Spain

ONE night last June, at the height of the Poets’ and Writers’ Congress held at the luxurious Formentor Hotel in Mallorca, the word suddenly spread that something strange was going on offshore. Leaving the bar, the writers, both foreigners and Spaniards, flocked out onto the terrace overlooking the tranquil waters of the Mediterranean.

Some distance at sea a solitary figure could be seen slowly rowing a small boat toward the land. As it came closer, the unmistakable, round head of the Congress’ chief organizer came into view above a mountain of books. It was the Spanish writer, Camilo José Cela, pretending to smuggle in a contraband load of literature recently banned by the censor’s office in Madrid.

This charming piece of literary horseplay is a good example of the subtle change of mood that has occurred in Spain in recent years. Criticisms of Franco, which were once made in hushed voices, are now made openly and often in the presence of government officials. Today even the most ardent advocates of the regime seem to be a little shamefaced in their apologies for a political system which has been revealed — especially since the discovery that Spaniards in high places are tucking away their money in Swiss banks — to be a hothed of nepotism and corruption.

The dark days of mass arrests and indiscriminate shootings are clearly over. The concentration camps have disappeared, and the government claims that only 1450 political prisoners are still languishing in its jails. Critics of the regime and potential troublemakers are still occasionally arrested, but it is usually as a kind of warning, and they are normally released a few weeks later.

This leniency has led some observers to believe that the Franco regime is losing its grip and that its days are numbered. Others interpret it to mean that the regime is now so firmly established that it can afford to turn a deaf ear to occasional outbursts of criticism. The truth no doubt lies somewhere between these two extremes.

Twenty years after establishing his grip on the country, Francisco Franco shows no signs of beinganxious to retire. Officially he is the Regent of the Spanish Monarchy — a status which was formally recognized by the Law of Succession of 1947 — and he is publicly committed to prepare the return of a Bourbon to the throne. But it is an open secret that he feels misgivings about Don Juan, the forty-five-year-old son of the last reigning monarch, Alfonso XIII. The Generalissimo is suspicious of the liberal tendencies which Don Juan is reported to have acquired during his period of service in Britain’s Royal Navy.

The favored heir to the Spanish throne is Don Juan’s son, the twenty-one-year-old Juan Carlos, who recently completed his fourth year of military training at the Air Academy of San Javier, in Murcia. Juan Carlos, however, has always been emphatic in declaring that he would never ascend to the throne while his father was alive. He is, furthermore, legally banned from immediately mounting the throne by the 1947 Law of Succession, which stipulated that the next Spanish monarch must be at least thirty years of age. Not until 1968 will Prince Juan Carlos reach that age.

Behind the lip service that Franco pays to the monarchy and to monarchic ideals, he seems to maintain a certain reserve. He was not a monarchist in his youth, he was made a general under the Republic, and it took him a good six weeks, when the Civil War first broke out, to decide with which side to throw in his lot. Circumstances rather than conviction have made him a monarchist, the monarchy appearing to him as the only durable alternative to a chaotic and Communistthreatened republic. But his reservations toward the monarchy have been so great that he has not hesitated to allow rival monarchist groups to challenge the legitimacy of Don Juan’s rights to the succession.

Industrial boom

There is general agreement in Spain that only something as serious as a major economic slump could at present undermine Franco’s hold on the country. Though Spain has been in serious economic straits, the situation is still not catastrophic. For the last five years, in fact, Spain has experienced something of an economic boom. Billions of pesetas have been poured into building new dams, irrigation canals, steel and iron works, car and truck assembly plants, chemical factories, oil refineries, and so on. No visitor to Madrid can fail to be impressed by the forest of new, red-brick apartment buildings which has mushroomed in the capital’s rapidly expanding suburbs.

From the beginning, however, the industrial boom has been artificially maintained by American military and economic grants and loans, totaling more than $600 million for the last five years alone. For a while this infusion of dollars helped Spain to acquire the raw materials, machine tools, and capital goods it needed for its industrial investment program; but by the end of last year the demand for such goods had so far outstripped the annual dollar grants and loans that Spain had only §65 million of foreign exchange reserves left, or less than one tenth of the annual import needs. The time for retrenchment had come.

As long as the investment boom lasted, it has been calculated that something like 120,000 new jobs a year were being created—enough to absorb a demographic increase which has lifted Spain’s population from about twenty million at the end of the Civil War to thirty million today. During the last four years, there was a steady decline in unemployment, the lowest point being reached in the first six months of 1958, when there were only 85,000 registered unemployed in a total working population of some twelve million. But when the ax fell, the number of unemployed began to rise.

