The markets, according to Moody's, approves of measures such as the Official Credit Institute (ICO following the Spanish acronym) offering a line of credit to feed a payment plan to government service providers who are owed money, but Spain's deficit goals, which are at unprecedented levels, will only be met if the government undergoes deep reforms in healthcare, education and the government employment.
The markets doubt that strength of regional governments and are asking the national government to set a standard and not let each regional government set out arbitrary reform measures such as types of healthcare co-pays that vary across regions.
We cannot allow any mistakes if we want to meet the deficit goal. The national budget is the tool for exercising leadership. It cannot be a failure. It will be the litmus test that the markets use to establish their view about Spain's strength.
