Thursday, 30 December 2010

When does it take a socialdemocrat to call for the army?

On December 4th, Spanish Prime Minister Mr Jose Luis Rodriguez Zapatero called for a national state of emergency in order to dismantle the strike mounted thet weekend by the air controllers. The air controllers were protesting against their working conditions and the proposal to cut their wages. They had held a low-intensity protest for a long time and finally decided to escalate to a strike in order to make their demands heard. The center-left wing government of Mr Zapatero, afraid of a collapse in all Spanish airports, and following a quite "Thatcherite" approach to labor negotiations, decided to call for the army. The Ministry of Defense took control of the Spanish aerial space and all air controllers (civilians) were threatened with a court martial if they failed to report to their posts. Leaving aside issues such as whether the air controllers' demands were fair or whether the strike was legal, many commentators were surprised to see a socialdemocrat government to make use of the army in a country were the military has been an instrument of the political right from the early XIX century to the (failed) military coup of 1981.

The truth is that this event can be seen as part of a long list of situations in which some policies were implemented by very "unlikely" political parties. For instance, France privatized its public sector under socialist Mitterand, Israelies conceded the Sinai peninsula to Egypt under hawkish Prime Minister Begin, and it was the blatant anti-communist Richard Nixon who first opened the US to trade with the Republic of China.

More than ten years ago, professors Alex Cukierman and Mariano Tommasi wrote a very nice paper entitled When does it take a Nixon to go to China? (American Economic Review, 1998) in which they gave an explanation to this phenomenon of "policy reversals": When voters do not know exactly what is the best policy to be followed and they do not know either whether a party takes a stand because it is in the citizens' interest or just because ideology, "unlikely" parties have an advantage in signalling credibly. If a hawkish israely government negotiates with Egypt or if a republican visits China, voters can be reasonably sure that it is because these are the best policies for the majority of the populations and not just because they are what politicians would prefer to do themselves. A socialdemocrat government thus signal more credibly than a rightist government that being hard on strikers and (perhaps) calling the army is the best strategy. Voters have less reasons to suspect that such a policy is proposed solely because of the ideological tendency of the party in office. This also explains why previous center-right governments in Spain failed to take a hard stand in previous conflicts with the air controllers.

And this also explains why, if the UK ever adopts the euro, it will be probably under a tory government.

Sunday, 5 December 2010