19 Pros and Cons of the Catalan Independence Vote and Referendum

On October 1, 2017, the people of Catalonia held a referendum for independence. Voters were asked one simple question: “Do you want Catalonia to become an independent state in the form of a republic?” The results were overwhelming. Over 92% of the population voted in favor of the resolution to the tune of more than two million votes. Only 177,000 people voted against the idea.

The Spanish government didn’t take too kindly to the referendum, the legislation that inspired it in the first place, and the overall processes followed by the Catalan parliament. The centralized government in Spain called it illegal and suspended by the constitutional court of the country after a request by the Spanish government.

The High Court of Justice of Catalonia had issued orders to the police to try to prevent the referendum as well, including orders to detain various people responsible for its overall preparation. Because there were alleged irregularities during the voting process, along with the use of force by the Civil Guard and the national police, international observers came to the conclusion that the results did not meet the minimum standards for an authentic election.

That doesn’t mean that the Catalan independence vote and referendum held no meaning. A majority of the population consistently wants to separate from the rest of Spain as a way to protect their culture and identity. Spain has a problem with the idea because it would cause them to lose Barcelona and the economic linkages that the region provides to the rest of Europe.,

List of the Pros of the Catalan Independence Vote and Referendum

1. Catalonia has different cultural priorities than Spain.
Catalans might be part of Spain with the current borders, but the culture is unique when compared to the rest of the country. You won’t find a preference for flamenco when you visit the region. Catalonia has already taken the steps to ban bullfighting because the population sees the practice as being barbaric and cruel. The regional government already has a measure of self-determination that has been reasonably successful, even after the sometimes brutal attempts to suppress this culture after the civil war.

Supporters of the independence vote and referendum make the argument that their language and culture in Catalonia are not given the sufficient respect that other regions receive in Spain. If something is not done to preserve their unique perspective, then there is a fear by the people in the region that they might lose it one day.

2. Independence would allow Catalans to finance their own future.
There is a real concern that Catalonia would be unable to afford to separate from Spain because of the amount of debt that the regional government currently manages. If the independence referendum were allowed to go through to create a separate country, then over 17 billion euros that would go to the centralized government in Spain would get to stay home. One of the reasons why there is such a desire to achieve independence is the fact that the tax demands on the population are unequal when compared to the other regions.

Catalonia doesn’t even have the fiscal autonomy that the Basque region enjoys, so the centralized government controls the economy instead of the local population. Independence would guarantee that Catalans could be in more control of their future. Catalans make up 16% of the Spanish population, but are responsible for about 20% of Spain’s GDP.

3. Many of the European benefits could remain with the right independence package.
There is no reason why the Catalan Republic would be forced to leave the European Union if they vote for independence. The process could be similar to what the United Kingdom is going through with the Brexit process. There could be an effort to maintain EU membership during the separation process. It would even be possible to stay within the Schengen Zone for open border access. Catalonia could even talk about staying with the Eurozone so they wouldn’t need to go through the growing pains of establishing their own currency right away.

Although there would be some economic issues to consider, the average GDP per capita in Catalonia is 27.43 million euros. It is 25.2 million euros in the rest of the European Union and 23.1 million euros for Spain.

4. Independence is what the population of Catalonia wants.
There is a clear majority of Catalans who want to be independent from Spain. Some polls have the favorability of this idea hovering near 60%. The argument could be made that it would be democratically irresponsible to refuse to let the region have a greater level of control over their governing process, especially since the centralized government in Madrid has made some efforts to roll back some of the independence that has already been granted.

The reality of Catalonia is that the population, as a majority, does not want to live under a monarchy that seems to have little regard for their needs. Giving them the right to choose the state in which they live, whether that is Spain or a Catalan Republic, creates more opportunities than disadvantages for the average household.

5. The size of an independent Catalonia would be comparable to other European nations.
Although there is an argument to be made about the idea of preventing different regions from creating their own countries because of size issues, Catalonia has a native population of 7.5 million people. Europe has already proven that there is a sweet spot in the population range between 5 million and 15 million people where the government can be large enough to offer a full set of services to the general population without losing the social cohesiveness of the overall culture.

Catalonia would join countries like Switzerland, Denmark, Ireland, Norway, and Sweden in this respect. That would help to make the country have the capability of standing on its own once it got through the initial growing pains.

