Azeri paper attacks Sassounian for saying Azerbaijan wastes … Armenian Weekly
Azerbaijan’s President Ilham Aliyev has accused the United States of siding with Armenia in the ongoing border dispute between the two South Caucasus countries. In a phone call with U.S. Secretary of State Antony Blinken on Monday, Aliyev expressed his dissatisfaction with the recent American actions in support of Armenia, which he said had jeopardized the U.S.-Azerbaijani ties.
According to a statement from the Azerbaijani presidential office, Aliyev criticized the U.S. for providing humanitarian and military assistance to Armenia, waiving the Section 907 of the Freedom Support Act that had barred such aid since 2002. He also denounced the U.S. for expressing concern over Azerbaijan’s establishment of a checkpoint on the Lachin corridor, a vital road that connects Armenia with the breakaway region of Nagorno-Karabakh.
Aliyev claimed that the checkpoint was necessary to ensure security and stability in the region, and that Azerbaijan had the right to control its own territory. He also reiterated his demand for Armenia to open a “corridor” along its southern border, linking mainland Azerbaijan with its exclave of Nakhchivan, which borders Turkey and Iran. He warned that if Armenia refused to do so, Azerbaijan would solve the issue “by force”.
The phone call came amid renewed tensions between Armenia and Azerbaijan over Nagorno-Karabakh, a mainly ethnic Armenian enclave that is internationally recognized as part of Azerbaijan but has been under the control of ethnic Armenian forces backed by Armenia since a separatist war there ended in 1994. In 2020, a six-week war erupted between the two countries, resulting in more than 6,000 deaths and the displacement of tens of thousands of people. The war ended with a Russia-brokered ceasefire that saw Azerbaijan regain control of much of Nagorno-Karabakh and adjacent territories that had been held by Armenian forces.
Since then, the two sides have been engaged in sporadic clashes and negotiations over the implementation of the ceasefire agreement and the resolution of the border dispute. The U.S., along with Russia and France, co-chairs the OSCE Minsk Group, a mediation body that has been trying to facilitate a peaceful settlement of the conflict since 1992. However, the Minsk Group has been largely sidelined by the recent developments and has faced criticism from both Armenia and Azerbaijan for its ineffectiveness.
In a statement after the phone call, the U.S. State Department said that Blinken had reaffirmed the U.S. commitment to the OSCE Minsk Group process and to the sovereignty and territorial integrity of both Armenia and Azerbaijan. He also urged the two leaders to engage in direct talks on a peace treaty and to cooperate on the unblocking of regional transport infrastructure and the delimitation of their common border. He stressed the importance of establishing confidence and preventing further violence in the region.
One thing didn’t change among the United States congressional top leaders, Democrat and Republican, after the election of a new US House of Representatives Speaker — their unanimous over-the-top commitment to the US government supporting Israel unconditionally. Thus, the congressional top leaders are likely increasingly concerned about both ongoing large war-related protests in which many people express criticism of the Israel government and the majority of Americans opposing the US sending weapons and supplies to Israel to aid it in its war effort.
How to counter the resistance to the US giving Israel more and more money, intelligence, and weapons? A resolution being considered in the US House of Representatives provides some of the answer: call criticism of Israel antisemitism.
See all those protesters out there and the Americans opposing the US giving Israel weapons and supplies to continue its decimation of Gaza and then do whatever else may be next in its war actions. Don’t be fooled, the resolution suggests: None of them are expressing opposition because they are noninterventionists, peace advocates, constitutionalists, humanitarians, fiscal conservatives, or people holding other admirable intentions. Instead, they are all antisemites. Do not listen to them. Shun them. And, absolutely, do not even think for a second of being one of them. That is the message of suggesting individuals should be considered antisemites because they take stands critical of Israel.
The resolution, H.Res. 888, declares in part:
Resolved, That the House of Representatives—
1) reaffirms the State of Israel’s right to exist;
(2) recognizes that denying Israel’s right to exist is a form of antisemitism;
What a strange statement from the legislative body that owes its existence to the American Revolution fought to end the existence of British colonial government in the colonies. The Declaration of Independence explained well the view of American founders regarding any purported right of a government to exist: The people have the right to alter or abolish government that “becomes destructive to” the securing of the people’s “unalienable Rights,” including rights to “Life, Liberty and the pursuit of Happiness,” says the Declaration of Independence. The House resolution turns this reasoning on its head, declaring the dominant right of a government to exist in perpetuity no matter whether it protects, neglects, or undermines individual rights.
