oct 27, 2019 at 3:21 pm

    Good, fair report.

    Sadly, compromise is not really in the Iberian character, and both sides are going up the ‘Action-Reaction-Action’ escalator, for their own narrow purposes.

    The refusal of Sanchez to even speak to the Catalan regional leader on the phone was disgraceful electioneering, and puerile. And for him to visit the region and not meet, quite unbelievable.

    Add to that most young people still facing very poor prospects even when employed – high rents, dreadful salaries and insecurity – and it’s explosive.

    On the bright side, it might cure the AirBnB problem in Barcelona, or alleviate it somewhat.

  7. Xabier
    Oct 27, 2019 at 3:22 pm

    For non-Spaniards, the ‘neo-fascists’ mentioned are in fact just plain old Francoists, who never went away.

    • Kiers
      Oct 27, 2019 at 4:11 pm

      I find “the far right” never really goes away. Look at the US: Reincarnation of so many far right memes, evergreen! These types are always carried along by each other.

    • Petunia
      Oct 27, 2019 at 4:34 pm

      I visited Franco’s grave in the 80’s and there were Spaniards there weeping, real tears. I could hear them comment on how much they missed him.

      • wkevinw
        Oct 27, 2019 at 8:31 pm

        There are always individual losers with significant change. I worked with central/eastern Europeans who said that the communists did some things “better”. For sure, the elderly had better pensions under the communists.

        Does that mean that communism was better than the what they got after the fall of the USSR? The vast majority would say “no”.

        It’s too bad that people can’t see the big picture. Also, it’s too bad that governments/politicians/the body politic, still can’t find (“productive/fair”) ways to subsidize damaged minorities during times of transition.

        • RagnarD
          Oct 28, 2019 at 1:39 pm

          In my recent trip to Croatia a milenial tour guide, said “that at least under communism there were jobs. Now it is very hard to find a job / decent $$$. Everything looks fine, but it is not. There is a lot of corruption / Nepotism. It’s is Not a meritocracy.”

        • nhz
          Oct 28, 2019 at 3:07 pm

          @ RagnarD:
          it is not just jobs that are hard to find, the same is happening with housing or secure place in society, in many liberal capitalist countries (not just the ones that were formerly communist). Seems current capitalism only cares about money (for the elites that ultimately harvest it), not what ordinary people can do with it to improve their lives or at least get buy without constant worrying about what will hit them next.

          Times are good for those with the right connections, less so for all others. And while in a materialistic sense most people are probably better off, there are many signs that society and environment are going in the worse direction as a result of this rampant consumption and purely materialistic policies.

      • MC01
        Oct 28, 2019 at 4:36 am

        That’s the Sebastian Effect.

        For those not in the know, it’s so named after King Sebastian of Portugal who died in battle in 1578. Long story short, Sebastian led what can only be called a Quixotic crusade against the Sultan of Morocco: the small Portuguese army marched in the interior of Morocco and was completely wiped out by the superior Moroccan armies. King Sebastian was killed in the fighting together with the flower of Portuguese nobility.
        As King Sebastian had no children, legitimate or otherwise, nor siblings and he had left no dispositions about his succession, Portugal was plunged into a devastating political crisis, made worse by the loss of most of the magnates who could have assumed leadership in time of crisis.
        Sebastian’s actions were worse than reckless: he acted with complete disregard for his country which ended up being gobbled up by neighboring Spain in a few years. It took almost three decades of brutal fighting and wearing diplomacy for Portugal to regain independence.
        All because King Sebastian had acted like an irresponsible fool.

        Yet, for those strange processes of the human psyche, King Sebastian became a powerful folk hero, inspiring a messianic movement (Sebastianism) and the whole idea of the Fifth Empire as refined by Pessoa in the 1930’s.
        The human mind is really as wonderful as it is puzzling.

        • Pete Stubben
          Oct 28, 2019 at 5:35 pm

          How amazing!!!… PJS

    • Makes no sense
      Oct 27, 2019 at 9:41 pm

      Um, right.

      Isn’t the socialist government preventing Catalonian indepenance the same one that moved Franco’s body last week? Oh the hypocrisy.