6. Catalonia would also benefit from the presence of wealthy neighbors.
Countries are unable to choose their location. You’re stuck making the best of what you’ve got at any given time. That’s one of the reasons why the United States continues to press Mexico because of the differences in the two economies. When looking at an independent Catalan Republic, the new nation would immediately benefit from its neighbors which are doing well. France is prosperous and would likely ignore the European cold shoulder that might come up because of the economic benefits a relationship would bring. Spain would fit into that category after they got used to the new normal.

Then there would be the tourism benefits to consider. Catalonia has a beautiful Mediterranean coastline, significant cultural centers in Tarragona and Barcelona, and plenty of hospitality infrastructure to enjoy.

7. Catalan would benefit from its established economic base.
If Catalonia were to become independent from Spain, then it would have an established economic base that would help the new country get through its initial growing pains. There is an extensive manufacturing center that would likely remain in the region because of the expertise that Catalans bring to the table. Two of the top-ranked business schools in that area of Europe are located there as well. There is also an established array of service industries that could mobilize to offer the supports that everyone would need in those initial days.

8. An independent Catalonia would have brand recognition.
Branding is an intangible benefit to consider when looking at the independence of a country. It can be deployed by the new government in a variety of ways to encourage several different economic advantages. Ireland is a prime example of how a country can use its presence to create a platform for success, recruiting high-tech companies from the United States to form an employment base thanks to the skill sets of its labor force.

Catalonia already provides a significant chunk of the positive economics that Spain receives throughout the year. When it is standing on its own instead of listening to Madrid, there is a very real possibility that it could become nimbler in its ability to begin creating jobs.

9. It would give Catalonia the chance to operate under its own currency.
The limitations of the euro are partially responsible for the high levels of unemployment that are found throughout Spain. Separating from the country would not automatically qualify Catalan for membership in the EU, even if proactive negotiations were part of the divorcing process. That might not be a poor outcome for the country as a new currency could help to boost the economic opportunities for the people.

There is no doubt that a new currency would be disruptive. It could be difficult to bring in tourism or business in those uncertain days. There could be up to 10 tough years before everything stabilized, but the benefits of value that are possible here are believed to outweigh the potential disadvantages that could be present.

10. It would stop the disparity in spending that happens in Catalonia.
The Spanish government provided figures on public support and taxation for 2014. It shows that the people in Catalonia paid almost 10 billion euros more in taxes than what Madrid offered in public spending. Nothing in this regard seems to be changing since then in the 5+ years since those figures. Losing that much money each year while still maintaining economic advantages for Spain is impressive, which is why some experts believe that a net gain could occur with independence.

List of the Cons of the Catalan Independence Vote and Referendum

1. Allowing Catalan independence opens the doors for others to do the same.
One of the critical consequences of the Catalan vote for independence and their referendum is the fact that others could follow suit throughout Europe. This process is often described as the Balkanization of Europe. Nationalists in many parts of the continent, including Bavaria, Flanders, Madeira, Scotland, Padania, and Scania would begin to clamor louder for their independence as well. It would create splits in Europe that would create a large mosaic of cultural groups who are self-governing, but also quibbling over their differences with the rest of the continent.

This process could cause the continent to devolve into a series of micro-states instead of larger nations. That would create more opportunities for others to come in with military might to take over the region. We’ve already seen historically how fast the borders in Europe can change when one dictator decides that they want more power. NATO would become almost impossible to implement.

2. Catalan is already in debt, so some type of bailout would be necessary.
The Catalonia region already receives billions of euros each year from the European Union to help with their structural needs, yet the regional government is already in debt to the tune of over 40 billion euros. If Catalan independence were permitted after their referendum, then the government body would likely need to apply to the EU to take advantage of their bailout mechanisms. That could result in a policy of austerity that would decrease the options for economic growth in the near future.

One of the issues with the debt is that the regional government owes a majority of it to Spain. At a time when Catalonia owed 77 billion euros, which was 35% of the GDP for the region, 52 billion euros of that figure was owed to the Spanish government.

3. There could be a refusal to support Catalonia financially.
Spain already has a problem with the Catalonian region because they do not provide the same levels of support for the less prosperous regions around the country. If they were to decide to become independent, then the favor would be returned by everyone else. It is a legitimate question to ask: why should Europe support the debt of Catalonia if there is no effort made in return?

