The Origins of Spain's Popular Party (PP) — Part 1

Spanish Political Parties Series, Part 1 of 8

Why does Spain's Partido Popular speak so many different political dialects at once — Madrid's free-market libertarianism, Galicia's institutional conservatism, the Christian democracy of its old guard — and yet remain the largest political party in Europe? In this opening installment of a new series on Spanish democracy, Diego and Rasheed argue that the answer lies not in incoherence but in DNA: PP is, and has always been, a coalition wearing the clothes of a party.

The conversation moves from the death of Franco in 1975 through the engineered transition under King Juan Carlos, the founding of Alianza Popular by the formidable and unelectable Manuel Fraga, the collapse of the centrist UCD, the failed "Roca Operation" through which Catalan economic elites tried to manufacture an alternative center-right, and finally the 1989 Sevilla congress where Fraga surrendered the stage to a then-obscure regional president named José María Aznar. Along the way: why a brilliant Francoist minister who helped draft the 1978 Constitution could never win a national election; how Margaret Thatcher personally berated Fraga over Spain's vote on NATO; why the "Clan de Valladolid" outmaneuvered Fraga's preferred successor, the glamorous Isabel Tocino, in a weekend confrontation at his Galician fishing house; and the case for Aznar as perhaps the most consequential pro-liberty Western leader of the late twentieth century outside Reagan and Thatcher.

Threaded through the narrative is a quieter argument about democratic self-restraint — Franco's regime dissolving itself into a constitutional monarchy, Fraga stepping aside despite holding the party in his hand, Aznar imposing his own two-term limit at the peak of his power and keeping the promise — set against the unraveling of those unwritten rules in contemporary Spanish politics.

Part I closes on the eve of the 2004 election, with PP at its absolute majority and Mariano Rajoy chosen as Aznar's successor by a finger pointed across the cabinet table. Part II picks up with what happened three days before the vote.

Transcript

SPEAKER_02 0:09

Diego, we are back for another episode of the Somewhere Anywhere podcast.

SPEAKER_00 0:15

Happy to be here with you, Rashir. Hey to every single one of our listeners. And we're starting quite a unique series. I don't think you can get this content anywhere. In English at least. We're going to dive into the different political parties and families of the Spanish democracy. And let's start with the right-wingers, right?

SPEAKER_02 0:35

Yeah. So we're going to do a very detailed podcast series. We don't even know how many episodes we're going to get out of this conversation. We're going to cover every political party in Spain of note. And we'll probably do a final episode of the ones that aren't that not.

SPEAKER_00 0:53

Even those, yeah. Yeah. We'll have fun. Bear with us. There were many of you that stuck with us to the end with a three-hour episode about Spanish constitution, Spanish rule of law, and political system. So this is far more interesting. And that one that one was fun. That was fun. But there was a deep, you call it a deep dive. That was like a dive to the depths of the ocean, right? We're gonna have fun, folks. So bear with us. This is going to be interesting and enlightening I'm gonna be able to do that.

SPEAKER_02 1:20

Yeah, sure.

SPEAKER_00 1:20

It'll be great.

SPEAKER_02 1:21

So we're gonna start today with Pepe, Partido Popular or the Popular Party. And we're gonna really go from the very deep origins of Pepe. And this is important because you know, something that we discuss now amongst ourselves and with our foreign friends and colleagues is why does Pepe seem to be so incoherent or at least so have desperate views depending on the region, depending on the time of year, you know, all these kind of things. And you know, I think there's a very clear answer, which is well, the actual party itself isn't a single homogeneous party, and it's in the deep DNA of Pepe.

SPEAKER_00 2:05

Just like Spain is not a completely uh unified polity, but rather a very plural, very decentralized nation with a lot of uh different communalities, uh sure, but also differences and asymmetries, and you need to factor that in when you understand Spanish politics. Therefore, you also need to understand that when you understand right-wing politics in Spain. And uh for a for for a foreigner looking at this, uh, or or local for that, for that matter of fact, uh it is true that sometimes you find that, oh, but Madrid is doing so much. I mean, some of the best free market policies in the West are taking place in Madrid. Madrid is the place to be for many libertarians these days, right? So it's Argentina under Mulet, sure. But uh how come that same party, PP, Popular Party, uh, which is a large political family, the largest in Europe, the uh the European Commission president, it it's uh Ursula von der Leyen, it belongs to this party. The current Chancellor of Germany is uh uh Chancellor Merz is linked to this party, the CDU is the uh the popular party, European Popular Party member of Germany. Uh so why then uh is it that the national PP does not have the same pro-free market, open society, cosmopolitan, uh libertarian mentality that you see in the Madrid PP? Well, we're about to tell you why, and uh there's there's uh this is a complex uh discussion. And by the way, if we had if there was such a thing as podcasts back in the 80s, uh we would have recorded about how the the right wing was trying to unify itself. Uh however, in the 90s and in the 20s, and for the first half of the 2010s, uh the the right wing was unified. So saying right wing in Spain and PP was synonymous. That's a good point, yeah. And in the last 10 years, the right wing split in three. So PP was only one of three parties with relevance in the right wing scene, and still today split in two. There is another uh sort of alt-right party, Fox, which is a spin-off of of PP. So uh this is why uh getting context and understanding the background is is going to be useful for anyone following our episode or Spanish politics for that matter.

SPEAKER_02 4:16

So, like most conversations in modern Spanish politics, we have to start at the transition. And of course, for listeners, we do have an episode on the transition, a very early episode. We're probably gonna do another one at some point very soon. But essentially, this when Franco, the dictator Franco, died in 75, 1975, that kick started a new period of Spanish history where they the politicians and the king at the time wanted to reform the Spanish state into something new, and the thing that they reformed it into, and the process to get to that point was called a transition, and that is where modern Spain comes from. The current constitution is from 1978, from this period post-Franco. And this is where the history of Pepe properly starts, and to be to get into that, Pepe is not the original identity of the thing that we now call Pepe. You can probably put the correct origin to Pepe, Alianza Popular.

SPEAKER_00 5:29

So AP, Alianza Popular, Popular Alliance, which it's a very similar name, uh was one of the different parties that sprang out once Franco has passed, the monarch, Juan Carlos, King Juan Carlos, uh sort of uh channels and pilots uh a transition towards democracy that brings in all political families and sensibilities, which is a reason why, although there's aspects of the transition that many people may discuss or criticize, overall on the net it's seen as a big success. So uh long dictatorship ended. Prior to that, there had been a very violent second republic, which in principle it was a democratic regime, in practice it was definitely not one, and a very illiberal regime full of turbulence, and then of course 40 years under General Franco. So suddenly here is democracy, and so civil society is trying to organize, and there's literally dozens of parties, dozens of political, but there's only four that make it, and in a way, today there's four main political parties in the Spanish political scene, which is something that is interesting, like that almost half a century has gone by. And you could argue that back in the day we had a center-right party and a right-wing party, a center-left party and a far-left party. And today, uh one could argue we have two far-left parties, uh, a standard conservative party and an alt-right party. And uh PP was one of the elements that was present in that early split. So therefore, it was one of the four main parties that was involved in the constitution. But although today it is seen as the moderate force of the Spanish center right, back in the 1970s, it was seen to be on the right of the center-right spectrum. So that is why, although Spain did have a center right president from almost Franco dies all the way up to 1982, so there's like seven years of leadership under the UCD party, PP was seen as the more right-wing party, more conservative, less appealing for the masses. So that is the origins of PP, a a group, a political group that comes up once Franco has died, and uh that is originally the fourth largest party in the country.

SPEAKER_02 7:56

But let's let's even give some more details on that because I found that particular period quite interesting. So, yes, when Franco died, so I'm thinking all of the details of this conversation.

SPEAKER_00 8:09

So when Franco died, the powers of So Can we pause there for a second? Franco died, which means that his regime ends with his physical end. Yeah, yeah. That is something that I mean, of course, it comes as obvious, but this is not the case in other regimes that have been either overthrown or have withdrawn power somehow. When he dies, when he physically dies, that's when the transition starts. So which is what 83, 85? He dies in in 75, he dies in uh 1975, he was 80. I think 83, 83, four years old. He had been sick for a few months, and that's when the king decides to, you know, pip pivot towards that a democratic so it's on that point.

