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As the Socialist prime minister approaches the end of his tenure, the troubled economy is his priority. This marks a major turnaround for a leader who was once known for his progressive and controversial social policies.
Prime Minister Zapatero will not run for a third term in office
When the Spanish Congress approved homosexual marriage and adoption in 2005, many left-leaning commentators rejoiced at what they saw as a reform which would bring the country firmly into the 21st century. Meanwhile, Catholic bishops accused the government of dismantling the family institution and organized massive protest marches against the legislation.
Having been in power only a year, this was the clearest example of how Prime Minister Jose Luis Rodriguez Zapatero's socially-oriented policies delighted some Spaniards and alienated others in his first term of office.
"Zapatero was what we might call a political reformist - he wanted us to have a better democracy," said Fernando Vallespin, an analyst at Madrid's Autonoma University. "He liked the idea of more civil rights, of more freedom, more equality, a greater secularization of the country. All of this went far beyond what was expected of a social democratic leader."
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It's no accident that Vallespin used the past tense when talking about Zapatero's socially-focused policy agenda. This Socialist from the north of Spain is now nearing the end of his second term in power, with elections scheduled for November 20. Having decided not to run for re-election, his career in front-line politics appears to be coming to an end. But with Spain's economy having dominated the latter years of his tenure, Zapatero resembles an economic reformist rather than a political reformist as he finishes his term.
When he took power in 2004, with the economy still booming, Zapatero focused on social reforms. Under his administration, legislation was pushed through allowing gay marriage, more accessible abortion and quicker divorce. His first cabinet had as many women as men, reflecting his commitment to gender equality.
He also introduced a controversial historical memory law, offering redress to victims of the Franco dictatorship and removing Franco-related symbols from public spaces. Many on the left welcomed it, although the law upset the political right.
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"The consensus after the death of Franco was that we would leave our past in peace," said Vallespin. "With this law for the recovery of the memory of the civil war, [Zapatero] was accused of breaking the consensus and a sector of the Spanish right has never forgiven him for that."
Another area where the Socialist government has made substantial progress is in battling the Basque separatist group ETA. The organization has killed over 800 people during its campaign for an independent Basque homeland, and attempts by Zapatero to start a peace process ended after ETA broke off a ceasefire with a fatal bombing in 2006. But constant arrests and weapons seizures by Spanish and French security forces have now left ETA on the verge of extinction.
A bold social democrat
By 2008, when he won re-election, Zapatero's credentials were cemented as a bold social democrat who was committed to strengthening social rights. As recently as July 2009, the Spanish leader told the New York Times that he believed Spain could emerge from the global recession with its welfare state intact.
"Some people will say that a social welfare state and a competitive economy are incompatible, that innovation is incompatible with workers' rights," he told the newspaper. "They want to deregulate workers' rights, deregulate social rights. That is exactly the same tune as people who say we have to deregulate the financial markets, and I do not dance to that tune."
When the economic downturn hit, Zapatero believed it would be short-lived and repeatedly forecast an imminent recovery.
But such confidence was ill-placed, said Jose Antonio Herce, of Analistas Financieros Internacionales consultancy: "The government did not recognize that the crisis was well established in the Spanish industrial and service sectors and was going to hit the public sector hard. [It was] neglecting the fact that the crisis was there."
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By 2010, Spain's economic indicators, including Europe's highest unemployment at around 20 percent, made it vulnerable to market turbulence and prompted Zapatero to backtrack on the ideals he had espoused to the New York Times. He embarked on an austerity program that included freezing pensions, cutting civil servants' pay and unemployment benefits. He also introduced more far-reaching reforms such as raising the retirement age from 65 to 67 and making the labor market more flexible.
Such policies have been "very effective" in bringing a spiraling deficit under control, according to Herce. But labor unions and many traditional Socialist voters felt betrayed by such policies, sending Zapatero's poll ratings plummeting. His tardiness in acknowledging the crisis and subsequent drastic reaction to it have damaged his credibility.
"He didn't act when he was supposed to have acted, when the crisis was already apparent and because he acted late, he acted more radically than he would have before," said Vallespin. "And this has very much weakened the confidence people had in him."
With Zapatero's successor expected to be in place by December, it is a very different Socialist leader who leaves office from the one who arrived in 2004.
Author: Guy Hedgecoe, Madrid
Editor: Michael Lawton