And Americans are not the only people to abolish and replace their government. It is an occurrence that has happened many times and in many places throughout world history. Yet, in this one instance to believe that such an ordinary thing should occur the House resolution derides as antisemitic. History has shown repeatedly that there are many other motivations that lead people to support a revolutionary objective. The antisemitism claim is obviously groundless assertion.
The desired effect of the resolution for many of its supporters, though, is for its condemnation to reach beyond people who call for the abolition and replacement of the Israel government. In the view of many of the ardent Israel government supporters in the House, whatever actions Israel takes in the name of advancing its national security are by definition taken in pursuance of protecting its purported right to exist. Question those actions, they would assert, and you defy and threaten Israel’s existence. Pointing to this resolution, they can also assert you are an antisemite. It is another step in the divorcing of the “antisemitism” label from anything having to do with ancestry or religion: Criticize the Israel government and, voilà, you are an antisemite.
On the bright side, this resolution is another step in obliterating the rhetorical power of shouting “Antisemite!” at any person who does not toe the line in unquestioningly supporting either whatever the Israel government does in the name of national security or however the US government supports such action of Israel. Increasingly, people are rationally answering the antisemite charge with a response of “Whatever, now tell me something that is meaningful.” That is a good sign. Hopefully, this indicates we will soon turn the corner so US support for Israel can be reevaluated.
This article was published by RonPaul Institute
By Scott Bennett
It may come as a surprise, but Robert F. Kennedy, Jr. can win the 2024 presidential election.
Every article you read about RFK Jr. is going to emphasize that his candidacy is a long shot. Some sources — like a recent Vox podcast — will even come right out and say he’ll never win.
The dominant message to the American public is that if you’re not voting Democrat or Republican on Election Day, you are “throwing your vote away.” This is the knee-jerk response to any discussion about a candidate that does not have a D or an R next to their name.
There are huge institutional barriers designed to block upstart challengers from operating outside the two-party system in the US. Stat-heads can summon Excel spreadsheets that “prove” it is impossible for an independent or third-party challenger to win the Electoral College. In fact, no independent has won the presidency since George Washington. Obviously it would be easier to get around that problem if the popular vote counted in presidential elections. But the US continues to hand victory to the loser of the popular vote about 11% of the time.
These psychological and structural barriers exist and will still be firmly in place on November 5, 2024. But RFK Jr. can still win.
Watershed polling
A recent Quinnipiac poll showed Kenedy with a surprising 22% share of the electorate in a head-to-head matchup against Joe Biden and Donald Trump. Another poll shows Kennedy pulling ahead of both major party contenders among voters under 45 in several key battleground states. This is a significant breakthrough.
Unexpectedly, Americans are becoming aware that 2024 could be a three-way race: An independent candidate could potentially upset the two-party hammerlock on power.
But is this a surprise? Joe Biden and Donald Trump are hugely unpopular. According to 538, a majority of Americans holds an unfavorable view of both candidates: 54% for Biden, same for Trump. To say that the people are not jazzed about a replay of the 2020 election is supreme understatement. In contrast, more view Kennedy favorably than unfavorably.
Old name, new game
So who is Robert Francis Kennedy Junior, who promises to inject fresh blood into the 2024 race?
Well, the name is a clue that he is actually some very old blood, at least by American standards. The Kennedy name is the most recognizable brand in US politics, putting even the Bush dynasty at a distant second place. RFK Jr. is the son of Senator Robert F. Kennedy Sr. and the nephew of President John F. Kennedy. It makes one wonder how many Americans would vote for RFK Jr. even if they didn’t know a single other thing about him besides that surname.
The Kennedy provenance gives establishment credibility that past independent and third-party candidates would have killed for: the advantage of an entire life spent in politics. RFK Jr. has been attending high-profile parties since childhood, including the one Frank Sinatra threw for his uncle Jack at the 1960 Democratic convention. As a result, Kennedy knows the fathers of practically every prominent modern American, and there’s a good chance he’s met their grandfathers as well.
