"In, Inde, Independència!"

I originally wrote this at the end of September 2012 but declined to post it because Spain at the time was in the throes of a serious financial crisis and in my professional position, a personal opinion of this nature may have been counter-productive. Five years-on, however, I feel the debate is out in the open and this may be a minor contribution to it.

Greetings, o’ loyal reader. It has been a long time indeed since I last wrote in my blog. Partly this is due to new demands on my time from a new family member but, more importantly, I have been constrained due to my current professional activity. I have a fiduciary duty to my employer and, as such, I need to keep most opinions to myself.

However, I have been raised from my quiescence by the recent sight of almost one million people clamouring for independence in Barcelona. Reflecting upon this event, I remembered a good friend and former MBA classmate who, as an advertising executive, revealed to me the art of his profession. “Blood, sex and money”, he said. These are the primal instincts that move people. Appeal to these and you can move mountains. Blood. Sex. Money. Think of all the cases where rational argumentation is futile because it directly attacks one’s feeling of belonging (religion and family?). Think of all the cases where rational thought is put away in order to pursue a sexual fantasy (Bill Clinton and Dominique Strauss-Kahn). Think of all the cases where civilised behaviour is eschewed in the pursuit of power and status (too many to mention?).

I pondered upon this when I tried to get another friend to explain to me why he defended the idea of an independent Catalonia. After failing rather miserably to present a rational argument he ruefully admitted: “It’s a question of feeling”. He was not able to rationalise an independent Catalonia, he worshipped an independent Catalonia. At this point, I realised that no rational argument was ever going to waive his conviction, his feeling of belonging, his kinship with the tribe.

Against irrational and emotional arguments that have set in people’s minds it is almost impossible to win. Think of religion- how many mad ideas are floating about which are plainly ludicrous, but whose mere criticism can place you at risk of death? This, unfortunately, is the situation that we have to deal with in Catalonia. There are limited ways of dealing with this problem and one, force, is clearly not an option in today’s environment. Yet other options exist and only require the political will to be implemented. Aligning incentives- both positive and negative- is clearly an option. The threat of a Spanish veto to a Catalonian entry to the EU is an example of negative incentives but these are not sufficient. Are positive incentives not available? Don't we have examples of how Catalonia has prospered within Spain? Many are available but few publicly abound.

Finally, the propaganda apparatus of the nationalists should also be deactivated, probably by cutting the access of public funds for these means. But also by using pro-Spain advertising and marketing. The population in Catalonia currently only have access to one side of the story.

In theory, the debate is centred around the fiscal"theft" that the rest of Spain inflicts upon Catalan taxpayers. Leave aside the obvious point that many of those claiming redress are net tax recipients rather than contributors. What is clear is that tax rules are the same in Spain as in Andalucia and as a consequence residents in Catalonia pay more because they earn more. Again leave aside the argument that part of the reason that Catalonian residents pay more is because of many large corporates selling to the rest of Spain are based here (Madrid, by the way, contributes far more for exactly the same reason).

So the gripe is about expenditure and "justice". Since 1978, Catalan nationalists have been asking for transfers of decision making, which has been achieved to an extent unknown in any jurisdiction I know. I can't, for example, think of a single instance of a region that does not permit public schooling in the national language, despite parental demand for optionality. Once most decision making power has been transferred, the issue is whether these powers are administered efficiently. It is pretty obvious that successive governments have done at least as badly as the national governments in managing expenditure.

One obvious source of expenditure reduction would be to recentralise some decision-making power but that is not an option, which shows that the debate is not really economic but more a smoke screen to hide the ultimate ambitions of the puppet-masters of the demonstration: secession. Time will tell.