Can One Forgive Certain Follies? A Simple Observation Comparing How Spain And Ireland Blew It All

Madrid Barajas Airport Terminal 4

Of all the countries I have visited in the past number of years, Spain is comfortably within the top three that I have visited most. My family and I love the country and we have grown accustomed to it over time. Ireland and Spain have a lot in common except most noticeably in relation to the weather. However we have both been battered by the extreme recession that has affected the developed world since 2008, more so than many other nations. We both allowed a property bubble to reach catastrophic levels and then collapse, thus saddling our banks and the sovereign with debt. While Ireland’s collapse was much more swift necessitating a rapid clean up, looking at Spain is like seeing the Irish banking car crash in painful slow motion whose outcome we can pretty much guess.

Nevertheless what we did during our periods of deluded excess we can notice some differences. What we spent our cheap loans on and what we have to show for it are different. Also, the main culprits in the fuelling of the irrational exuberance are dissimilar. The follies of this period that we now have to pay for or are saddled with are numerous. But I keep asking myself is there any merit to what we have to show for it all? This may all sound strange but bear with me.

Whenever I visit Spain I generally arrive in a gleaming, well-equipped airport, a shining gateway to the nation I have just arrived in. One can only look at the vast and serenely voluptuous Terminal 4 at Madrid’s Barajas Airport. It’s welcoming canopy of pillars are bright and fresh compared to sheds like Gatwick or Newark. I effortlessly connect from many major city airports on an air-conditioned and modern metro system to a hub train station. From here I can continue my journey on a fantastically sleek high-speed train to virtually all corners of the country. I could if I want spend my time in many of the cities and marvel at the investment in civic and art facilities from the Guggenheim in Bilbao to the Parc del Forum in Barcelona.

Parc del Forum's giant solar panels

Yes I admit it is an idealistic and innocent interpretation of the situation in Spain. Many of these fabulous pieces of architecture and ingenuity were paid for with loans that will probably never be repaid and many, such as Ciudad Real’s airport or the mesmerizing Centre for the Arts in Aviles, designed by Oscar Niemeyer lay empty with no customers and groaning under mountains of debt. However many of these are public and merit goods. Spain had a property bubble just like ours, leaving empty towns and cities such as Ciudad Valdeluz and banks with impaired loans. But in Ireland, personal property and the cavalier development of it by rapacious developers was the main cause of the boom and bust. We had no regions rivaling each other to build new airports and cultural centres. It was a deeply concentrated personal greed at the expense of all others that we in Ireland are now paying for.

In Ireland all we have to show for the period of inebriated wealth are the physical hangovers of property tycoons gone bust and the sad, necrotic-looking ghost estates throughout the country. The government allowed a greedy few run roughshod over the land in a vile pursuit of personal enrichment. Now there were certainly many in local and regional governments in Spain that also benefitted illegally in the good times and are now being investigated. Bribes were paid that fuelled property speculation. However, whether out of trying to show off and take some pride they at least took a more social, bread and circuses approach to spending.

International Cultural Centre, Aviles

 Many of these follies are functioning, such as Valencia’s metro. Ciudad Real’s airport may never open, doomed in perpetuity to lying luxuriously on the scorched Spanish highlands but it could probably in the future, spurring growth in the area. Many of these white elephants could in the future be turned around and made in to something once their debts from local caja banks and others are sorted out. In fact if there is some separation of the debt from the asset, investors may be interested in them. In Ireland we didn’t spend as much in proportion on infrastructure or cultural entities as the Spanish did. What we had was a small, deluded plutocracy built on shaky loans that did their very best to enrich themselves by creating deeply personalized things such as housing; the vast majority over-priced, badly built and speculatory. For a time we were building more houses than our neighbors across the Irish Sea, a nation with close to fifteen times our population. What good is it for anyone to have decaying houses strung around the countryside that will never be populated?

While the Spanish boom is coloured with terms such as airports and art centres, what we have in Ireland is one of Quinns and McNamaras, individuals that did no use to this country other than indebt us with useless property. We have two Luas lines that don’t connect, one decent new airport terminal and a national theatre that still sits languishing in its 1960’s box even after ten years of debates about moving it to a better location. So forgive me for having some sort of positive attitude to those follies in Spain, many of them I use quite often with countless millions.