Sanchez’ PSOE is back to stabilise and modernise Spain with the help of a European progressive alliance

Spanish socialist leader Pedro Sánchez's agendaSpanish socialist leader Pedro Sánchez

Gustavo Matías | Everything seems to indicate that Pedro Sánchez will be acclaimed as PSOE leader at the 39th Spanish Socialist Party Congress to be held 16-18 June. His political resurrection was as unexpected eight months ago as Jeremy Corbyn’s in the UK. He is proposing a new social pact to modernise and stabilise Spain, with its roots in a European progressive alliance, in the face of the current or upcoming neoliberalism crises, after the failure of third socialdemocratic way due to its excessive moderation. Positioning himself between Tsipras’ nominal radicalism in Greece and Macron’s social liberalism in France, Sanchez hopes to work with all of them. And in line with Costa’s left-wing alliance in Portugal, to make it possible for the European Union to offer an alternative to this neoliberalism which has been spreading since the 1970s and its populist consequences which govern the US and have grown in other European countries, on both the right and the left.

So the new PSOE, renewed as it was in the 1970s and with such a strong leadership, is looking for an alliance with the European progressive and democratic parties and greater superstate integration than the new plan of the current eurocrats agreed by populists and socialists, which won’t bow to Trump’s humiliations: instead of doubling military spending in NATO to 2% of GDP, security via cooperation from a European Defence fund. Its economic aims would be clearer: a Central European Bank like the Fed, with an added mandate on employment (Spain still has a third less jobs than in 2008), a fair and sustainable economy, which puts an end to “austericide”, substituting it with a policy of stimulus and investment in technology and the digital economy; partial mutualisation of Europe’s debt and a staggered waiver for countries suffering the effects of a bailout (Greece); a budget which represents 3% of EU GDP and is financed by community taxes, like a tax on CO2 emissions and a tax on financial transactions; the eradication of speculative and unproductive finances and shameful tax havens; social rights as a binding element of the Treaties, with a European unemployment insurance and a harmonised minimum wage; the mutalisation of debt, banking union and the single currency complemented with elements of social convergence; strengthened and pooled diplomacy, more active in the United Nations, the G-20, the IMF and the World Bank; support for sustainable development which puts an end to inequality and poverty gaps, more proactive with the Middle East, Latin America and Africa, and with 0.7% of GDP for development cooperation.

In the eight months since he was forced to resign after a kind of coup within the PSOE, supported by the socialists who govern in half a dozen of the regions, Sánchez has knocked down the main rebukes and prophecies used by rightwing politicians and media: loser, insecure and immature, in the hands of Podemos, a risk to stability, etc. None of these has been confirmed, although they insist on the risk of podemisation. This is because his criticism of the elite and of austerity policies would be taken from the 2020 electoral programme of Iglesias’ party.

On the contrary, without outlining an electoral programme, Sánchez is showing himself to be a tough opponent of the neoliberalism and centrism which he attributes to the Popular Party (PP) government. This toughness, which if it doesn’t achieve power will at least get more social policies out of the PP, is aimed at reigniting the electorate’s confidence and political illusion with an autonomous and participative project which is recognisable as a clear alternative to neoliberalism.

He has already been successful in the first two stages inside the PSOE party and hopes to corroborate this with the rest of the electorate in the next two. In the first place, in front of 187.360 card-carrying PSOE members, where he won an absolute majority with over 50.2% of the votes and do this in all the 19 regions, with the exception of those of his rivals: Susana Diaz’s Andalucia and Patxi Lopez’s Basque Country.

Secondly, in front of the over 1,000 delegates at the 39th Congress sent by the 19 Spanish regions, who will approve his programme prior to the renovation of socialdemocracy containing almost 200 pages, of which 72 will consist of 84 amendments against the PSOE management committee which took over from Cesar.

Thirdly, a proposal for a Federal State, starting with the creation of a parliamentary subcommission, within the Constitutional Commission, to engage in talks with all parties and decide on a reform of the 1978 Constitution to resolve the problem of Catalonia. The offer on the table would be maintaining sovereignity for Spain as a whole, while perfecting the plurinational character of the State in line with article 2 of the Constitution.

And in fourth place, foster a new social contract either from the opposition ranks or from the government itself. The objectives of this contract would be to create jobs, provide decent salaries, and divide up the work  (a 35 hour week) to integrate these groups and avoid the increasing risks of poverty now and in the future which will be the result of digitalisation. Also not exclude from this future a basic income, with a minimum income objective, by way of tax benefits which operate like indirect income transfers. With measures like the revoking of the PP’s labour reform and the Grades Law (3+2), he is trying to recover the level of salaries’ contribution to GDP in 2011 (20.000 million euros more), offering a minimum wage of 1.000 euros per month by 2020, up to 60% of the average salary established by the European Social Charter. He also wants to promote active policies to create jobs (which the PP government and even that of Susana Diaz put the brakes on). These would be financed by eliminating the current bonuses for hiring workers and creating a new integrated service of training and employment in every region particulary focused on young people. All of this along with higher education spending (up to 5% of GDP initially and 7% in the medium-term, with 2% earmarked for universities), as well as public support of over 3% of European GDP for R&D.

Then other tough measures to deal with monopolies and social responsability, as well as complementing the GDP indicator with an Index of Sure Progress (IPS in the Spanish acronym, the same initials as Pedro Sánchez has). This would published at the same time as the official GDP figures, and in line with the objective declared by Germany’s SPD party in 1959 in Bad Godesberg: “as big a market as possible, and enough State as necessary.”


About the Author

Gustavo Matias
Gustavo Matías, Doctor of Economics and Business and graduate in Media Studies, is Professor of Economic Structures, Economic Development and International Institutions at the Autonomous University of Madrid. He directed for ten years the first Spanish PhD course on New Economics of the Information & Knowledge Society.