Spain’s Transition: Economy, Society & 1978 Constitution
Spain’s Transition Economy
Looking back at 1973, Spain faced the following economic situation:
- GDP growth stood at 8%.
- The unemployment rate did not exceed 2%.
- Foreign exchange reserves amounted to 6,000 billion Pesetas (Note: currency assumed).
- Inflation was running at 12%.
The underlying reasons for Spain’s economic vulnerability at this time included:
- A relatively closed economy, limiting international trade and competition.
- An inequitable public sector, potentially implying high or poorly structured taxes.
We can distinguish two main phases in the economics of the transition period:
First Phase: 1973-1977 Oil Crisis Impact
This phase was characterized by the spectacular rise in oil prices in 1973. At that time, Spain heavily depended on oil, so its economy was greatly affected. The resulting crisis spread throughout the transition period.
A decision was made not to pass the full impact of the crisis onto the population; therefore, national income had to absorb the oil price hike. How was this managed?
- Increasing state revenue.
- Allowing price increases.
- Reducing real wages.
- Decreasing employment.
- Drawing down national savings.
- Seeking new energy sources.
Consequently, national savings were considerably reduced. The error was the assumption that the oil price rise would be short-lived, a fad. It wasn’t, and by 1977, the situation was catastrophic.
Second Phase: 1977-1985 Adjustments and Challenges
1977-1979: Suárez Government and Moncloa Pacts
The government changed, with Adolfo Suárez becoming the new President. Key measures included:
- Devaluing the currency (Peseta) by 20%.
- Reducing imports and increasing exports.
During this time, the Moncloa Pacts (October 1977) were established, representing a consensus among political forces to address the crisis.
1979-1982: Second Oil Shock and Industrial Crisis
Oil prices rose again (second oil shock), affecting Spain more severely than the first time. National income was significantly impacted. An industrial crisis was declared. At this point, Spain’s oil dependency was around 61%.
1982-1985: Socialist Government and Rising Unemployment
The Socialists (PSOE) came to power with an absolute majority. Unemployment increased significantly. By 1985, the economy was vastly different from that of 1973. Agriculture continued its decline, both as a sector and in its contribution to national income.
Society During Spain’s Transition
The society undergoing the transition had its roots in the changes of the 1960s. This society exhibited several key characteristics:
- A predominantly urban population.
- A significant and growing middle class.
- Improved quality of life for workers.
- Increased incorporation of women into the workplace.
- Rising cultural and educational levels (e.g., more universities).
- Increased societal openness and mobility (e.g., student scholarships, tourism, emigration/return migration).
- A significant shift in the Spanish mentality.
The working class primarily focused on labor-related demands. This highlighted the need for effective trade unions.
Key societal desires underpinning the move to democracy were peace and order.
In summary, the transitional society saw people radically change their thinking following the Franco regime. Freedom of thought became noticeable.
The Spanish Constitution of 1978
The Spanish Constitution of 1978 is the supreme law of the Spanish legal system. Any law contradicting the Constitution is void.
Following a long period of dictatorial rule under Francisco Franco (who died in 1975), there was a recognized need to enact a constitution aligned with contemporary times and the emerging Spanish society. It embodies the historical and social aspirations of all peoples within Spain, reconciling national development with the unity of the country.
The Spanish Constitution of 1978 consists of 169 articles. The Constitution comprises: a preamble, a Preliminary Title, and ten Titles divided into chapters (with Chapter II of Title I further divided into two sections). Structurally, it can be divided into three main parts:
- An dogmatic part (Articles 1-55): Outlining principles, fundamental rights, and duties of the state and individuals.
- An organic part (Articles 56-165): Detailing state institutions and their functions.
- A constitutional reform part (Articles 166-169): Specifying the amendment process.
Additionally, it includes a preamble, four additional provisions, nine transitional provisions, one derogatory provision (repealing previous laws), and a final provision.
The text was approved in a referendum on December 6, 1978, with 87% support. It was sanctioned by the King on December 27 and published in the Official State Gazette (BOE) on December 29, entering into force on that date. Since then, December 6th has been celebrated annually as a national holiday in Spain, known as Constitution Day.