This post could be a book and it is about a subject that I still need to address in Spanish. The substance of this post is easier to explain in English because the English/American culture is a culture in which the role of business in society is much better understood than in Spain. Indeed, the biggest obstacle I see with the Spanish crisis is that most Spaniards, voters and government included, don’t really understand how wealth is created. They don’t understand how capitalism works and, therefore, how it sometimes does not work. They don’t understand the concept that a rising tide lifts all boats (economic expansion) and a falling tide…lowers all boats (recession). So as Spain goes into record high unemployment of 25% and youth unemployment of 50% the emphasis is not in improving the workings of the Spanish economy but in blaming each other.

In Spain it is more common to complain about what others are doing poorly than focusing on the “what can I do to help” that is needed for all Spaniards to collaborate to restart the economy. Many Spaniards unfortunately suffer from a serious case of “blinding envy” of others and thus have a false understanding of the economy. Envy makes them see the economy as a pie of have and have nots. Instead of realizing that a shrinking GDP makes everyone worse off, they think that if they are doing worse is because somebody else “stole” what they used to have, that if they are doing worse then somebody else is doing better. They don’t get the concept that everyone is worse off! As a result, Spaniards are constantly looking for the few people who are doing better and crucifying them. But these are the entrepreneurs who could save Spain. Instead they are convinced that either foreigners or rich Spaniards ended up with what they used to have. Spaniards in general, have a lack understanding of entrepreneurship, of innovation, of job creation, of wealth creation of how hard it is nowadays to compete in a globalized economy. Interestingly they get it in football and Spain has some of the best football teams in the world, but they don’t in normal life. Their best entrepreneurs, people like the founders of Zara or Mango, some of Spain’s most successful multinationals, live in hiding for fear of what the average Spaniard may think of them. Amancio Ortega (Inditex) one of the wealthiest men in the world and his famous picture in which he looks as a convict, is an “only in Spain” story. Entrepreneurs are seen as people who get what is not due to them, not as wealth creators, but as thieves. For me as the founder of Viatel (partly in Spain), Jazztel, Ya.com and now Fon all in Spain, it is painful to read my own Twitter line and see how confused the average Spaniard is about the subject of entrepreneurship and job creation. I am tired of getting called “rico de mierda” people focus on what I have and not on what I do for the economy. Nor what all other entrepreneurs do. Having a daily twitter conversation with around 30K Spaniards has given me a great insight as to what people think on subjects such as compensation, social charges, labor flexibility and other crucial aspects of wealth creation.

And in this mix, the government does not help: the Socialists want to spend their way out of the crisis, the Conservatives want to cut their way out of the crisis. Nobody seems to understand that it is the type of spending that has to change, not the level. That less spending and more investment is needed. That Spain needs to invest on what works in Spain and less in what is dying in Spain. But the new economic plan seems tailored to old industry. The conservatives made it much easier to fire, but equally hard to hire.

As things stand Spain is in a much deeper crisis than any of the larger economies of Europe and as much as it is an economic crisis, it is a crisis of understanding. Without agreeing on the root of the problem: a lack of entrepreneurs, entrepreneurship, business imagination combined with a labor force that is to a great extent trained for an obsolete industry, construction, Spain will not turn around. But I don’t see anyone marching on the streets promoting new business creation. What I see is a lot of people trying to cling to a past in which Spain borrowed and build white elephants. A past that is gone forever.

I end my post with a link to the plan that I presented to Cristobal Montoro. I still consider it a great plan for 2013 but it was not taken seriously by the conservative government.

And here is another article in which I explain in more detail what is wrong with Spain that is different than what is wrong with the rest of Europe.

Follow Martin Varsavsky on Twitter: twitter.com/martinvars

No Comments

Adan on May 2, 2012  · 

Spaniards also believe that wealth is inherited, not created. My cousins and friends are always talking about the swimming pools they’re going to put in when they inherit their homes from their parents. I’m sure you can imagine the look I get when I tell them to buy their own homes with a swimming pool…

Pilar on May 2, 2012  · 

A bit of irony for you: what do you mean the Spanish don’t understand entrepreneurship? Surely that extra half an hour during which the civil servants will have to warm up their seats is going to turn things around??

On a serious note, great article.

Having left madrid 20 years ago, I’m still in the uk. During my last visit I was struck at the resistance in Spain to change how they think about work or for anyone to offer solutions about how to move on.

Eduardo Lina on May 2, 2012  · 

“This post could be a book…” Well, Martín, I hope you finally get to the point where (or the moment when) you make up your mind to write that book. I say that even though, as you once wrote, a book may eventually get a lower readership than a blog.
I’d like to read what you have to say (and elaborate) on entrepreneurs and entrepreneurship, as well as on other subjects related to this post.
At nearly 56, and being lucky enough to be studying again at a university, I get the chance to get hold of lots of new books on technology, innovation and the like. I’d like to read yours, too.
C’mon! Don’t give in to “The Tyranny of the Moment” (http://www.amazon.com/Tyranny-Moment-Fast-Slow-Information/dp/074531774X )
Keep up the good work (and sharing on this blog, as I am not crazy about Twitter to follow you there)
Best wishes from Holon, Israel

José Luis on May 2, 2012  · 

Just after reading your article, I came along this one:
http://www.elconfidencial.com/opinion/notebook/2012/05/02/espana-del-capitalismo-catolico-al-protestante-9125/

There seems to be a consensus about what’s wrong with the Spanish economy. Envy, our capital sin, and our peculiar work ethic are on the top.

Ruben on May 2, 2012  · 

El problema orignal es el sistema de democracia en España, que no está lo suficentemente bien diseñado para que los mejores politicos alcancen los primeros puestos de sus partidos.

Christopher Wright on May 2, 2012  · 

Martin,

A succinct article, where you’ve cut to the heart of the problem, a real lack of understanding of how wealth creation works in macroeconomics.

It’ll be interesting to see the feedback you get when you write in spanish, they’ll probably ask for your spanish passport and send you back to Buenos Aires 🙂 !

Trying to be an entrepreneur in Spain is hard work.

For me its amazing the negative reaction people have when you swap emprendedor for empresario.

Viva change!

