EU elections: Selling good news

When elections come, governments tend to pay utmost attention in cajoling voters. You only need a spell of luck to perform the trick. As the economic climate seems to turn milder, there are always some good news ready for sale. That is, for instance, the manifesto the Spanish ruling party is riding upon in the forthcoming European election. To underpin a decent outcome it undertakes a low-key campaign trying to deter people from flocking the poll stations. Campaign managers fear they might be tempted to cast punitive ballots, as the crisis wreaks havoc on anyone holding office.

No one believes his choice on the European Parliament will influence his personal welfare. The EU seems an endless discussion on futile issues taking place in Brussels. We are all too aware that real decision-making lies in Berlin. This election raises little interest in Spain as in most countries. Yet, should the party supporting government  fail to come first out of the pole, it could bolster rivals up to now resigned to spend long years in opposition. Only defeated politicians would readily concede this election has limited importance.

Can the Spanish government boast of reining in the crisis? On face value it is entitled to blow its own trumpet as the worst is over, and the economy seems to pick up once again. But comparing current performance with the deeply depressed one witnessed only a few months ago, amounts to a rather misleading self-satisfied mood. Moreover, the slow pace of recovery will hardly tackle the huge unemployement  built up over the last years. A grim outlook still looms ahead.

So long as government contents itself delivering good news, so much the better. Should it try to reconcile itself with voters, implementing populist measures, things might turn wrong. The obvious choice would point to a tax cut, thus reverting to the policy it endorsed before taking office. Yet, the need to keep deficit under close control does offer little scope for performing any bold move. For the time being, Spain faces such a huge collapse in public income preventing any extensive tithe reduction. Some slender gestures are expected in personal taxes. But any attempt to reshuffle wtaxes will have to wait for more favourable circumstances.

Brussels has already voiced its concern. It adamantly opposes any move potentially jeopardising the virtuous path to budgetary discipline. The scope for delivering more than good news seems too slim for taking the risk of an across-the-board tax cutting. Especially when the general election next year will need further ammunition to persuade voters.

About the Author

JP Marin Arrese
Juan Pedro Marín Arrese is a Madrid-based economic analyst and observer. He regularly publishes articles in the Spanish leading financial newspaper 'Expansión'.

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