Independence would likely require financing to help save the banks in the region. The growing pension bill from this region requires significant attention to maintain its viability. There are added costs of military and diplomatic services that Catalonians would need to manage as well. Then they would need to apply to the European Union, which means they’d lose those benefits immediately.

4. Catalans have more in common with Spain then they might want to admit.
The Catalans have a culture that is clearly their own, but there is a lot that they have in common with Span as well. You can find late-night dining as a preference throughout the region and country. Everyone has a passion for football, and there is a love of counter-culture activities. Barcelona benefits from its connections with Madrid, which would potentially sever with Catalan independence.

When cultures decide to isolate and focus on monoculturalism, then their creative edge begins to die. There are fewer opportunities that come their way. 45% of Catalonia’s exports go directly to Spain as it is. That financial incentive could go away.

5. It’s a contradiction to the message that Europe attempts to provide.
Unionists suggest that remaining with Spain is a better idea than independence because they see it as a backwards step toward what history wants. It’s viewed as a contradiction to what the European Union attempts to provide to the rest of the world. Instead of creating barriers to trade, employment, and travel, staying with Spain would guarantee the economic benefits that are possible with being in the EU.

Although there are admittedly unfair taxation practices that frustrate everyone in Catalonia, those are issues that can be rectified through ongoing conversations with the centralized government. There is a real need for the people to start guiding the politicians they elect instead of the reverse happening.

6. The establishment of a new border would create several short-term disadvantages.
The short-term outcomes of a separation from Spain would be negative for all parties. By establishing a new border, there would be a loss of employment opportunities, less income, and fewer opportunities for wealth for everyone, no matter where they happened to live. Those losses would be provoked by new barriers to trade, growing financial concerns, and the spending needs that Catalans would have immediately.

Despite the taxation gains, there would need to be new central banks, embassies, trade contracts, and other state structures that would facilitate governing. The economy could shrink by up to 30% and unemployment could double before the expected improvements would begin to form.

7. Businesses and banks began to move out of the region.
Although there were some significant benefits that came out of the October 1 referendum for Catalan independence, the move also created some immediate issues that made even those who are fighting for greater autonomy to second-guess the decision. Leading banks began to move out of the region to protect their assets in the event that the vote was successful and Spain let the region go. Large businesses began to leave to avoid the unpredictability of the situation.

These actions created another level of fear regarding what might happen if the quest for independence was successful. It would be very possible that an independent Catalan Republic could get the cold shoulder from the rest of Europe, which represents 65% of their trading opportunities. Angela Merkel and Emmanuel Macron both opposed the move at the time.

8. The world had no confidence in the economic wellbeing of an independent Catalan.
Financial markets and businesses began to worry about the economic consequences of independent Catalonia within 72 hours of the referendum. The shares of two banks, Banco Sabadell and CaixaBank, both with their headquarters in the region, fell by more than 5% in the first trading days after the vote. Traders were hedging on the idea that growth could occur, so losses were being built into the margins to protect wealth around the world.

9. Catalonia would lose access to the international market for debt funding.
The Spanish government set up a special fund in 2012 to provide cash to all of the regions who were unable to borrow money on the international markets after the financial crisis years that began in 2007. Catalonia has been the largest benefactor of this scheme, receiving over $67 billion euros since it began. If the vote for independence is ever allowed to proceed, then the regional government would lose access to this resource. It would also raise more questions on the ability of the country to repay its obligations after separation.

Verdict on the Pros and Cons of the Catalan Independence Vote and Referendum

There is a desire to maintain the Catalan culture and an immense distrust of the Spanish government. When the national police began destroying ballot boxes and targeting voters, this issue only gained in prominence. Almost 1,000 people suffered injuries during the voting day in October, most at the hands of Spanish nationals attempting to prevent the inevitable outcome.

Regardless of what the outcome of independence would be, the fate of bout countries would likely depend on the decisions made after the separation. The problem of debt and who would be responsible for it. Catalonia is responsible for about 10% of Spain’s overall debt, which is significantly lower than their overall population.

The pros and cons of the Catalan independence vote and referendum exposed numerous rifts in Spanish culture. Either staying or going could prove to be detrimental to the region. They either face a potential trade boycott or additional legislation that further limits their autonomy while increasing their debt responsibility.

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