      • Petunia
        Oct 28, 2019 at 9:40 am

        When they start changing history you know things are really bad.

    • marc
      Oct 28, 2019 at 12:35 pm

      And let’s thank God for them.
      They prevented western Europe from becoming another socialist dictatorship a la China.

  8. Lisa_Hooker
    Oct 27, 2019 at 3:50 pm

    Most of the poor and middle classes, everywhere on the globe, now have cellphones and an international internet. From a social standpoint this time IS different. Social movement information is no longer limited by slow newspapers and broadcasting stations, it’s peer-to-peer. I hope for the best, but I do not think this will turn out well.

    • nhz
      Oct 28, 2019 at 6:28 am

      Social movement “information” is easier to influence/manipulate than ever before for evil companies like Google, Facebook, Twitter etc. that all work for the Dark Side.

      Just look how easy it is to totally manipulate huge amounts of people with a simple game like Google’s Pokemon Go – and this was just an early experiment. Who knows what game these companies are playing with the herd, I have zero doubt they are trying to profit from it and governments and big corporations are salivating at the prospect.

  9. Auld Kodjer
    Oct 27, 2019 at 4:01 pm

    One of, if not the fundamental principle of the United Nations is the right of a people to self-determination.

    That right of the Catalans has been crushed by a troika of darkness.

    Guterres the coward. Tusk the zealot. Sanchez the dictator.

  10. Old Dog
    Oct 27, 2019 at 4:38 pm

    Nick thanks for the great report and watch out for flying bricks!

    I lived in Barcelona shortly after Franco died. The prosperity that surged in the mid 70s and practically didn’t end until the 2008 crisis masked the Catalan reality: the wounds of the civil war never healed. Winners and losers from the civil war are still fighting. The winners want to continue enjoying the spoils of war. The losers are fighting to put a stop to the abuse.

    While those two groups continue fighting, the economy is falling relative to France and Northern Europe. Unemployment is still sky high, especially for the youth. There won’t be any relief for the youth in the next 10 years as the country’s prosperity was mortgaged in the 90s, 00s and 10s. The only way Spain can compete is by turning labor into slavery. If I were 20 years old and I was told that I have to pay a debt that I didn’t sign on to, I too would be mad as hell.

    • Brant Lee
      Oct 27, 2019 at 4:53 pm

      “as the country’s prosperity was mortgaged in the 90s, 00s and 10s.”

      Did you mean the U.S.?

      • nhz
        Oct 28, 2019 at 7:07 am

        Yes, or most of the Northern European countries that look prosperous to outsiders but have epic debts, especially mortgage debt. Dutch private debt is 270% of GDP, one of the results being that young people have to pay epic rents (over 50% of income, unaffordable for many) or sign up for a mortgage that you can never pay off with a normal job (but who cares as long as a downpayment is not required and mortgage rates are close to zero …).

  11. Crazy Chester
    Oct 27, 2019 at 4:43 pm

    Wolf: What happened to Don? Has he gone away? This used to be his beat.

    • Sancho
      Oct 27, 2019 at 8:01 pm

      Did he find his Dulcinea?

    • Oct 27, 2019 at 9:41 pm

      He’s now writing in his real name.

  12. Oct 27, 2019 at 5:07 pm

    Popular uprisings seem to spreading and, if we are fortunate, could be part of another great reformation.
    The last great experiment in authoritarian government run through the 1500s, corrupting the Church into a murderous and costly police state.
    It took until the early 1600s to ruin the economy. Too much in-your-face and in-your-wallet government prompted popular uprisings, that eventually bypassed or reformed institutional brutality.
    It evolved most successfully in England.
    Another way of looking at it is as a movement towards individual freedom and away from centralization. Which also involves regionalism.
    Both could be happening in Catalonia.
    Not to overlook what’s going on in North America, with the governing classes both scorning and taxing the “Fly-over” citizens.

  13. Just Some Random Guy
    Oct 27, 2019 at 5:12 pm

    I spent 3 weeks in Barcelona when I was 22. Time of my life.

    However, I never did understand how anything gets done in that part of the world. Everyone is always out eating or drinking. 10am, 2pm, 8pm, restaurants and bars are packed. I always wondered to myself, does anyone actually work?

