Spanish Prime Minister Rajoy Ousted From Power; Sanchez Is New Socialist Prime Minister

As was widely expected, this morning Mariano Rajoy's six year reign as Spain's prime minister, ended when he become the first prime minister in Spain’s democratic history to be ousted by parliament after losing a vote of no-confidence amid a corruption scandal engulfing his Popular party. He will be replaced by the Socialist opposition leader Pedro Sánchez.

A small but sufficient majority of Spanish lawmakers was sufficient to end Rajoy's career, voting 180 to 169 to remove the prime minister, cutting short the second term of one of Europe’s longest-serving leaders currently in power. The center-left Socialist Party had called the no-confidence vote last week and proposed its leader to replace Mr. Rajoy.

Rajoy takes his seat at Parliament before the vote of a no confidence motion in Madrid, June 1. Photo: Reuters

Quoted by the FT, in his brief final speech to parliament, Rajoy bade farewell to the country after seven years in power: “It has been an honour to leave Spain better than I found it. Thank you to all Spaniards and good luck.” The speech came after a last meal of sorts:

Mr Rajoy spent eight hours in a Madrid restaurant on Thursday afternoon instead of sitting through the first part of the parliamentary debate, but appeared composed on Friday during his resignation speech.

Socialist Party leader Pedro Sánchez, who becomes prime minister immediately, told lawmakers that his policy goals include bolstering social policies to address problems such as unemployment and poverty levels, both of which remain high despite Spain’s strong growth. Among Sanchez' challenges will be managing the eurozone’s fourth-largest economy and dealing with internal problems such as the crisis in Catalonia.

The new socialist prime minister will lead a weak minority government with just 84 seats in parliament, part of a coalition that includes a "hodgepodge" of different political parties, including the far-left Podemos group and a string of regional national parties including the Basque Nationalist party and two Catalan nationalist parties; this suggests a tumultuous time is in store for Spain both before and after the upcoming elections.  Indeed, as the WSJ notes,  the new premier's minority government will struggle to pass legislation and has already promised to call parliamentary elections ahead of the current 2020 deadline.

The leader of the liberal Ciudadanos party, Albert Rivera, labelled this a “Frankenstein government” due to its lack of unifying views. The Catalans want full independence from Spain, for instance.

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Rajoy's ouster comes just as an antiestablishment government comes to power in Italy, now home to Western Europe’s largest anti-establishment movement, after a three-month power vacuum.

Paradoxically, coming at a time when Europe is supposedly "growing" and following several years of ECB QE meant to stabilize Europe, the two high-profile political crises this week in southern Europe underscore the social and economic scars still borne by the region years after the eurozone’s 2011-12 crisis, damage that is feeding political discontent and stirring hunger for change.

Rajoy had seen his support steadily erode since he became prime minister in 2011 and began to enact a series of painful economic reforms during the eurozone crisis. He has shouldered much of the political blame for a recovery that has left millions of Spaniards behind. He is the first Spanish prime minister to be unseated in a vote of confidence.

That is not to say he didn't bring it on himself: after numerous lawsuits and years of corruption allegations against Rajoy’s Popular Party came to a head last week when a top Spanish court ruled that his party financially benefited from an illegal kickback scheme. The party has said it would appeal the ruling.  Rajoy hasn’t been charged and denies knowledge of the scheme, however if recent events in other developing nations such as Malaysia are an indication, the public will demand a fall guy, and it may be only a matter of time before Rajoy finds himself behind bars.

For now, however, there is celebration that some order has been restored, with Spain's Ibex 35 1.8% higher, while Spanish 2Y yield have tumbled to -0.12%, after hugging the unchanged line for much of the past 2 days.

Comments

Peterman333 Blue Steel 309 Fri, 06/01/2018 - 08:37 Permalink

It is, and it will be again soon. This is where these failed (but don't realize they're failed yet) republics are heading, right back to Monarchy. I'm not talking about "constitutional monarchy" whatever that bsh*t is, I'm talking about an absolute monarchy which has hundreds and hundreds (some places over 1,000) of years of solid track record in Europe whereas the "ism" forms of government have brought an out sized portion of misery and death in just the couple of hundred years they've been tried. The root of democracy is demon.

