SPAIN’S ABUSIVE BANKS

The big economic news has been the massive 100 billion euros bailout of Spain’s banks with perhaps multi billions on the way. However the back story has been the numerous protests by Spaniards against measures to support banks which are largely in trouble through their own greed, corruption and mismanagement.

It is no surprise that Bankia is being investigated by the Guardia Civil for fraud. This is the bank whose 2011 results showed a profit of 40.9 million euros but turned out to be a loss of 3.3 billion euros. Read those figures again very carefully and you see the full extent of this fiscal fiasco.

The head of Bankia is José Ignacio Goirigoizarri. He asked the Spanish government for a 19 billion euros bailout. He also explained that the bank would not be repaying this money. It was not a loan or a handout but capitalisation so didn’t need to be returned. Remember that next time you go to the bank for a loan. Tell them you won’t be paying it back as it’s not a loan but you are recapitalising. Good luck with that one!

The other Spanish banks at the time were outraged by the bailout being handed to Bankia which accounts for around 50 per cent of all the bank debt in Spain. María Dolores Dancausa, a senior official at Bankinter, called the help given to Bankia as excessive and demanded an explanation as she and other bankers believed it gave the bankrupt bank an unfair advantage over them.

Now Spain is set to get a 100 million loan not bailout from the Euro zone that money has to be paid back. No doubt María Dolores is happier as all banks will be helped but I doubt whether Germany is going to buy Goirigoizarri’s argument he needn’t repay it as its just “capital”.

On the streets of Spain there is a major backlash against the rescuing of Bankia in what has been and still is an abusive banking system. Let me first take you to the Andalucía town of Ronda. Recently 71-year-old Antonio Gil Jiménez was detained in the centre of Ronda by police after entering a branch of the Caja Madrid and causing a disturbance as he demanded the return of his money. He accused the savings bank, which is now part of the embattled Bankia group, of having cheated him out of his savings.

Days after his protest he decided to take his complaint to the Ombudsman who is responsible for Bankia clients. He has asked for the return of the 18,000 euros he invested with the Caja Madrid three years ago in May 2009 in a deal that lasted “in perpetuity”. Not five years, not 10 years but “in perpetuity.”

Antonio Gil insists that at the time he believed he was investing his life savings in a secure account and not what has turned out to be a “producto basura” – a rubbish product. He had confidence in the financial entity with which he has banked for years but his trust was abused by a bank that could take a pensioners savings “in perpetuity”.

He says that since 2011 he has requested the cancellation of his investment in this product only to be told each time Caja Madrid would contact him. Finally in April he was informed his investment of 18,000 euros was worth 14.306.40 euros and a month later it had fallen further to 13,500 euros. This led to his angry protest in the bank in May.

Antonio Gil has asked the ombudsman for the return of his money in its entirety because he had not been given the correct information on an investment product which he has called “abusive”.

He is not alone. Ronda has a population of around 35,000 yet it is estimated that some 200 residents have been cheated by “productos basuras” with a number of financial institutions.

Now let us move on to Arcos de la Frontera just an hour’s drive from Ronda. Recently members of the Andaluz Workers Union and Izquierda Unida (United Left communist led-party) in Espera took over the Arcos branch of Caja Madrid in protest at the government’s rescue of Bankia. The protestors led by the communist mayor of Espera, Pedro Romero occupied the bank from 10.30 forcing the branch to close for business.

The mayor says the situation which is suffered by families in the Sierra de Cádiz is unsustainable, but the government prefers to concentrate its efforts on rescuing Bankia, even though the banks are to blame for the economic crisis. He says the government also makes it impossible for councils to help local residents, by restricting their money. 

Also in Cádiz province is Olvera, which is 30 minutes away from Ronda. On the same day as the Arcos protest the communist led council decided to close its accounts with two well-known savings banks because it believes they are not treating its clients properly. The local authority also invited other town halls to adopt similar measures against the abusive banks in their communities.

As you read this courts throughout Spain are admitting cases brought against banks that have entered in to abusive agreements with their clients in which they have seen their investment wiped out or greatly reduced. In the courts and on the streets the banks’ troubles are only just starting as a massive backlash takes place which will overshadow any EU bailout or government intervention. In many areas it is being led by the far left but in its anger Spain knows no political boundaries. Over 26 per cent of its people are unemployed whilst around half of its youth are jobless with no hope for the future. Yet the fat cat bankers are bailed out whilst families experience economic meltdown; have their homes repossessed and their benefits cut. No jobs for half a young generation but financial support, high salaries and bonuses for abusive bankers. Welcome to the Spain of the centre right Partido Popular and its premier Mariano Rajoy: truly the heirs of Franco.

(The above article appeared in the London Progressive Journal on Friday June 22 2012. Versions of this article have also appeared in Panorama and other publications).

HISTORIC VICTORY AND A SPICY TALE

The various rounds of the French presidential and parliamentary elections are now over. Before they started socialists throughout Europe were on the back foot. Now France has a socialist president and the Parti Socialiste will also have an overall majority in the National Assembly for Hollande’s five year term. This is historic but as Pierre Kanuty, who runs the international affairs of the Parti Socialiste in Paris points out – it is the end but also the beginning.