Enrico Giordani on May 2, 2012  · 

I live in Spain, but I’m from Italy and what you are saying about Spain can be applied to Italy as well.
I guess that in crysis time, latin people react in the same way: calling thieves those who create wealth.

In Italy we did even worse, putting a “man of the banks” to lead the government, not really a great idea since many of today’s problems have been caused by the bank system… at least in Spain banks haven’t taken over the government… yet.

Ary on May 2, 2012  · 

The book is already written. It’s called “Economía liberal para no economistas y no liberales” by Xavier Sala i Martin. Varsavsky’s approach should include 21st century business models (customization, web-based, etc.), but the essence lays in that book.

A.N. on May 2, 2012  · 

The envy is the capital sin of Castilla, not Spain. Catalans are not like that. The problem with Castilla is that it was a very small start-up right before the second millenium, just between Asturias and Cantabria, and the only way to grow was to take land and resources from the more rich islamic empire they had to the south. After 800 years of doing so, the natural selection, the mindset evolution, was through envy, because envy was for Castilla just like the greediness of the present american entrepreneurs, the force that pushed all. The castillian entrepreneurs, i.e. the aristocracy, felt so sick of the success of the muslims that they risked their lifes just to take what they had. To work was for cowards, winners just stole. The difference with the other countries of Europe, who had as well to expand themselves like that, is the time that took the whole process. 800 years is too much and it becomes a way of life. I know you would like to be loved and popular in Spain, but for sure while you are rich you won’t. You have the Amancio Ortega way (hide yourself) or the Julio Iglesias way (go away), but if you are waiting the castilians to change, you may have a hard time.

And that said, you have my full respect for what you have done and are still doing in Spain, so easy would be for you to fly away to Silicon Valley or England.

Christopher Gamble on May 2, 2012  · 

Shocking revelations that one always thought could be possible but not really so in Spain. I think history will look back at these tough times and refer to it as the beginning of ‘NEW SPAIN’.

Pablo Pomposiello on May 2, 2012  · 

Thanks Martín for a great article, quite to the point. I am a entrepreneur in Madrid, and I have, sadly, a vast experience in dealing with Spanish risk-averse tendencies. For example, working a couple of years ago as the CSO of a failing biotech in Madrid, I gathered my co-workers and suggested we try an employee buyout, and change the direction to more profitable and interesting projects. Not a single employee wanted to own the company. Not one. I decided to go on my own and start Bacmine SL, a small biotech start up. Doing great and having fun!

Miguel Angel Martin on May 2, 2012  · 

I agree with the general outlook of the article. However I’d like to point out that the lack of entrepreneurship lies on the cultural background of us Spaniards. We have all been raised to the standard of stability and fight for a life-long job not far from home, if possible. And it is part of our culture. Entrepreneurship is not promoted and, generally speaking, those who call themselves entrepreneurs have not the knowledge and the spirit of becoming real activity producers but that of trying to make as much money as possible in as little time as possible as well.

And it is also a problem that lies on our education. We are not taught to take risks and look for the way of generating wealth but to let somebody else take those risks and then jump on board if it sails or critize the wreckage. We are not taught to become leaders but to obey those who tell us what to do. Or just critize them in case they suceed. And politics can be the clear example of that. Once natural-born leaders, as Suárez or González, were out of the way no real leaders have arisen and we only had mediocre presidents. Why? For the only reason that we are not taught to lead.

I agree envy is one of the feature problems. The other one is the lack of ethics. Corrupted politicians have emerged and succeeded and they still manage to win election after election.

The third problem, in my opinion, is that we fight for our individual success and not for the comunal one. It is not a matter of patriotism but of common objectives. In my area, in Aragón, people do not feel to be called up unless they feel in danger their Virgen del Pilar, Real Zaragoza or River Ebro. And those issues are pretty much alike elsewhere in here.

Victoria on May 2, 2012  · 

Es que nos quedamos muy cansados como emprendedores despues de atravesar el oceano y descubrir un nuevo continente. Por favor, que sigan los demás con lo de los telefonillos, fonotecas y esas menudencias.

Caroline on May 2, 2012  · 

It is a shame and in my experience this is a well written article. I lived in the Canaries for 4 years and over that time up till 2008 when the crisis came and it became untenable for us to carry on there. Efforts were made by various people, generally long term expats from various countries to try to get the local business’s to pull together and create something good for our town. The more support and organised we got the more difficult it got with local politicians trying to infiltrate and sway the ‘power’ of the chairman who wanted none of it. He worked hard and all he received was jealousy. This I was told by Spaniards was because anyone who is in control of a group of people no matter how small, is considered doing it for his own personal gain and then undermined. Simple as that. Even a group of islands, so remote from the Peninsular are unable to work together from a tourism point of view, each island wants to better the other, rather than create a larger success together. But you can see this attitude at a small level too, people live in big nice houses with walls and gates whilst all around them is rubbish and mess. Us expats find this hard to understand because usually if you have a nice house you want the area to be good too. You can also see this point of view in the environment, though there is a small green effort generally the population see environmental protection as someone elses problem and do nothing not even pick up their plastic bags that float in the sea and litter the golf courses, if anyone is picking it up it wont be a Spaniard. They blame Francoism, but after 7 years I cant see this attitude changing till the youngsters mix outside of Spain through technology and learn to understand working together is better than all for one.

Antonio García on May 2, 2012  · 

Martin, tienes mucha razón en la falta de cultura emprendedora y en el acierto (y necesidad) de la inversión. La rotonda que lleva a mi empresa fue construida en el año 2009 dentro de un plan de apoyo DIRECTO al sector inmobiliario de 8.000€, que luego fue redondeado con otro de 5.000€. En total, 13.000 millones para salvar del naufragio a un sector moribundo sin apenas impacto en la economía. Con ese dinero se podrían haber creado 25.000 startups de medio millón de euros con sus correspondientes 250.000 empleos en alta tecnología. Esa oportunidad no pasó, todavía se podría hacer, y realmente tendría un impacto increible y significaría que España tiene un plan. Mucha gente pensará: “están recortando por todos lados como para invertir esa burrada de dinero”. Eso es como si un contable parado no le contrata nadie porque no sabe manejar bien ordenadores, y como el curso de excel cuesta 500€, pues no se atreve a hacer esa inversión. Y así sigue, parado y metido en un hoyo cada vez más profundo quitandose hasta la leche y los huevos y bajando al super a comprar un paquete de arroz y una barra de pan, como lamentablemente veo cada vez más gente en mi barrio. Pues ese parado es España, que primero gastó como un nuevo rico, y ahora está recortando todo tipo de gastos (que es muy necesario pero eso no es en sí mismo un plan para el país), pero que no se atreve a hacer una apuesta fuerte en alguna dirección para salir de la situación. Con chinos fabricando a 400€/hora, España tiene que encontrar un modelo de crecimiento que permita competir en otra cosa que no sea costes…

Antonio on May 2, 2012  · 

All due respect Martin, I think that you’re oversimplyfing all this. Lest not forget that you also criticized the Spaniards in this article. Have you become one?

