Since there is a general election coming up before March 2008, Zap has been making promises of government grants and subsidies to pretty much everybody and his dog. Two days ago he announced that persons between ages 22 and 30 with gross earnings of less than €28,000 will receive a monthly rent subsidy of €210, along with a €600 loan to meet the deposit and a government 6-month payment guarantee for the landlord. The measure will take effect January 1, 2008, and will cost €436 million a year.
More Zap government spending programs:
The new Dependents' Law, in effect since January 1, 2007, will provide €13 billion of central government money between now and 2015 to some 225,000 seriously disabled people. The various regions are to match central government spending with €13 billion more.
€2500 per new child born, in effect since Zap announced the measure on July 3. The plan is to make the payment retroactive to include all children born in 2007.
The minimum government pension will be increased by double the average increase of all pensions.
The National Health will pay for the dentistry work of all children between ages 7 and 15. This will take effect next year, benefit some four million children, and cost at the very least €160 million a year.
The PP has suggested that instead of subsidizing rental apartments for people under 30, Zap might consider reducing everybody's income tax instead. They also suggested that the government might consider providing better legal security to landlords, who have great difficulty evicting tenants who don't pay and repairing damage caused by said tenants; this would bring more rental apartments onto the market, as many people are unwilling to rent with current laws. Even the Communists have pointed out that landlords are very likely to simply increase the rent they demand by €210 a month.
Personally, I don't like this particular rent subsidy; what I'd do is pass better landlord-protection laws, get rid of rent control (which keeps literally millions of dwellings either off the market or occupied for rents far below market level), and re-zone extensively to make it easier to build housing.
I'm a moderate on government social spending in general: I prefer for spending and taxes to be as low as possible. However, I also understand that we have a social contract to protect the weakest among us. In that spirit, I like the Dependents' Law; if most of that money is spent reasonably, it ought to help out Spain's most severely disabled people a lot. I also like raising the minimum pension; these are retired folks getting by on very little, and they need all the help they can get. Paying for children's dentists should be means-tested. Poor children are weak and vulnerable and deserve to have their cavities filled just like everybody else, but middle-class folks ought to be able to pay for their kids' dentist themselves.
I'm going back and forth on the subsidy for newborns; the government's purpose is to raise the birth rate, and I guess that's important enough that all taxpayers ought to kick in in order to make sure there are enough kids born now to pay for our pensions in thirty years or so. On the other hand, I can't help wanting to means-test the payment. And I don't think a €2500 check is going to convince a lot of middle-class people to have kids, and I'm not sure we ought to encourage the reproduction of those who are willing to bear a child in exchange for a check.
By the way, the money spent on these programs is going to add up to a lot less than the "infrastructure" central government transfer to the Catalan regional government. It has been decided that 18.8% of all Spanish government "infrastructure" spending is to be transferred to the Catalan government in order to invest as it pleases; Catalonia produces 18.8% of Spain's gross domestic product.
So on Monday economics minister Solbes and Catalan economics counselor Castells came up with their new definition of "infrastructure" spending: it will consist of not only spending by the Development and Environmental ministries, as it had until now, but also spending on industry, commerce, agriculture, technology, and research and development. So this year the Catalan government received €3.2 billion from Madrid for "infrastructure"; next year it will get €4.3 billion, in addition to an extra €800 million for 2007.
On one hand, I'm not offended at all. This is just divvying up the pork, something that exists everywhere, and the Catalans are doing their best to get as much of it as they can. That's what I'd do if I were a Catalan politician.
However. All this extra cash is going to be turned over to the members of the political machines currently in power, the Socialists, Communists, and Esquerra. It's no secret that what they call "clientelism" is rampant in Spain, and it's reminiscent of big city boss politics in the bad old days in the States. The money is going to be handed out in the form of jobs and contracts to party loyalists, and the Socialists are going to get the biggest slice of juicy ham.
And it's ridiculous that political machines hide behind the ideal of nationalism--"we poor Catalans are getting screwed over again, Madrid is stealing our money, they want to keep us down, that's why they won't let us be independent, so they can exploit us, and blah blah blah." Come on. Catalonia is prosperous and Catalans have a high standard of living, and I figure that most of the problems (none spectacularly important) we have around here are pretty much our own fault. But it's such fun to blame Madrid.