Euro Zone Crisis: Pay Cut For Spanish King, No Time For Siestas
Spain’s royal family is taking a pay cut. The royal budget of €8.3 million will lose €100,000 with King Juan Carlos seeing a €20,900 ($25,660) reduction from his €292,000 salary. His son and heir, Prince Felipe, will lose about €10,450 euros from his salary, which would then be about €131,000 euros.
For both the King (under fire after going on a “lavish” hunting trip in April in Botswana) and the Prince, the cuts mean a wage reduction of about 7.1 percent.
As the BBC notes, “the gesture has received a mixed reception on websites and social media, with some quipping that the royal family might now struggle to make ends meet” (though one suspects they won’t be lining up to receive food from the Indignants).
The cuts to the budget of the King and his household were announced as civil servants (including police and firefighters) have taken to the streets in Madrid. Last week, Prime Minister Mariano Rajoy announced €65 billion of “exceptional measures to exceptional circumstances,” of spending cuts and tax hikes including €3.5 billion cuts to public spending, a 21 percent increase in the Value Added Tax (VAT) and no more Christmas bonuses. The latter usually came in the form of double pay for workers in December; the “no Christmas bonus” cut amounts to about a 7 percent reduction in salaries.
At the risk of sounding like the proverbial broken record, more cuts (and more protests) are likely. The Guardian lists three more signs of the economic challenges facing Spain as of Wednesday:
1) The Bank of Spain reported that the ratio of bad loans on bank balance sheets rose to 8.95 percent in May from 8.72 pecent in April. Non-performing debt now totals €155.8 billion.
2) The amount of money in deposits in Spanish banks fell by 5.75 percent in May.
3) House prices in Spain have fallen 8.3 percent in the second quarter of 2012, as compared with 2011.
Unemployment in Spain is currently 24.6 percent and over 50 percent for younger persons; the country is in its second recession in three years and its economy is not predicted to improve until 2014.
In such a climate even the traditional Spanish long lunch and siesta are not immune, Reuters reports. While the siesta, an afternoon nap to get through hot afternoons, is for the most part “defunct,” more Spaniards are now foregoing two-to-three-hour midday lunches to work longer hours. Instead of eating out, they are (in the way of many Americans) bringing lunch from home and eating at their desks. Parents, unable to pay lunch fees of some 150 euros at state-run schools, are sending children to school with previously unheard of packed lunches. Austerity has come to Spain at every level.
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Photo of Juan Carlos and his wife, Sofia, via Wikimedia Commons