However, several members of his family have gone out of their way to disavow his candidacy. Four of eight living siblings put out a statement saying, “Bobby might share the same name as our father, but he does not share the same values, vision or judgment … We denounce his candidacy and believe it to be perilous for our country.”
While his family is busy spurning him, Kennedy has now spurned the Democratic Party his family’s traditional home. The Democrats currently hold the White House, and incumbency is always the strongest advantage in any election. Earlier this year the Democratic National Committee voted to support President Biden’s plan to reorder the primaries according to his preference. On top of that, Democrats won a court case in 2017 that gave the major parties an all-clear to play favorites during the primary election season. Facing what he called roadblocks to “fair primary elections,” RFK Jr. is now running as an independent.
RFK Jr.’s political views: third-party mindset
Voters may know what they’re getting with Biden and Trump, but Kennedy is a true wild card. He told New York Magazine, “I still consider myself a Democrat, and I have all the values that I grew up with, nothing changed.” But outside of his positions on the environment and abortion, there isn’t much overlap between RFK Jr. and his family’s party.
The perception of many Democrats is that RFK Jr. is an anti-vax nutjob. His unorthodox views on the subject are like catnip to the millions who listen to Joe Rogan, but absolutely anathema to mainstream MSNBC-watching Dems — though Kennedy has not actively sought the approval of traditional Democrats, anyway.
It is precisely Kennedy’s ability to appeal to voters outside of the traditional Democratic spectrum that makes him a threat to both major parties. Taking a page from Trump’s playbook, Kennedy has recently said he plans to “formulate policies that will seal the border permanently.” He has also been critical of gun control. He has stressedthat, while he might support a bipartisan assault weapons ban, he was “not going to take people’s guns away.”
As a Democrat who was willing to criticize President Biden, Kennedy was a frequent guest and darling of the right-wing media circuit during his period in the Democratic primary. After announcing his independent run, however, that relationship may have soured. Republicans like Trump spokesman Steven Cheung swiftly went on the attack, saying in a statement, “Voters should not be deceived by anyone who pretends to have conservative values.”
The GOP has good reason for anxiety. Current polling shows Kennedy is likely to take a bigger chunk of Republican voters than Democrats. No doubt even more alarming to party insiders, a Politico analysis of campaign finance reports shows Kennedy is pulling in significantly more big-money political investment from those who traditionally give to Republicans, hitting the GOP where it hurts.
Kennedy’s image as an anti-establishment populist has enabled him to stake foreign policy positions far outside what either major party could stomach. His primary attack on the Democratic establishment is that Hillary Clinton and Joe Biden are “warmongers.” He has also criticized the CIA as an institution designed only to provide more wars to keep the military-industrial complex afloat.
But there are also reasons to question how anti-establishment Kennedy truly is. Despite a willingness to call out chemical and oil companies, industrial agriculture and Big Pharma for their culpability for chronic disease, he does not support single-payer healthcare. His views on the Israel–Palestine issue are unlikely to win over many on the left either.
Kennedy also regularly reaffirms his economic orientation as that of “a free-market capitalism kind of guy.” This really shouldn’t be surprising, of course, considering Kennedy’s roots. As he wrote in his own family memoir, American Values, “During the Depression, there were only twenty-four known millionaires in the country, and among them were” both of his grandfathers, Joe Kennedy and George Skakel.
The US’s perfect independent candidate?
Herein lies the irony of Robert F. Kennedy Jr.’s campaign for president. He is the most establishment candidate, strictly on the strength of his family and the privileged personal position and connections the Kennedy name confers on every member, and yet he possesses an anti-establishment streak. This candidate spent his entire career as an environmental attorney (and if a job like that doesn’t make a person distrustful of what corporations or bureaucracies tell them, nothing will). He is somehow establishment and anti-establishment all rolled into one.
It is precisely this combination of factors that might make him the perfect candidate for this moment. Independent voters, a huge plurality according to recent polling, have an unfavorable view of both Donald Trump and Joe Biden. They are looking for something that neither major-party candidate is offering. If Kennedy gives independents reason to show up on Election Day, he can win.
