present crisis of the After going through a brief upswing in 1969, the Spanish economy entered a declining phase that lasted until the end of 1971. Then there was a new wave of expansion that lasted until 1974. The first signs of upturn had appeared around the end of 1971, and they were totally confirmed in 1972, opening the road to one of the most prosperous phases of Spanish copitalism.(1) Let us look briefly at some of the characteristics of this expansion, for it is important in understanding the nature of the recession that presently marks the process of monopolist accumulation in the Spanish state. The rapid expansion that began in 1972 is fully reflected in the growth rate of gross domestic product (GDP) during the past few years. Thus, the growth rate rose from 4.7% in 1971 to 7.7% in 1972 and 7.9% in 1973. This strong growth was due fundamentally to the expansion of industrial production. The growth rate there was 3.9% in 1971, rose to 10.7% in 1972, and stood at 9.5% in 1973. It is surprising and interesting to analyze the fall in the growth rate for agricultural production, which declined from 6.1% in 1971 to 0.8% in 1972, rising again to 5% the following year. The agricultural crisis The crisis of agricultural production has several consequences that are important to point out here. First, it entails a permanent deterioration in the agricultural trade balance because of the growing need for imports. The deficit tripled in three years. It rose from 12, 274 million peselos in 1971 to 24,511 million in 1972 and to 35, 768 million in 1973. (1 peseta-USS0.02.) Second, the agricultural crisis leads to the perpetuation of protectionist policies for certain basic agricultural products, production 28 the spanish cconomy by J.P VARGAS of which is stimulated by the rise in prices. Of the 14.2 points of increase of the general cost of living index in 1972-73, fully 8.5 points were due to increases in the prices of food products. Thus, the price policy favoring agricultural products is transformed into one of the major causes of the present acute inflation, to which we will return further on. Third, this agricultural crisis does not affect all agricultural production in the same way. The agrarian crisis is mainly a crisis of small-scale production, which every day becomes less capable of competing with large landed property, the latter being strengthened by the mechanism of differential rent, the appropriation of surpluses as a result of the protectionist and price-support policies, and the process of mechanization, which especially favors large-scale property - (2 But what is most important to point out about this agrarian crisis within a more general perspective is that for the first time it is not having serious repercussions on industrial production. That is, agricultural production has ceased to play the significant role that it had previously played in the very parficular development of the capitalist mode of production that prevails under the Spanish state.
From the 1972-73 industrial boom to the present recession But let us center our attention on industrial producfion, for it is in this sector that the important expansion has been concentrated. We can note increases of production in all industrial branches in 1973, with the exception of the extractive industries and certain sectors of the chemical industry and of the textiles, artificial fiber, and shoe industries, al-
though production did expand in the latter two branches taken as a whole. The figures in table 1 give an idea of the expansion of industrial production.
GDP in current prices
GDP in constant prices
Utilization of productive capacity
Productivity per capita of active population
Productivity per employed person
Source: Ministry of Industry
*Revised, nondefinitive figures.
**Provisional figures,
Production of capital goods
Construction (including housing)
Import of capital goods
Export of capital goods
Investment in capital goods
Total investment (apparent)
Source: Research service of the Ministry of Trade
*Serial index, 100 equals the same period of the previous year.
TABLE 3
Industrial Production in 1974
Bose: 1962-100
Monthly
(compared with
General
Month
Index
371.2
January
10.7
Februory
359.7
3.1
-
March
381.0
5.9
April
372.0
2.4
-
380.2
2.2
May
382.0
June
0.5
July
354.2
7.3
-
August
281.8
- 20.4
350.7
24.4
September
October
375.4
7.0
November.
348.1
7.3
-
330.3
December
5.1
Source: National Institute of Statistics
Such an expansion of the industrial sector and of the service sector entails a big rise in investment.
Table 2 indicates this expansion of investment in all its components.