You say everybody is worse off now? I can’t agree with you. The rich people are now better than they were. And the poor and middle class is much worse off. Independently of productivity in Spain, it’s not they who are to blame for this crisis.

And on ways to get out of this, I agree that both governments didn’t do anything and I like you give your opinions on how to get over it, but please, take a deeper analysis on this. I’m sure you can.

Martin Varsavsky on May 2, 2012  · 

Thanks Antonio I needed an example to prove my case. You, like most Spaniards believe that since 2008 the rich got richer and that’s why they are worse off.

juanjo on May 2, 2012  · 

You claim the lack of entrepreneurship as one of the root causes of the crsis in Spain but you don’t mention the problems that face those who want to be entrepreneurs, specially regarding taxes, labor costs and financial support and that’s not a matter of envy, or who have what or not.

Banks don’t give credit and when they do, interests are extremely high. I know some people who started a local business and failed and now they’re still paying the banks for that failure and will be for many years. Unlike the US, where as far as I know, it’s very easy to start something and faill, in Spain there are no VC or business angels to back people with their projects.

As a result it is much easier and cheaper to work for others instead of building something by ourselves.

You could add to the equation the lack of imagination and creativity our society has. I find myself willing to start something someday but when I start thinking what could I build I don’t come up with anything revolutionary or that hasn’t been created yet. And you could say, Tuenti was created when Facebook already existed, yes, but again, if you try to start something locally no one backs you being a bigger alternative out there.

BTW, regarding the envy. If you look at the most prosperous countries, excepting the UK with Scotland, all of then have a strong sentiment of union across the whole country. There is no separatism or nationalism. They are aware that a united country is much stronger and benefitial for the citizens than independent regions.
They consume local products that create jobs because they know they really benefit all. And what are we doing here? Regions willing to go their way, consumers avoiding products from those regions and even buying them from developing countries where the cost is much much cheaper. Companies with strong and growing earnings year after year firing people and outsourcing services and factories, and of course our corrupt politicians doing it wrong and distracting the population with meaningless issues.

We are not helping each other doing that. And that’s because we are selfish.

Joaquin on May 2, 2012  · 

I have to agree. From Cadiz, living in Puerto Rico, I’ve come to understand my countrie’s problems living at a distance.
It’s envy.

It’s focusing on trying to be right rather than on solving the problem.
There’s a HUGE fear of failure, of ridicule. You can see it on everyday interactions. This is not the case on other countries.

There’s a correlation between the fear of being wrong (ridicule) and the avoidance of entrepreneurship.

Markus on May 2, 2012  · 

The hypocrisy in this post is enervating. Specially as its a clear cut apology of the large multinationals, instead of a much-deserved defense of the small and middle business (PYMES as are called in Spain) that are the ones really hurting during this recession,

Maybe you should start by admitting that during this crisis few if any large spanish company (hell, or even international) has seen its profit line falling below the danger zone.

Thats pretty much what the common citizen hold against you guys. That large companies are still getting the same net profits as during the economic bonanza…usually at the cost of massive staff layoffs, overworking the remaining staffers with the tasks that were formely done by 2 co-workers, and “forcing” overtime (unpaid, OF COURSE) on your staff if they intent to keep their work comes next year. A culture of fear and loss of worker rights that has remained unchecked for way too long.

btw you, Martin, are an example to prove 90% spaniard’s case. Jazztel has outsurced their support hotlines to south american countries.
As a Jazztel customer myself, and at the risk of being called a racist, I have to state the obvious: The service is piss poor and going to worse as days pass by.

And you dont care, because you probably have saved untold amounts of money by moving that services to economiclly distressed countries where the labor force is unimaginably cheaper than in the industrialized countries.

As a result people have lost jobs (or job opportunities) in Spain, your customers are recieving a far worse service overall, money generated in Spain is going out of the country, and you get richer in the process.

Yes, we understand that most if not all telecommunication companies have done exactly the same. Case in point, others do that in India for the english-speaking countries
Yes, we understand you owe yourself to your investors.
Yes, we understand that is capitalism’s purest essence.

and yes, that still makes you a despicable person. a rich, despicable person.

be rich, or be despicable. your call. and then come to terms with of your decision.

but playing the victim here is laughable at best.

Gonzalo López Martí on May 2, 2012  · 

Yo creo que los españoles no son envidiosos, de hecho tienen una gran tolerancia a la desigualdad y la estratificación social. ¿Será sumisión, tal vez? Tampoco creo que los españoles sean poco aventureros o provincianos.

Es muy difícil hacer diagnósticos basados en un empirismo anecdótico.

No podemos sacar conclusiones apresuradas sobre la realidad actual sólo mirando la coyuntura de un par de décadas. Una o dos generaciones es nada en la historia de un pueblo. Es apenas un fotograma en una película (perdón por el cliché)

Se dice que los latinos católicos son envidiosos, mezquinos, indolentes, poco aventureros, carentes de iniciativa propia, colectivistas en el mal sentido, con tendencia a igualar hacia abajo, a no comer ni dejar comer, xenófobos, reaccionarios. Son defectos humanos. Los anglosajones tienen una larga lista de defectos también. Todas las sociedades y culturas los tienen. ¿Alemania no los tiene? Recordemos la Alemania de la primera mitad del siglo XX. ¿EE UU no los tiene? ¿Japón no los tiene? ¿¡China!?

En los momentos malos surge la tendencia a ver todo con negatividad.

