Pedro Sánchez will become the new Secretary General for the Spanish Socialist Workers Party (PSOE), is drawing up the first parts of his government's agenda. On the menu are a VAT hike and a new tax on the wealthy, both echoing policies held by France's Christian Democrat party.
This is a clear wink to the military socialists that were just elected to manage the PSOE. As economists, we maintain a clear-headed and responsible attitude toward public and bank debt and try not to preach. Still, raising taxes will make it hard for the economy to rebound and the nation to pay down its debt. Strong promises are one thing, and economic reality is another.
