The Economy of Catalonia

€16,500 million that «fly away» from the country each year which is so
immensely popular in Catalonia.
As a matter of fact, political positions are not determined by the data or
their interpretation but rather the opposite: predetermined political positions
lead to the choice of the data that lend themselves best to defending
them. It could be said, quite justifiably, that the work of academics and
scholars is to introduce some rationality into the debate, so that people
can take their decisions freely, with knowledge of the «pros» and «cons»
of each alternative.
But I think that politically – and not just as a matter of academic thoroughness
- it is also a mistake in Catalonia not to put all the cards on the
table in this matter and to exhibit, time and again, only those estimates
that show the fiscal deficit that is most detrimental to Catalonia. In the
first place because there is no need to exaggerate the figures in order to
justify the central aspect of our approach, which is that the fiscal deficit is
manifestly excessive. What is more, exaggeration is harmful because it
gives arguments to the other side that, by simply discrediting the figures
used, cast doubt on the whole reasoning. Secondly, and most importantly,
citizens should know all the facts before deciding – the favourable
aspects, certainly, but also the difficulties. The enthusiasm citizens feel
for a cause should not be based on ignorance or belief in some unreal
paradise, but on the conviction that the cause is worth the efforts that are
undoubtedly required to defend it. That is why it may be useful to make
some comments about the meaning of each of the different ways of calculating
the fiscal deficit.
Firstly, when we consider the question of «neutralisation» (should the
expenditure and revenue of the central government be allocated «as if»
the budget were balanced?), we need to distinguish between the shortand
long-term effects. In the short term it makes more sense to use «nonneutralised»
data. However, in the long term, if we bear in mind that the
Spanish government budget tends to be balanced throughout the cycle as
a whole, the «neutralised» data better reflect the permanent (or structural)
effect of eliminating the fiscal deficit with the rest of Spain.
Consequently, an independent Catalonia’s finances would certainly become
more solid and sustainable over time. However, it is confusing to
claim, as is often done, that the removal of this deficit would mean that
the Catalan government’s financial problems would disappear overnight
two preliminary remarks... 39