The 2020 election contest had record voter turnout — the biggest in more than a century, 66%. But 80 million eligible voters still didn’t vote: one-third of the US voting population. 80 million is more than enough votes to turn the tide in Kennedy’s favor.
It is the winner-takes-all election system that bequeaths two-party politics to the US. It is winner-takes-all that gives us the lesser-of-two-evils phenomenon, making any independent or third-party candidate a “spoiler.” But another reality of a three-way race is that it is possible to win with a simple plurality of the vote, as little as 34% if the race is a dead heat. As Kennedy himself said, “The Democrats are terrified I’ll spoil the election for President Biden. The Republicans fear I’ll spoil it for President Trump. The truth is — they’re both right! But only their inside-the-beltway myopia deludes them into thinking we have no chance to win.”
Of course RFK Jr. can win.
The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.
About the author: Scott Bennett is a writer living in Chicago. His decent (but not hoity-toity) university education never prepared him for this moment. It did, however, prepare him for a career in major market media. He has been working on a book for 10 years with few ideas on how to publish it, so he turned to TikTok. There he has amassed a sizable following and hopes this is the beginning of something big. He is an optimist at heart.
Source: This article was published by Fair Observer
Here’s the good news. Only 1 percent of Americans are (1) lawful U.S. residents, (2) uninsured and (3) lack access to subsidized health insurance. That fact comes from health economist Brian Blase, based on a recent Congressional Budget Office report.
Currently, 24.3 million individuals in the United States are uninsured. But aside from those who are here illegally, virtually everyone else is eligible for enrollment in Medicaid, Medicare or in private plans such as those offered in the Obamacare exchanges or by employers.
Medicaid enrollment is free, Obamacare insurance is heavily subsidized and almost all employer-provided insurance is required to be “affordable.” So arguably, we have achieved “universal coverage,” or something very close to it.
Here’s the bad news. Almost all of the increase in health insurance coverage under Obamacare has been the result of an expansion of Medicaid. When Obamacare was being debated, its advocates never said they planned to insure the uninsured with Medicaid. But that is what happened.
What is wrong with that? Two things.
First, since Medicaid pays the lowest provider fees, Medicaid enrollees are the last patients doctors want to see. Almost a third of doctors won’t take any new Medicaid patients at all. Second, since eligibility for Medicaid is determined by income, people find they are enrolled and disenrolled frequently over the space of a few years.
Families at the bottom of the income ladder find that as their income goes up and down and as their job opportunities ebb and flow, they bounce back and forth among eligibility for Medicaid, eligibility for subsidized insurance in the Obamacare exchanges, eligibility for employer-provided coverage and sometimes eligibility for none of the above. No continuity of health insurance usually means no continuity of medical care.
Going by the raw numbers, the Congressional Budget Office tells us that the number of people with private insurance has increased by 1.6 million over the last decade. But remember, Obamacare came into being as America was recovering from the Great Recession. So, even without any change in health policy, we would expect that as more people found jobs, more people would have been privately insured. On balance, there is little reason to think that Obamacare has increased the number of people with private coverage at all.
There has been a major change in the kind of private insurance people have, however. An increase in the number of people with coverage purchased in the Obamacare exchanges (where the average government subsidy is about $6,000), has been offset by a decrease in employer-provided coverage (where the average subsidy is $2,170).
Aside from needlessly adding to the federal deficit, what’s wrong with that? Four more things.
First, the typical plan offered in the exchanges pays provider rates that are not much more than what Medicaid pays. As a result, these plans look like Medicaid with a high deductible. Second, the deductibles are really high. In Dallas, Texas, for example, an average-income family of four getting insurance in the exchange pays no premium at all. But if a family member gets sick, the out-of-pocket exposure is $9,100. If two family members get sick the exposure is $18,200. And that’s every year.
At lower levels of income, the children may qualify for Medicaid and the adults may qualify for subsidies that reduce their out-of-pocket costs. But these freebies from government are far from “free.” The benefits phase out quickly as income rises. So, if the family earns an additional $1,000 in wages, they can lose several times that amount through higher health care costs.