SPEAKER_02 8:49

So the king, why the king? Well, Franco made the king. I am still unclear why this specific thing happened, but before Franco died, years before Franco died, Franco made the king his official successor to all the power. This is kind of crazy to me, to be clear. But Franco, the dictator, brought back the monarchy under Juan Carlos, who was, I think, not supposed to be the actual monarch succession, supposed his brother or father. But Franco chose Juan Carlos.

SPEAKER_00 9:18

They skipped the father because he did not get along with Franco. Okay. So they went straight to the son. But since the elder son had actually died in a hunting accident with King Juan Carlos himself, uh shotgun was fired, and so the second son of the hare was the one that eventually became king Juan Carlos.

SPEAKER_02 9:38

It was Juan Carlos, yes. So Franco chose Juan Carlos again long before he died to become his successor when he does die. And that's what happened. So when Franco died, there was no power struggle, the law, the courts, everything continued, and Juan Carlos became the head of the Spanish state. Yeah, the head of the state. At that time. And it was Juan Carlos as head of state that essentially decided, no, we're going to transition to democracy, which to me is a remarkable thing to say.

SPEAKER_00 10:07

Yeah. Truly. When I speak to uh the some of the Chicago boys that were involved in the reform process in Chile under Pinochet, you could clearly see how both in the Spanish and Chilean example, the first instinct of the military leaders was to just, you know, hold power and control in a country that was descending into chaos, right? Peter Thiel was recently visiting Chile and learning uh firsthand from Jose Piñera, who is I consider a friend and who was uh responsible for the capitalization system that has resulted in the savings accounts for all workers and uh so on. But when Piñera explains this, he clearly identifies it two part, two parts of this regime. And the second one being one where the civilians take power, start to put together the sort of reforms that lead to democracy, and eventually there is a democracy. And in that case, Pinochet does establish a vote where he's voted out and he leaves power and leaves it in the hands of a new political system that came after him. In a way, this is a similar process because Franco's first reaction was, economically speaking, was very interventionist until the late 50s. Politically speaking, of course, it was an authoritarian regime that was mostly concerned with keeping law and order after so much chaos under the Second Republic and a civil war. But then obviously started to open up more freedom, economically speaking, or also for civic society. Granted, still a dictatorship, but becoming way, way, way more open in many aspects. And so this facilitates the fact that when the king calls for a move towards democracy, it doesn't really come as a shock because Spain was clearly moving in that direction, and that was probably the plan from the get-go. But Franco understood that he could not present himself to be a democratic leader after 40 years of autocratic rule, but he did understand that the times were changing and that after him something different needed to come. But they were concerned with order, so everything was done very orderly. So the banned political parties were legalized. There was no violence, not a single drop of blood was shed. So it was a peaceful transition to democracy, something of which Spanish are naturally proud of, regardless of the fact that, of course, some things could have been done better that yeah.

SPEAKER_02 12:20

Yeah, there were some issues, of course, but it was primarily quite good and quite salient and quite peaceful. So after Franco died, Juan Carlos, the king at the time, also importantly the head of state in complete control, all powers, all legal authority, it's him.

SPEAKER_00 12:36

And to be precise, he's the head of state at this point, and he may be referred to as king because of nobility. Right. But Spain is not a monarchy, technically speaking, at this point. There is a vote to create a democratic Congress one one year after Franco dies. Then this Congress drafts a constitution which is then voted, and then Spain is proclaimed to be formally and officially a democratic monarchy. Right. So after the official constitution. So technically, between 1975 and 1978, the three years that go by between Franco's death and the constitution is proclaimed and voted for by around 90% of Spaniards, Spain becomes a monarchy, a democratic monarchy. And in the meantime, we do have a monarch, but that the title there is for nobility reasons.

SPEAKER_02 13:23

He's only legally constituted as it would be it would be more accurate to call him the dictator at the time. Yes, you could. You could.

SPEAKER_00 13:31

You could f further from night from 75 to 76, he's doing the Harakiri, like the Japanese would say. So he's surrendering absolute power, but he did have absolute power because he inherited from Franco. So if he wanted to, he could have stayed forever, right? Unless someone threw him out, of course, but but but he did have absolute power and they pivot into democracy. So that was so this pivot, this pivot is the important part.

SPEAKER_02 13:57

So when uh Juan Carlos as head of state he uh chose his former tutor, Taquata Miranda Fernandez, yes, to lead the council of state, and then as the leader of the council of state, he had to give a list to the head of state, Juan Carlos, to select a new prime minister. And he maneuvered his way internally to get Adolfo Suarez to be on the list, and then Juan Carlos chose Suarez to be the prime minister. This is an important fact because another important figure here, Manuel Fraga.

unknown 14:36

Yes.

SPEAKER_02 14:36

So Manuel Fraga was a minister, well, he was an official in the Franco regime during the transition period. He was a minister and someone who was an ambassador, but he thought that he should be have chosen as the head of as the prime minister by Juan Carlos, but he was not. Suarez was chosen as the prime minister, and that started this tension now between Suarez and Fraga that we're gonna get to at some point. Exactly.

SPEAKER_00 15:04

So, long story short, many parties come up, of course. Every everyone there was like uh competition to actually you know legitimize the movements that wanted to have a future in the new world.

SPEAKER_02 15:14

Yes, it was Suarez that legalized the Communist Party, for example, to do it on Holy Sunday of all times to do it. Yes. And that was in 75, 36, and then they had the first the first democratic election in Spain since 1936 was in June 1977. Yes. And that is when the current landscape started to get filtered.

SPEAKER_00 15:38

Don't want to get in a rabbit hole here, but there's many things we could say about that 1936 election, by the way. Okay, but let's not go that rabbit hole at this point. Okay. So yeah, since the 30s, Spain had not had a election regime.

SPEAKER_02 15:53

Yeah. So in 77 election, there were four major parties that came from that.

SPEAKER_00 16:00

But but let's forget about the left for for today's episode.

SPEAKER_02 16:03

But those make the point. So we're not going to get into details, but to make the point is UDC, that's the Suarez party that got 34% of the vote. Pesoe, the left party, got 29%. Currently in government. Currently in the government. PCE, the communists, they got 9%. And then AP, the Fraga Manuel Fraga's party, the origin of Pepe, only got 8% in the first ever election.

SPEAKER_00 16:31

So the idea of having Suarez become the favorite of the elites to be the new democratic face of Spain is a top-down move. 100%. And it essentially was he was the head of the state broadcaster. He was the head of the BBC. Yeah. So he was uh obviously a someone that journalists knew, politicians knew, he was fairly young. And if if you want to narrow down his ideas, his readings, his influx, I really respect his work as a someone that tried to bring people together. So don't take this as a negative read on him. Uh, I do have criticism. Mostly economic policy was horrendous, to be honest, in the first years of the transition by just trying to compromise with the unions and with the socialists all the time. He actually got nothing done from the center-right platform that in principle he represented, but that the different conversations. But Suave really had a very bland ideology. He just knew that it was time to modernize Spain, so he just knew that the institutions needed to be homogeneous to these European democracies that we wanted to look like and sort of emulate. So he was mostly concerned with pivoting that institutional reform. But he was that darling that the elites chose to be the sort of the face of the new democratic system, and that explains why he was the winner of almost every election that was held until 1982. So his party, UCD, was a coalition of many parties. But again, it really doesn't matter because it they did not have that much of a real social base. It was more of like the king and the people around him sort of signaling that hey, this guy, this is our guy. Like he come, he was a reformist under the Franco regime because he was definitely not a nostalgic guy that didn't want democracy, but rather someone who believed in it, and he can represent peaceful change. Now, Fraga, who just you just mentioned, is a different story. Because Fraga had been a minister for Franco. So everyone knew Fraga, every civilian knew Fraga. Now it's true that he was a very reformist minister. So, for example, there was the censorship was essentially lifted off under Fraga. Foreign investment and foreign tourism were essentially allowed and developed with Fraga's reforms. And Fraga himself believed in that democracy needed to be the new paradigm for Spain. So definitely not a nostalgic. Plus, Fraga was read you know a couple of books every day, was a big, very heavily inspired by the British political system and really wanted to have a democracy that could be compared to the UK one. So a larger-than-life figure, just Google him, he just looks like he looks apart. He's quite a towering figure for the center right. But Manuel Fraga was someone that, you know, although he had surely the credentials to be a head of government in terms of having done very significant reforms, Fraga was a man of the past. And that is, I guess, the original sin that Alianza Popular was always going to deal with as long as he was in power. And that is why he only got 8% of the vote. 8% of the vote.

