Rajoy ahoy

By G.T. | MADRID

IT WAS a victory of epic proportions. Not since Spaniards turned massively to Felipe González's Socialists to run a country threatened by coup plotters, terrorism and inflation in 1982 has anyone been handed such parliamentary firepower as Mariano Rajoy of the centre-right People's Party (PP).

Given a perfect storm of rampant unemployment, zero growth and soaring debt yields this time around, a victory for the opposition was assured. But the ruling Socialists were obliterated, losing a third of their seats in the worst result since the return of democracy following Francisco Franco's death in 1975. The PP now holds 186 of the 350 seats in Parliament, 11 of 17 regional governments and three-fifths of town halls. It has a say in the running of two other regions, and looks set to take control of the populous, and almost eternally Socialist, region of Andalusia in March. Moreover, given the PP's hierarchical structure, Mr Rajoy will have little trouble keeping his party in line. José Luis Rodríguez Zapatero, the current prime minister, will remain in office for another month, meaning he and Mr Rajoy may be forced into a de facto national-unity government over the next few weeks to keep markets at bay. But once the PP takes over, Mr Rajoy will hold nearly untrammelled power.

How will Spain's new leader choose to wield it? Mr Rajoy is dogged—he managed to overcome the PP's internal infighting during seven years in opposition—but is neither especially combative nor given to dramatic gestures. And he has given precious few details of his plan for fixing Spain. In his victory speech, he appealed to national pride and heroism in difficult times, recognising the “immense task ahead” and that problems need to be addressed “as soon as possible”.

Indeed they do. At one point last week Spain's ten-year bonds yielded a whopping 7%, and so far today the rate is rising again. Mr Rajoy says Spain will be “the most compliant and the most watchful” country in Europe, code for deficit targets and austerity. This year's goal of 6% looks like a stretch despite sterling efforts by Elena Salgado, the outgoing finance minister, and next year's 4.4% target may require dramatic spending cuts. But fiscal contraction will only exacerbate the economic downturn—23% of Spaniards are currently out of work, and growth has ground to a halt—unless it is accompanied by deeper reforms. Labour law is brutally unfair to the young, the multi-tiered bureaucracy is highly inefficient and the banks have fallen ill from their indigestible loans to real-estate developers.

Mr Rajoy insists that the PP “hasn't promised miracles”. But, scared of turning voters away with too much talk of cuts, he has implicitly done just that. He has already pledged to protect pensions, which are linked to inflation, and to reduce taxes for small and medium-sized businesses. How he would finance these promises remains a mystery.

If Mr Rajoy does decide to get serious, he will be hard to stop. With backing from like-minded reformists in the Catalan nationalist Convergence and Union coalition and in the Basque Nationalist Party, he can claim support from MPs representing nearly half the Spanish electorate. And trade unions, who have blocked meaningful labour reform until now, have much less bargaining power than they have had in the past, even if they threaten a general strike.

Compared with southern Europe's other troubled economies, Spain has much to be proud of. Its protesters are determined not to use rocks or firebombs. It has much less debt than Italy or Greece. And unlike those peers, who are now led by unelected technocrats, it has chosen its own captain to guide it through the storm. If Captain Rajoy cannot now steer Spain to safety, who can?