In Spanish election, economy eclipses issues like gay marriage

Though unimpressed with either of Spain's two main political parties, Santiago Rodríguez knows what the big issues are in this Sunday's national elections. "Unemployment, salaries, immigration – those are the things that matter," says Mr. Rodríguez, a civil servant.

It wasn't expected to turn out this way. Only a few months ago, the March 9 vote looked set to hinge on broad political questions about national identity, regional autonomy, and how to deal with the Basque separatist group ETA. In addition, it was seen as a referendum of sorts on Prime Minister José Luis Rodríguez Zapatero's sweeping social reforms on gay marriage, divorce, and other issues, which have riled conservatives and the Roman Catholic Church.

Then the economy faltered, and everything changed.

"I can't remember if it was Churchill or another British politician who said, 'The worst thing that can happen to a reelection campaign is an event,' " says José Ramon Montero, political scientist at Madrid's Autonomous University. "With the economy, Zapatero has an event."

He does indeed. After reaching a high of 4.3 percent in December 2006, economic growth here slowed in the fourth quarter of 2007 to 3.3 percent. Unemployment in January hit 8.6 percent, spurred by crises in Spain's real estate and construction industries, which together constitute an unusually large part of the country's GDP. And in step with the rest of Europe, the costs of basic foodstuffs in Spain have risen exponentially in the past few months (the price of milk is up 25.85 percent in the past year, the price of flour up 19 percent).

Both major parties competing in Sunday's election have scrambled to recast their campaigns accordingly.

Zapatero, a member of the Socialist Party, has created a ¤210 ($320) subsidy for young people seeking to rent their own apartments and a ¤400 rebate for all taxpayers. In Monday night's nationally televised debate with Popular Party (PP) candidate Mariano Rajoy, the prime minister promised "a battery of actions designed to reactivate the economy," the first being an "infrastructure plan that will compensate for the drop in the construction industry."

Socialist Party campaign director Oscar López claims that the measures have made a difference. "We've shown that we're best prepared to confront this economic slowdown and demonstrated to Spanish families that we're the ones who will help them."

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