Escolar blames weak Spanish consumption on public misperception
Ignacio Escolar attributes Spain's sluggish household spending to flawed economic perception. Critics counter with cumulative CPI data and eroding purchasing power since 2020.
English · Original discussion in Spanish · Published
Escolar links drop in Spanish consumption to 'wrong view' of economy
The director of elDiario.es, Ignacio Escolar, argues in a tweet that Spanish households are curbing consumption due to a mistaken perception of the economic situation, not because their money buys less. The statement, shared with an article link, has sparked outrage among those struggling to balance grocery budgets for months. The most common response is not ideological but arithmetic: if wages do not rise with prices, no narrative can fix it.
Escolar’s approach reverses the usual causal order. It is not that the economy is failing so people tighten their belts; rather, people believe it is failing, so they stop spending. Translated to personal finance, this suggests the problem lies not in food, mortgage, or fuel prices, but in how they are viewed. The ensuing debate raises a serious question: to what extent does consumer confidence drive spending versus actual paychecks?
The unpublished cumulative CPI
The main argument against Escolar’s thesis is simple math: the cumulative CPI since 2020. A widely cited figure indicates that what cost €1.05 then now costs €1.25. In terms of salary, someone earning €2,000 today buys what they could purchase with €1,680 in 2020. This represents a monthly loss of €320 in purchasing power, never announced as a cut but functioning as one.
The price list circulating in discussions is stark: food up 100%, gasoline 40%, housing 30%, and taxes 25%, while salaries rose only 2%. These figures, easily verified against bank statements, suggest the "misperception" suspiciously matches reality.
Why isn't consumption rising despite GDP growth?
The underlying paradox is the gap between macro data and micro experience. Spain grows, tourism thrives, and employment holds, yet household consumption cools. Official explanations cite uncertainty; street-level views point to grocery bills. A third factor emerges: internal devaluation since 2012, which allegedly impoverished workers to boost competitiveness.
This strategy’s result is visible in the aging car fleet, which gained three years of average age in a decade—an indicator more telling than growth forecasts. Experts warn that when tourism slows, the full picture will emerge.
Seafood consumption rises: union subsidies
Contrasting depressed family spending is increased public outlay. Reports state the Government doubled subsidies to unions, nearly matching in one year what the previous administration distributed over four. This expenditure bypasses household baskets but inflates institutional consumption.
The irony noted is that administrative funds do not appear by magic; taxpayers fund them. Yet these same citizens are told their issue is perceptual. Subsidized public spending sustains consumption levels families cannot maintain alone.
Two Spains: civil servants vs. low-wage earners
Social analysis reveals a divide beyond rich/poor. On one side, skilled jobs and civil servants see above-average wage hikes; on the other, many low-productivity roles remain tied to collective agreements or minimum wage (SMI). Rising average wages are largely attributed to public sector strength, not broad improvement.
Labor dumping in precarious sectors worsens the scenario. While some enjoy packed terraces and holiday shopping, others face shared rooms and end-of-month shortfalls. Aggregate consumption persists because part of the population still lives well. How long this lasts remains uncertain.
Subsidized journalism and official narratives
Criticism extends beyond economics to the messenger. Media receiving institutional advertising and subsidies have structural incentives to align with the current government’s narrative, regardless of political orientation. Some do so openly, others discreetly.
Press oversight functions are compromised when outlets depend on the powers they should monitor. In this context, blaming consumers for their paralysis reads not as analysis, but as part of the problem. The lingering question: will consumption recover when people see reality clearly, or when they can afford to fill their fridges?
The director of elDiario.es, Ignacio Escolar, argues in a tweet that Spanish households are curbing consumption due to a mistaken perception of the economic situation, not because their money buys less. The statement, shared with an article link, has sparked outrage among those struggling to balance grocery budgets for months. The most common response is not ideological but arithmetic: if wages do not rise with prices, no narrative can fix it.
Escolar’s approach reverses the usual causal order. It is not that the economy is failing so people tighten their belts; rather, people believe it is failing, so they stop spending. Translated to personal finance, this suggests the problem lies not in food, mortgage, or fuel prices, but in how they are viewed. The ensuing debate raises a serious question: to what extent does consumer confidence drive spending versus actual paychecks?
The unpublished cumulative CPI
The main argument against Escolar’s thesis is simple math: the cumulative CPI since 2020. A widely cited figure indicates that what cost €1.05 then now costs €1.25. In terms of salary, someone earning €2,000 today buys what they could purchase with €1,680 in 2020. This represents a monthly loss of €320 in purchasing power, never announced as a cut but functioning as one.
The price list circulating in discussions is stark: food up 100%, gasoline 40%, housing 30%, and taxes 25%, while salaries rose only 2%. These figures, easily verified against bank statements, suggest the "misperception" suspiciously matches reality.
Why isn't consumption rising despite GDP growth?
The underlying paradox is the gap between macro data and micro experience. Spain grows, tourism thrives, and employment holds, yet household consumption cools. Official explanations cite uncertainty; street-level views point to grocery bills. A third factor emerges: internal devaluation since 2012, which allegedly impoverished workers to boost competitiveness.
This strategy’s result is visible in the aging car fleet, which gained three years of average age in a decade—an indicator more telling than growth forecasts. Experts warn that when tourism slows, the full picture will emerge.
Seafood consumption rises: union subsidies
Contrasting depressed family spending is increased public outlay. Reports state the Government doubled subsidies to unions, nearly matching in one year what the previous administration distributed over four. This expenditure bypasses household baskets but inflates institutional consumption.
The irony noted is that administrative funds do not appear by magic; taxpayers fund them. Yet these same citizens are told their issue is perceptual. Subsidized public spending sustains consumption levels families cannot maintain alone.
Two Spains: civil servants vs. low-wage earners
Social analysis reveals a divide beyond rich/poor. On one side, skilled jobs and civil servants see above-average wage hikes; on the other, many low-productivity roles remain tied to collective agreements or minimum wage (SMI). Rising average wages are largely attributed to public sector strength, not broad improvement.
Labor dumping in precarious sectors worsens the scenario. While some enjoy packed terraces and holiday shopping, others face shared rooms and end-of-month shortfalls. Aggregate consumption persists because part of the population still lives well. How long this lasts remains uncertain.
Subsidized journalism and official narratives
Criticism extends beyond economics to the messenger. Media receiving institutional advertising and subsidies have structural incentives to align with the current government’s narrative, regardless of political orientation. Some do so openly, others discreetly.
Press oversight functions are compromised when outlets depend on the powers they should monitor. In this context, blaming consumers for their paralysis reads not as analysis, but as part of the problem. The lingering question: will consumption recover when people see reality clearly, or when they can afford to fill their fridges?
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Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (104 replies).
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