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megimoo
04-07-2011, 03:37 PM
A case study on how incompetent politicians, blinded by postmodern socialist ideology and prone to reckless government spending, combined with voter apathy, can drive a nation into the ditch.

By taking Spain into a war with Libya, Socialist Prime Minister José Luis Rodríguez Zapatero was calculating that he could defy fate by diverting media headlines away from the fact that he has also led Spain to the brink of economic catastrophe. But like the haughty Babylonian King Belshazzar, drunk on the wine of narcissism, a dazed Zapatero has been forced to read the writing on the wall: He has been weighed on the scales and found wanting.

After a recent opinion poll showed that more than 80 percent of Spanish voters have lost their trust in Zapatero, making him Spain’s least popular prime minister since the end of the dictatorship of Francisco Franco in 1975, Zapatero announced on April 2 that he will not be seeking a third term in the 2012 elections. “I thought it would be best for the country,” he said.

The irony is that while many Spanish voters will be breathing a sigh of relief, Zapatero’s exit is likely to create even more problems for Spain than it resolves. Spain is hopelessly mired in the worst economic recession in its modern history, and Zapatero’s withdrawal from 2012 race has opened a power struggle within the Socialist Party. Analysts fear that any power vacuum may spook the markets and endanger Spain’s fiscal future by increasing its borrowing costs.

The political uncertainty in Spain comes as Moody’s Investors Service downgraded Spain’s sovereign debt rating by one notch on March 10 and warned of further cuts to come as it expects bank restructuring will cost far more than what the government expects. Moody’s says Spain may need up to €120 billion ($165 billion) to recapitalize its failing banks, even though the Spanish government and central bank insist they need no more than €20 billion ($30 billion).

At the same time, Spain announced on March 2 that its jobless rate surged to a 15-year record to above 20 percent at the end of February, the highest level in the industrialized world. The jobless rate among the young in Spain has soared to well above 40 percent, a figure that exceeds youth unemployment rates in Egypt and Tunisia. Overall, more than 4.7 million Spaniards are now out of work, and unemployment benefits constitute the largest single component of government expenditures.


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