If as a country we could make 10 new year´s resolutions for this critical year, what would they be? Here´s my list, in order of importance:
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1. DO SOMETHING to unblock the growth in Spanish productivity. (This one overlaps with all the others, but it´s so important that it deserves its own space.)

2. Have an honest conversation about the model of collective bargaining and the political role of unions in Spain. Tell the truth in public about how dysfunctional it is and how it affects productivity, democracy and even the ethical nature of business in Spain.

3. Make some concrete bipartisan, cross-society plans to change 2).

4. Have an honest public debate over the dysfunctional Spanish labor market. Recognize how the peculiar characteristics of Spain´s labor laws reduce productivity, raise wage costs, reduce employment and squeeze Spain´s well educated young people out of decent jobs.

5. Make some concrete, bipartisan plans to reform 4). Start by wiping out everything there is and introducing a single contract for all people of all ages, with severance pay that rises over time (say, one month per year) up to a reasonable maximum (say, 12 months).

6.) Redefine «unfair dismissal» (despido improcedente) so that it becomes a rare exception rather than the rule.

7. Drastically increase the number of training courses offered with public funds.  Take them out of the hands of unions and offer them in partnership with the private sector, in a great public-private partnership to raise Spanish skills and productivity.  Include language courses for immigrants.

8. Thoroughly overhaul the INEM so that it becomes a true clearing house for job opportun ities, along the lines of the new French public employment services.  This might also be done in cooperation with the private sector in another great PPP.

9. Reform unemployment benefits by requiring the unemployed to show up for job training or job interviews.  Withhold unemployment benefits permanently at the first missed job interview or training session.

10.  Cut wages across the board, in all sectors, by 10%, to restore Spanish competitiveness.

I know, it´s an unbelievably ambitious list.  But imagine how different Spain would be by 2012 if we could make all of these changes!  They´d have to drop the S off of PIIGS….

Happy new year to all!


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