This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L SECTION 01 OF 02 MADRID 000961

SIPDIS

DEPARTMENT FOR EUR/WE
NSC FOR FRIED AND VOLKER

E.O. 12958: DECL: 03/18/2014
TAGS: PREL PGOV SP PSOE
SUBJECT: WHO ARE THE SPANISH SOCIALISTS?

REF: A. MADRID 881

¶B. MADRID 919
¶C. MADRID 812

Classified By: Acting Deputy Chief of Mission Carol J. Urban,
reasons 1.4(B) and (D).

¶1. (C) Summary: The Socialist Workers Party of Spain
(PSOE), surprise victor in March 14 elections, is a
center-left party in the European social democrat tradition.
Since the end of the Franco regime and the beginning of
Spain's modern democracy in 1977, PSOE has generally
advocated comprehensive social programs and limited defense
spending, as well as a reduced domestic role for the armed
forces. In practical terms, members of Zapatero's inner
circle have been careful to say PSOE will make no significant
changes to the Aznar government's successful economic
policies. We expect static or reduced defense spending under
PSOE, increased social welfare programs, more "green"
environment policies, a greater focus on Spain's role in the
EU (including increased adherence to French and German
leadership), and distancing from the Spain's close
relationship with the United States that Aznar fostered. End
summary.

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Mainstream Socialists
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¶2. (SBU) Founded more than 120 years ago, the PSOE espouses
as its main goals liberty, equality, solidarity and social
justice. Communists broke with the Socialists after the 1917
Russian revolution and formed their own party (now the United
Left, or IU). PSOE renounced any connection with Marxism in
1979, reaffirming the democratic and federal nature of the
party. Since the end of the Franco regime and the beginning
of modern Spanish democracy in 1977, PSOE has advocated
comprehensive social programs, limited defense spending and a
reduced role for the military in Spanish life.

¶3. (SBU) The Socialists governed Spain with Felipe Gonzalez
as President from 1982-1996. Though the Socialists lost power
in 1996 amidst a swirl of corruption scandals, Gonzalez is
credited with having strengthened the foundations of Spanish
democracy and governmental institutions during his time as
head of government. Spain joined the European Community and,
in a national referendum, reaffirmed its membership in NATO
under Gonzalez, a position PSOE had originally opposed.
Gonzalez called the latter a "triumph of the people of
Spain." The Socialist government under Gonzalez also updated
Spain's agreement with the United States for American use of
Spanish military bases.

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Zapatero's PSOE
---------------

¶4. (C) President-elect Jose Luis Rodriguez Zapatero took
over as PSOE's secretary general in 2000, narrowly edging out
party "baron" Jose Bono. In 2003 the party issued a
resolution outlining its political program designed "to
increase freedom and the decision-making power of ordinary
citizens over their own lives; to reduce crime; to allow
citizens to develop their talents and abilities to the
fullest; and to ensure individuals are not abandoned to their
own fate." Following is a summary of PSOE positions in major
issue areas:

-- Foreign Policy: See Ref A for a discussion of PSOE's
likely foreign policy goals. PSOE's general foreign policy
outlook was summarized well by Manuel Marin, the party's
international affairs spokesman in Congress: "Aznar wanted
to make Spain a great nation among the great nations, but
Spain lacks the means and capacity for that role. Spain
cannot be a determinative force in great international
conflicts. We do not have the political or economic weight
for that, nor the internal security and defense capabilities
that would be necessary." In general, we expect PSOE to
conduct more of its foreign policy via Brussels and to hew
closer to Franco-German positions. Zapatero's comments have
also indicated he plans to distance Spain from the close
relations the U.S. enjoyed under the Aznar government.

-- Economy: The outlines of PSOE's economic platform are in
Ref C. Close associates of Zapatero have been careful to say
that the incoming PSOE government will not make significant
changes to the PP's successful economic policies. Some
business leaders have voiced the same expectations with us.
PSOE will work to decrease unemployment (currently over 11
percent and one of the highest in the EU) and convert jobs on
temporary contracts (currently one-third of new jobs created)
into permanent positions which carry full benefits.
President-elect Zapatero has stated his government will focus
significant attention on calming the rapid rise in housing
prices and has already announced the creation of a Ministry
of Housing. The PSOE also advocates more investment in R&D
and training for workers. They have promised to simplify the
tax system, resulting in decreased taxes for many Spaniards,
while maintaining a balanced budget and fiscal discipline.

-- Social Programs and Issues: PSOE has pledged to: include
more health services in the nation's health plan and reduce
the maximum wait time for operations; increase pensions and
improve health care for the aged; raise the minimum wage;
lengthen legally mandated paternity leave; change the civil
code to allow gay marriages; mandate gender-based affirmative
action for government jobs; and devote more attention to the
problem of domestic violence.

-- Education: Zapatero has said PSOE will lengthen the
school day, increase bilingual education (one-third of
classes will be taught in English), improve computer access,
and increase grants for students who go on to higher
education.

-- Environment: We can anticipate more "green" environment
policies. PSOE officials have made clear they plan to scrap
the PP's hugely controversial north-south water transfer
plan, replacing it with a new water policy to be based on
better water management, increased reliance on underground
water supplies and greater investment in desalination. PSOE
has pledged Spain's complete compliance with the Kyoto
Protocol, despite rumblings from Spanish industry that
emissions cuts agreed under the EU umbrella will severely and
negatively affect competitiveness. PSOE's campaign platform
called for a formal moratorium on nuclear power within five
years, but recent pronouncements have indicated that the
party might simply deny renewal of current licenses.

¶5. (C) Zapatero has not explained how he plans to pay for
increased social programs while cutting taxes at the same
time, except to suggest he may trim defense spending to pay
part of the bill. His inner circle have suggested some
revenues may come through greater government efficiencies,
without specifying programs or jobs that would be eliminated.

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Comment
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¶6. (C) PSOE is a mainstream European socialist party.
Although Zapatero has led PSOE for four years, he has never
held a government position, and since PSOE has been out of
power for eight years, neither have many of those around him
(see Ref B for a discussion those surrounding Zapatero).
PSOE and Zapatero will have a steep learning curve to climb
upon taking power. Given the need to appeal to his large
anti-war constituency, Zapatero will distance Spanish foreign
policy from Aznar's close relations with the U.S.
Nonetheless, we are hopeful that once PSOE grasps that it has
won and Zapatero is in office, Zapatero will come to realize
that while he may have differences with the U.S., it is still
in Spain's interest to cooperate with us on a number of
issues.

ARGYROS