SPEAKER_02 19:57

Again, so he didn't agree with Suarez, so he had a essentially a vendetta jealousy, and he decided to not join uh UCD, the Union de Centro Democratico, Central Democratic Union, and he formed AP with some other hardline Francoist people. So there are not that many of them.

SPEAKER_00 20:16

To be clear, all of these people that had been on the Franco regime did believe in democracy, did believe in, did did they all of them were reformist ministers under Franco. So I'm just saying this because it's easy to then just pinpoint PP's origins back to the Franco regime. Well, these people fought for a freer Spain serving under Franco, and then once they had the choice, they clearly stood with democracy. Fraga is one of the men who drafted the Spanish constitution. Well, okay, about that.

SPEAKER_02 20:46

Let me, you know, devil's advocate here in some ways. So when the election happened in 70s, in 1937, then they started the process of doing the actual constitutional draft, a new constitution. So that it so from the Congress, there was a committee, a drafting committee chosen. And a drafting committee consisted of three deputies from UCD, one from Pesoe, one from AP, one from the Communists, and one from the Cajalan minority. So Fraga was the person from AP chosen to essentially draft. So he literally drafted the constitution that eventually went for a vote.

SPEAKER_00 21:27

He's a founding father of the Spanish constitution and democracy. So that is why, you know, the idea of trying to present Fraga negatively because he had been a minister of Franco is this sort of read on history that fails to understand context.

SPEAKER_02 21:43

But to me, here's the complication though, Diego, is when they did the vote in Congress for the new constitution, AP didn't vote completely in favor of it. So five people from AP voted for. Approving the new constitution. Three, I believe, voted against, and then one had abstained or something like that. So it wasn't even the case that all of AP voted for the transition regime that most people in the consensus wanted.

SPEAKER_00 22:15

But it's true that when you're going through a constitutional convention, not everyone may agree with what is being presented or what is going to be submitted to referendum. And if you trace the reasons for the hesitation within the group, many of them are still valid in today's right-wing circles, like people in liberal, conservative, libertarian, moderate, Christian democratic, even moderate social democrats. They do believe that the constitution gave a lot of leeway for separatism to grow, for example, or that some other elements of the way in which decentralization was conceived were not proper. So this needs to be taken into account. Those concerns would still be hold if you talk to a regular random right-wing or center-right person that you walk through in the street. To be clear, although that position was held in Congress, AP did campaign in favor of the constitution. By the way, all four parties campaigned in favor of the constitution. So when it really came down to telling people what to vote for, there was no split. Not just not internally, but rather within all parties. The communist and the party that was seen as being the more hard-line right, which was AP, and later to become popular party, they all campaigned for the constitution, which was approved by more than 80% of the vote.

SPEAKER_02 23:25

Yeah, it was like almost 70% of the population voted in the referendum, and then they over 85% voted to approve the new constitution of Spain in 1978. Okay. But then to this is the origin's point. But we mentioned the so AP. But AP is again, I mentioned they only got 8% of the vote in 77. Why this is a very minor party by any metric. But then something started happening. In the 80s, the UDC began to collapse. And as you mentioned, this is like a federation of parties. It's not itself a singular party. There are many different small little groups involved there. And they started to break off. And the actual UDC kind of really pushed forward and they're breaking up after Suarez has lost confidence and all these kinds of things. So therefore you had new parties pop up. You had Partido Liberal, you had the Partido Democratico Central, you had many, many small parties also pop up. This is the early 80s now. Yes.

SPEAKER_00 24:32

So UCD was probably just a vehicle for the transition. It was just the right face for the transition. The one reformist who could who could get the communists and the conservatives and the Franco-reformists and the moderate socialists and the centrists and just everyone to rally together around the idea of beyond party politics, let's first set up a democracy. So Suarez will always get the utmost respect from me and from so many Spaniards, to be honest, because he was able to channel that transition. Now, having said that, the man was not fit for actual dealing with the challenges of the time because he was not a man of ideas, he was just a man of, you know, a very apt politician in terms of reaching deals, agreements in order to press forward with this transition to democracy. But then economic policy, like I say, was not very good. Ideas-wise, UCD was a centrist party, but what do centrist parties stand for? One could argue, yeah, moderation, one could argue nothing, right? Sometimes trying to be like policing the left and the right at the same time, and you end up pleasing no one. So when UCD starts facing the fact that it was a useful vehicle for transition, but not a useful vehicle for government, that's when AP suddenly has a chance. Because when Suarez's leadership collapses in the early 80s, and it becomes apparent that eventually a socialist party with a young leader like Felipe González, who had some, by the way, pro-free market people around on his circle at first. Hard to believe that is the same party that is now running Spain, but that is that was certainly the case in the 80s. That's the perfect opportunity for AP. So that's when AP decided to create this hostile take to just go for this hostile takeover and just essentially take the reins of and all of that vote from the disappearance of UCD almost translates immediately to AP in the 1982 election, in which Fraga will see a significant jump and it will clearly become the leader of the opposition, and UCD will essentially stop existing at this point. Sware wasn't even president. In that last year, he actually left power to Calvo Sotelo.

SPEAKER_02 26:49

Yes, um it was um Leopoldo Calvo Soto. Leopoldo Calvo Sotelo became the head of the UDC at the 82 election.

SPEAKER_00 26:58

Yes. And by the way, they went from government to having free seats. So UCD just disappears and Popular Alliance, the predecessor of the Popular Party, just becomes the main party of the center right, but of course now in opposition.

SPEAKER_02 27:13

So now in opposition. So, for example, I guess perhaps we can say maybe our favorite party, Union Liberal.

SPEAKER_00 27:24

Yes, but that was yes, but that was in 83. That's already in 83. Exactly. As much as we would like to think that there was a liberal movement that popped up and was eventually relevant, or as much as much as the moderates and the Senate would also like to think so, this was all an operation led by Fraga. So essentially Fraga realizes okay, now UCD doesn't exist. Now, now I'm not the guy because I'm not president, but I can broaden my base if I present my party from now on as a coalition of those parties of other parties that you know touch upon that those areas of the political spectrum where I just can't seem to convince people. So from AP, there was a conscious decision to sort of on the one way just finance, because there was a financial support for it, but on the other way, just to assimilate and bring them forward and create coalition and bring them into their list of candidates of small political groups that they wanted to inflate and prop up. That was coal popular, exactly. So now they become the popular coalition. Now it's no longer the popular alliance. But it's it's artificial, like to be honest, like Pedro Schwartz, former president of the Montpeler Society, one of the most relevant classical liberal thinkers of the world. Exactly. A friend of Popper, of Hayek, of Mrs. of Friedman for sure. Um no, sorry, he did not meet with Mrs. like that. Mrs. was a bit uh older than him, but uh a friend of Popper, Hayek Friedman for sure, president of the Montpeler Society. Do check that Pedro Schwartz episode if you have not. It's an amazing conversation we had with him. Um we even played Karl Popper's piano once we were done typing because it's actually sitting in his house. But Schwartz was, you know, a member of a liberal elite which existed. Esperanza Aguirre was the main architect of the free market system in Madrid that now survives under the leadership of Governor Ayuso. She was part of that group. But that was like it wasn't a big political party. If they had to finance a campaign and stand for election, they wouldn't go nowhere. But AP decided, okay, let's prop up these little groups. One was PDP, uh, which was former members of UCD, centrist elites, prestigious lawyers, and people that were known in political circles. Partido Democratica Popular. Yeah. So PDP, and then let's also prop up the liberals, right? So that there is a libertarian or classical liberal party, and then let's present ourselves as a coalition. And you would see some adva advertisement would be libertarians for fraga, or like moderates for fraga. As in trying to present this to the electorate as okay, we're we keep on broadening our base and we represent not just the right but also the center right.