As I write this the final share of the seats in the French parliament is not known but the Parti Socialiste will have between 312 and 323 of them. The figure for an absolute majority is 289 out of the 577 so Hollande’s party will rule outright without having to rely on the support of the Greens or other left wing groupings.

One of those MPs will be Axelle Lemaire who is the first MP to be elected for the new constituency which embraces the UK, Republic of Ireland and all the Nordic countries. Lemaire is a French Canadian who spent her teenage years in France before settling in London. In the second round of voting she secured 54.8 per cent of the vote (Hollande received 53.1 in the presidential voting). A clearly delighted Lemaire expressed: “Un immense merci à tous ceux qui ont cru en moi, à mon équipe et aux électeurs! Fierté, responsabilité.” Her constituency must be one of the largest in the world but thankfully 80 per cent of her electorate are in the British Isles.

So now to Paris where Pierre Kanuty is celebrating the second major victory for the Parti Socialiste in just over a month. However he takes a sober view of events telling me: “the socialist party made it and won an absolute majority. This is historical, but we’re not hysterical. Historical because, for the very first time in the history of our country, the left, has all the powers. The local level and the national level. In a sense, it was mechanical, and no one forgets where we are coming from.”

Indeed the socialists in France have spent years out in the cold. Pierre observes: “Ten years ago, the defeat was so bitter that we’ve been through a deep depression. Under the leadership of François Hollande, the crisis was hard but we started to re-conquer from local basis thanks to our victory at all local elections from 2004 to present. With the local powers came the main cities like Paris, Lyon, Nantes, Toulouse, the regions and the departments - local councils.”

So Pierre why did Sarkozy win in 2007? “In a way, winning the presidential elections of 2007 was possible, but at the time, there was a strong gap between the fierce campaign of Nicolas Sarkozy and the controversial campaign let by Segolene Royal. Although we lost that year, we got more MPs than five years before and it was the promise of future victories. The landslide of municipal elections in 2008 and regional elections in 2010 brought a historical change with our victory in the Senate, for the very first time in history.”

So what was left for the Parti Socialiste to achieve? Pierre stated: “What was left was a national success for the left. Our primaries, the presidential campaign and the legislative elections, gave us a momentum we never lost. But on the other hand, voters were fed up with a whole year full of politics and elections. This is one of the reasons for the low turnout.”

I have already mentioned that Axelle Lemaire will be one of the new MPs and Pierre makes the point this election was: “Historical also because, more than one hundred female MP's, most of them socialists, will enter the new assembly. The conservatives had decided to sacrifice gender equality to secure an impossible victory. Ethnic minorities are also part of the winning pack with a dozen new MP's.”

So I asked Pierre how will the new parliament look? He explained: “François Hollande and Jean-Marc Ayrault have now a strong majority to implement their commitments. For the first time, the Green party will have a parliamentary group. The left front (a coalition including the communists) are the big losers of the campaign. Melenchon decided to defy Marine Le Pen, but the socialist candidate was ahead. This personal failure is to be added to a political crisis for the left front on the very day Syriza didn’t win the elections in Greece.

“On the right side, the Right went wrong. Most of the MPs from UMP who had been flirting with the National Front have been defeated. The National Front will have two MPs: a former controversial lawyer and the granddaughter of Jean-Marie Le Pen who will be the youngest MP.

“If we look at the map, we have historical victories in traditionally conservative constituencies. In many parts of the eastern side of the country, next to the borders, in areas that have not recovered yet from the collapse of industries, the conservatives and the nationalists made a strong performance.”

Pierre started his remarks by saying the Parti Socialiste had secured a historical victory but the socialists were not being hysterical. He explained why: “we're not hysterical because we fully understand the pressure of responsibilities. The current economical and social situation is the main frame. The situation has never been so hard. The socialists never had such a majority. But mathematical superiority must match political possibilities.

“It is the end of a decade in opposition and the beginning of a new era full of uncertain stakes and challenges. This will question the real strength of politics. Are we able to tackle unfair choices, to take over financial markets and stop the hysteria of austerity or are we just good to manage hard times.

“The government has the support needed to rule for economical efficiency and social justice. It is also a momentum for François Hollande and the time for him to make the right moves in Europe and in the G8 and G20. It is a strong hope for the progressives. Now it is time to move forward.”

The Spicy Tale: It was in early April that I wrote the first of this series of articles on the French elections. I touched on the colourful love lives of French politicians and that is how I shall close. Segolene Royal, the former partner of Francois Hollande and mother of his children was of course the party’s candidate for president in 2007. This time around she stood as an MP in Charentes-Maritime in La Rochelle. She was defeated by an independent socialist Olivier Falorni 63 per cent to 37.

Hollande had pledged his support for Royal but the new first lady who sits in the Elyse Palace in her place, Valerie Trierweiler, is said to have posted on Twitter her support for Falorni. In her speech conceding defeat Royal spoke of betrayal as well she might.