A fourth problem is that enrollees in Obamacare exchange plans often lack access to the best doctors and the best hospitals. Our Dallas family, for example, has no access to the city’s Baylor Medical Center or UT Southwestern Medical Center, or MD Anderson Cancer Center in Houston.
Consider these headlines:
Infant mortality rises for the first time in 20 years.
Almost four in ten Medicaid enrollees delay care because of cost.
Traffic to emergency rooms is higher than ever. The average wait time is 2½ hours.
Patients wait 13 hours for free health care.
Despite the appearance of universal coverage, we are doing a very poor job of providing care to those at the bottom of the income ladder. Careful studies have determined that Medicaid itself is a poor health insurance plan. In the most meticulous study ever done of the matter, researchers discovered that Medicaid in Oregon had no effect on the physical health of enrollees and that after enrollment, emergency room traffic actually increased. A subsequent study found that Medicaid enrollees value their participation in Medicaid as little as 20 cents on the dollar.
It’s not clear that Obamacare’s exchange insurance is that much better. One reason Congress in recent years added on an extra tier of subsidies for higher-income families is that the unsubsidized part of the individual market was in a death spiral. It seems that very few people are willing to pay the market price for what Obamacare has to offer.
All that said, there are pockets of excellence here and there within the safety net.
Parkland Hospital in Dallas delivers almost 13,000 babies every year. It is one of the largest baby delivery centers in the country. Almost all of the mothers are low-income minorities. More than three-fourths are Hispanic, and I suspect that a great many of those are undocumented. This is a group researchers call “at risk.” Yet among those who go through the prenatal program, infant mortality is half what it is for similar populations elsewhere.
The Parkland baby delivery program has been underway for several decades, and I wrote about it in Priceless. It involves extensive pre-natal and post-natal care provided by nurses. Most deliveries are done by midwives, rather than obstetricians.
Although the hospital does not release the figures, I suspect that this nonprofit institution actually makes a “profit” on baby delivery by piecing together various sources of government funding, minimizing the cost of personnel, and avoiding costly complications that lead to infant and maternal death.
Parkland’s baby delivery program is an example of what Harvard professor Regina Herzlinger calls a “focused factory.” These are places where the providers become really good at providing high-quality, efficient care. There would be a lot more Parklands around if we changed the way the health care safety net operates.
Boston University economist Laurence Kotlikoff I and have advocated replacing Medicaid, the Obamacare exchanges, and other safety programs with a system that functions like Medicare Advantage. Risk-adjusted payments would be made to competing organizations. The ones that succeed in producing high-quality, efficient care would be financially rewarded. Those that fail in this regard would be penalized with financial losses.
The first step toward that goal would be for the health policy community to recognize that the achievement of near universal health insurance coverage has not created universal access to high-quality care.
This article was also published in Forbes
It is a particularly quotidian breed in the modern, management-driven university. The desk clerk who pretends to be an academic and researcher but is neither. The desk clerk who admires rosters, work plans and “key performance indicators”, thinking that the process of knowledge is quantifiable by productivity targets and financial returns. The desk clerk who pilfers the work of undergraduates, sports a dubious doctoral thesis, and who rarely sets foot within the sacred surrounds of a library.
The rise of such a figure in the global university scene, one neither fish nor fowl, is no accident. As universities have declined, bureaucracy has bubbled with furious enthusiasm. The decline of teaching and its quality is complemented by the rise of the paranoid penpusher and spreadsheet artist. With a decline in substantive learning, the emergence of soft, watered-down syllabi, diminished reading lists (how dare one expect students to read one book a subject, let alone a few journal articles?), an increased focus on entertainment (flickering videos, please), the desk clerk has become sovereign, dominant, and terrifying. Shallow, weak, insipid, such beings occupy a particular space of decline, subsided by the toilers who put in the hours in often shoddy conditions. For the casual or sessional workforce, this is particularly acute.