TABLE 1
Growth Rate in %
1971
1972*
1973**
10.5
17.6
21.4
4.6
10.9
10.1
89.0
83.0
87:0
2.0
9.3
7.8
2.9
8.3
7.5
TABLE 2
Apparent Investment in Fixed Capital*
Annual Averages
1971
1972
1973
98.3
116.4
123.1
106.1
115.9
120.2
98.8
149,4
121.0
130.3
132.4
113.2
95.0
125.9
123.9
99.5
121.6
122.4
Variation in %
Tendency
Annual
(compared with
(Index)
preceding month some month of preceding year)
16.9
355.9
14.0
358.1
13.4
364.3
17.1
363.2
12.5
362.1
12.6
361.0
9.3
358.7
9.8
358.8
4.2
354.1
7.5
352.5
2.6
351.0
1,5
29
SPAIN
But as early as the last quarter of 1973 there was a deceleration of the demand for investment, the real motor force of the rapid pace of activity of the
Spanish economy. (3) Thus, by the second half of
1974 three factors emerged that slowed down the expansion of investment. First, there was a decline in domestic demand for consumer goods, which originated in the price increases resulting from the acute inflation. Second, the increase in the costs of production ruined many construction companies, provoking a serious decline in production in this important industry. Third, the cancellation of investment programs was reflected in the deceleration of the growth rate for the demand for investment in capital goods. The consequences of the deceleration of investment were reflected in a fall in industrial production, as is indicated by the index of industrial production. (See table 3.)
Growth of unemployment
As we stressed earlier, the sectors most affected by the regression have been mainly those related to consumer goods (food, drink, and tobacco, textiles, clothing and shoes, etc.). This decline is confirmed by a most reliable employers' source.(4) Table 4 clearly indicates the pessimism that is afflicting the employers.
Year and
Order
Month books
1974
11
January
February
1
March
April
May
June
July
- 1
August
1
September
-18
October
-20
November
-26
-32
December
1975
January
-37
Source: Ministry of Industry
30
The immediate consequence of this recession has been an increase in layoffs. Unemployment increased throughout the year in all the various sectors, especially in construction, thus confirming the slowdown in activity in that industry that we have mentioned.
(See table 5.)
The problem of unemployment is being aggravated by the notable decline in the rate of emigration, especially to the countries of the Common Market, which have been seriously affected by the crisis and where the intensification of unemployment has led to quite restrictive measures on the immigration of workers. This fall in the rate of emigration has an additional important consequence: its impact on the balance of payments, because of the decline in the amount of currency sent back by the emigrés, which has been one of the most important factors in
"stabilizing" the development of Spanish capitalism.
Balance of payments deficit and inflation
This fact indicates the necessity of considering the crisis of the Spanish economy within the general framework of the crisis that is now shaking the whole imperialist chain. In this sense, one can observe a worsening of the trade deficit for 1974 as compared with 1973, with a manifest tendency toward more TABLE 4 Employers' Estimates All Industry Excluding Construction Construction Inventory Predicted Volume Volume tendency of of work production contracts done -12 -1 1
0 -1 0 250 IN -N
-1 12
16 -13 16
TABLE 5
Unemployment
Year and
Sectors month
Industry agriculture
- Construc:
Tota
1974
25,745
47,077
January
29,925
February
45, 937
March
34,719
44,485
33,883
46,969
April
22,079
47,914
May
19,738
48,876
June
21,233
50,798
July
25,112
54,843
August
September
25,563
56,990
26,985
October
63,082
November
40,862
74,361
42, 229
85,709
December
1975
48,921
96,376
January
Source: Ministry of Labor rapid growth of imports than exports. It is obvious that one of the main causes for the growth of imports has been the price increases for fuel. It is also important to stress that there was a decline of 4 million in the number of tourists in 1974 compared with
1973. This decline has meant that the positive balance of the income and expenses for tourism, another pillar of the development of Spanish capitalism, will be practically the same in 1974 as in 1973
(the decline in the number of tourists being compensated by price increases). This has entailed a reduction in the level of currency reserves from
$6, 625.7 million in January 1974 to $5,961 million at the end of 1974.
During the previous phase of expansion, the rate of inflation reached 14.2% per year (in 1972), the highest rate since 1959, that is, since the beginning of the period of consolidation of the accelerated accumulation of monopolist capital in the Spanish state. In 1971-72 the increase in the general cost- of-living index was 8.3%; in 1972-73 it was 11.4%.
This index continued to rise, as did the price index, throughout 1974, thus demonstrating the persistence and intensification of the inflationary process going on during the crisis. (See table 6.)