Ya vendrán tiempos mejores, con las explicaciones del “milagro español”, tan arbitrarias e incompletas como las que hoy lo ven todo mal, pero ideales para vender best sellers de baja intensidad intelectual, de esos que leen los ejecutivos en los aeropuertos.

Es cierto que los países sin poder de presión geopolítica, sin recursos naturales, sin mano de obra barata y sin cierta capacidad militar son hoy por hoy más vulnerables a los sacudones globales (caso YPF). No siempre será así.

En fin, la economía moderna es vertiginosamente cíclica y volátil. A no desesperar. Repito, ya vendrán tiempos mejores. Antes de lo que muchos creen.

Pelayo PPdR on May 2, 2012  · 

the grass is always greener on the other side, otherwise ask Portuguese who envy us for our dinamism and creativity.

One extreme example. The real estate boom may have been the product of a strong capitalist and entrepreneur spirit by vilified spaniards. With some exceptions (maybe in too large volumes) real estate developers saw a growing demand for a product and starting massively producing to satisfy expected demand. The source of the problem was law interest rate, not lack of guts.

Eva on May 2, 2012  · 

Gonzalo, no concuerdo contigo sobre el tema de la envidia en España. No sé si es la forma en que te has explicado. Creo que aunque todos somos personas y nos guiamos por los mismos instintos, incluida la envidia, en otros paises son más conscientes de lo que es la envidia que en este pais. El problema de los españoles es que son envidiosos y no lo saben.

Sin embargo, coincido contigo en que el problema de España no son los españoles en sí, tan personas como cualquier otra, sino que en España se echa en falta un referente “cultural” e independiente, una especie de think tank, que haga DUDAR a las personas y hacerles ver un rayito de luz en ciertos asuntos.

Eso a mi modo de ver, y según comparto con otras personas, es lo que le hace falta a esta sociedad para poder frenar lo que podría ser la tendencia, de cualquier otro pais en las mismas circunstancias.

Esto sirve para marcar la importancia que tiene que en un pais haya unos organismos que se dediquen a hacer estudios independientes, serios, que conduzcan a la opinión pública, de forma más inteligente. El actual sistema nos está llevando a un empobrecimiento mental grave de la sociedad.

Ojalá me esté leyendo alguien y se anime a crear un think tank de opinión realmente independiente, como existen en otros paises.

Un saludo, y buen articulo, sólo que le faltó la aclaración de que España no está mal por los españoles, sino por el sistema.

No es que los españoles sean más envidiosos que el resto del mundo, sino que hay un sistema que “institucionaliza” la envidia, por decirlo así.

jomateix on May 3, 2012  · 

The typical analysis from a centralized perspective. Euskadi, and Catalonia in particular, are different. Here entrepreneurs are respected, Catalonia is a entreprenours country. Is a f…… miracle Catalonia can run with the handicap of a fiscal annual deficit of 9% with the rest of Spain. We are so tired
You can read also the Wall Street Journal
article:
Why Spain Won’t Reform
“Catalans know first-hand that in Spain, all
roads—and high-speed rail—run through
Madrid.”
http://on.wsj.com/IeYzrQ

Martin Varsavsky on May 3, 2012  · 

I agree, Catalonia and Euskadi are much more aware of the key role that entrepreneurship plays in wealth creation. Having said this a lot of Catalans and Basques think very much like the people I describe in my post about their own entrepreneurs.

Cesar Cortés on May 3, 2012  · 

Juas juas, España, un pais de NO-emprendedores.

Esto no merece un post de mas de tres líneas. Pongan una enciclopedia al Sr. Varsavsky

eldeloli on May 3, 2012  · 

For us, Catalans, it is not always easy to get our message across tothe world, not having a State behind (but rather
against) us. It is refreshing to read an article that reflects so well what the vast majority of
Catalans, from all political ideologies and walks of life, feel in regards to Spain and the current
economic crisis. The world needs to know, as
Spain occupies the spotlight, that there is a
deeply-engrained national conflict within the
frontiers of the currently-existing Spanish state.
It has been going on for centuries and finds its
roots, as the article points out, on the attempt to
mimic the centralist French model too late in
history and on a territory that already had very
strong national identities (Castilians, Basques,
Catalans).
Catalans have always tried to defend and
maintain their way of life, their own culture and
language, their own institutions and laws. But
this has not been easy under successive Spanish
governments, democratic or else, that have
always tried to impose the Spanish (Castilian)
national project on us. Many here believed that
the transition to democracy after Franco’s death
would bring greater freedom and autonomy for
Catalonia. But the reality, after forty years, is
very different and currently the majority of
Catalans feel a strong disengagement from the
Spanish state. It is difficult to gauge how much
support a Catalan state would get on the ballots,
because Spain does not authorise (unlike Great
Britain) an official referendum to ask the people
of Catalonia if they want to be independent or
remain in Spain. But there’s no doubt that the
support for independence is growing every day.
And this crisis has only made things more
obvious and urgent.
The world should look very carefully at the so-
called reforms being undertaken by the Spanish
government. On the outside they may look as
the kind of austerity that the markets are asking
for. But if you dig a little bit more on the
accounts that are being reduced and the way the
expenditure is distributed you will find that there
is a clear political agenda behind the cuts, which
is not favourable to business and growth, but
attempts to create the kind of state that the
Popular Party and its think-tank (FAES, led by
former prime minister Jose Maria Aznar) have
been dreaming of for many years: a heavily
centralised Spain, with the Catalan and Basque
so-called “problems” (i.e. the will of Catalans
and Basques to have their own state) finally
curbed. Instead of reforming the Spanish central
administration to solve its deep-rooted
inefficiencies, they are actually trying to
reinforce that state and its civil servants, going
against all common sense and economic
rationale. There are many more initiatives, such
as the infrastructures mentioned in the article,
that will show to any impartial observer that the
Spanish state is not bent on solving the crises by
undertaking structural reforms and promoting
growth. They have other (political) objectives in
mind.
For Catalans, who have a society with a long
mercantile and industrial tradition, the rigid and
state-minded policies of the successive Spanish
governments are alarming, mostly when our
fiscal deficits run so large and our own economy
and society has been suffering so much from
lack of productive investment and public
resources. The summary of all this is that we are
coming to a point of no return. Many that not
too long ago still believed that the Catalan spirit
of entrepreneurship, austerity and hard work
could reform Spain are now disenchanted and
have come to see that the only real solution,
both for Spain and for Catalonia, is to file for
divorce. We know that Spain is not going to
accept this so easily (not because they like us,
but because they need us as a source of
revenue). But most of us are determined to
achieve our own state and be recognised within the EU as such. In that process we will need all support from the good-wil…

Christopher Wright on May 3, 2012  · 

Martin,

You certainly know how to stir up and create debate. And this is debate that needs to happen if we want to seriously reduce unemployment and create growth.