SPEAKER_02 30:18

So one of the other parties that you mentioned implicitly, but to make it explicit, was Partido Liberal, which was a separate party from, well, again, separate institutionally from Union Liberal with Pedro Tuarz. So in 83, Partido Liberal was kind of refounded by Enrique La Roque. I can't do double R. La Roque.

SPEAKER_00 30:41

But again, like this was all a managed transition. Pedro Schwarz explained to us in our episode how he voted for NATO accession. Uh, at a point when Fraga made the horrible call for which he was berated for by Margaret Thatcher herself, who called him into his office to just learn why the hell Spanish conservatives were voting against NATO accession. Fraga was only doing this because the socialist government had campaigned against NATO accession. So then he thought, okay, the government's own base has voted for a government that said no to NATO. So now if the government is saying yes to NATO, his own voters won't go for it. So let's just ask our voters to abstain, and that will be a big defeat for the socialist government, which will elevate myself. Totally stupid idea. But that was the calculus, right? So Schwartz, Pedro Schwartz, and the Union Liberal Party, they believed in NATO accession. They believed in the Reagan and Thatcher approach that the Western democracies had to be united against the communist threat, and they believed in common joint security forces and strategies. So when Union Liberal split from that coalition and supported NATO accession, and when Pedro Schwartz was seen voting when Fraga had asked them to abstain, and certainly Pedro did not hide from anyone in doing this, then they decided to feed the other partid and to then eventually combine them together. But this time it was essentially they were just replacing Pedro with someone they could control more. But there was never such a thing as of an organic libertarian movement, you know. It was always PP trying to prop up a liberal party that they could yeah, AP, yeah, trying to prop up a this idea of a coalition that would result. And to be honest, the 1986 result was the same as the 1982 result. Right. And that's when people realize, well, it's not a matter of a coalition, it's a matter of you, Frag. Uh, you've reached your ceiling. So he was able to create a political movement for the center right. He was able to unite different sensibilities that have become relevant because today there is a big libertarian scene in Spain and a centrist scene. So he clearly understood how all of that had to fit under the same umbrella if they wanted electoral success, but his leadership had a ceiling. So that was called El Techo de Fraga, which literally translates as Fraga's ceiling. And by the way, that is why Felipe Gonzalez, the socialist prime minister, was very happy to always give Fraga a very institutional role as the opposition leader because he knew that Fraga would never be as popular as him. He was still seen as a man of the past who was trying his best to reform the right wing, and everyone thought Fraga was very intelligent and a very smart guy. Like the left really respected him. Like today's socialists will say Fraga was a Franco minister. Back in the day, they respected the hell out of him because he was a cultured man, a man of state. But Gonzalez Nuki had a ceiling. That's why he favored having him as his opposition leader. That is like if you can have Kamala run as the Democratic Party candidate forever, like you would do that because she was just so bad. Right? So this was a similar example.

SPEAKER_02 33:59

So Fraga again, this is to me surprising because Fraga himself decided something has to give, and that actually means me. I have to give. And he decided in 1989 to call for what we call, I guess we call it a refounding of the party to something new. So in 89, Frega called it a massive congress, as an internal party member to come to Seville to have a session and to vote on some new changes to the structure of the party. And during that time, of course, what some things happened. One, Partido Liberal dissolved and joined the new Pepe. So at this time in 1989, it's when the name changed to Partido Popular Popular Party. So the Liberals, the Partido Liberal dissolved, officially joined Pepe, no more coalition. There are some other parties like the Partido Democratico. And the moderates they joined, they dissolved, and also joined Pepe as well. So from so a curious point, from that party, the PDP, there were some major figures from that party that actually became major figures in Pepe, like Jaime Mayor or Greha, who was eventually minister under Astnar, or someone we will get to. But these are again, these are different institutions. Yes, they had links and coalitions and some funding, but they had different internal logics, different internal players, different internal ideas and plans, and they kind of all dissolved and formed into this new thing we call Pepe at the 1989 conference.

SPEAKER_00 35:42

There are some things that need to be taken into account here, which is the some of the secrets of the 1986 to 1989 period, right? And there are some writings about this, but many Spaniard don't even know about what I'm about to share, right? So the first thing is that Fraga was horrible at managing the finances of the party. The party was terribly indebted. And so after the 1986 election, that became apparent. And you know, the big donors and the banks and the large companies that wanted a strong and successful center-right party started to actually apply some pressure. They were saying, okay, so economically we've supported you, Fraga, to become the leader, clearly succeeded at creating a movement, a political platform, but you will not be elected president. We're sorry, but that's sort of become apparent now. So Fraga realized that. Then internally, within the party, there was a push for a different leadership, which eventually happens. There is a different leader that is called up. He's Andalusian, he's called Hernandez Mancha. He's still around these days. He published a memoir. If he speaks English, I'm sure of that. It'd be awesome to have him on the podcast. But he's a very unknown figure, right, to be honest. Because like he was very uh it was a very short-lived leadership, but he was the face of PP for a while. But still, you know, things were not fully working. And the economic elites try to push from, especially from Catalonia, they tried to create a different party. So there was a competing well-funded uh attempt, mostly from the Catalonian economic elites, to create a new center-right platform. So, okay, Fraga has a ceiling, let's create a different party. That push existed. It was known as the Roca Operation because the leader of this was a man called Mikel Roca, who was, by the way, had been involved in the transition, very successful lawyer, and there was some very smart people involved in that. The current president of Real Madrid, Florentino Perez, who is a very successful businessman, a billionaire, he was involved in that. And this was a very well-kept secret of the you know what happened in you know in between, just in the shadows of the of the center, right? The employers federation was heavily involved with you know separating a bit from Fraga and trying to see if this operation would succeed, it was a total disaster. They they get they I think they won like one seat. They won zero seats. Zero seat. It was nothing, right? And one nothing. Nothing, nothing. So because the Rocka operation failed, that was a downing moment for everyone. So economically, it's realized, okay, so PP is our only bet. So if we want to finance a party and not just have the socialists in power forever, which by the way, they were in power for 14 years, 82 to 96. So it was obvious that they they had to find an alternative. PP is going to be it. It's not going, there's no way around PP. Fraga has succeeded in uniting the Spanish center right. We've wasted our money in this separate attempt of launching a different movement. The other alternative, Hernandez Mancha, was short-lived, so Fraga wasn't the solution, but fine just putting someone else isn't the solution either. And so we find ourselves at this crossroads. And even worse, for the economic elites, the free market reforms of the first period under Felipe González really alienated the left-wing vase of the socialist party that was surely not expecting that to be their policy. So moving there from 1998, from 88-89 forward, it becomes a socialist party, a proper socialist party, which is not good news for the employers, for the economic freedom. So everyone becomes really concerned that something has to give and things needed to change, and that's when 1989 happens, and that is the year in which the Berlin Wall falls, and also the Fraga wall falls, I guess, here, and a new movement needs to be created out of the ashes of what Fraga had built, which to be honest was a lot, but he hit his ceiling.

SPEAKER_02 39:46

So if we resigned as the head of the party, and then Fraga came back as the interim president until they chose a new person. But though they have to find a new person.

SPEAKER_00 39:57

And he really there was this woman who was eventually the minister of agriculture, exactly. Isabel Tocino was seen as the most well-dressed, the most beautiful politician of the era by the press. So there was she was a glamorous woman, and she was seen as a very apt politician as well, a very well-prepared face, and she was seen as everything Fraga could not be. She was someone that could spark interest and seem new. So that's what Fraga wanted to go for. So Fraga's instincts were there. Let's go for Isabel Tocino, let's make her the face of the party. But that wasn't the final decision. That's not what happened, no. So just give us some landmarks here. So again, we are coming now. Tocino, by the way, means bacon. Yes. So she didn't have the most glamorous surname. But but she was a glamorous, and by the way, let's beyond style and looks, she was a very happy woman.

SPEAKER_02 40:46

So we have a situation here where there is this ceiling for AP, a ceiling for Fraga. They can't seem to dethrone the socialists in any material way, any real way in any part of Spain, until 87, where there was a young guy in Castilla e Leon that somehow managed to defeat the socialists in a regional presidential election, and that was José Maria Aznar.

