Spain has a critical and essential employment problem: high chronic unemployment and job insecurity. Both of these are amongst the key causes of an embarrassing inequality, one of the worst in Europe. Then, to complicate the solutions, comes the problem of the high public deficit, which has increased over the last decade as an inevitable inevitability. A debt aggravated by its dependence on external financing with a bias towards instability. And at the heart of this debt is the chronic deficit accumulated over the last decade in the pension system, which widens its deficit every year.

The Spanish pension system works well, is efficient, even generous compared to other systems. It is essential to mitigate inequalities. But pensions are at the centre of the debate on the stability and sustainability of Spanish finances in the euro area. That is why European partners are concerned and are calling for intelligent and urgent reforms. Minister Escrivá’s speech in Brussels is credible, it sounds solvent; but he has to move on from muses to theatre, to action. And this step is complicated because it comes up against seemingly insurmountable obstacles and interests.

The minister is proposing a reform that Professor Elisa Chuliá describes as a “piecemeal reform” that reminds me of the so-called silent reform the landowner Flores de Lemus called for in the early 20th century for Spain. ((Chuliá’s recent work for the Círculo Cívico de Opinión, which we publish as a report in this issue, can be seen in full on the Círculo’s website)

This silent reform never materialised because the Spanish aristocracy and bourgeoisie, selfish and blind, prevented it, considering that paying taxes was a “disastrous obsession” of liberals and socialists. Now it is the trade unions and other interest and ideological groups putting the brakes on the reform of a pension system that can be sustainable and viable if it undertakes the necessary reforms. If it fails to do so, we will be heading for a crisis with serious social consequences.

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