Forum user highlights Spain's collapse in purchasing power

Salaries no longer buy what they used to

There is a scene that sums up the last decade in Spain: two university graduates looking at an estate agent’s window, calculating that the apartment their grandparents paid for in two years would take them half a century of salary. Frustration with the cost of living has moved from bar talk to the center of economic debate. The figures are stubborn: according to calculations circulating online, since 2018 housing prices have risen **60%**, rents by **40%**, grocery bills by **35-45%** depending on the item, and tax pressure on households by **10%**. The question is no longer if the system works, but for whom.

What has increased and how much since 2018

The most circulated breakdown details the impact line by line. Housing leads with **60%**; rents trinc at **40%**; cumulative general inflation stands at **25%**; fuel has risen **20%** and electricity **25%**. In the shopping cart, fruit is **35%** more expensive, meat **45%**, and fish **40%**. New cars are **40%** higher. On this basis, household tax burden has grown an additional **10%**.

Comparisons with previous decades are the most repeated argument. It is claimed that in the sixties, seventies, and eighties, a person without formal education could sign a two-year mortgage and support a large family; that in the nineties, **5,000 pesetas** was enough to fill a market basket with fresh produce. Today, that same basket translates to **€500**. The gap between these figures is not anecdotal: it measures the collapse.

The dividing diagnosis: taxes or model?

Here the real disagreement begins. One school of thought argues the problem is crony capitalism entrenched for decades: a bloated state serving its own interests and lobbies rather than citizens. From this view, Francoism did not privatize anything—it created INI (National Industrial Institute) and maintained strict control—and it was the transition and subsequent governments of all colors who sold off national assets cheaply.

The opposing thesis points to **regulation and taxes** as direct causes of rising costs. The market vendor example is recurrent: previously, they sold lettuce at cost plus margin; now they need food handler certifications, equality training, eco-labeled vans, self-employment fees, VAT, and parking taxes. All this, it is argued, ends up in the final price. This line concludes that **more liberalism**, not less, is needed: let everyone sell what they want and answer to justice if they do it wrong.

The most repeated calculation in this dispute is fiscal: a worker pays around **80% of their salary** through Social Security contributions (around **35%**), IRPF (personal income tax, between **19% and 40%**), VAT (**21%**), special taxes, fees, and levies. Compared to 1970, the major change is not gross salary, but the portion the State keeps to maintain its structure.

Housing as a generational fracture

If there is one point where frustration is unanimous, it is housing. The central argument is demographic and supply-based: during Francoism, the State built millions of homes so every Spaniard had one; today, it is argued, the State focuses on receiving millions of people but neither builds nor allows construction. The result is a generation with two degrees renting rooms, unable to move provinces because leaving the family safety net means ruin.

Some add an uncomfortable layer: **family** as a class marker. Previously, anyone from a town had a partner and children; today, it is claimed, only a few can afford to start a family, while the rest are excluded from the market.

Frustration against the official narrative

The thread does not stop at economic diagnosis. Much of the discontent targets political management and the feeling that official discourse ignores the problem. The most common criticism is that price hikes are blamed on external factors while tax pressure and housing costs are internal decisions. Others note deteriorating access to public healthcare—six-month waits for appointments—and infrastructure investment failing to keep pace.

Counterpoints come from those arguing conditions would be equal or worse under the previous government, and from those warning of confirmation bias: perceptions of decline feed on negatives and ignore improvements. The discussion remains open: each group has its own list of culprits and key figures.

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How much would average salaries need to rise for the equation to balance again? No one dares put a number, perhaps because the number no longer matters: what is debated is whether the framework used for calculation is still valid.