In reply to by Blue Steel 309

ATA Fri, 06/01/2018 - 06:29 Permalink

 

 

SPAIN RISK OFF MOTIVE...

 

ATA knew it over half year ago - 10.2017...

 

CATALONIAN VIRUS...

 

http://www.atafinancialresearch.5v.pl/wpis%2ccatalonian%3bvirus%3b%2c168722.html …

 

SPANISH IBEX - NO PASARAN... ( for now )...

 

http://www.atafinancialresearch.5v.pl/wpis%2cspanish%3bibex%3b-%3bno%3bpasaran%3b%3bfor%3bnow%3b%3b%2c168761.html …

 

EUROPEAN APOCALIPTO...

 

http://www.atafinancialresearch.5v.pl/wpis%2ceuropean%3bapocalipto%3b%2c168998.html …

 

 

Overflow Fri, 06/01/2018 - 07:05 Permalink

This guy, "socialist" is the neccesary muppet to start a hard intervention on Spain, Greek style.

 

The kind of changes we must prepare for, can ONLY be applied by a left-wing muppet, they have much more scope for action before the riots.

 

That's all.

 

The catalonia issue stays the same: You need 3/4 of Congress and 3/4 of Senate to change Constitution. Period. 

pc_babe Fri, 06/01/2018 - 07:09 Permalink

The vote says we don't like the pace and cost of getting our economic house in order, instead we will move further Left, thereby choosing to have our cake now and to eat it too while we demand other's pay for it

HorseBuggy Fri, 06/01/2018 - 07:10 Permalink

I guess it's now only a matter of time before we can tell who is better at the dumpster diving for food sport that takes place in socialist run countries. I am placing my bet on the Venezuelans as they had a head start plus by now they are all slimmer and most likely better jumpers.

 

 

Lokiban Fri, 06/01/2018 - 07:17 Permalink

Spain and 'strong growth' is a paradox.
I feel for Rajoy, he did his best like all politicians who are not corrupt. They eventually get outed by the corrupt ones.

hooligan2009 Fri, 06/01/2018 - 07:22 Permalink

european politics is dominated by a "proportional representation" system of electing governments.

this means that voters elect politicians based on what they say, before an election, only to see those elected politicians work out "deals" with other politicians with markedly different political positions.

not only does this disenfranchise voters by giving voters precisely what they didn't vote for, it means there can never be anything but "emergent" political strategy , IN OTHER WORDS, NO POLITICAL LEADERSHIP OR DIRECTION IS POSSIBLE.

The best thinkers over millenia know that all organizations that use emergent strategy WITHOUT ANY MEASUREMENT OF SUCCESS will fail - planning requires leadership, not TOTAL compromise and a dominating probability of unintended consequences.

This is one of the problems with the direction that each nation state within europe (and the EU itself) takes to resolve problems like unemployment, economic growth, and fiscal deficits.

here is a description, taken at random, from the plethora of management theory, gleaned from successful strategies employed by companies, that should be a salutory lesson to politicians that, supposedly, want to be remembered as improving the lives of their electorates.

http://open.lib.umn.edu/strategicmanagement/chapter/1-3-intended-emerge…

note, as its management theory, it is full of a lot of "waffle", but at the "intended strategy" stage, it should be clear that there actually was intent, to do something specific. strategies are then adapted for changing signals. this does not happen in Europe, since there is no end-goal and, not only do strategies "emerge", they emerge from a previously unspecified emergent strategy. the Maastricht Treaty goals of 60% debt to gdp and 3% fiscal deficits, are "rigged" by financial shenanigans at the ECB, where NIRP that is "all risk and no reward" is thought to be SANE and is de rigeur, by other insane central bankers.

There will be no progress in the EU, until signatories to treaties actually deliver their promises, and the ECB has its mandate changed to prohibit QE/NIRP/monetization of profligate governement spending/non-penalization of profligate governments.

(e.g. the ECB effectively has given a credit card interest holiday, to a chronic spendthrift by putting a tax on future generations of new, non-spendthrift people that want to properly use a credit card).

Proportional Representation is a libtard socialist demoNrat tactic to remove the power of voters to elect governments that can pursue a coordinated long term strategy that is visible to all. instead, replacing it with unaccountable, unknown policies rife with unintended consequences that themselves cannot be dealt with.

bleh.