In Madrid this past week I've been surprised and impressed to find little resentment towards the European Union and the powers (Germany) that direct its policy. There's less ill feeling, I'd say, than in Ireland, for instance. It's hard for a foreigner to judge on a brief visit, of course, but the mood of the people I've talked to has been one of grim resignation more than anger at Brussels or Berlin.
What makes this all the more odd is that Spain did not bring financial ruin on itself in the way that Greece did. Going into this crisis its budget was in surplus and its public debt was much lower than the EU average. With hindsight, Spanish governments were at fault for failing to lean heavily against surging house prices and private borrowing, for allowing the trade deficit to explode and for letting wage inflation push Spanish unit labor costs so far out of line. But I don't know how many governments elsewhere would have avoided those errors if the same conditions had arisen. The housing boom was fueled by a wall of easy money from abroad--easy to interpret as a vote of confidence in Spain's long-term economic prospects, and a difficult thing to turn back. Also, if the borrowing was excessive and irresponsible, so was the lending. EU creditors are deeply implicated too.