The factors that can be listed as directly linked to
Estimated unemployment (number of persons)
Total est. Tendency unemployed (thousands Services of persons/ 102, 619 32,865 161,229 156.7 102, 581 32, 183 164,689 158.1 100,998 33,310 169,027 159.3 104,130 33,525 171,538 162.4 106,552 33,896 162,527 166.0 105,447 33,647 158, 832 170.7 108,312 36,074 105, 519 176.2 115,248 36,506 176,806 183.9 120,169 37,350 183, 082 196.7 128,954 38,490 194,429 211.6 146, 006 43,675 230,543 227.5 160,463 46, 100 248,792 246.5 178,729 53,954 281,004 265.6 this inflationary process are several. We have already listed some, like the agricultural policy, but we must stress those whose origin is purely monetary. Throughout 1974 there was a persistent increase in cash offers in which the private sector was clearly the most important and most active factor of variation. As usual, there was an attempt to pass the costs of inflation on to the working class. In fact, among the well known measures of economic policy contained in the law-decree of November 30, 1973, the only really effective one was the measure freezing wages. (5) But the exceptional character of the Spanish state, which reflects the Spanish bourgeoisie's inability to establish a hegemonic political leadership, has not prevented the conjunction of economic crisis and social crisis, which characterizes the present situation. (6) This is sufficiently demonstrated by the rise, intensity, and breadth of workers struggles since the end of the 1960s. (7) And it is precisely the existence of this state form that is transforming many of these economic struggles into political struggles, making the Spanish state objectively one of the weakest links of the imperialist chain today. The depth of the present crisis and the inability of the state apparatus to deal with it is perfectly illustrated in the resumé of the report of 31
SPAIN
TABLE 6 Cost of Living Base: 1968-100 Year and General Monthly (commonth Index vious month 1974 January 151.3 0.60 February 151.8 0.33 March 155.1 2.17 April 158.5 2.19 May 160.5 1.26 June 161.2 0.44 July 163.7 1.18 August 165.8 1.66 September 168.4 1.57 October 170.2 1.07 November 174.9 2.76 December 177.3 1.37 1975 January 179.9 1.47 Source: National Institute of Statistics the Agrupación de Periodistas de Información Eco- one d the nómica that was published in the April 22, 1975, issue of the Madrid daily Informaciones. One of the most important paragraphs of the report explains: "For various reasons the administration. refrained from acting in a significant manner during the critical four-month period of November to March, during which the cost of living went up by more than 6%, $500 million of currency reserves were lost, collective labor conflicts tripled, the peseta suffered considerable devaluation, and, in the final analysis, productive activity experienced the deepest decline of these past ten years." There is not sufficient space here to analyze the more structural aspects of the present economic recession in Spain: the inability of Spanish industrial products to compete on the markets of imperialist countries; the much lower level of Spanish wages relative to wages in the other imperialist countries of Europe, which implies a more limited (and more vulnerable) domestic market for durable consumer goods; the sharper dependence of Spanish industry on foreign capital, especially in the realm of importing advanced technology; the negative consequences from the standpoint of Spanish capitalism of Spain's exclusion from the Common Market; the risks of the permanent collapse of the "privileged" market for Spanish capitalism that had been represented by the Portugal of, Salazar-Caetano, and so 32
Variation in %
Tendency
(Index)
Monthly acpared with precumulation
(compared to previous December)
151.8
0.60
0.93
153.8
3.13
155.8
5.39
157.8
6.72
159.7
7.18
161.8
8.44
163.8
10.24
165.6
11.97
168.3
13.16
171.1
16.29
174.1
17.89
177.0
1.47
179.0 on. We will return to these questions on another occasion.
Footnotes:
1. J. Muñoz, S. Roldón, J.L. García Delgado, and A. Serrano, La Economía Española 1973. Madrid:
Edicusa, 1974, p. 17.
2. J. Muñoz, S. Roldán, and J.L. García Delgado,
La Economía Española 1972. Madrid: Edicusa, 1973, p. 68.
3. Coyuntura Económica Española, Información
Comercial Española, No. 490, June 1974, p. 34.
4. The index of production does not take account of the so-called small and middle-sized companies, which are in general more strongly affected by the crisis and play an especially important role in the particular character of monopolist accumulation in the Spanish state.
5. La Economía Española 1973, op.cit., P. 77.
6. E. Mandel, "The Generalized Recession of the
International Capitalist Economy, " INPRECOR,
No. 16/17, January 16, 1975, and "La récession et la combativité de la classe ouvrière, " Le Monde
Diplomatique, November 1974.
7. The number of working hours lost due to strikes in the Spanish state in 1969 was about half a million;
in 1973 it was more than 12 million. See E. and A.
López Campillo, "La stratégie des Commissions Ouvrières, " Le Monde Diplomatique, February 1974.