SPEAKER_00 41:15

Of course. So he would eventually become the prime minister between 96 and 2004. He would be therefore be the first head of government from PP. But like you said, he was a regional leader. So if you just think that at face value, you would think that it's just our local politics of sorts. But not so much in his case. He was convinced that there was such a thing as a path forward for the Spanish center right. So he always positioned himself very carefully in trying to not just be a regional president, but also thinking of the big issues of the time, fighting the national government when necessary from the regional level. And granted, we've said this many times before: Spain is de facto federal, right? So this is acting to having a state governor in the US, you know, fight back. So think Gavin Newman in California or Ron DeSantis against Biden back in the day. So that that or of course I use these days against Sanchez here locally. So his profile began to grow. And people internally in the party started to realize okay, you you seem to be mesmerized by Isabel Tocino. She of course seems to fit the, you know, what what if you sketch what the ideal candidate looks like, it would be someone with her credentials. The charisma, the attraction, you know, that kind of thing. And Fraga was seen as you know, non-charismatic. Uh guy with a moustache. Like the moustache was always brought up as something uh very serious, not not with a lot of humor. Um you mean Fraga or Aznar? Atnar, Aznar. Well, surely Fraga had no sense of humor whatsoever. He's just an angry old guy. Yeah. Right? But uh but uh but Atnar was seen as like not in principle a appealing candidate.

SPEAKER_02 43:00

He was notoriously dull. Notoriously dull. I mean, even even now you hear him speaking in a podcast and it's like extremely dull.

SPEAKER_00 43:10

Yes, like I I I I would of course uh uh disagree that he's dull if you pay attention to what he says.

SPEAKER_02 43:19

Yes, yes, yes.

SPEAKER_00 43:21

Introspect type of speaking, correct. That's what I mean. And I mean I mean I don't mean dull because like literally dull. Yeah, yeah, but he's mumbles like this.

SPEAKER_02 43:28

Is that how he talks? And he he also has like the the career background of a cartoonish dull person who's a tax inspector, yeah. Right, like all of these things together, you would not think this is the guy that transforms or would transform Spain.

SPEAKER_00 43:46

And I think, in all honesty, you take out Reagan and Thatcher out of the equation, and from the 80s to the mid 2000s, I think he was probably the most successful, relevant pro liberty leader. In any OECD country. Well, he certainly was. And we can say many reasons why, and we can do episodes about it. We'll do episodes about him, yeah, sure. But but to be by the way, we're writing a book about his reforms. We've revealed this before on the Esperanza Aguirre podcast, so you will be able to read, not just listen to these stories at some point. But yeah, on paper, you've got this stunning lady who's got this low background and she seems to fit into what the ideal candidate would look, sound like, think like. And then you have the tax inspector who became regional. And uh yes. Also, to be honest, it's true that his grandfather had been a relevant man in the newspaper industry. He had been involved in the Second Republic, he was a very open-minded reformist leader, and the people he was surrounded with were brilliant. He had a brilliant number of advisors around him. We recently had a private interview with one of them. We are hoping to bring him on the podcast. So I will not name him for now just for privacy reasons, but if he's willing to go on the record, that would be a delight. And this is what we call in Spain the clan de Valladolid. The Valladolid bunch, right? Valladolid is a city like it's a one-hour train ride or a two-hour car ride away from Madrid. That's where the administrative capital of Castilla-León is, and that's where Aznar was operating from. And so in principle, a regional leader doesn't have to become a thing nationally, but he became so well seen internally that at some point everyone flew to Galicia, where Fraga was or is originally from Galicia. I am as well. By the way, Fraga, once he leaves the national stage, he becomes the president of Galicia for like 15 years. We will get there. We'll get there, you know. But while he's there on his summer house, so convinced in Perves where he would go fishing in the morning and then read a bunch of books and write, and he would work all day long. This guy never had a uh a day off in his life. Uh, remarkable character, really. And he's there, he's fully convinced that it's Isabel Tocino, and there's four guys that just essentially get in a plane and then get in a car and just drive there to just essentially he thinks he's just ready to have all of these four guys that work for him, the four top guys in the party, ready to just sign off on the Tocino election on this election, and they just tell him, No, no, no, it's not her, it's him, it's Aznar. So he doesn't understand, he's caught off guard. They take a few days, they take the weekend off to just to think about it and to talk this through. And when the weekend is over, the decision is made, yes, it's him. So Fraga surrenders power. Then he will do this publicly, but it privately. This really happens in the Galicia weekend, in which this guy was ready to just essentially knite his successor as as you know, but it wasn't her, it was him.

SPEAKER_02 46:47

He outmaneuvered by his party members. I don't know. I say outmaneuver, but he was convinced by the people who he trusted in the party that no, the Toscino choice was wrong and you should go with Ashnar, even though on the surface it seems crazy to do this thing. No charisma, tax inspector, but clearly the people around Astanar saw something that was clearly true that wasn't apparent at the time.

SPEAKER_00 47:14

And I think that it was probably for the better because Aznar then proved a very apt leader, and in every single election after Aznar was chosen, UP's share of the vote grew. So he ran a first election. We will speak about all of this with more detail, but he first stands in in 89 and gets a very good result compared to where the polls were, because at this time Fraga has left, Hernandez Mancha comes in, it's a disaster in the European election, so he's run out. Fraga is back, but it's just an interim candidate, and then Aznar is thrown into an election almost with no time to prepare.

SPEAKER_02 47:46

But also because the social in the 89 party, socialist star that PP is reorganizing. So let's go for an early election. Yeah. Exactly.

SPEAKER_00 47:55

So Aznar has no time to prepare, but just runs runs for the election, does well. Then in 93, he does very well, and then in 96 he wins. Yeah. And then in 2000, he wins by an absolute majority. So four elections, all of them remarkable growth. So he broke the ceiling. So it was the right call to make. But it's funny. Like the four main guys of the party go and met the godfather of the Spanish right uh to convince him that yeah, you think it's her, but no, it's not her, it's him.

SPEAKER_02 48:23

It's him, yeah. So in the 89 conference, we mentioned a civilian event where Pepe properly really started at the reorganization. So that happened in 89, and that's when things really start to change. Again, conference again. AP existed, these other parties that AP kind of spurred and founded, sorry, ceded, but again with different institutional logics, they dissolved and they joined AP and created PP. And then in the 89th conference, again, the new party elected Ashnar as the chosen successor of Fraga officially. The very interesting thing that happened also at that conference with Ashnar and Fraga.

SPEAKER_00 49:09

Yes, because Aznar signed a resignation letter that he publicly wanted to hand in to Fraga so as to signal, okay, I stepped in.

SPEAKER_02 49:19

Undated one. Yes.

SPEAKER_00 49:20

And then just keep this because Fraga was going to be remain president of the political organization. So he wanted to give him this signed resignation letter that he could use at any time, and he just wanted to sort of signal that okay, I was called to stand in for this election. I did the best of the best I could, we had a good result. But this is not necessarily my ship to run. So here is my resignation letter. I want to know, I want this organization and all of the country to know.

SPEAKER_02 49:48

And after subservient to Fraga.

SPEAKER_00 49:51

So if I I was asked to be a candidate, I ran for it. I did my best. We did a good result, but we lost. So here's my resignation letter, please execute it whenever you want. I don't need to be here if you don't want me to be here. So Fraga gets on stage. And to be clear, didn't put it in private, you know, it was a personal conversation between him and Fraga. So Fraga gets on stage, tells the anecdote for the word to know, brings up the the signed letter, and rips it up in front of everyone. Oh, the cameras, everything. For everyone to type it, and he says, You are not being managed, you will not be bossed by anyone, you're the boss.

SPEAKER_02 50:31

Yeah, that was a pivotal moment in history of Spanish politics. So one thing before we leave the CDA conference that I thought was particularly interesting. The slogan of the refounding of AP into PP was avanzar in libertad to advance in liberty, which is almost the same thing of Miles Party now in Argentina La Libertad Advanza. Yeah.