Importantly, the desk clerk cadres perform the role of keeping actual academics with unhealthily industrious standards in check, acting as a sinister Varangian Guard for the broader management of the universities. They monitor staff emails without warning, undermine privacy with habitual criminality, conduct surveillance with pathological tendency. They straitjacket thought, curtail originality, quash dissent. To assist them in their mission is a vicious set of regulations known as the “Code of Conduct”, a document that would be neatly slotted into any KGB manual on thought control. Good to be on your best behaviour: the Desk Clerk is keeping an eye on you. Be a team member. Don’t question university policy, however criminal or moronic. If not, to the cooler, a disciplinary hearing devoid of natural justice precepts.
So, where do we find these crawling creatures so menacing to learning and murderous to thought? In the position of Deans, associate deans and their collaborating adjutants. Program managers on the make. Colourless gauleiters, humourless henchmen, women and those in between hoping to make a buck or two out of the neuroses of identity politics. (Fancy an aboriginal cause we can advance?) In the role of directors of learning and teaching. (Universities are in a bad way if they need such areas.) In sections with names resembling toilet cleaning products or carcinogenic chemicals.
These people are, in turn, given orders by nameless, unaccountable individuals in the upper echelons of the institution, crowned by that most unaccountable of officers, the Vice-chancellor. Usual corporate and commercial laws do not apply, be there in terms of remuneration or governance decisions. This is particularly the case in Australia’s universities, where the average salary for the VC hovers around A$1 million. Despite being treated as corporate institutions, such universities are not controlled by the same disclosure requirements that companies must follow. The results are predictable enough: the sloshing and moving of dark money, the prevalence of shady deals, and poor, even bankrupting decisions.
The desk clerk’s orders, often crafted on a ghastly template, are followed without question, delivered at meetings held with academics who should know better. (An academic who has time for meetings is obviously not pulling any weight.) It is one of the greatest conflicts of interest in the academy: the associate dean, having a chat with staff in a discipline meeting ostensibly to address a critical issue of merit. Given that the associate dean in question is not beholden to staff welfare but the unelected officialdom of a mini-police state, the spectacle is not merely farcical but scandalous.
Debate is supposedly held, discussion conducted. Academic staff babble, gossip and chat in convivial surroundings pretending to follow a serious agenda. But these meetings only ever serve to rubberstamp the bleak reality that is hatched in the University Chancellery, where thought is purposely killed in favour of middle-management speak, corrupt goals, and self-feathering. For desk clerks keen to rise up the greasy pole, it’s best to be obedient and steely in resolve, kick down against the opposition, and suppress the contrarians. Never mind that students are ignored, a toxic workplace rife with bullying neglected, or that the university is becoming increasingly irrelevant.
The favourite occasion of the year for the desk clerk is the announcement of the promotions round. Bootlickers and coprophagic devotees delight in the news that they have gained an associate professorship or even professorship, despite having not authored work of note – or any work for that matter. The time has surely come to strip such individuals of academic positions and admit them to the role of administrators, with salaries adjusted downwards. Because that is what a desk clerk, after all, is.
By William Chislett
The OECD’s latest economic survey of Spain coincides with the Socialist-led minority government winning parliamentary support for a third term, four months after July’s inconclusive snap election, with the hard-left Sumar as its junior partner again and backing from Catalan and Basque separatist parties.
These surveys, produced every two years or so by the Paris-based think tank that embraces 37 countries, known as the rich countries’ club, though Mexico, a member, can hardly be called wealthy, provide a comprehensive analysis of economic developments and challenges and set out policy recommendations.
Spain’s economy, one of the hardest hit in the EU by the COVID-19 pandemic (GDP plummeted 11.2% in 2020), recovered its pre-pandemic level of output in the middle of 2022 and since then has grown relatively strongly, fuelled by a rebound in tourism and commerce and strong exports.
The Bank of Spain forecasts GDP growth this year of 2.3%, well above the euro zone average of 0.7%. Headline inflation is comparatively low and unemployment is below 12%, the lowest rate since 2008 when the global financial crisis burst.
But public debt stands at 111.2% of GDP, up from 95.5% in 2019 (39.7% in 2008), the structural fiscal deficit (ie, as opposed to the cyclical one) is around 4% of GDP, and despite more reforms doubts remain about the sustainability of the pensions system in its current form.