I believe that your idea is not to criticise Spain but to understand and identify the causes of Spain’s problems to help stimulate new ideas and solutions.

Constructive

Martin Varsavsky on May 3, 2012  · 

I have been trying to help the Spanish government with plans to generate employment, so far they have not been implemented. My meeting with Montoro was cordial but fruitless.

Gordo on May 3, 2012  · 

Hi,

I agree with your vision. I think that here applies the Kennedy recommendation: “ask not what your country can do for you—ask what you can do for your country”. Most people blames the government, banks or foreign investors for their situation or for the country situation. I am not saying that this agents aren’t guilty of many of the economy trouble, but, what about your responsibility? What can you do for helping your country(and helping yourself)?

And then there’s also this other thing about envying other people wealthiness, press in Spain is full of “news”about how much this executive earns or expends. As if their money was stolen from others less fortunate, as if it was immoral earning money when there are others in need.

Regards

G

Ernesto on May 3, 2012  · 

Bravo!
Totalmente de acuerdo! 100%
# 28 lastima que no se entienda tambien que la union hace la fuerza.

Ernesto on May 3, 2012  · 

Sorry#25

Simon Brown on May 3, 2012  · 

I am English, I live in Catalunya and experience, first hand, the attitudes of the Spanish and the Catalans. The Catalans pride themselves as being incredibly efficient – the Germany of Spain. The reality is somewhat different. They are more efficient than the rest of Spain but they are still nothing to write home about. I get to see the attitude here to – I wouldn’t even call it entrepreneurship – self employment? Working for yourself? In the UK when I got made redundant (again) I registered self-employed and became a freelancer, paying my tax and National Insurance. I paid around 20% of my income in tax as I am not a high earner. In Spain, I can register self-employed and I would pay 20% of my income in tax AND the same amount in National Insurance – €3,000 per year. Leaving me with nothing to live on. There is no financial support for the self-employed, there are no benefits, there are no banks willing to help (despite a well-written business plan, a profitable track record, ongoing profit despite having to run a business on €750 per month and feed and clothe myself, pay rent, pay bills etc).

Catalunya or Spain it doesn’t matter – it’s not that people can’t think outside the box. It’s that they can’t think outside the box AND the only boxes they can think inside of are one shape, made of one material, in one size. It’s like dealing with children. Or people who are institutionalised. I constantly ask – have you no initiative? Have you no endeavour? Have you no way to look at an obstacle and think your way around it? Or is the best way through the obstacle to continually hit your head against it and then blame people because your head hurts?

At the same time, companies like Jazztel don’t make our lives any easier. I was sold 20Meg broadband on a phoneline that can only support 6Meg – I phone to complain they decide they can’t understand my English accent and hang up. Shops sell substandard products and give minimal customer service safe in the knowledge that most people can’t be bothered to ask for the complaints book.

Here in Catalunya shops are still closed for 2 or 3 or 4 hours at lunch time. And on Saturday afternoons. And all day Sunday. My office is in the Raval in Barcelona and all the Asians keep their shops open at these times and make a fortune. So naturally they are resented by the rest of the population because… I dunno – they’re successful? They’re willing to work in shifts? (welcome to the 19th century people) They place a value on working hard and not feeling entitled? They aren’t miserable and grumpy and sullen and inattentive when you go in to the shop?

There seems to be a basic disconnect between Spain and reality. It makes difficult to get stuff done here BUT the upside is there is FAR less competition. It also means that when people “get” it – or when they open their eyes and “get” it – they really get it! But it can be such hard work…

In answer to “why don’t you just go back to England then?”

1.) The weather.
2.) The culture (it is more laid back)
3.) The Spanish / Catalans – despite my gripe about their business-sense there is plenty to love about them
4.) Cost of living is slightly lower and it’s a lovely place to raise kids (we’re working on that…)
5.) With property prices collapsing it’s the only place we can think about buying right now…

Iago on May 3, 2012  · 

En mi opinión un análisis superficial de la situación Española. España tiene muchos problemas, pero me parece que tu diagnóstico es muy parcial. No todo se soluciona con “móntate una empresa”, porque entre otras cosas no todo el mundo puede. Y no se trata de la demagogia de la competencia por los empleados porque de hecho si algo está sucediendo en muchos países y en España en particular es la deslocalización de los puestos de trabajo a donde sea, siempre que se trate de un ahorro de costes y sea factible.

Entre este tipo de medidas y la cultura del auto-empleo y de montar Pymes de 3 trabajadores, pues evidentemente el poder adquisitivo de la gente ha caído por los suelos, y en cuanto llega una crisis la mitad del tejido productivo acaba barrido.

Yo trabajo en una empresa de tamaño medio llevando el área financiera y, sinceramente, creo que tienes una falta de visión global bastante acusada, me parece que no estás para dar lecciones, y menos en ese tono de suficiencia que usas.

Además, no ayudas en nada haciendo este tipo de análisis. Crítica demagógica sobre en este país. Hay mucha gente con soluciones que pueden crear sinergias muy positivas, otra cosa es que haya alguien que les vaya a hacer caso.

Martin Bekker on May 3, 2012  · 

Wow, Martin. You make some pretty vast, sweeping and unsubstantiated claims here. The extent of your generalizations border, to me, on outright bigotry. For example, in a single paragraph you move from “In Spain it is more common”, to “most Spaniards”, to “Spaniards are”. Surely that’s not accurate, and *possibly* stereotyping?

To my real question – and it’s a constructive one: So, what are the most important steps of “creating wealth?”. What are the concepts which the Spanish are NOT grasping? You make a clear case about how NOT to do things – your tide-flowing-out metaphor, etc. But wouldn’t it be a better angle to point out which discourses you find absent, and at what level.