    See also everywhere in S. America I’ve been.

    • Xabier
      Oct 28, 2019 at 6:28 am

      On average people work longer hours in Southern Europe than elsewhere.

      And they might start very early in the day too.

      More public holidays than in the States of course.

      State employees can be another matter, and are notorious for not putting in their official hours. A relation of mine only worked 50% of the time he was paid for as a university lecturer, which is not uncommon.

  14. Thom Payne
    Oct 27, 2019 at 8:00 pm

    Freedom. A concept now quite out of favor in most of the world.

    It is now accepted worldwide that George Washington should have written a nice letter to King George III, and offered to have polite talks in the even power relationship that always exists between King and subject.

    In which case, Americans would know the words to God Save the Queen and be even more fascinated with royal princesses.

    (This of course does not apply to any revolution sponsored by the CIA or MI-6, in which case people who throw Molotov Cocktails at police are celebrated as freedom fighters on CNN and the front pages of the NYT and The Guardian)

  15. Rat Fink
    Oct 27, 2019 at 9:57 pm

    There are many parallels between the Hong Kong and Spanish protests (although the HK protesters are not demanding independence).

    There are a few common denominators but the key one is the impact that the protests have on the economies of each place.

    If a large enough number of people have reached their breaking point and feel that they have nothing left to lose if they tip over the economy, and are willing to protest regardless of the measures taken by their government to try to stop them, then we have a very big problem.

    The governments cannot take the heavy hand and smash the protests because that would only accelerate economic collapse. And it would seem the protesters are well-aware of this.

    So they continue to pile on pressure expecting the government to eventually give in to their demands knowing full well that the government and elites have a great deal to lose if the economy blows up.

    It will be interesting to see if the China/Madrid governments blink as economic Armageddon approaches.

    Retail and tourism are getting smashed and the Christmas shopping season in underway; people are not shopping.

    If these crises continue until the end of the year, both places will be at the precipice in January.

    Will the governments hold the line or will they cave?

    When you are a student or young adult who is unable to rent or purchase a decent home looking on with despair as the cost of living ratchets up and your salary does not keep up, you don’t blink.

    When you are an entrenched elite and you see your business empire about to topple, you either blink, or you reach for the tissue to wipe away the tears.

    • Xabier
      Oct 28, 2019 at 5:46 am

      The ‘economic breaking point ‘ argument does apply to many of the young violent protesters in Catalonia: ten years of Brussels announcing schemes ‘to help the young’, and nothing changes in the Eurozone, above all in the South.

      Many employers are exploiting young workers terribly ( a cousin of mine included! We don’t speak…).

      But the political problem remains insoluble as any clash of competing nationalisms must be (Catalan, Basque, Spanish). Nationalist fanatics are the same whatever the state of the economy: obsessive, unable to compromise.

      Politics is totally sectarian, and which side you belong to is a family tradition (often derived from who shot whom in the Civil War) which you cannot ever depart from. The reasonable person is despised and isolated as a ‘traitor’.

      Guess why I live in England – one can breathe freely!

      Might go back to die though, as it is so beautiful, the mountains call, and England is being wrecked by still more cheap-money developments on farmland….

    • nhz
      Oct 28, 2019 at 7:20 am

      Agree about the many similarities, although one should also keep in mind the huge group of people that profit from the current system (like government workers who have gotten serious pay raises lately way above official inflation, homeowners with a mortgage who have profited hugely from ZIRP/NIRP policies etc.) and who will support anything to keep the status quo – even if they see that the current system isn’t fair. Politics is going to cater to their current supporters.

      I also see some similarity with the growing conflicts about climate change an other environmental problems: especially in Europe a large percentage is now aware of the need to act quickly – but only as long as they don’t have to compromise themselves on stuff like rampant consumption, cheap meat, thirsty SUV’s, multiple faraway vacations etc. Most governments cater to the groups that profit from the proposed “solutions” without making any real changes to the consumption economy (like EV’s that solve very little, “clean energy” that often isn’t clean at all, shuffling carbon credits so that big multinationals can make multi-billion dollar extra profits). It won’t work and the standoff will get worse and at some point the whole economy will suffer serious damage. I don’t think the elites will blink until it is too late.

