What kind of future does Spain have?

By Alex Barrera on August 16th, 2012

Seemingly unaware of the hopelessness of its strategy, the current Spanish government keeps deploying austerity measures in an effort to keep the country afloat. But recent hints of full bail-out for Spain demonstrate that the hull is leaking faster than it can be corked. What most are failing to see is that, while focused on the immediate hemorrhage, no one is considering how to steer the boat to a safe harbour, lest it capsize entirely.

Spain needs to fix its current situation but many in the country think short-term stop-gaps are enough. Mediterranean countries suffer from a lack of long-term thinking. I suppose you can’t blame us, given the quality of life we have. But it’s heartening to see more and more Spaniards taking to the streets to oppose the drastic, myopic and short-term measures Prime Minister Rajoy is imposing on his fellow citizens.

The question is: if the short-term plugs aren’t enough, what kind of strategies is the Government pursuing to kick-start the healing process? Many in Spain still remember the words Zapatero, the former Spanish Prime Minister, uttered back in 2009: “The economic future of Spain depends on innovation, environmental sustainability, education and social policies.”

Many during that period were excited to learn that the Government was finally willing to take steps to move away from basic industries like real estate in favor of innovation in science and technology. Of course, that wasn’t what happened. In fact, things got worse. It got so bad that Nature went on the record criticizing such policies.

So while the real estate industry was going down in flames, most of the interested parties were simply… waiting for it to come back. Much was said on innovation in science and technology. Every day there someone appeared on the news to remind us how important it was for the future of the country that we diversified our industries.

But we should have known better. Spain ranks 87th in the Global Innovation Index, behind Ghana. It’s 36th in the Global Competitive Index ranking from the World Economic Forum for 2012.

While the economic situation deteriorated and Zapatero’s socialist government was ejected from power, the right wing party, PP, led by Mariano Rajoy, took over by the end of 2011. Spaniards, desperate for a change, listened eagerly to the promises the new Prime Minister made during his investiture speech:

“[…] a new fiscal framework is needed to match the necessities of entrepreneurs, who will have an essential role during the economic recovery of the country and have a priority within our reform program. […] An agenda wouldn’t be complete if we didn’t offer a complete strategy for how to raise the competitiveness of our economy, embracing all industries, especially those with a bright future … the much needed investment in innovation and internationalisation of Spanish companies.”

Fast forward to July 2012. Where is that investment in the future of Spain? Or was it just lip service? Because cutting down science budgets by 22.5 per cent in only the last year doesn’t look like progress to me. How can you defend cutting the top scientific grants in the country from an already weak 250 in 2010 to 175 in 2012? A quick peek at the 2012 science budget from the US makes the whole situation seem surrealistic.

There’s more. How about we check how many students are signing up for science and technology degrees? Engineering degrees have seen a 20 per cent decrease in enrolled students since 2008. Computer Science has seen a decrease of up to 40 per cent in the same period. These numbers are a little misleading, as Spain has been undergoing a change in higher education structure, but the overall picture is a decrease in the number of students enrolling in science and technology degrees. How is the Government planning to foster innovation in such circumstances?

The more you dig into the state of scientific research in Spain, the more uncertain the future looks. According to a now infamous science law approved in December 2011, the Government had one year to establish what has been called the National Research Agency, an organisation that would centralize the funding for research and development in the country. While most were focused on the crash and burn spectacle of the Spanish financial system, few knew that the Government postponed the creation of the agency until 2013, something that is in violation of its own law.

On the entrepreneurial front, the news isn’t great either. An over-hyped “entrepreneurs’ law” is yet to see the light after eight months on stand-by. With the implosion of 222,000 business during the last four years, it would seem such a law is badly needed but, of course, the Government is in no rush to touch anything except banks and real estate projects.

The decrease of students in all science and technology fields is bad enough, but if you factor in the staggering numbers of Spaniards fleeing the country – 40,625 in the first semester of 2012, according to INE data, the picture is dramatically worse. It’s hard not to feel empathy for those who leave Spain when all the Government seems able to do is waffle and raise taxes.

Foreign investment dropped like a rock by 57 per cent in 2009, staying low in 2010 and only slightly picking up in 2011. According to my sources on the ground, the 2011 increase is essentially a reflection of foreign fortunes going on sale with Spanish corporations, more of which we’ll see in 2012.

All in all, there hasn’t been a single law, a single program, a single agency, a single anything that has been created in these past four years that sustains the claim that Spain is investing in its future. I believe we’ve reached a point where Spaniards need to step up and dig themselves out of this mess. There no options left except the effort and sacrifice of unnamed heroes within the country.
It’s time to stop waiting for the Government to come good on its promises and take matters into our own hands.