Are you worried that the social contract is not understood? Are you concerned that people are not taking business chances as a result of impossible credit regulations? Do you feel that the value-adding chain is ignored in favour of ‘rent seeking’ behaviour? Do you feel that people’s general orientation is too Proudhonesque (‘property is theft’, etc.) and not cut-throat Capitalist enough? How?

You deal with my above-mentioned question by a passing reference to “compensation, social charges, labor flexibility and other crucial aspects of wealth creation.” I hope you could flesh this out systematically – I’m very keen to learn.

Thanks!

Martin Varsavsky on May 3, 2012  · 

Thank you for reminding me that I had not linked to the plan that I had proposed to the Spanish government to implement to focus on growing industries and generate employment and was completely disregarded. http://spanish.martinvarsavsky.net/espaaa/reunion-con-cristobal-montoro-sobre-mi-plan-para-hacer-del-ano-2012-el-ano-del-empleo.html

If you read my blog there is much more detail on what I think is wrong with Spain and how it can be fixed. You are right if you read this article without context it may come across poorly. I am sorry for that.

Eva on May 3, 2012  · 

#32 Me parece ver que le quitas valor al hecho de crear una empresa. Crear una empresa es crear riqueza, es crear valor. Pero en España esto no se entiende.

Crear empleo, lo es todo, de ahí pende la economía. No hay más fórmulas mágicas. El Estado NO se sustenta con funcionarios, sino que, el Estado y los funcionarios SE SUSTENTAN a través del empleo (privado).

Crear una empresa es como bien dices, muy dificil y tiene muchos riesgos, que no todo el mundo es capaz de asumir. Pero si el Estado aun lo pone más dificil, qué queda? Esto es lo que queda:

http://www.ferrerinvest.com/28/post/2012/04/por-qu.html

Y luego queda reflejado en las listas de paro.

En general, el gobierno de turno se ha dedicado a allanar el terreno para que la gente lo único que se termine planteando es vivir del Estado de una forma u otra.

El sector privado de este pais se ha convertido en una “caza de subvenciones”.. hasta tal punto, que resulta un chiste intentar separar lo público de lo privado. Alguien dijo “corrupción”..?

Manuel on May 3, 2012  · 

Entrepreneurs talking about economics always sounded to me the same as teenagers talking about love… with all due respect.

Fátima Dones Luengo on May 3, 2012  · 

Hola Martín,

Mi profesión es Secretaría de Dirección y soy una de las emprendedoras que está intentando crear riqueza y empleo desde hace año y medio en España. Despedida de mi anterior trabajo en una situación familiar muy delicada de salud. Mi primera inversión ascendió a 1.500 euros. Vendía mis productos desde los sofás de un Hotel. Empezaron a gustar mucho y al poco tiempo pasé a 2 maletas. Propuse abrir una pequeña tienda en el hall, aceptaron pero no cumplieron con los compromisos hablados. Trasladé la tienda al pueblo donde resido. Un poquito antes del traslado a la nueva ubicación llegué a otro acuerdo verbal para introducir algunos de mis productos en una empresa por internet. Se empezaron a vender pero por alguna razón que desconozco no parecían tener mucho interés. Welcome to Spain!!

Mientras se siga engañando a la gente, se siga manipulando, sigamos con la desconfianza entre unos y otros, no haya generosidad, no se hagan las cosas con cariño, sinceridad y sigamos haciendo las cosas mal, señores, esto no cambiará.

Tengo ganas de crecer, tengo ganas de ayudar, tengo ganas de trabajar. Con todo esto que te transmito Martín quiero decir que es lógico que la gente se encuentre en una situación límite. Yo soy una afortunada, sigo adelante.

Iago on May 3, 2012  · 

#32 No sé de donde sacas el hecho de que le quite valor a crear empresas. Claro que le doy valor, sólo constato el hecho de que el discurso de que todo el mundo puede ser emprendedor puede que sea positivo para crear sinergias, pero es obvio que mucha gente ni siquiera tendrá acceso nunca al capital necesario para ello, porque no todo es montar startups basadas en la web con inversión mínima. Hay muchos negocios que sí necesitan una inversión fuerte de capital y eso en España sí que es un problema.

La empresa para la que trabajo, sin ir más lejos, aunque de momento hemos ido salvando y nos va bastante bien.

No todo es culpa del sector público y la mentalidad española. Eso es, lamentando el lenguaje, una tontería. Claro que España tiene muchos problemas pero no han aparecido de la nada. ¿O es que acaso pensáis que los españoles nacen odiando a los ricos y con mentalidad de funcionario? Hombre por favor, no seáis simples. El análisis es mucho más complejo y en la ecuación también entra el sector privado en España. He trabajado en Abertis, Telefónica, y alguna que otra del Ibex 35 y sé bien de lo que estoy hablando. Evidentemente no puedo largar así como así, pero vamos, parte de la culpa tienen que asumirla.

Un ecosistema favorable para crear empresas no consta únicamente de una sociedad de gente con ganas de emprender y un gobierno que no meta zancadillas. También tienen que participar los que poseen capital. Y aquí son dos gatos. Los demás con suerte te ignoran.

Supongo que hay que vivir el ambiente de Telefónica para entenderlo… no lo sé.

Eva on May 3, 2012  · 

#39 Consideras a Telefónica una empresa privada? Yo no. Urdangarín por qué se fue a Telefonica? Por qué se fue a Endesa Salgado?

No es un poco “sospechoso”? Vamos, es de chiste escuchar como se habla en este pais de “capital privado” y se pone de ejemplo a empresas cuyos lazos con el Estado son más que estrechos…… ha dicho alguien la palabra “corrupción”?

Catalan on May 3, 2012  · 

Great post. The roots of this problem can be found deep down in history:

Jews and Moors expelled out of the country in the XV century (to steal the wealth they had created, but they took their scientific knowledge somewhere else).

Wealth coming on boats from America: why should I work or trade if I have gold literally coming on boats?

Bourbouns taking over in the late XVIII, copying the (inefficient) French state model: centralized country with aristocratic civil servant class (not really serving people but parasitizing them). The centralized airport system would be a great example of that.

