The the surprise of nobody, Spain elected a new government. The Socialist government was unable to solve the economic problems in Spain, and now the conservative Popular Party will get a chance to implement the austerity programs that sunk the Socialist party. Its hard to see how Spain can reduce its debt to GDP ratio as long as interest rates on its debt exceed the growth rate of GDP (which is close to negative). Perhaps the "confidence fairy" will come to the rescue and reward the new government with lower interest rates.
The popular party will have the advantage of a majority government that does not depend upon the support of a coalition partner. It will also have support from the conservative Catholic Church. It may have problems, however, in several regions which resist control from Madrid. If the Popular party attempts to recentralize control in Madrid, the government will have a cultural war to fight along with a difficult struggle with the economy. We should hope that the new government can restore economic growth without reverting to Francoism. The worse outcome for Spain would be a return to a culture war by a party unable to fix the economy.
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