This unfavorable development has been aggravated by the carefree way in which the recent industrial expansion was financed. It has been estimated that 35 to 50 per cent of the expenditures of Spain’s 820 public and semipublic enterprises has actually been covered by budgetary receipts in the last few years; the rest has been provided by bank loans and by the printing of new money. The result has been a serious inflation, which has raised the cost of living by 40 per cent in the last two years.

By the beginning of this year, the sizable wage increases of the autumn of 1956 had been wiped out by the sharp rise in prices, which had the subsidiary effect of discouraging new consumerdemand. Many plants in Barcelona were forced to close down late last spring, not only by a lack of imported raw materials but even more by the cessation of new orders and the piling up of inventories. By the time that the Minister of Commerce, Alberto Ullastres, and the Minister of Finance, Mariano Navarro, came out with their stabilization program last June, it was at least six months too late, for they were faced with a deflationary, not an inflationary situation. The net result was that the restriction of credit and other stabilizing measures will make it harder than ever for Spain to climb out of its present economic rut.

The neglect of agriculture

At the root of this crisis is the overemphasis that has been placed on the rapid industrialization of Spain, to the neglect of its agriculture. There are certain areas where industrial investments have clearly been justified. Spain’s coal mines, which produced seven million tons before the war, now produce sixteen million. Even the controversial Aviles iron and steel mill in northern Spain, which cost between 14 and 28 billion pesetas (depending on whether one accepts official or private estimates), can probably be justified, though it is dependent on imports of iron ore from the Moroccan Rif and of coal from the United States.

It is less easy to justify enterprises like the Scat (Spanish affiliate of Fiat) motorcar assembly plant at Barcelona or the Renault factory at Valladolid. The first produces some 18,000 cars a year, and the second, when in full operation, will turn out 12,000 Dauphines. Such low and uneconomic rates of production partexplain why a Spanish Seat costs three times as much as a Fiat in Italy, and a Spanish Dauphine three times what one costs in France.

Only by increasing its exports can Spain hope to pay for its everexpanding imports, and most of Spain’s exports are in agricultural products like olive oil, citrus fruits, wines, and vegetables. It has been estimated that Spain’s agricultural produce could be significantly expanded by simply doubling the million tons of fertilizers Spanish peasants and farmers use each year.

The crisis has been partially mitigated by the fact that there have been fairly bountiful rains, and consequently the best harvest — five million tons of wheat — in years. But a plethora of wheat cannot make up for a shortage of work and jobs.

The groups opposing Franco

Most Spaniards believe that with a little more help from Uncle Sam they can somehow muddle through. Among the opposition, a few believe that the present economic crisis would bring the Franco regime to its knees if only the United States were to leave it to its fate. But just what would happen thereafter is a question that no two Spaniards seem able to agree on. Reluctant as they are to admit it, most Spaniards are tacitly convinced that the disappearance of Franco at this uncertain juncture would simply lead to anarchy and renewed civil strife.

There are a number of reasons for this. The Spanish Catholic Church, which is as reactionary as any church in the world, is probably as hated as it was in the days of the Republic. The new Pope, John XXIII, is known to wish to liberalize the Spanish Church and to have it gradually dissociate itself from its compromising ties with the regime. But by the terms of the concordat which was renewed several years ago between Rome and Madrid, the Vatican is pledged to choose new Spanish bishops from a list of three candidates drawn up by the Spanish government. This spring there was official irritation in Madrid when the Pope disregarded the three government-selected candidates for the vacant bishopric of Córdoba and named Monsignor Manuel Fernandez Conde, a Spanish prelate who had served for a number of years in the State Secretariat of the Vatican.

The active opposition groups, which include Socialists, Christian Democrats, syndicalists, anarchists, Basque and Catalan patriots, and a dozen or more splinter groups, have never been able to get together on a common program. The monarchists are a relative minority, limited to a few intellectuals who feel that any kind of monarchy would be an improvement over a military dictatorship and to a number of titled aristocrats who expect the monarchy to help them preserve their vast estates, so that they can go on declaring and paying taxes on a sixth or a seventh of their real earned incomes.

The best organized opposition group is probably the Communist Party, if only because it enjoys secret financial support from Soviet sources mid a radio station which broadcasts in Spanish from Prague. But even the Communists have less real power than they like to claim. The general strike which they tried to engineer last June 18 was a spectacular flop.

In this situation the Spanish army remains the final and decisive force. Its high command and its senior officers, down to the rank of colonel, appear to be quite loyal to Franco. Spanish liberals are persuaded, however, that time is on their side. They believe that the pressure of European competition from such organizations as the Common Market is bound eventually to undermine the strength and autarchic pretensions of the present military dictatorship. The more international and European organizations that Spain can join, the better it is, they feel. Spain is already a member of the Organization for European Economic. Cooperation, and they look forward to the day when it will become a member of NATO, the Common Market, and the Council of Europe.