One thing Spain can teach us: how not to spread the wealth in your country | Teresa Garcia-Milà and Therese J McGuire | Comment is free | theguardian.com
The Spanish system used to be a model for resource distribution. But Catalonia shows how it's blatantly unfair.
One thing Spain can teach us: how not to spread the wealth in your country
The Spanish system used to be a model for resource distribution. But Catalonia shows how it's blatantly unfair
A boy waves a Catalan 'estelada' flag during a pro-independence event in Barcelona. Photograph: Emilio Morenatti/AP
Spain
has learned the hard way that designing a federal system of government
to accomplish equity goals is exceedingly difficult. And countries
wrestling with how to fund various levels of governance – which is to
say most of them – should take heed.
Only 35 years ago, Spain
emerged from one of the 20th century's most enduring dictatorships and
created a strong democracy. Today, Spain is on the brink of breaking
apart – with Catalonia dominating the news because of its strong push for independence.
The
Spanish federal system – once viewed as a model for countries around
the world – was designed to ensure that poorer regions had enough
resources to fund publicly provided goods and services.
But
regional governments in Spain, particularly Catalonia, are chafing under
a federal system that has devolved spending responsibility without
giving the communities commensurate revenue-raising authority. While it
has significant control over spending, the central government is still
in charge of levying and collecting most taxes, which it then
redistributes to the autonomous communities with the aim of producing
"fiscal equalization".