The OECD makes a series of recommendations (see Figure 1), including ending the support measures introduced in 2021: a temporary cut in VAT on natural gas and electricity from 21% to 5%, a one-off payment of €200 million for 4.2 million households and direct support worth €1.8 billion for companies in the transport, agriculture, fishing and energy-intensive sectors, among other measures.
Other recommendations concern raising revenue from taxes, alleviating child poverty, improving the education system (the early school-leaving rate is still high at close to 14%) and increasing the stock of social rental housing. In an unusual move, half of the report is devoted to the long overlooked plight of young people who have ‘a difficult transition to an independent, productive, and happy adult life’.
Figure 1. The OECD’s main findings and key recommendations
| Main findings | Key recommendations |
| Support measures to alleviate the impact of high energy and food prices have been sizeable and only partly targeted towards the most vulnerable. | End the support measures. |
| Public debt at 113% of GDP is high, the fiscal deficit is still sizeable and pension and health-related expenditures are set to rise in the longer term. | Adopt a medium-term fiscal plan, step up the pace of deficit reduction from 2024, and ensure all extra spending is fully financed over the medium term. |
| Spending is tilted towards social spending, mostly pensions and unemployment benefits, with too little allocated to growth-enhancing items including education and training. Young people benefit less from public spending than others. | Based on spending reviews and sound cost-benefit analysis, set longer-term spending priorities more geared to growth-enhancing items, notably skill-building measures such as education. |
| Tax revenues are low by EU standards, and there is scope to improve the design of the tax system: the VAT base is narrow; marginal personal income tax rates climb quickly already at modest levels of income, discouraging labour supply; and the tax system is not well geared to achieving environmental goals. | Mobilise additional tax revenues by gradually broadening the VAT base, imposing higher excise duties on alcohol and tobacco and raising environment-related taxes, while reducing some capital taxes and the tax burden on labour for low-income households with children. |
| Promoting strong, inclusive and sustainable growth, and pursuing efforts to raise productivity and fight corruption | |
| Social spending is titled towards contributory benefits favouring people with a job and a stable financial situation. Social assistance programmes do not adequately protect vulnerable groups. Child poverty is high. | Increase the amount and coverage of cash benefits for poor families with children. |
| The legal framework to fight corruption has been enhanced over the past decade, but the level of corruption is still perceived as rather high by citizens. | Continue efforts to reduce corruption in the public sector. |
| Despite improvements, Spain remains heavily reliant on fossil fuels, favoured by tax exemptions, modest fuel taxes and considerable subsidies in agriculture and fishing. | Broaden the base for environment-related taxation by phasing out exemptions and gradually increasing the tax rate on non-ETS emissions and compensate partially and temporarily the most vulnerable. |
| Current policy efforts are unlikely to be sufficient to reach stated goals, notably net zero carbon emissions by 2050 and a cleaner energy mix through greater renewables. | Install more electric vehicle charging points and provide more support for the retrofitting of buildings. |
| Water quality is poorer with toxic levels of nitrates concentrations spreading because of intensive agriculture production. Securing water is also a worsening problem in parts of the country afflicted by persistent drought. | Promote a more efficient use of fertilisers by increasing taxes or improving their regulation. Encourage a better use of water through more efficient irrigation, reusing and recycling water or increasing water pricing for irrigation. |
| Tackling difficulties facing youth in the labour market, education, entrepreneurship and housing | |
| Expanding access to early childhood education has been a government priority since 2021, but spending on early childhood education is lower than in other OECD countries and poorer families face challenges to access early childhood education and care, while access to childcare seems a barrier to female labour force participation. | Continue expanding access to quality early childhood education and care to children under the age of three prioritizing disadvantaged children. |
| Early school-leaving and repetition rates in compulsory education are very high, curbing educational advancement and job prospects. | Train teachers to identify and support students at risk of leaving education early and address their learning needs. |
| Enrolment in vocational education and training programmes is growing but remains comparatively low, despite graduates’ good labour market outcomes. | Foster collaboration between SMEs to provide apprenticeships to students, training to teachers or share managerial duties. |
| Despite recent efforts to reform vocational education and training, skill mismatches hamper school-to-work transitions. Close to 40% of 15-34-year-olds report that their highest level of education did not help them in their current jobs, one of the highest rates in the EU. | Encourage collaboration between education institutions and businesses in designing and updating university degrees and in student counselling to promote a better alignment between studies and labour market needs. Publicise data on the success of students’ labour market placements. |
| Recent rises in minimum wages have been rapid and large, which could potentially lower employment for vulnerable groups. | Make the recently established expert commission independent with a mandate to advise on minimum wage changes in line with labour market conditions and productivity and ensure their access to data. |
| Entrepreneurship is low, and Spanish entrepreneurs lack training on how to start a business and on financial literacy more generally. | Extend entrepreneurship education to more young people who are out of the formal education system. |
| Rental housing is expensive. The stock of rental housing is stagnant and, at 1%, one of the lowest in the OECD. Many young people involuntarily delay living independently. Rent control regulations are among the most stringent in the OECD and further increases would risk curbing housing supply. | Encourage rental supply in stressed areas by increasing the stock of rental housing, relaxing rent controls, and making taxation less distortive (eg, by updating property values more regularly and reducing property transfer taxes). |
Source: OECD Economic Survey Spain, October 2023.
