The Future of Europe

An Interview with José María Aznar

Another problem is that the Western Allies said, “I don’t like problems.  We don’t like problems.” But obviously, Russians take note of this, Koreans take note, Iranians take note, Venezuelans take note, Cubans take note, and this is a very bad situation.  In politics, serious problems will prevail if you don’t establish very articulate policies to avoid more problems with people that don't respect the rules.

OR:  Do you think there is a perception overseas that the US is in retreat and disengaging from the world?

Aznar: I believe that in a lot of countries this is very disconcerting.  For instance, there is not a lot of interest in Europe in this administration to the desperation of the Europeans, because the Europeans were in general extremely favorable in the beginning to this current administration.  But the absence of this administration in the Middle East is a problem.  This concerns a lack of trust.

One thing is to redefine policy and another thing is the absence of leadership.  The only country at this moment with some capacity to establish some order in the world continues to be the US with its allies.  If not, we will find more and more problems in the future.

Spain

OR:  Do you feel Spain has turned a corner and that the recovery is sustainable or do you still think there are significant reforms that need to happen?

Aznar:  We are on the way to recovering competitiveness, to recovering some part of the ground that we lost in the crisis, but we need more time.  I hope that the government will be taking more decisions to stimulate growth and create jobs and to make reforms and to take advantage of the opportunity to change a lot of things in the Spanish economy and improve the opportunities for the people.

Politics means, in economic terms, to create opportunities for the people. To be more precise, to create jobs.  But to create opportunities and to promote reforms vital to the society, we needed political tranquility.  We have a majority in this moment.  We have problems with separatism in Spain, but the majority of the country is against this possibility of secession.  We must continue to reinforce the unity of our nation, to recognize a plurality in the nation, but to respect the rules essential to our constitutional system.

My experience in the government, in this sense, was a good experience.  We created almost six million jobs, new jobs, in eight years.  The transformation of the country was very impressive.  Imagine that almost fifty percent of the jobs that exist were created during the eight years.  The transformation in my country was enormous.  The mentality of the people changed totally and there was then an optimism in the country, to say as a people, “We are capable of doing a lot of things. Now, we have a place at the table with the people that decide the important things in the world.”  That is a different mentality and this is what we must recover.

OR: Do you feel that there is more of a sense of optimism now in Spain or there is still concern?

Aznar: Maybe in the economic sense, we are more optimistic.  Politically, the concerns are serious.

OR: Do you think that the tough reforms will happen politically?

Aznar: This is a responsibility of the national government but is the responsibly as well of the ECB.  The intervention of the European Central Bank and Mr. Draghi has been extremely correct and decisive.  And the idea that there can be intervention by the European Central Bank to stimulate growth or to avoid deflation, I think is extremely important.  If we can turn these words into decisions, I think the situation will become better more quickly.

OR: When you left office, Spain’s debt was among the lowest in Europe. It’s now approaching one hundred percent of GDP.  Do you think that will continue to be a drag?

Aznar: Indebtedness – public and private – continues to be important in Spain, but the capacity to attract new investments in the country is very strong at this moment.  But we must continue to reestablish discipline in public life and to decrease the level of indebtedness in the private sector.   And we need time.  We need to combine this with the actions of the European Central Bank.  This is one of the questions because if you combine deflation with indebtedness, it is a very serious concern.

OR: So what do you think is the biggest risk for Spain going forward?

Aznar: I think it’s political risk.  I think that the major risk is we don’t establish a very strong national policy that continues the history of the success of the thirty-two years in Spain until 2004.  That transformed the possibilities for the Spanish people.  I think the risk is political.  It’s not economic.  It’s political where you combine secessionists on the one hand and the unemployment on the other hand especially for young people.  This is one of the reasons why we must move very quickly in this.

OR: Do you see a risk of social unrest?

Aznar: No, but we have the combination of different problems: unemployment, problems with immigration, decisions that limit the extension of the welfare states.  Again, they can be used by the extremists and this is the worst situation.

OR: Do you think the banks are now in decent shape?

Aznar: I think the banks are in a much better situation, but we must recover the normalization of credit for companies, for families and for people in general.  This is the normal activity of the banks. This will be a consequence of more stability in the economy and the decision of the European Central Bank and the evolution of the Eurozone.

OR: You're definitely seeing more foreign investment.

Aznar: The capacity of the country to demonstrate trust in the future and that there are a lot of opportunities for foreign investment is very impressive.

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photo by Berit Kessler

The Middle East

OR: Switching topics, do you think that Iran is eventually going to get a nuclear weapon?