Failure of industrial revolution in the XIX, with only partial success in Catalonia and Basque Country (hence the slightly better attitude towards entrepreneurship in this countries)

Corrupt development under Franco regime in the 50’s and 60’s

Obscure privatization process of the (inefficient) public companies under the Aznar regime: most of Ibex 35 “private” companies have strong imbrications with politicians: “if you scratch my back today…”

In Spain, it’s all about not having LESS than my neighbor (even if we are both starving). And of course, always try to blame it on the others: the jews, the catalans, the immigrants, the germans, or the referee when it comes to football.

This country doesn’t stand a chance.

Catalan on May 3, 2012  · 

PS This twisted look on wealth creation has contamined labor relationships, with unions still talking about “la empresa” in third person, like they don’t play a key role in the company’s success! On the other hand, I tremble when I hear the spanish “liberals” talking about free enterprise: fascists in disguise, with freaks like E. Aguirre leading them. Having said that, the few enterpreneurs left are nothing but heroes. It must be discouraging to be a small businessman trying to export your products and seeing your tax money spent in empty AVE’s instead of building an european railway system for good transportation. Government lost most of its credibility with this kind of decisions.

Iago on May 3, 2012  · 

#40 ¿Y qué tiene que ver que sea casi una agencia de colocación a que sea pública o privada? Por supuesto que es privada, no te quepa ninguna duda de ello. Y claro que tienen unas relaciones muy estrechas con el estado, es más, te diría que sin el estado estas empresas perderían una parte muy jugosa de sus ingresos, no conseguidos compitiendo precisamente, pero por lo que veo ya te haces una idea.

Eso sí, es privada claramente.

Ivar Rekve on May 3, 2012  · 

I am norwegian, having lived 6 years in the US and now the last 8 years in Spain.

You are spot on with your description!

Un saludo,
Ivar

maria on May 3, 2012  · 

Muy acertado tu artículo!!. Los suscribo al 100%. El gran problema de España es que la denominada “cultura del pelotazo” ha hecho mucho daño. Eso significa que las personas creen que hacerse rico es “dar el pelotazo” como sucedió en el Boom inmobiliario y casi nadie (tan sólo los emprendedores) está dispuesto a pagar el precio que supone el éxito y el bienestar. Quieren ser ricos sin esfuerzo y eso es algo que no existe ni existirá. Crear valor y riqueza requiere de mucha preparación, tesón, fe y TRABAJO y pocos están dispuestos a ello.
Espero que algún día los españoles dejen de mirar a los demás y se miren a sí mismos. Espero que dejen de pensar “qué puede hacer mi país por mi” y pasen a pensar “QUÉ PUEDO HACER YO POR MI PAÍS”.

Jose on May 4, 2012  · 

Martin,

Do you believe Amancio Ortega hides because of fear of what people could say of him? seriously?

Amancio is a very introverted person, is not like you are, a very extroverted person. Introverts do not like going from party to party meeting people and doing interviews, they do not care staying alone for some reasonable periods of time(they need it) and prefer a small circle of people around them. There is nothing wrong with that.

About Spain, well, Spain is very big to make generalizations, the north has nothing to do with the south. Do not let an angry minority to disturb you.

I do not believe that Conservatives want to cut anything, they are forced to cut by Europe, the socialist would had been forced in the same situation, indeed Zapatero was forced the last two years, he promised them he were going to cut but then he did not(he knew it were not going to be popular), and because Europe was busy with Greece, nothing was done.

Christopher Wright on May 4, 2012  · 

This crisis is a crisis or Innovation.

Christopher Wright on May 4, 2012  · 

This crisis is a crisis of innovation. We don’t create enough companies that can compete at an international level.

Eva on May 4, 2012  · 

#43 Si dices que son privadas claramente, pero también admites que tienen unas relaciones muy estrechas con el Estado. Pero vamos a ver, aquí hace falta definir cosas básicas: una empresa privada es una empresa INDEPENDIENTE con capital PRIVADO. Si NO es ni INDEPENDIENTE ni todo su capital es PRIVADO, entonces, de qué estamos hablando?

Los políticos de turno en su día decidieron llamar privatización a hacer chanchullos pasando una empresa a que se gestionara con capital privado. Y los españoles se lo comieron con patatas parece, que a día de hoy sigo escuchando a la gente convencida de que lo que se ha estado haciendo aquí en España es igual que lo que hizo Margaret Thatcher.. cuándo se ha hecho en España un estudio serio sobre las condiciones que tendrían que darse para que se creara un ambiente de competitividad que favoreciera al cliente, que favoreciera a todos en general? Nunca. Entonces no lo llamemos privatización, por favor, porque lo que se ha hecho en otros paises si es privatización, pero esto ya no. Llamemoslo de otra manera, no sé, pataterismo español, no sé, pero privatizar desde luego que no.

España es como un niño malcriado. Cuando aun el pais no había madurado, llegó una avalancha en miles de millones en subsidios de la UE. Y claro, llegaron los despilfarros. Y así con el tiempo, el español incluso se terminó creyendo que no había nada extraño en que tuviéramos más aeropuertos que Alemania, por poner un ejemplo, de la cantidad de despilfarros de la lista.

Y ahora que ya no hay dinero, el niño berrea y da patadas, y echa las culpas a otros. Pero de nada va a servir, si no es capaz de mirarse así mismo y admitir que algo no iba bien. Y eso comienza por un estudio de cada uno de forma individual, y dejar de culpar a los políticos de turno.

Veo muchas huelgas convocadas y muchas historias, de exigir exigir exigir.. como el niño inmaduro que patalea, y exige que los demás cambien, sin exigirse así mismo un cambio.

Verás tu la bofetada de realidad que les va a llegar.

anna on May 4, 2012  · 

Very interesting subject. I see some similarities with Sweden (envy!!!), but I think that here everybody understands and at some level accepts that entrepreneurship means jobs, even though it leads to huge differences in wealth distribution. If you look at salaries, inequality in Sweden is very low, but if you look at wealth, Sweden’s Gini wealth index it is among the worst in the world if you consider equality to be a good thing (it’s just as bad as Argentina’s, Spain’s is among the best). High income taxes and a general desire for everyone to be equal are actually a great driver for entrepreneurs. Maybe something for Spain to consider? With more income maybe the Government could afford free English lessons. 😉

Finally: it is not a well-known fact that Sweden is so unequal, not even here. Enough people recognize that more envy would be very bad for the country, exactly what you are saying about Spain, and keep quiet about it. It’s better to talk about income equality and how much we tax higher salaries so that the less educated are happy and the ambitious try to find a way around it. Taxes when you sell startt-ups are low compared to taxes on salaries.

