Three Factories, Two Countries and One Long, Hot Summer | Edward Anderson
A sigh of relief in Sunderland is a cry of despair in Barcelona.
Here in Santander, people have begun to leave the hibernation of flats to bathe in the sun and now feel safe enough to take their pigs for a walk (don’t ask). However, as enjoyable as the weather on the beach has been, we are about to have an ocean of lay-offs as the tide rolls back. The Nissan factory in Barcelona is just one of many.
In the UK, workers in Sunderland are entitled to a pint or two in relief that their factory will stay open but last week Nissan announced that all 3 factories in Barcelona would go, leaving thousands out of work and the knock on effects on thousands more.
In truth many people have feared this decision for a long time and with Nissan having posted a €200 million loss (their first loss in over a decade) for the October – December 2019 quarter, combined with Covid killing demand, it was clear that Sunderland and Barcelona wouldn’t both survive.
However, it is likely that Covid has pushed what may have been a staggered process into a bombshell being dropped on people in a city where motor vehicles made up roughly 10% of the Catalan economy. If you don’t think that sounds like a lot, tourism made up 12% and the horrific damage tourism has done to the ability of people in Catalonia to start families is not the case with car manufacturing. Predictably, the protests captured the public mood that the starting gun had been fired for the culling of staff to begin in other companies and that has proven to be true.
What you won’t have seen in the UK but is perhaps more insightful for the damage that will be inflicted upon Spain was the closure of the last aluminium making plant in Spain from Alcoa, in the province of Lugo. The direct loss of 500 jobs is the hollowing out of Spanish industry, sucking out well paid jobs in a region where good jobs are hard to find. In announcing the closure, Alcoa alluded to the fact China makes 60% of the product in the world and have been able to collapse the price. Whether this trend of allowing key industries to be monopolised by the Chinese state (to turn on and off at will) is allowed to continue is a question for another time but there is already talk in Spanish political circles of selling Barcelona as a place to bring back large amounts of the medical production that has allowed the Chinese to have Europe over a barrel.
The short-term effect will be to accelerate the long-term decline of provinces outside of Madrid and Barcelona. An exodus that had fallen to a trickle will be a flood as the few young people that are left try to scramble out of a province that has lost 60,000 people in 30 years and most probably, flee the country too.
Faced with these immense challenges, how has the Spanish political class acted in recent days? Well, Vox decided that the best way for their supporters to protest a lockdown where they are confined to small spaces was to leave their homes to climb into an even smaller space to sit in traffic (with their stunt blocking an ambulance here in Santander). The Spokeswoman for PP in Congress, Cayetana Álvarez de Toledo, accused the father of Pablo Iglesias (the current Deputy PM) of being a terrorist. Not to be outdone, Iglesias has already stated that he believes Vox would love to launch a coup but aren’t brave enough to do it (this is a country where less than 40 years ago a section of the army did just that). In short, Spanish politics has lived down to its reputation.
Away from the circus, Ciudadanos (if you require a lazy political comparison, think Lib Dems as both have been decimated in recent elections) have agreed to continue the state of alarm with money promised for the tourism sector. However, this should be the fear for every conservative in Spain that in the midst of this crisis, instead of using it as an opportunity to reset the priorities and path of the nation, Spain will continue to march down the road that has made secure housing impossible for a generation and led to a society where only the rich and the desperately poor immigrants are prepared to have children.
A secure, long term job at Nissan or Alcoa is objectively better than a non-contract job selling beers to the modern tourist, who with the proliferation of AirBnb (a model that all conservatives should wish to eradicate) are putting unsustainable pressure on housing and has destroyed the European style housing security that was the compromise for a lack of home ownership. The disaster of modern tourism (just like smoking rooms, there was a reason why hotels existed) has led to a long- term problem even before the crisis. Now, with Spain desperate for any cash it can get, it is about to double down on a model that is going to walk the country off the demographic cliff.
I do not have a crystal ball but I am decidedly less optimistic than I was at the start of this crisis for Spain and the potential for renewal. A lot of people will get a final ERTE payment in June then their contract is up. Unemployment is predicted to be above 20% at the end of the year for the fourth time in the post transition era. The impossibility of people to afford kids before the crisis could now mean that an entire generation sees the slim chance to have a family disappear forever.
The influx to the few cities that do have work will see them in direct competition with tourists who have led to the speculative boom that allows landlords to leech millions in whilst contributing nothing. The pressure on Catalonia and their capital, a place that has been a battleground between the Spanish State and the separatists for years, is going to be immense as they head for yet another election before years end.
Spain is set for a long, hot summer and it might be on fire before the year is out.