SPEAKER_00 51:03

Very curious parallel between the two organizations. Something's been lost there for many. Those of us who believe in freedom have been inspired through the years by the writings of so many authors or the acts of relevant leaders and intellectuals and surely economists that are more linked to the Anglo sphere, right? But with this podcast, we try to bridge this gap between the Hispanic world and the Anglo world. And I certainly believe that one of the unsung heroes of the last 40 years or so is Aznar. And when you start looking at the legacy that he left behind, the consequences of having one of the largest economies in Europe commit to these ideas of an open society and a free economy, commit to it so openly, and then actually developing and executing a program that was fully coherent with properly done e-com policy, open society, migration. We are very pro-migration here in an orderly manner, of course, and in a smart way. Surely not the way Sanchez's government is doing it. And so millions of people were living in Spain that had flocked to our country following his four eight years in office. And that's the result of these ideas that were like so refreshing for a party that had been struggling to find at its course, trying to find its place in civil society. And that conference, that speech in Sevilla, in Seville, it's remarkable. And through the years he cultivated this uh narrative and just this has really stood the test of time. I'm pulling up some of the things he said back then, so I if I can just quote and translate on the fly. He was saying socialist projects have nothing left to offer. That's become apparent here, just like in Eastern Europe, in any country, anywhere, socialism has been applied, societies have found that they ultimately end up in disaster. But that also calls for new and good and positive alternatives. Now we are not looking for an hegemony of ideas. We are not looking to just apply power on everything that doesn't think uh like us. We're looking to develop a proposal for an open society. We want to dialogue, not to have citizens uh dissolve into submission to the state. We are looking for a new system of political relationships. In that strategy, we want to press forward with freedom. Uh not only will a new government be good for our democracy because it will mean that there is different parties being able to come to power and not just the same old, but also many principles that come out of this. We want to have Spaniards become happy and confident in their country again. We are not mistrustful of individuals, we actually believe in them and we think that they don't want more state intervention, censorship, threats from power, and a continued intent on control. We believe in the ability of society to organize for themselves, to pursue free initiative and just personal freedom. And we think that this is not just as fair, but also free and therefore more valid than any government-run initiative. And we do not just believe we should just accept that this alternative cannot be built. We want to give the main character of our fit of this film needs to be the citizen. Rough translation here and very much on the fly. But that's what he was saying.

SPEAKER_02 54:43

Yeah. So so now you have this transition to the new founding of Pepe under Astanar. And this is where you have to again take a pause and recap where we came from. You have essentially now the three, call it three shrands of Pepe. You have the liberal shrand. Again, we discussed the different parties, different institutions that came in. Also, Asenar is from that liberal shrine that points towards markets, entrepreneurship, merit, and the individual factor at the center of politics. And then you have the Christian Democrats that also came in to AP as well from the different smaller parties that come into AP in 89 that stand for more dignity, social balance, family, language, politics, and the idea that freedom should be embedded into all the legal architecture. So much more institutionalist European centre-right movement. But then you still have the conservative trend that the Fraga wing essentially represents from historical ties that point towards continuity, order, national cohesion, constitutional loyalty, and more skepticism about very fast-changing culture. Those things all now have to exist in this big tent called Pepe, headed by Aznar.

SPEAKER_00 56:10

The big tent, that's the word. That's where Fraga was going, really. At first, it was a bunch of Franco reformers who wanted to get together and get these reforms done, and he succeeded there, then in forming a party. The party, however, was not successful because of this Fraga ceiling, so he broadened the base and he assimilated all of these different movements which he seeded and helped prop up. And then ultimately it got to the point in which, okay, now he's leading a united political organization. But he needs to take a step back because, of course, there was a limit to how far he could take this with the electorate. He had the respect of journalists, no one disputed his intellectual capacity, his credentials. And by the way, he ran Galicia, I would argue very well for like 15 years as a regional governor, but the national presidency was just not meant to happen. So he eventually accepts this, not without hesitation. Many would argue that when he handed this power to Hernandez Mancha, he was not really happy about that. Many would argue that the Aznar choice he was never fully sure of because, as we've said, he thought the right call was Isabel Tocino. Time proved him right. And he played his service for the center right. He united different political groups, and yeah, the result of that was a net positive for Spanish society.

SPEAKER_02 57:26

So now the Aznar period is where we are from 89 up until 2004. So Aznar also moved the party institutionally into a much more credible, center right, liberal, in a European sense, liberal, more free market, more individual power direction. At the same time, he managed to essentially control the party. And there was a line from one of the people that we spoke with recently that kind of took us off guard. For sure. Where he meant he worked for Aznar. And he mentioned that Aznar is one of the few people in Spanish history that can say to be like in total control and the intensity to really bring people to his opinion and really get things done. And he listed there are only three other people in the long arc of Spanish history as intense and controlling in a good way as Astnar. He said it was Isabel Catholica, Philip II, Philippe II, and Franco. Putting Aznar in this category is a think about this, it's a dark figure that will likely go down in Spanish history for generations and centuries.

SPEAKER_00 58:44

You frame it in that light. I believe that his leadership was someone that was something that perhaps those within the organization did not think could be as strong as it was. But he paid attention to ideas. Of course, he wanted to recruit the best MPs, MP candidates, good governors. He really believed in that. Now that's obvious. But he also realized that they needed a program. And he spun off an organization that, by the way, he was already building this for him as a regional governor. In Castilla Leon, which means how much he cared about ideas. And these folks were actually given you know Fulbright sort of program funds to just go visit the US and learn, learn about the Cato Institute, learn about the Heritage Foundation, learn about some of the more relevant think tanks. And they went and traveled and they asked for the same sort of program to be set up for them by the UK Embassy. So they did so, and they they got to know the IEA, the Adam Smith Institute, the Center for Policy Studies. So they traveled the world, they saw what think tanks were doing, and then they adopted that system for PP here. And PP really comes into government nationally at the 96 election, but PP becomes preparing for being in government and having a ready-made program for governance in between 1992 and 93. Once Aznar has chosen his leadership, his cadres. He starts performing very well in regional and local elections. And for example, the Madrid majorship is won in the late 80s, and that is very important, very symbolic. The Madrid region is won for PP in 95, so one year before the national government go swings in into PP. But for these three, four years, they are working towards that goal of having the ideas, the government-ready program, and PP. You're saying it's not very coherent as an organization. Yes, it's not today, but it was. It was definitely while this was taking place, while the Atnarias were crafting a new political organization with its own political speech. Those were the golden years for PP in terms of a party that had a clear idea of what sort of country they believed in, what sort of policies they wanted enacted, and they did enact them, and they were successful in it. So certainly, I mean, for PP, those were the days. Like who can deny that?

SPEAKER_02 1:01:06

95 was also the year when Ashnar had an assassination attempt against him by Eta. Yes. And that seems to, from what I can read, that seems to be a pivotal year for obviously for Ashnar. He survived. They planted a bomb in the car, but the car was armored, so he survived the explosion. And that was also the year when he published the book, The Second Transition. I think someone had made a comment that he became a lot more assured of his ideas after that happened, where he really doubled down on I need to win, I need to change Spain because this cannot be the case going forward. So he really doubled down on his hardcore liberal individualists pushing Spain forward. The need to increase the machinery of freedom, the need to actually Europeanize and all these kinds of things, really pushed forward much more assuredly after he survived this Tasnitre attempt.

SPEAKER_00 1:02:09

Suddenly he was seen as a man of courage. The boring candidate became something else. Heroic survivor of an attempt to take his life. Forced hundreds of thousands of them on exile out of the Basque country region. And luckily today it's formally disbanded. And luckily, we must say that its political heirs are part of the socialist government coalition in parliament. And that is a very sad outcome. It's also, I can't even fathom that. I can't even fathom that they've taken the lives of many socialist leaders, and now the socialist party is putting power over principles and just getting into agreements and being in bed with these former terrorists, like to add some important nuance here because people can make this point and get lost in the weeds.

