Despite his initial desire to stay, Zapatero finally gave up yesterday after popular claims to call for early presidential elections. Today we can see where unfounded optimism goes. In the last seven years, Zapatero had four government crisis and his closest ally, Elena Salgado, is the only one who has survived them all.
The timing for the new elections date, November 20th, has two main implications. One is that Zapatero will not provide encouraging economic data in the months to come, maybe we should wait for a negative surprise.
He is leaving now because even his Cabinet can´t support the credibility of its growth forecasts. Yesterday the IMF warned that Spanish government projections are overvalued and called for more actions, especially in regional areas.
Just hours earlier, Moody's placed Spain in negative outlook for a possible downgrade and lowered the note to six CCAA, which increased the risk premium to 354 points when the Dow Jones lost 7 percent of its value during the last month.
The second implication is that the Fiscal Budget FY 2012 will be an extension of the previous ones, which interrupt the implementation of the adjustments imposed by the EU and makes more difficult to Zapatero´s successor to applied them in the near future.
This, coupled with the disastrous economic legacy that the winner from the presidential elections will inherit, dismisses any sign of responsibility, contrition or respect from Zapatero.
He pledges that he doesn?t want to leave to his successor the most challenging tasks, like additional unpopular adjustments, but he has not dared to undertake them under his term. Instead of leaving with his head high he preferred to show his inefficiency once again, acting under pressure from financial markets.
