Submitted by Mike "Mish" Shedlock

Another Deadlocked Election Coming Up In Spain?

After six months of failed coalition attempts, Spain’s King Felipe dissolved parliament and announced new elections. I reported on this last week, but the official document dissolving parliament was signed today. New elections are on June 26. Will the results be any different?

There are 350 seats in Spain’s parliament. Courtesy of the BBC, the 2015 election went like this (blue highlights mine).

Party Leaders

PPOE – Former Prime Minister Mariano Rajoy

PSOE – Pedro Sanchez

Podemos – Pablo Iglesias

Ciudadanos – Albert Rivera

Coalition Problems

PSOE and PPOE could have formed a coalition, but the result would not have been stable. The party leaders do not get along and the left and right generally don’t mix.

The three leftists parties could have formed a coalition, but Podemos is eurosckeptic and in favor of letting Catalonia have a vote on independence. The other two leftist parties are staunch nationalists as well as staunch euro supporters.

Ciudadanos ruled out forming a coalition with Podemos for philosophical reasons noted above.

Ciudadanos was formed as an anti-corruption party and wants nothing to do with Mariano Rajoy and his totally corrupt PPOE Popular Party either.

Clash of Ideas

The Financial Times explains the blame game as follows.

Mariano Rajoy, the acting prime minister and leader of the conservative Popular party, has repeatedly blamed the Socialists for refusing to form a grand coalition under his leadership. “What happened over the past four months must not repeat itself. Vetoes are bad for democracy,” the prime minister said on Monday.

Pedro Sánchez, the Socialist leader, has in turn attacked the anti-austerity Podemos movement for turning down his proposal for a Socialist-led government with the centrist Ciudadanos party.

Podemos, meanwhile, has lashed out at the Socialists for declining its invitation to form a leftist government.

“A poll by Metroscopia, published in the El País daily over the weekend, gave the PP 29 per cent of the vote, far ahead of its closest rival, the Socialists, with 20.3 per cent.”

Podemos IU Alliance

Let’s complicate the matter further. Podemos just announced an alliance with Izquierda Unida (IU) United Left.

IU received 3.68% of the vote in 2015.

Via translation from El Pais, please consider Podemos Seeks to Unite All Forces Left of PSOE.

Podemos “We Can” has launched new operations in three communities (Catalonia, Galicia and Valencia) to gather support for the upcoming elections. Now, Podemos seeks to expand these agreements not only IU but a whole series of forces to the left of the PSOE with good territorial projection.

In short, Podemos is going after that block of “other” voters in the above chart. If current results hold, Podemos will oust PSOE from the number two spot.

Political Setup

No party is going to achieve a majority. PSOE and Podemos unlikely to reach 50% Ciudadanos will not enter a three-way agreement with PSOE and Podemos If PSOE and PPOE can muster up 50% combined, there will be intense pressure by the king to form an unstable “grand coalition” If PSOE and PPOE cannot muster up 50%, another failed election is in store.

Budget Analysis

Spain’s budget is way out of control. No matter who gains control, huge budget cuts are coming up. Won’t that be fun?

I expect an unstable “grand coalition” forms. If so, I doubt it lasts a year. PPOE will not like the budget cuts but will have to keep voting for them for the coalition to “work”.

Podemos is waiting in the wings for the upcoming collapse.