  16. Susan K
    Oct 28, 2019 at 12:57 am

    I stayed in Eixample this last week. It was very quiet and hard to tell anything went down whatsoever. My friends stayed in Gracia and had slightly more action. Their posh hotel was stuffed with American kids soccer teams and hated how noisy the experience was. Of English speakers at the tourist sites, tapas restaurants, metros, etc., I’ve mostly heard American accents and very few British ones. Maybe Thomas Cook is decreasing the numbers here more than the violence. It seems like the Chinese will ultimately fill that gap anyhow. Sagrada Familia and Park Guell were both stuffed with Chinese tours. Our English tour on a sunny afternoon only had 7 participants.

    I found it interesting that mini protests will sprout where they see the police hanging out. They then disperse once the police leave. The counter protest yesterday felt more like a sports rally or tailgate party. Many of the Spanish flag wearers and carriers were simply brunching on the sidewalk cafes. And some of the older crowd looked like they were picnicking on the bus and park benches. I didn’t see any security to get onto Diagonal or go to Plaza Catalunya. I commented to my friends that all the people that came into town to represent the Unionists didn’t seem that passionate, almost as if they were paid by the campaign. In addition the Gracia eateries and cafes looked pretty happy to be getting their business.

    • nhz
      Oct 28, 2019 at 10:16 am

      Sounds very much like the squatter’s riots in Amsterdam around 1980 …

      while tanks were in some cases driving through the small city streets, crushing parked cars along the way, with hovering military heli’s and legions of military police roaming the area, bus stops or small business storefronts on fire and burning tires flying through the air, on the next street all could be quiet and citizens and tourists where enjoying their beer or coffee. It all was “unreal”.

      Heavily armed police forces seem to attract violent action, in some way understandable as they represent the responsible authorities who are clever enough to hide on such days. And difficult to say how much of the violence is organized or encouraged by the authorities in order to give the protesters a bad rap and justify harsh punishment in return.

  17. Oct 28, 2019 at 1:19 am

    This article has a decent description of the modern ramp-up of the independence movement:
    https://en.m.wikipedia.org/wiki/Catalan_independence_movement

    Roughly, Catalan was moving toward more regional autonomy and they lost a lot of ground in a 2010 Supreme Court decision as agreements were declared unconstitutional.

    The independence movement picked up as a reaction, but actual independence lacked popular support … most people wanted more say on where their taxes went, and more of their tax dollars to stay in Catalan. The Rajoy government was against this, favoring more centralized control of the Spanish budget, and Catalans responded with more calls for independence.

    The independence vote was pushed as a threat to Madrid, and they declared the vote illegal but it ultimately went through anyway. The Catalan leaders were arrested and Catalan autonomy was reversed by the Supreme Court in 2017.

    There was hope that both sides could work something out, but the rough prison terms of the Catalan politicians sparked the most recent flare up.

    I’m really glad I went to Spain in 2017 (Madrid, Granada, Seville, Valencia & Barcelona). It is a beautiful country and I hope they can somehow resolve things peacefully. That seems to be getting less likely all the time.

    Excellent report Wolff.

  18. X-Pat DE
    Oct 28, 2019 at 10:51 am

    … and never a word about this (nor the french yellow vests) in the nightly (German) news which instead reports about the unrest in Chile and Hong Kong and, of course, the never-ending BREXIT.

  19. Naresh
    Oct 29, 2019 at 3:17 am

    Sounds very bad for the tourists and this is terrible as we have not to many safe places to go California is burning and now Spain is falling apart iknis breaking apart canada is getting more and more boring sleepy Vancouver has no cigar lounge and closes by 10pm .. Hong Kong is ok if you need your had bashed in . I suppose russia is the only best place left .

    • Susan K
      Oct 29, 2019 at 2:42 pm

      Spain is not falling apart. Aside from a few rallies/parades/protests in a few neighborhoods that have happened, it’s business as usual. Tourist areas are crowded and plenty of foreign travelers were riding the trains today. Clubs and bars are full of party kids. What CNN is showing is sensationalized to look like it’s the whole country when it’s not even the whole city.

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