Spain Elections- Rajoy just inherited 22% unemployment
Right wing winds are spreading in Europe as the “crisis” go even deeper. In today’s Spanish elections, Mariano Rajoy, ended as the winner. With the enormous problems Spain is facing, Rajoy will have a hard time trying to fix the 22% unemployment, the collapsing property market, and an economy everybody thought would grow forever, just as long as the English would buy houses in Spain. The housing boom is a memory, and people have not adjusted to the “new normal”. With the bond vigilantes awake, Raloy will probably have to start out by a “light” bail out Spain is facing. From Bloomberg;
People’s Party leader Mariano Rajoy won the biggest parliamentary majority in a Spanish election in 29 years and called on Spaniards to work together to prevent the nation being overwhelmed by the sovereign debt crisis.
The People’s Party won 186 of the 350 seats in Congress compared with 110 for the Socialist Party’s candidate Alfredo Perez Rubalcaba, based on 97 percent of the vote counted. That’s the worst showing for the Socialists since Spain returned to democracy in 1978.
“Today more than ever our destiny is played out in and with Europe,” Rajoy said in an acceptance speech in Madrid. “We will stop being a problem and become part of the solution again.”
We wish him good luck. Some more from El Pais;
The circumstances of the changeover in power could hardly be more daunting for a new government, with five million Spaniards out of work and a financial crisis which is forcing the Treasury to offer interest rates on its sovereign debt similar to those of Greece before that country turned to the IMF and EU for a bailout.
Spain’s obligations to its euro-zone partners, as part of its program of returning to fiscal rectitude, will require a budget cutback of some 21 billion euros in 2012 in order to reduce the deficit to 4.4 percent of GDP.
Rajoy has been tight-lipped on what budget items he plans to cut back on, singling out state pensions as one area which will remain untouched. Instead, the conservative leader has stressed the competence in economic among his party’s team, although he has dropped no hints about who will occupy the key ministerial posts.