Gini: http://en.wikipedia.org/wiki/List_of_countries_by_distribution_of_wealth

Neno on May 7, 2012  · 

You may want to watch this video, which explains in croncrete details some of the many things that Spain needs to change.
http://www.youtube.com/watch?v=t4_WmvROkT8

Jose Miguel on May 8, 2012  · 

Hello,

Martin I fully disagree about your view about the Spaniard’s mentality. I agree the envy is one of the worst defects of Spanish people but most of the people do not blame on enterprneurs like you.
In general it is thougth that the problem & crisis come from the country’s economy structure and our “business model”. Spanish people love Amancio Ortega -a national hero-, Spanish people like enterpreneurs, technological ones are especially well considered, Spanish people like you, Spanish people hate people such as Florentino Perez, Luis del Rivero, Fernando Martin, Luis Portillo, Enrique Bañuelos….people who became rich thanks to the construction industry and receiving public money. We also hate the fact that politicians spend our money for building airports everywhere, high speed trains, high ways….facilites that nobody is going to use. Corruption, politicized justice, etc…
This is the Spanish understanding of the crisis.
Anyway, it is hard to say what it is the concern of the Spaniards.

Dani Santi on May 15, 2012  · 

Mostly agree with your post.

I tried to explain this to my parents, because they think wealth is like energy:
Energy does not disappear it changes forms, opposite to wealth that is created and “destroyed”.

Most of us (Spaniards) tend to blame to others instead of look for solutions, and even some people boost that behavior of just blame on others work, instead of promote people who find solutions and create wealth.

pitujones on May 17, 2012  · 

no estoy de acuerdo , qué se supone que dice el Sr. Varsavsky que tenemos que hacer , ya que dice que nos tenemos que poner en el lugar del empresario ? y yo que no puedo montar una empresa , tengo que pensar qué puedo hacer para levantar la economía , pues lo tengo claro , si no tenemos trabajo , no hay ingresos, si no hay ingresos no hay gasto , si no hay gasto no se genera riqueza ….. es un post para echar el marrón a los demás, y la verdad pena me da que tener contratado algo en España con una persona que se dedica a criticar a los que hemos generado su riqueza ……….

Juan Pablo on May 18, 2012  · 

I’m an ant. An entrepreneur in Barcelona. In this post, you can learn how I’ve managed to sell an energy efficiency software to the Spanish Energy Efficiency Agency out of the blue.

http://wp.me/p20mFM-aZ

Something that must have been done in one month, took 36. When finished with success, I’ve asked them “Why don’t you endorse me to do the same thing for the whole Government? You can save about 10 Million euro a year in stupid energy waste, I can grow and create jobs. The answer “We can’t be so directly associated with a private company because we lack independence if we do that”. The facts that I was the one and only expert that went to them with this solution, endured a 36 month torture to finish something that could have been done in 30 days, AND that my expertise and knowledge would have been beneficial for THEM more than anyone, didn’t counted. Perhaps the only private enterprises this politicians can be linked to are the ones that give free suits? I always say the best salespeople we have are the politicians themselves so, why do you get so scared when someone that wants to sell something shows up? To sell is the same than to steal? Where are the companies that pay taxes get the money from, if a sales guy is evil???

Mari Anbotoko on May 20, 2012  · 

Completamente de acuerdo con este artículo. En España la gente se piensa que el dinero existe por obra de dios; y no se dan cuanta que hay que crearlo. Aquí la palabra “empresario” está muy denostada; se da por hecho que consiguen su riqueza perjudicando al pueblo. Muchísimos jóvenes simpatizan con las ideas socialistas de antaño y se movilizan en contra del capitalismo; que según ellos es el responsable de todos sus males. Quieren un sueldo (digno), servicios públicos para todos, toda clase de ayudas para los pobres tanto del país como del resto del mundo… como si el dinero lloviera del cielo. En mi opinión, es lo que ocurre cuando un país menos evolucionado se ve de pronto inmerso en una sociedad occidental e industrializada: aprenden rápido a gastar y a disfrutar de los beneficios económicos, pero no han aprendido el funcionamiento de este sistema, lo que supone conseguir ese capital para vivir mejor: prepararse, formarse, trabajar, ahorrar, invertir, innovar…

Juan Pablo Garcia on May 21, 2012  · 

I’ve spent 3 years to sell an Energy Efficiency software to get rid of PC Energy Waste to the Spanish Institute of Energy Saving. Once I’ve completed this “success” that could have been done in 30 days, when I asked them for help to deploy the same solution in the whole Government (they can save 10 Million Euros each year and my tiny company could grow) they’ve said “We can’t endorse any particular company, it will not be fair”. So, an entrepreneur is devil, even when he solves one of THEIR problems and… yes, it´s the one, the first and then only that invests his time and money working on something they are failing at. Poor Spain.

http://www.leantricity.es/2012/05/how-ive-sold-an-energy-efficiency-software-to-the-spanish-government/?lang=en

Noam Gonen on May 28, 2012  · 

Dear Martin, I believe what you pointed out is not solely an isolated Spaniard problem. It is common to all western societies. After industrial revolution, creation of upwardly mobile middle class all products of healthy capitalism and “positive envy” (I want to have what you do therefore I have to work as hard), we seem to have stagnated in a frame of mind that dictates “I deserve”. I’m so glad the Chinese are giving us a great wake up call: hard working, humble, nimble and even play-dirty at times, they remind us all that “if you want it come and take it”.
I live in California, and I could superimpose your take on Spaniards right here in LA…
I remain optimistic that while people will marvel in their ability to destroy what humanity has built for a while, common sense will prevail and we’ll all realize that in a global village with no boundaries social-economic potential flows like water and it’s only the countries that through visionary governance facilitate ecosystems for entrepreneurship and risk-taking that will rip the benefit and enjoy the high tide you are talking about, one which raises all boats.
Thank you for being part of those who take risks, innovate and create.
To all who read this, stop relying on your governments to save you. Save yourself, be proud of working hard, be proud of having a success and twice as proud for having a failure.

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