SPEAKER_02 1:03:08

So there are different parties in the Bath region. It's not only one party. It's the confusion sometimes. So importantly, in the 1996 election, Pepe got the plurality of votes. I think the single largest number of votes, but not enough votes to form the government by themselves. I would be the 159 or something like that. And they needed a 176 to form government in a majority. So Aznar, as the single largest party, decided to do a coalition agreement with who else? Catalonia. However, not a coalition government, but sorry, parliamentary. Support from Exactly, exactly. Now, apparently, this is not the same party that we're talking about with the ETA. Yes. So this is the clarification here. So Asnar got the support of the Cajalonian government, of the Calunia Party and the PNV, the Basque Nationalist Party, to support his investiture, that's his installment as the president of the government. And in that he, for example, gave a tax refund, some itarius for the civil guard in Cajalonia, for example, and he gives up slightly more autonomy to some issues in the Basque region, you know, things like that. So he did some negotiation with these parties. But importantly, the PNV is not Bildu.

SPEAKER_00 1:04:41

The different things. Yeah, it's a Basque conservative party that some PP voters at the local level vote for the mayors of the PNV. And it was traditionally known for you know being pro-economic freedom, heavy on having strong industries and protecting the local output through strong uh through strong economy. Of course, it was a separatist party, so there was a fundamental clash of ideas at the core. One is a unionist national party like PP, PMV is a separatist. But Aznar he needed some votes to have a stable majority in parliament. And he sat down with these folks and with the Catalan separatists that sat on the right wing of the spectrum, which crazily enough are the ones that then ultimately had the push for independence in 2017, that coup d'etat then happened in in Spain some almost 10 years ago. But back then, when these parties were, I guess, more moderate, Aznar sat together with them and told them, hey, territorial thing. We're never gonna agree with that. Everything else we can probably agree on. Plus, this socialist government is corrupt, it's not performing well for the economy. For example, Spain could not join the Euro because it didn't meet a single criteria for membership, not inflation, debt, deficit, interest. Rates, nothing. So Aznar sat together with them, center-right parties that, however, were separatists, and they he was able to move them towards this idea of okay, there is there are some minimum per minimum here that we can agree on. Let's leave the territorial stuff behind because that's something we're never never going to agree with. But let's work on the on everything else. And he was able to have a stable relationship with them in parliament with its ups and downs, of course, for four years. And then when Spaniards went to the polls again in 2000, he was given an absolute majority, so he no longer needed that support.

SPEAKER_02 1:06:34

Yeah. So yeah, so in 2000, the Pepe under Ethnar won the absolute majority in Congress. That means they got more than 176 deputies in Congress. So they formed a government all by themselves. So this is in some ways, I would say the height of Peipe, but it wasn't actually height of Pepe because later we'll get to Rajoy actually won a bigger majority. It was the biggest ever reign for Pepe, but yet it feels like this moment between the 96 and 2004 period under Asenar, the Asenar period, felt looking back now, like a much more assured, much more coherent, and much more dominant Pepe. Yes. Even though numerically they became more dominant later. I find that's an interesting comparison, I think.

SPEAKER_00 1:07:23

Yes, and I guess the power dynamics cannot be understated. You have to understand when you look at what this party has become, that it had to struggle to first get electoral support, then have organizational clarity and unity, create a common message that could gather around a majority of Spaniards, be able to craft agreements with separatist parties that sit at a completely opposite end of the spectrum when it comes to the way they see the country. And he was able to do all of that. So I guess there was a big success. Then there was also the financial constraints that I mentioned, they were able to clean that up, clean the debt of the party by managing their funds and everything more properly, and then eventually made it to government where they were in power from 1996 to 2004. But most importantly, that's when PP starts entering regional and local governments massively. So, yes, surely PP has been in power on and off at the national level. But for example, since 1995, there's always been a PP president at the regional government in Madrid. Since 9, except for a four-year period between 2015 and 2019, there's always been a PP mayor in the city of Madrid. And a similar story can be said of many other territories. Some of those regions in Madrid that had tradition in Spain, sorry, that traditionally resisted a PP would eventually swing PP under Raznar, so that became the case for some of them. And the last remaining bastions for socialism, which were Andalusia and Extremadura, those ended up becoming a sort of a PP stronghold in more recent times. But the territorial advance of the party, which is like I said, relevant if you want to be a party with power, with that that that holds office at the local level, at the regional level, and surely at the national level, that also happens under Aznar.

SPEAKER_02 1:09:15

So the question now comes in, I think obvious question someone asked. Okay, Pepe won absolute majority in 2000 and 2000 after it is long run from AP from 76, losing, losing, losing, then of minority government, and then first time ever to 2000.

SPEAKER_00 1:09:38

But I just can't help but think of Trump with his we don't win anymore. We need to win. For the right wing, they kept losing, right? But if you look at it on a more nuanced way, it was it was going somewhere. But they had to figure it out. So some elements were like, let's prop up new movements that solidify us as a broader party. Then let's find if it's a leadership problem, then let's fight the proper leader, then let's create a program for government. So it took the majors, but yeah, sure.

SPEAKER_02 1:10:06

And then we missed the point that also in 1991, after the final Suaristas essentially switched to Pepe, that's when the UDC, the CDS dissolved. Formally, yeah. Formally dissolved, and that's when it really became much more coherent.

SPEAKER_00 1:10:21

And by the way, today PP is the largest party in Europe. Because if you look at the European elections and you look at the share of votes for all of the different parties that sit in the different European parliamentary groups, the one that contributes the most number of seats with a higher percentage of vote to the largest European Parliament group, which is the European popular party, it's the Spanish one. It doesn't hold office because, as you know, the socialist government is in bed with the devil and whatnot, you know, terrorists, communist, social, you name it, right? But it did win the last election. Yeah. They had the most vote single party polls. They just need 0.5% more of the parliament seats. So it was a very, very, very tight election, and so that's why they're not in power. Every poll says they will be in power eventually when there is an election in a year or so, but until then, like that's just polls, right? Polls can change. But what I'm saying is that that political machinery which we are describing, which seems precarious at times, it's now one of the largest political parties in Europe.

SPEAKER_02 1:11:19

Yeah, it's a very shocking story. Hope this deep history gives the delight. At any point in time, between especially between 1977 and 1991, Pepe could have failed. They could have just disbanded again and broke up into all these small parties that we've been come to explain in this episode.

SPEAKER_00 1:11:42

What would have happened if those economic elites that push for the Roca operation had succeeded? And then there was a party that was formerly controlled by the largest companies in the country, but had no real uh civic society elements uh behind it. We could maybe have a business party model like uh Berlusconi built in in Italy, but it could have also been a disaster. The fact is that voters rejected this, and uh apparently they were clear in that they wanted uh something different. Uh that's what they got. They got PP, and uh PP is now But but by the way, as as we know, the traditional right has been you know threatened, uh, electorally speaking by the alt right, uh so to speak. Now uh even the Republican establishment in the US today has been completely shaken up by the Trump uh phenomenon and everything around it. So uh the question here is uh what has happened to PP in Spain? Well, actually, they remain the largest party. And although Vox, which is a new you know party that sits to the right of them, has grown and is a relevant party, there is that there also seems to be a ceiling for them, and in the sense that okay, for every one vote that Vox gets, or every percentage of vote that Vox gets, PP seems to have double that amount. So so so it is a successful machinery in that sense. But uh it is also true that you know later times, which we won't be able to get into today's episode, so we'll probably leave it for part two about PP, later times became more problematic uh because under Rajoy there was so much disappointment that then this unified center right became split in free, as we said before. And still today is split in two because PPE now has to share, I guess, as part of the spectrum with Vox. So okay.

SPEAKER_02 1:13:27

Astnar won an unprecedented right-wing majority in 2000. But Asenar did not run for election again. This was important. Yeah, it's in 96 he said, I will only serve two terms. I don't like that he said that because he I wanna say foolishly, but he really himself caused this retraction of Peipe. Again, we we can get into the actual election in terms of the issues there, but itself imposing a term limit of two terms at the height, the height of your ambition and your power and your control is such a again a very shocking thing for any person to do.

