Last week, a story was picked up in the international media about the collapse of the Spanish real estate company Reyal Urbis owing banks, businesses and workers 4.75 billion US dollars.
It is the second biggest filing in Spain since property company Martinsa Fadesa defaulted on nearly 9.5 billion dollars of debt, precipitating the run on Spanish banks in 2008.
Every day in Spain there are a hundred stories of businesses going to wall, job losses and pay cuts, which don’t make international headlines.
Along with billions in debt, Reyal Urbis has left behind a ghost town of empty homes in Valdeluz, north west of Madrid. The town built for 30,000 people has come to represent the crisis in Spain.
Like a house of cards built on a Las Vegas gaming table, the speculative property market was the blackheart of the financial crisis in both Spain and Ireland.
In the boom years, thousands of young men were lured away from finishing high school to work in the lucrative construction industry.
Now they join the ranks of 56 per cent youth unemployment in Spain; one of the worst statistics filling the pages of economic briefings on leaders’ desks, leaving a lost generation of young people who may never fulfil their dreams from teenage years.
The coordinated response to stem the global banking crisis saw trillions of dollars of public money transferred to the banks, while 84 per cent of people who lost their jobs had no unemployment protection.
Many families have lost their jobs, even more their homes. Spain has the toughest mortgages laws in Europe – more than 400,000 people have been evicted since 2008.
These staggering numbers stem from Spanish law which sees banks seizing both the house on which the mortgage payments cannot be made, as well as the collateral to guarantee the loan.
For many parents in Spain it was commonplace to use their own homes as guarantees for their children to take the first step property ladder. Now parents on pensions and their jobless children are homeless.
‘For sale’ signs brand every other window in Madrid with the failure of austerity policies, like marks on the door warning of sickness inside medieval homes.
Crisis of leadership
The ITUC global poll found only 13 per cent of people believe that as voters they have any influence on the economic decisions of democratically elected governments. In the space of just a few decades, Spain has moved from a military dictatorship to an economic dictatorship.
Labour market reforms – dictated to countries by the IMF, European Commission and European Central Bankn troika, and accepted by the Rajoy government to calm the bond markets – have in an instant stripped away collective bargaining agreements and lowed wages.
With wages making up the lowest part of national profit, these are ideological cuts which pit workers against bosses, and do nothing to kick start an ailing economy.
Rajoy’s refrain of “we cannot spend what we don’t have” (used in nearly every speech from the Prime Minister) is monetarist policy in a sound bite.
We cannot grow jobs without investment, we cannot grow economies if we don’t earn. There are economic alternatives.
From a gathering of nearly 1000 workers in a packed hall in Madrid I heard the clamour for a plan, the shouts for hope.
We know how to build economies. It requires investment in jobs. The biggest medium term multiplier is infrastructure.
There is money to do just that. More than 21 trillion dollars sits in tax havens. Nearly seven trillion dollars is in corporate vaults of major companies, not being invested.
The EU can borrow money at no interest and help with a jobs and growth plan. Banks could pay back some of the public money given to them.
With pension funds, there is 25 trillion US dollars of workers capital invested in the global economy which is still going into hedge funds or speculative capital. This is money that could be spent in patient capital, in the real economy, in jobs.
Global leaders and the G20 can find one trillion dollars to invest in infrastructure to create jobs; less than half of what was liberally handed to the banks.
Meanwhile the havoc wreaked by austerity continues to take hold. This week France is asking Brussels for a budget reprieve and for the first time since 1978 the UK has lost its AAA credit rating.
As I left Madrid, demonstrators once again took to the streets to protest against austerity and economic corruption.
In the face of the misery vested on this country by the greed of the banks, the bond markets and the anti-worker ideology of the troika, people are determined to take a stand for their rights and their dignity.
Out of the fires of desperation, burn hope and solidarity.