Catalonia Declares Independence but Hits Hold Button; Spain Sets Emergency Meeting; Good Outcomes Seem Unlikely

October 11, 2017
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Tuesday evening, Catalonia’s President Carles Puigdemont tried to come up with a Solomonic compromise between his separatist movement and the Spanish government. With other senior officials in the region, he signed a declaration of independence, but said he was suspending it for several weeks to pursue negotiations with Spain.

Spain’s leaders reacted quickly, scheduling an emergency Cabinet meeting for Wednesday morning. Prime Minister Rajoy was mum, but central government officials kept up their drumbeat of disapproval. For instance, the BBC reported:

Spain’s Deputy Prime Minister Soraya Saenz de Santamaria responded to Tuesday’s developments by saying: “Neither Mr Puigdemont nor anybody else can claim… to impose mediation.

“Any dialogue between democrats has to take place within the law.”

Puigdemont’s gambit was consistent with his initial move after the contested independence referendum: he said Catalonia would secede shortly but called for negotiations. As we pointed out then:

Yet after having threatened to declare independence within 48 hours of a favorable referendum vote (and press reports indicated that the total number of voted lodged favoring departure was higher than the threshold Catalonian separatists had set), officials in Catalonia are now retreating from their threat of a speedy exodus. Instead they want to negotiate and have the EU moderate. But you can’t have talks unless the other side wants to talk too.

In the intervening days, Spain has made it even clearer than it did in the referendum crackdown that it has no intention of indulging Catalonia’s secessionists. The only open question is how harsh its next moves will be.

Let us consider the moves Spain has already taken against the separatists:

Spain issued a decree allowing companies to move headquarters more readily. One well-regarded company,  Oryzon Genomics, announced plans to move even before the Spanish government intervened to facilitate a corporate exodus. Some US companies with units based in Catalonia claimed they could withdraw overnight. CNBC provided a roundup yesterday of the companies who said they were making plans to relocate or giving it serious study.

The king denounced the separatists. From his speech:

For some time, certain authorities in Catalonia, repeatedly, consciously and deliberately, have been failing to comply with the constitution and the statute on autonomy…

With these decisions they have systematically infringed the approved legal framework, showing an unacceptable disloyalty to the powers of the state. A state that those authorities represent in Catalonia.

They have broken the democratic principles of the rule of law and have undermined the harmony and coexistence of Catalan society, to the point — unhappily — of dividing it…and with their irresponsible conduct are even putting at risk the economic and social stability of Catalonia and all of Spain.

Experts pointed out that the last time the king made a similar statement was during a short-lived coup attempt in 1981.

The Constitutional court suspended a scheduled Catalonia parliamentary session. As we described, the Constitutional court blocked the meeting of Catalonia’s parliament at which the referendum results were set to be presented and where the legislators were expected to approve a declaration of independence. Moreover, as the Guardian pointed out:

The court warned that any session carried out in defiance of its ban would be “null”, and added that the parliament’s leaders could face criminal action if they ignored the court order.

There is no reason to think that the government in Madrid has had a change of heart and will now make nice to Catalonia. The only retreat it has made from its hardline stance is to apologize for the headbreaking during its referendum crackdown. That in turn resulted from the media widely publishing video clips showing excessive use of force, resulting in international condemnation.

In other words, the central government is not going to negotiate, since it sees no reason to. It will stick to its playbook. . From the Financial Times last week:

As Spanish prime minister Mariano Rajoy met other party leaders on Monday, his government gave little sign it was open to talks as long as the separatist Catalan government pushes for full independence from Spain, in contravention of the law and the constitution…..

Rafael Catala, the justice minister, said the government would use all the tools at its disposal — including if necessary the suspension of Catalonia’s autonomy — to enforce the rule of law. “We have always said that we would use all the force of the law,” he said told Spanish television.

There were also hawkish calls by Albert Rivera, the head of the liberal Ciudadanos party which supports the PP government, to suspend Catalonia’s autonomy immediately. The government on Monday rejected taking these steps right away, although has left the option open for the future.

One of the reasons Madrid won’t compromise, aside from the fact that that appears to be out of character for Rajoy, is that the central government isn’t willing (it would argue isn’t able) to give Catalonia the compromise that could put the secession push to rest, namely, giving Catalonia a level of autonomy similar to that of the Basque country. The critical change would be to let the region control its own tax collection and remit some funds from that to the central government. Catalonia’s intent, as with the Basques, would be to keep more of the proceeds for itself. The Basque region is small enough that the revenue loss wasn’t terribly consequential. By contrast, given that Spain does not have its own currency, and separately is a devout believer in neoliberal economics, Spain can’t deficit spend on a sustained basis to make up for a shortfall, and raising taxes or cutting spending in a still-weak economy would be unpopular and would hurt growth.

Shorter: there’s no solution space even if Rajoy’s government were willing to talk.

So the open question is how harsh will Rajoy’s new measures be? ABC Australia set forth some possibilities:

Prime Minister Mariano Rajoy could take the unprecedented step of dissolving the Catalan Parliament and triggering new regional elections, the so-called “nuclear option”….

Last week Carlos Uxo, a Spanish studies expert at Monash University, said there were a couple of outcomes:

• The President of Catalonia would probably be arrested
• The Spanish Government would seize control of the region<

/blockquote>

At a minimum, it seems likely that Spain will order the arrest of everyone who signed the declaration of independence. It might offer the token concession of being willing to withdraw the order if they cancel the declaration.

If Catalonia does not back down and the separatist leaders are able to evade arrest, Madrid could invoke Article 155 and take control of Catalonia.

But as we’ve said, if the secessionists don’t retreat, this becomes a lose-lose situation. While the central government has more than enough tools to bring Catalonia to heel short term, it can’t keep down a popular movement with as much support as the secessionists have garnered. And the less careful and surgical Madrid is in how it combats the secessionists, the more it does to increase their resolve.

The Basques eventually got their way via a sustained campaign of violence. That is what Spain will put in motion in Catalonia unless it proceeds with great finesse, a quality its leaders seem to lack.

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