Spanish Election May Be a Gamble for Sanchez

WASHINGTON, D.C. -- Millions of Spaniards go to the polls on Sunday to cast their ballots in an early general election called by Prime Minister Pedro Sanchez. Despite substantial losses in recent regional elections, Gallup data show that Sanchez – who leads Spain’s first coalition government as head of the Spanish Socialist Workers’ Party (PSOE) -- has been a more popular figure throughout his four-year term than his predecessor, Mariano Rajoy. However, the majority of Spaniards continue to disapprove of Sanchez’s job performance.

Sanchez’s approval has never dipped below the current 42% since he came to power, leading Spain’s first-ever coalition government, in 2019. This is despite the major challenges posed by the COVID-19 pandemic and cost-of-living crisis. But pundits see his decision to call an early general election as a gamble after recent electoral losses.

Quick Summary: The center-right Popular Party (PP) made strong gains in recent regional elections after framing the vote as a referendum on Sanchez, winning in many of Spain’s major cities. However, the PP largely failed to win outright majorities across the country, with the far-right party -- Vox -- also performing strongly.

Both the PP and Vox have benefited from the collapse of the Ciudadanos party, which has split the right-wing vote in previous years. However, taking control of city halls would require the PP to enter coalitions with Vox. Sanchez is likely hoping this prospect will galvanize his socialist-led coalition and centrist voters into electing him for a second term.

Economic Figures Paint Hopeful Picture: At the heart of Sanchez’s pitch to the nation is his strong economic record. Spain has the highest employment levels it has seen in 15 years and has been more insulated from inflation than much of the rest of the European Union. Reflecting this, the proportion of Spaniards who say they are living comfortably on their incomes has risen through most of Sanchez’s tenure, reaching a record high of 44% in 2022.

Household income perceptions have improved notably among 15- to 29-year-olds, half (50%) of whom claimed to be living comfortably last year. However, economic challenges remain, and Spain is not immune to brisk global headwinds. Twice as many Spaniards now believe their local economic conditions are getting worse (60%) rather than getting better (30%).

Majority of Spaniards Remain Dissatisfied With Housing Situation: Housing is also set to be a hot election topic. The majority of Spaniards have been dissatisfied with the availability of good, affordable housing for many years. In 2022, two in five (41%) Spaniards were satisfied with the availability of housing, falling slightly to 37% in Madrid, the country’s capital.

Property ownership in Spain is widespread -- with about 80% owning their homes -- but the housing market was hit badly by the 2008 financial crash. Rents and evictions soared, leaving Spain with the highest percentage of people in Europe whose housing costs exceed 40% of their income. As a result of this long-standing crisis in housing, a significant new law was passed in May that endeavored to make housing a human right.

Sanchez’s housing reforms are another key element of his pitch to voters, particularly to the young. His government recently introduced a new aid package, designed to make it easier for young people to secure mortgages with the backing of the government as a guarantor. But the future of this legislation could be up for grabs if the opposition seizes power.

Majority Also Dissatisfied With Efforts to Protect Environment: A majority (59%) of Spaniards are dissatisfied with the government’s efforts to preserve the environment -- one of the highest totals in Europe.

After three years of minimal rainfall and high temperatures, Spain has been in a long-term drought. 2022 was officially the hottest year ever in the country. Sanchez has warned parliament that the ongoing drought is one of the biggest issues facing Spain and its people.

In 2021, as part of the Lloyds Register Foundation World Risk Poll, 79% of Spaniards thought that climate change posed a "very serious" threat to their country in the next 20 years. Globally, only Chile was more concerned about the threat of climate change. Spain has suffered some of its worst-ever wildfires in the past 18 months.

Sanchez has made tackling climate change a core part of his political agenda. As drought continues to grip the country, the election is set to define the government’s response to climate change in the coming years.

Bottom Line

Sanchez’s leadership has recently come under fire from different angles. Aside from the regional election losses, he has alienated some of the electorate for relying on Catalan separatists and Basque successionists as part of his coalition. A recent sexual consent law pushed by coalition party Unidas Podemos also caused reputational damage by cutting the prison sentences of over 1,000 sex offenders.

Sanchez’s electoral gamble lies in his belief that recent regional gains for the PP and Vox parties will spur leftist and centrist voters into action.

And while his economic record and historical approval ratings are both relatively strong, Spain still faces challenging global economic headwinds. How effectively he can tap into public concern about key electoral issues such as housing and climate could also play a key role in deciding the vote.

The rest of the EU will be watching closely to see whether Sanchez’s gamble pays off.

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