Tax Break

Who said tax is boring?

Mas or Messi?

Barcelona. There was a time, not so long ago, when the capital of Catalonia was not yet known for Freddy Mercury’s super-hit of the same name, when the  1992 Summer Olympics had not yet produced gold, when Carlos Ruiz Zafon had not yet got round to romanticizing La Rambla and the mysterious Cemetery of Forgotten Books, when Gaudi’s architecture and that permanently half built church just looked plain weird – and the best football team in the world had yet to stamp its trademark on the beautiful game.

Spain was a place for low-cost vacations, El Cordobes, fugitive gangland figures and cheap Muscatel wine that belonged next to the Coca Cola on the shelves of English supermarkets. But most of all, if you happened to like 1970s British humour , Barcelona was the birthplace of the semi-idiot waiter Manuel in John Cleese’s classic sitcom, Fawlty Towers. No TV character was ever more successful in hijacking the collective perception of an entire city.

Artur Mas, the President of Catalonia and a normally highly intelligent man, has been displaying elements of Manuel Syndrome lately to remarkable effect. Struggling, like everybody else, with Spain’s austerity programme and coming to the conclusion that the wealthy region of Catalonia was paying more taxes to support the rest of Spain than it was receiving from Madrid, he decided it was time to shake things up.

Calling an election only two years into his term of office, he based his manifesto on a promise of a referendum on Catalonian independence from Spain. That the promise was contrary to the Spanish constitution didn’t seem to bother him. This was his chance to give Catalonia freedom to set its own taxes (which seems to be the main gripe) and for an obscure local politician (Mr Mas) to hit the big time.

He would have “persuaded” Mas not to call a referendum

In fairness, Catalonia  does have certain characteristics of a nation. It has its own culture, its own language (which is more than can be said for Australia, Canada and the United States) and a population of 7.5 million. On the other hand, Catalonia has lacked true independence since time immemorial, while  a chunk of it has been  stuck in another country for centuries. That chunk has not expressed any similar desire to break away from the warm bosom of  its French maitre. So at best the prospect is for a Peoples’ Republic of A Big Chunk of Catalonia with an in-built reason for going to war with France to “free” its (unenthusiastic) compatriots from foreign domination. Judging by France’s dismal performance in wars over the last century, they might even win.

Apart from being a local politician who wants to get his name in the history books, Mr Mas is also an economist, which, given the economic lunacy of his independence idea and the mess Spain is currently in, makes me wonder what they teach in the Social Sciences Department of the  University of Barcelona.

Catalonia is justly proud of its export record but almost half of its trade is with other Spanish regions. If it were to gain independence it would need to apply for membership of the EU (not a foregone conclusion as has been pointed out to the Scottish secessionists) and meet its EU budget obligations, while servicing its own (bloated) debt. Although, in the modern global economy,  absolute size  is no longer a pre-requisite for  prosperity, access to trade certainly is. What is more, major economies have learnt that there is much to be gained by supporting weaker economies as they grow, producing , in turn, new middle-classes that will increase demand for their products (perhaps Mr Mas, so engrossed in other issues, hasn’t had time to learn about the European Union).  So what is the point of seceding from a country that is critical to your own economic prosperity, even if it does currently cost you a few pesetas each  year?

In the event, while pro-independence parties won the election last week, Mr Mas took a drubbing and will now, thankfully,  spend more time trying to stay in power than concentrating on independence and messing things up generally.

It also became clear during the campaign that enthusiasm for absolute independence was not that great. Should the Government in Madrid offers the regions some form of federalism with  proper taxing rights, it could be that the whole independence thing evaporates. Then Catalonia could get on with being the engine to  pull Spain back to the economic health so crucial to the Euro project.

At the end of the day, any move for independence will have to deal with a far bigger question. What will happen to FC Barcelona? Would the Spanish let them carry on playing in La Liga or punish them for deserting ship? If they were turfed out, could Spain and Catalonia survive without  the bi-annual Civil War between Barça and  Real Madrid? In the end, given the power of football, that could be the deciding factor. Anyway, isn’t all this nationalist stuff passé? After all, the opposing fans will be cheering for Messi and Ronaldo. Neither is Spanish, let alone Catalonian.

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