“Cherchons la femme” as they say in the Rue du Chat-qui-Pêche.

 (The above article appeared in the London Progressive Journal on Wednesday June 20 2012)

FRENCH CANADIAN BATTLES TO SPEAK FOR LONDON IN PARIS

The French Presidential elections are done and dusted and France now has a Socialist President, Francois Hollande, who has replaced the centre right incumbent, President “Bling Bling” Sarkozy.

Now France is embroiled in its elections for parliament. Nothing in French politics seems easy. There were two rounds of Presidential elections and whilst voting is underway for its MPs the final outcome will not be known till the second round on June 17.

Life is too short for me to enquire further in to France’s electoral system: for the wider centre left in the UK there are only two questions. First will the French voters elect a socialist majority to support Hollande and will the voters in the Northern Europe constituency return the Parti Socialiste’s French Canadian-born candidate to the 14^th National Assembly of the Fifth Republic as their MP?

French nationals à l'étranger have previously been able to vote for their president and for Senate seats. Now the French parliament has decided that for this election there would be overseas constituencies to represent its nationals abroad. I personally applaud the concept but given the size of the Northern Europe constituency I wonder how effective a voice the voters will have in practice.

When an MP stands for a seat he or she campaigns in their constituency which covers a small confined area. National leaders of the party are expected to travel from one corner of the country to another to canvass for votes. However for Axelle Lemaire, the Parti Socialiste candidate in the Northern Europe Constituency, and her rivals they have to campaign in the UK (which is home to 80 per cent of the voters), the Irish Republic then from Denmark, Sweden, Norway, Finland, Iceland, Estonia, Lithuania, Latvia to Greenland. I understand Lemaire has visited 25 cities on her campaign trail.

Axelle Lemaire is a true French international. Born of a French Canadian father and a French mother in Canada she lived there to her teenage years. Then after school and university in France she did a post graduate degree in law in London where she has lived for the past ten years. Her two children are as “international” as she is. The former advisor to a Labour MP now heads the socialist campaign in a constituency that is the Parti Socialiste’s to win.

The initial omens are good. In the first round of voting held on Sunday Lemaire took 30.16 per cent of the vote. Whilst in the second round of the French presidential elections a month ago 53.1 per cent of Lemaire’s voters backed Hollande compared with 46.9 per cent for Sarkozy. However it remains to be seen whether French voters in her constituency and wider France will give Hollande the socialist led parliament he desires. Fingers crossed for June 17.

For the picture in wider France I once again turned to Pierre Kanuty who runs international affairs for the Parti Socialiste in Paris. Pierre told me: “We hope our expectations will match the pundits' predictions. In a couple of weeks, the French voters will decided whether they want a left majority or not in the National Assembly after the victory of François Hollande three weeks ago.”

So how have French voters taken to Hollande’s new administration? Pierre stated: “As the first steps of the government led by Jean-Marc Ayrault seem to get positive media coverage, we believe a victory for the socialists is possible. The stakes are high. We need to find the tools necessary to shift from austerity to growth. Even if François Hollande's debuts on the diplomatic level and the first public appearances of our new members of government brought fresh air, style and determination, we cannot depend on an artificial momentum. There is no time to rest!”

In a presidential system of government how important is it to also have a majority in the National Assembly. Pierre is in no doubt: “We need an absolute socialist majority for if we need allies, we should, without arrogance, be able to count on our own in case there are hard decisions to make. By claiming so, we ask our voters to vote for us. But we have also decided to endorse candidates from the Green party so maybe, for the first time they will have a parliamentary group after the one they gained in the Senate last September.”

And what of the conservatives and Sarkozy’s supporters?

“The conservatives are very strongly divided and they have already started a violent fight between current UMP leader, Jean-François Copé and the former prime minister François Fillon. The quarrel goes from the leadership vacuum left by Sarkozy and the strategy towards the National Front. Copé claims he wants no deal with the National Front, but he and his friends use a NF like rhetoric,” warns Pierre.

“Most of all, the conservatives haven’t recover yet from their electoral hangover as they call for national unity and a new cohabitation. They consider the victory of the left as a danger, and the results of implementing our programme as catastrophe for the nation. It is weird to see a party, in power for ten years, kicked out from is by a clear vote, trying to keep its hooks in what they believe their property.”

Pierre has a clear message to those who supported Hollande on May 6. He stated: “We also use the scarecrow of cohabitation and the victory of the right to mobilize our voters. There won't be a mechanical effect just because on May 6 more than 51 per cent of the French voters chose François Hollande.”

The centre left fight back started in France on May 6 with the election of Hollande as the president. However it is clear that for socialists the job is only half done and the outcome of the June 17 parliamentary elections are vital. Let us hope for a Parti Socialiste victory and that French Canadian Axelle Lemaire will be London’s first French MP in Paris.

(Photo courtesy of Axelle Lemarie)

(The above article was publishing in the London Progressive Journal on June 6 2012).