Monday, February 20, 2012

Spanish protest against spending cuts and changes to labour rights

Protesters in central Madrid on Sunday.
Protesters in central Madrid on Sunday. Photograph: Andrea Comas/Reuters
Spain's conservative government faced its first mass protests on Sunday as hundreds of thousands took to the streets to demonstrate against austerity, spending cuts and radical changes to labour rights.
Madrid's central Puerta del Sol square filled for the first time since the "indignant" protesters camped there last May, as people gathered to protest against reforms introduced by prime minister Mariano Rajoy's government.
Protesters also marched through Valencia, capital of a heavily indebted and corruption-plagued region run by Rajoy's People's party, and Barcelona. Unions claimed more than half a million people demonstrated across the country.
The protests came two weeks after Rajoy, who became prime minister in December, introduced a labour decree making it easier for employers to fire workers and opening the door to wage cuts.
Rajoy's reforms are part of a programme designed to create jobs. Spain has the developed world's highest unemployment rate. But with the economy set to shrink this year by 1.7%, even the government admits the shocking 23% unemployment rate will rise in the short term.
Other reforms include a "golden rule" limiting future budget deficits and new rules forcing banks to write down the value of property they own and set aside money against bad real-estate debts left over from Spain's burst housing bubble.
Unions complained that labour reform would lead to a fresh surge in lay-offs. Rajoy himself has said he expects them to call a general strike soon.
"There has to be a general strike," said Alberto Carrillo, a teacher who protested in Madrid. "They've cut rights, but not said how they plan to create jobs."
"When we designed this reform we were thinking of the people who are out of work, who see no future," Rajoy told a party conference on Sunday.
His government has already cut €9bn in spending and hiked income tax as it struggles to meet an EU-set deficit target this year. It will have to find at least a further €30bn, however, to meet the current deficit target – though it is hoping that the EU can be persuaded to ease up on this year's target.
Austerity has already helped drive Spain's economy back into the second part of a double-dip recession, however, with the economy shrinking 0.3% in the last quarter.
"They're not looking to the future but to the next election with cuts dictated from Brussels," said Nacho Foche, a 27-year-old university researcher who was protesting in Madrid.

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