Thousands of kilometers of fast-track rails, highways, tramways, airports… Compared to its European neighbors, Spain has made impressive public investments over the last decades. Only China and the United States have more kilometers of highways than Spain.

Many of the new roads, rails and airports, however, have created huge holes in public accounts. Now that the country faces a deep economic crisis, they have become clear reminders of the failed management of public funds while Spain's economy was still doing well. 

The reform program that the Spanish government has pushed forward over the last months is not enough to create confidence outside the country. Apart from the Bankia crisis, the financial sector reform and the labor reform, the European Union is well aware the millions of euros that Spain spent on a great number of public projects that have been all but profitable.

Pressure is now put on, for instance, Germany to accept changes in the European austerity policies to help countries like Spain that have ended up in economic difficulties. German Chancellor Angela Merkel, however, insists that Spain has spent over its capacity and that it will have to tighten its belt even more.

To their defense, Spanish politicians justify the country’s bad finances with the high unemployment and the unexpected drop in activity. Not once have they recognized that their bad planning contributed somewhat to the deterioration of the public finances.

A total of 52 airports

Spain, with a population of 47 million people and 17 autonomous regions divided into 50 provinces, not including Ceuta and Melilla, two Spanish enclaves on the Moroccan north coast, has a total of 52 airports. Only eight of them are profitable and over 20 provinces have another airport within an hour’s drive. Germany, with a population is almost twice the size of Spain’s, 81 million, only needs 39 airports.

If the Spanish government had increased spending by the same speed as the German government between 2002 and 2008 – by 2.8 percent instead of 50 percent – Spain would have had a budget deficit of almost 1 percent of gross domestic product in 2009, which corresponds to about €10bn. Instead, the deficit in 2009 reached 11 percent, equaling over €100bn.

Europe criticizes the countries in the south for overspending, while it applauds the savings in, for instance, Germany, where the gross annual income is almost twice as high as that of Spain, €40,914 compared to €21,500.

Spain's 26 regional public TV channels

The German austerity can be seen, for instance, in the fact that it only needs ten regional TV channels, while Spain has 13 public regional TV stations broadcasting a total of 26 channels.

Only the regional TV station in Valencia, on the east coast, has an accumulated debt of €1.2bn, the largest debt of all the regional broadcasters. Without counting public subsidies or taxes, all of them together have accumulated a debt of more than €2.1bn.

In the current situation, where different options for international help to Spain are being discussed, politicians are blamed for the irresponsibility and for not saving and reducing taxes while the economy was growing.

In fact, a study by the Presidency of the Government reveals that Spain is the country in Europe with the highest number of politicians per capita holding public positions. In total, they add up to 445,568 – 300,000 more than in Germany. They work at all levels within public administration and include, for instance, senators, mayors, deputies, councilors, public servants in international organizations and municipalities.

More fast-track railways than the United States

This year, the Spanish fast-track railways, the AVE (Alta Velocidad Española), celebrated its 20-year anniversary. It is a world leader when it comes to punctuality and the total length of its rails, resulting from investments of €39.5bn over two decades.

The first fast-track train that was the one that unites Madrid and Sevilla. Since it was inaugurated, Spain has advanced to number two on the list over country’s with most kilometers of fast-track rails, only China exceeds it, with a population that is 30 times that of Spain. Both France and Germany lag much behind.

In 2010, the total length of the AVE rails was 3,744 kilometers, while in Germany the fast-track rails were slightly over 1,400 kilometers.

During a visit to Spain in May 2009, the US Secretary of State for Transport. Ray LaHood, invited by the Ministry for Public Works, was surprised by the economic capacity of a country with a gross domestic product 15 times smaller than that of the United States, congratulating the government. The United States could not allow the investment and maintenance costs related to the AVE.

In July 2011, the ministry had to close the railway line running between the Spanish cities of Toledo, Cuenca and Albacete, where they lost €18,000 every day for transporting an average of nine passengers per day. None of the fast-track railway lines in Spain – not even the one between Madrid and Barcelona – is profitable.

Thousands of kilometers of highways

Spanish highways present yet another example of badly planned public investments. By the end of 2007, Spain's highways added up to a total of 14,689 kilometers, only the United States and China had more. Spain exceeded Germany, France and Great Britain by large numbers.

The highway between Cartagena and Vera in the south presents another example. It was designed to accommodate an average of 7,000 vehicles per day, but the number does not yet reach 2,000. About €650m was invested there.

The new toll highways entering Madrid has a daily average of traffic that is less than 30 percent than what would be needed for them to be profitable, in other words, a financial disaster. The investments in these roads, considered “indispensable” by the authorities when they were inaugurated, added up to €2,6bn.

The highway that unites Madrid with Toledo, a city about 90 kilometers from the capital, has about 80 percent less traffic than what was estimated. The same goes for the highway around Alicante, a city on the east coast, where it was predicted that about 30,000 vehicles would travel per day and the number is less than 10,000.

In 2006, Germany had 152 kilometers of highway per every million of citizens, while Spain, with a minimum salary level of €641, had 276 kilometers.

This article was translated and edited by Stina Lunden.