No Spanish government is a blessing, not a curse, says Bloomberg

The very notion of a country enduring nine straight months without clear leadership is enough to send economists running for cover, but the curious case of Spain’s election impasse appears to be having the opposite effect.

Since last December when the country first went to the polls, Spain has been without a proper government. The nation voted again, in June, but again could not elect a majority among the various parties…

Little has changed since then. The respective leaders have given barely more than an inch, and where olive branches have been extended, recipients have been less than grateful. As it stands, Spaniards are likely to be asked to head back to the polling booths for the third time in a year, with Christmas Day the most likely date.

But while this all sounds like a recipe for financial disaster, the reality is far more rosy. In fact, political analysts at news platform Bloomberg actually believe that this prolonged deadlock could be something of a blessing for a country still tentatively feeling its way out of recession.

But why? And how? The stats do not lie – Spain is on course to grow its GDP by 3% this year, outperforming much of Europe. The reasons for this are manifold, but the chief reason why things have not derailed since December lies in the fact that Spain has a largely decentralised system of government, with strong local authorities and a professional and embedded level of bureaucracy throughout the country.

Unlike, say, the UK – where London is the all-consuming centre of power – Spain has many regional powerhouses, from wantaway Barcelona in Catalonia, Valencia’s robust economy along the Mediterranean, Seville’s de facto role as Spain’s cultural capital, and plenty of clout in the cities of Málaga, Santander, Bilbao and San Sebastián.

A summer tourism boom has helped, with job creation growing organically rather than fuelled by any sort of employment programme, while the labour reforms pushed through by acting Prime Minister Mariano Rajoy’s PP mean that businesses are able to make their own bargaining agreements with unions, which has helped to liberalise the job market.

Basically, the Bloomberg piece argues, Spain already has a series of policies and regulations in place to effectively run itself well, for the near future at least. Of course, some sort of leadership will be required when and if things need tweaking, but Spain currently resembles an airplane on cruise control – little further input is required, and things are going rather swimmingly.

Long may it continue, many believe…