SPEAKER_00 1:14:24

Unless you believe that there are principal leaders that actually do believe in limiting the power that one individual can hold. And that is a very American revolution type of approach. And he wanted to do that, he wanted to limit power, and that was and that resonated with the Spanish voters, and I think it's one of the reasons that legitimized himself as a viable and a man of principle, because here on the other end was the socialist party that was seemingly willing to just do anything it took to stay in power. And the more scandals that came out, the more corruption that was unveiled. Even they even sponsored state terrorism to go after the separatist, socialist, Basque separatist terrorists of ETA, which of course, surely like my contempt for this group for ETA is infinite, but you should go after them with the rule of law in your hand, not by sponsoring state terrorism, which with which is what the socialists did at some point. We will get to that in our episode episode in Salis, but dirty um socialist party. But there's so many scenes in their past, so many scenes on what past and present and future. Yeah, sure. We did that flash episode on socialist corruption that is up there on the archives, and it's just like we we could do a flash episode on new corruption scandals every single week. But anyway, beyond dirty the abuse of power. Yeah, we call it la peso sometimes because it sounds like la mafia, like we use a feminine adjective for that. But so Agnar did that and limited himself to two mandates as a way to signal I am not like Felipe Gonzalez, I am not like the socialists, I don't want to be here forever, I am not willing to do whatever it takes to be in power. I have a plan, I want to implement it, I want to be re-elected and continue this for four more years, and then I will be done. I will go home and I won't come back into politics ever again. He fulfilled his promise. He agreed. I won't chastitize the implement for being a man of principle in a world of lies.

SPEAKER_02 1:16:18

That's true, because even with other people, even other ministers, after they left the cabinet, they became deputies, they did other things. But Aznar Lerou stepped back. He didn't become anything else after that, did he?

SPEAKER_00 1:16:33

No deputy, no mayor, nothing else. Another harakiri in a way. So the so the the Franco regime and its leadership doesn't harakiri to allow the transition to democracy. Fraga builds a party and creates a center-right force, but then suicides himself as a national leader just to allow Aznar to come over. And then Aznar willingly commits to leaving power eight years after the fact he gets elected, which he did. So there is a lot of you know self-constraint on it. And I think that really comes into a direct clash with the power grab that is the main characteristic of the socialist left in Spain, and still today, or even more today than ever, you can see how there are some limits that PP would have never surpassed or that Vox would never advocate for overpassing. And those limits have clearly not been respected by the socialists. And I think the polarization you see in political life is because there are some rules of the game, some of them are written, some of them are unwritten, but PP was willing to behave as a loyal member of a democracy where there is alternative part.

SPEAKER_02 1:17:45

Yeah. So Aznar, before he formally resigned, or not resigned, after the new election, he said I will not run. And didn't step in. Right. So he appointed, more or less appointed his successor. It was Mariano Rajoy. Which again to me was a very curious choice. I do not know in detail the alternatives, but looking back, at least from my perch coming into Spain, why would you choose Rajoy to be Aznar? Why would you choose Rajoy? He doesn't seem to have any particular ideological bent, he doesn't have any particular extreme charisma. I mean, he can barely talk Spanish. Infamous lying of him on t-shirts and things just mess up having a normal conversation.

SPEAKER_00 1:18:39

There was three relevant ministers that were responsible for, you know, um many of the reforms that took place under Aznar that were also considered to be in the running for succession. Number one was everyone's favorite on paper, which was Rodrigo Rato. Number two was, you know, the guy that had been in I don't know if he was a minister in seven or eight different departments of government, who is Mariano Rajoy. And number three was Jaime Mayor Oreja, who originally came from the moderate circles of PvP. And today you could argue he's a like staunchly conservative member of the conservative think tank groups in in across Spain. Um so there were three options, right? Three options, or at least those were the options he considered. And he chose this accessor. It was named by he was pointed a finger at someone. That is why sometimes that is called a dedazo. Dedo means finger. So it was like, okay, that you the finger was pointed at someone, right? And the finger was pointed, could have been pointed at Rato, but he was seen as perhaps an elitist, economic technocrat. He was too arrogant, apparently. Yeah, be seen as an arrogant guy internally in the government, maybe wouldn't resonate with the middle class or the low of the lower income spectrum. Uh eventually became the head of the IMF. So surely we are talking of someone who was a darling of the economic elites. Then he was disgraced because he agreed to come back into public life to pilot an operation to make a semi-government, semi-public savings bank to consolidate a few of them that were essentially broke after the financial crisis in 2007-08. And put them together as a bank, privatize it, put it on the stock market, and save it. That operation failed. It did fail, and it was thrown under the bus by the very same PP colleagues that he had under working under him during the Ethnar government. So he was found guilty of a series of charges and he was he did time in jail. So many times it is sometimes it's argued, well, yeah, the the the economic superstar of the Aetnar years, he ended up in jail. Yeah, but these are two completely unrelated episodes of Rodrigo Ratos' life. Um and by the way, he was never the most pro-free market guy. The more you learn about the inner dynamics of the Aznar government, you find out he was more of a more of a corporativist elite, more of a technocrat elite, but the the free market ideas, those came straight from Aznar and his inner circle, right? So he just executed those uh and sometimes tried to water them down a little bit, even.

SPEAKER_02 1:21:30

I I should I should say just because we haven't spelt out as much as we should, but you know, time constraints, so we do we can't have an eight-hour episode on Pepe. But it was Aznar that did the modernization of Spain's economy and the state. Got into the Eurozone, got into all the European Union stuff, it did all of the reformulation of the labor market, the construction market, the housing market, budget stability, um, lower taxes, uh privatization, liberalization, you you name it.

SPEAKER_00 1:22:03

Like like I said, bar but take out Reagan and Thatcher out of the equation by far.

SPEAKER_02 1:22:08

He he was very famous for the comment he made where he said, I don't want Spain to be a club med, you know, the Mediterranean, Southern European laggards. I want Spain to be in the center of Europe, with Germany, with France, England. So he did all of that effort to really get Spain to be a modern, vibrant economy.

SPEAKER_00 1:22:28

And if you look at who were the main uh Western leaders at the time and how were they you know meeting and arranging uh the political affairs of the West, you would see Aznar there right up there with you know Bill Clinton and George W. Bush and Tony Blair. Like uh he was uh you could argue his profile was as high as Chirac or Schroeder, if not higher. It's not higher.

SPEAKER_02 1:22:48

So so people forget that now. People forget that. Again, as as I mentioned, when uh you mentioned when Aznar came into the head of Pepe, Spanish population less than one percent foreign-born. And you know, when he left, it was like close to 15 something percent. So the Spain that people know today, modern Spain, yeah, modern Spain really is Aznar Spain, yeah, for sure.

SPEAKER_00 1:23:11

And Madrid being the most shining example, and the Madrid reforms were uh created by one of his key people in government who was Esperanza Aguirre, yeah, and those today live on through the brother to join uh to lead Madrid. We discussed that on our episode with her, yes. So then of course they could have chosen Mayor Oreja, but he was seen as too tied to the you know fighting terrorism bit, maybe seen as too socially conservative, so I maybe didn't want to go that direction. And he went with Rajoy, who was you know the grayish candidate, not very ideological, but very apt in the sense that he had been in, I don't want to get this wrong, but he was in several departments of government. A crazy amount of them. He was education minister, industry minister, public administration minister. He was in several departments of government as the main as the minister responsible for them. So he was seems an able statesman who could, you know, run the country. Plus, the polls were fantastic for PP, so no one could have expected the defeat in 2004. So that's a critical point.

SPEAKER_02 1:24:15

The polls were fantastic. This is why we here are saying, yeah, the polls are so good for PP next year. But you never know.

SPEAKER_00 1:24:23

My goodness, things things happen. So I think we can wrap the part one here, which is where like really we've seen PP on the ups and downs, but surely on the overall upwards trajectory since Franco dies all the way up to Aznar's decision to leave power in hands of Rajoy. And now is when you know it will get a bit more complicated in part two, even more complicated because it it surely was an easy path. But as our listeners will find out, then when this choice is made, Rajoy will not win power, but he will remain in power for ages until he is finally able to win power and he is present under a deep crisis. There's some stabilization program measures that were very good, some were very bad. So a lot of people lose confidence in PP for different reasons, and the Spanish right becomes split in three and currently in two. But that's for another one.

SPEAKER_02 1:25:29

Up until the week of the election. Oh yeah. Then there was the biggest terrorist attack in European history in peacetime, and everything changed.

SPEAKER_00 1:25:43

Exactly. So we'll put a rabb on this one right here, and we'll follow up in our next episode with a very enlightening tale of let's say the last twenty years of history of the popular party in Spain. So until then, thanks for joining us.