Politics

As part of the strategy to create state structures and to get a new fiscal agreement between Catalonia and Spain, the Catalan Government and the four Provincial Councils, all run by the Centre-Right Catalan Nationalist Coalition (CiU), have created the embryo of Catalonia’s Treasury. They will merge exiting structures, in terms of facilities, staff and resources, to create a single body to collect all taxes at local and Catalan level at no extra cost. The pillar for the future Catalan Treasury’s formal birth ceremony comes the day before the crucial meeting between Catalonia’s President, Artur Mas, and the Spanish Prime Minister, Mariano Rajoy. Rajoy has already said he will not accept a specific fiscal agreement for Catalonia.

In a very unusual movement, Juan Carlos I has issued a short but clear letter one week after the massive demonstration for Catalonia’s independence. The King emphasised the need to remain “united” and asked the people to retake the “values” of the “Democratic Transition”, such as “dialogue” and “the sacrifice of particular interests for the general good”. The Catalan Government does not feel “concerned” by the King’s letter. However, it states that Catalonia “offers solutions” and “does not chase pipe dreams”. Spanish nationalists celebrate the King’s words while PM Mariano Rajoy still remains silent. Catalan and Basque nationalists criticise the King for taking sides and not emphasising values such as “pluralism, diversity, tolerance, and respect for discrepancies”.

The Catalan Socialist Party (PSC) is against independence but supports claims for greater self-government and fiscal autonomy for Catalonia. The PSC’s Secretary General, Pere Navarro, proposes a “preferential bilateral relationship” between Catalonia and the Spanish Government, within an “asymmetrical” federal Spain. However, the Spanish Socialist Party (PSOE), which is formed by federated territorial parties such as the PSC, seems to evade the question, at least for the time being. The PSOE’s Secretary General visited Catalonia for the first time after the 1.5 million strong demonstration for independence and did not mention the word “federalism” a single time.

The Autonomous Communities are responsible for 18.7% of Spain’s global public debt, while they manage around 40% of the country’s public spending. The Spanish Government’s share represents 76.8% of Spain’s global debt, which reached €804.39 billion at the end of June. Spain’s debt is now 75.9% of the GDP. The Catalan Government has a debt of €43.95 billion. The day before, the Spanish Finance Minister announced that the Catalan Government had a 0.59% deficit for the first half of 2012. Furthermore, Catalonia suffers from a structural fiscal deficit due to Spain’s fiscal redistribution scheme, which annually takes away 8.5% of its GDP, a €17 billion annual solidarity contribution.

By the end of the year, Catalonia must meet a 1.5% deficit target. According to the Spanish Finance Minister, Cristóbal Montoro, the Autonomous Community governments are heading “in the right direction” to honour the deficit objective for 2012. The Catalan Government had a 0.38% deficit at the end of July, according to its own sources. This represents a €767 million deficit, while at the end of July 2011 it had a 2.09 billion deficit, which represents a 63% deficit reduction.

At a conference in Madrid, the President of the Catalan Government, Artur Mas, warned Spain about the “great mistake” of downplaying the massive demonstration for independence. No members of the Spanish Government or leaders of the Socialist Party (PSOE) attended the event, which is unusual. In front of a crowded audience with many foreign press, Catalan MPs and businesspeople, Mas explained that Catalonia “has been trying for decades to reform Spain to make it our state”. However, Catalans are now “tired” from “the lack of respect” and the “disloyalty”. “If Spain denies the fact of Catalonia being a nation”, “many issues will not be solved”. Then “it is logical for a people to solve their future “peacefully, democratically and in a strictly European way”.

“Listen, and listen carefully. Do not get angry if you don’t like what you see. And put solutions on the table, if you have them”, the President of the Catalan Government, Artur Mas told Spain the day after the 1.5 million strong demonstration for Catalonia’s independence. He also stated he will work to create “state structures”. The Spanish Government refused to comment directly on the event, stating it should be analysed “coldly”. However, it said Spain and Catalonia should have other priorities.

In the largest demonstration Barcelona has ever seen, 1.5 million citizens according to the Catalan Police marched in Catalonia’s capital after the banner “Catalonia, Europe’s new state”. The Spanish Government reported a reduced number of 600,000 participants while organisers talked of 2 million participants. The Catalan President did not attend it because of his institutional position, but gave his support at a personal level. Most of the Catalan Government was present. Members from most of the Catalan political parties were also present, including the Socialists (PSC) but at a personal level. The only absentees were representatives from the People’s Party (PP) and anti-Catalan nationalism ‘Ciutadans’ (C’s). Many families gathered for the demonstration which ended with the petition to start the secession process.

However, the Commission also clarified Barroso’s words from late August. A Commission Spokesman said hours before the kick off of the independence demonstration that in the case of secession from Spain, Catalonia would no longer be part of the EU. A negotiation process to join the EU would be required. However, other EU sources stated that the hypothetical new state may have the same benefits of a “transitional” member. They also added that the accession process would be “faster and easier”. Catalan citizens have been net contributors to the EU for decades and are currently considered European Citizens, but this is “additional”, according to Barroso.

The President of the Catalan Government, Artur Mas, leader of the Centre-Right Catalan Nationalist Coalition (CiU), sent a warning message to the rest of Spain and in particular to the Spanish Government. “If there is not an agreement on the economic bases”, “Catalonia’s way to freedom is open”. The Spanish Prime Minister and leader of the People’s Party (PP), Mariano Rajoy, stated on Tuesday morning that Spain and Catalonia should have other priorities. The Spanish Government and most of the rest of Spain are against a new fiscal agreement between Catalonia and Spain, reducing the Catalan solidarity contribution, which represents some €17 billion per year. Furthermore, the Catalan PP has stated it will stop giving its parliamentary support to CiU.

Catalan nationalism has changed over the years. Most Catalan nationalists have now concluded that Spain will never accept a plurinational state, will not fully respect Catalan language and culture, will continue threatening Catalonia’s self-government, and will not accept a reduction in Catalonia’s fiscal contribution to the rest of Spain, which annually represents between 6.4% and 8.7% of the Catalan GDP. Catalan nationalists are now tired of negotiating these issues and have come to the conclusion that Spain will never accept a comfortable place for Catalonia within the Spanish state. Now, 51% of Catalans citizens would vote for the independence in a hypothetical referendum.