The OECD’s report comes at a time when the EU is close to a deal on restoring and revising its fiscal rules, suspended since 2020, which limit budget deficits to 3% of GDP and public debt to 60% of GDP, limits that Spain, and other countries, long ago broke. The new rules might give Spain more flexibility in correcting its imbalances, but even so the new government has work on its hands. Sustained fiscal consolidation needs to get underway, given the demographic outlook (a rapidly ageing population and a low fertility rate) and the high debt, which makes Spain vulnerable to external shocks.
The Bank of Spain’s says the consolidation should be framed in a detailed multi-year programme in order to ensure its credibility from the outset and increase the likelihood of a gradual consolidation. This will not be easy for a government supported by parties with such disparate agendas. The risk is that in order to satisfy all of them, structural reforms will not be effective.
A particular problem for Spain is sluggish productivity growth, a key element of a country’s prosperity. Growth was 0.6% per year between 2010 and 2022 compared with 0.8% in the euro area, and is one factor behind Spain’s lagging convergence with the EU in terms of per capita GDP, which in 2022 was 15% below the EU average. Between 2002 and 2009, when the economy boomed until the global financial crisis, per capita income was above the EU average. ‘Weak productivity performance has severe implications for future improvements in material living standards, given that ageing will soon become a larger drag on growth’, the OECD says.
There are many reasons for Spain’s relatively lower productivity: the sectoral composition of the economy skewed more towards services such as commerce and the hospitality sector, sectors of low value-added; the scant investment in R&D+i (1.2% of GDP, 0.8 pp below the EU average and way below the top performers); the lower quality of human capital (for example, the still high early school-leaving rate of 13.7%); the complex regulatory environment (different between regions and even between municipalities and hence not a level playing field) and its impact on an efficient assignment of funds; a labour market, despite reforms, which still has a relatively high proportion of workers on temporary contracts (in itself a cause of low productivity); cronyism (a Bank of Spain study indicated that the companies that grow the most are sometimes those closest to political power and not the most productive); and the reduced confidence in public institutions and their management capacity, including a judiciary system whose efficiency is below that of comparable countries.
The productivity problem is also highlighted in a recent book, Un país posible: manual de reformas políticamente viables (A country that is possible: manual of politically viable reforms, Deusto) by a group of economists, sociologists and political scientists, coordinated, among others, by Toni Roldán, a former MP for the now disappeared would-be centrist Ciudadanos and the party’s economy spokesperson, which sets out how to enhance Spain’s economic potential. Its main message is that the new legislature should be one that concentrates much more on human as opposed to physical infrastructure.
Both the report and the book should be on the desks of the new economic team.
- About the author: William Chislett (Oxford, 1951) is Emeritus Senior Research Fellow at the Elcano Royal Institute. He covered Spain’s transition to democracy for The Times of London between 1975 and 1978. He was then based in Mexico City for the Financial Times between 1978 and 1984. He returned to Madrid on a permanent basis in 1986 and since then, among other things, has written 20 books on various countries.
- Source: This article was published by the Elcano Royal Institute