This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L SECTION 01 OF 03 MADRID 000764 
 
SIPDIS 
 
C O R R E C T E D  COPY - CLASSIFIED BY LINE ADDED 
 
E.O. 12958: DECL: 03/05/2014 
TAGS: PREL PGOV PGOV PGOV SP SPPREL SPPREL
SUBJECT: SPANISH NATIONAL ELECTIONS:  THE KEY ISSUES 
 
Classified By:  Kathleen Fitzpatrick, Political Counselor, 
Reasons 1.4(B) and (D). 
 
¶1. (C) SUMMARY:  As Spanish voters focus on the March 14 
nationals elections in earnest, three issues will dominate 
their thinking:  the war against ETA terrorism, unease over 
growing secessionist tendencies in the Basque and Catalan 
regions, and the economy.  On all three issues, Aznar,s 
Popular Party, now headed by Presidential candidate Mariano 
Rajoy, is banking on the PP,s strong record to sway voters. 
Recent polls, though showing a slight narrowing of the gap 
with the rival socialist party, continue to put the PP ahead 
by some 6 points.  The polls also indicate, however, that 
some 56 percent of the voters would like a change in 
government after eight years of government under Aznar,s 
Popular Party.  With some 23 percent of the voters still 
undecided, the desire for change factor could strengthen the 
Socialists showing and complicate the PP,s chances to 
achieve an absolute majority in Parliament. Socialist party 
candidate Zapatero is attempting to capitalize on the Iraq 
issue, but thus far has not translated this into a surge of 
support for his party.  END SUMMARY 
 
¶2. (C) Though unofficially underway for months, the campaign 
for the March 14 Spanish national elections officially began 
February 27 at midnight local time (yes, the Spanish 
electoral campaign officially lasts only two weeks).  PP 
presidential candidate Mariano Rajoy and Spanish Socialist 
Party (PSOE) candidate Jose Luis Rodriquez Zapatero, have 
laid out their positions on issues ranging from high foreign 
policy to ameliorating traffic conditions on Madrid's 
notoriously chaotic streets.  However, three key issues will 
dominate:  the continuing war against ETA terrorism, the 
growing challenge in the Basque and Catalan regions for 
greater regional autonomy (and in the case of the Basque 
region, a separatist plan that fundamentally challenges 
Spain's delicate federal system), and the economy. 
 
¶3. (C) In each of these, the Popular Party's strong record 
has helped put PP candidate Rajoy some 6 points ahead of 
Zapatero.  Another recent poll indicates that Zapatero may be 
narrowing the gap as voters begin in earnest to focus on the 
elections, and still another shows the PP might well win the 
absolute majority.  The PP views its record on terrorism, 
regional issues and the economy as key to voter decisions on 
March 14.  Zapatero recently has played the foreign policy 
card, seeking to tap into widespread opposition to Aznar,s 
Iraq policy as a means to motivate Socialist voters, some 23 
percent of whom remain undecided. 
 
ETA Terrorism 
 
¶4. (C) Under the Aznar government, Spain has had significant 
success against ETA, rounding up key leaders, drying up 
operational and support networks. The dramatic arrest 
February 29 of two ETA operatives intent on a major action in 
Madrid underscored both the danger and the PP's success 
against ETA. 
 
¶5. (C) At the same time, the Socialist Party is still reeling 
from the scandal over Catalan Nationalist Carod-Rovira,s 
meeting with ETA in January, in which he tried to negotiate 
an ETA ceasefire in Catalonia (but not in the rest of Spain). 
 The issue brought in Zapatero and the national party because 
Carod's party had earlier entered into a regional governing 
coalition with the Catalan socialists.  Since the scandal, 
the PP has tried to cast doubt on the ability of the 
Socialist party,s national leadership to effectively deal 
with both the separatist and the terrorist issues.  However, 
the PP strategy may have a downside:  many thought that 
comments made by Interior Minister Acebes following the 
recent ETA arrests went too far:  he indicated that Carod 
should be pleased that the terrorists - who clearly sought a 
major explosion in Madrid - were not headed to Barcelona. 
 
¶6. (C) Still, a recent morning talk show question posed 
separately to Zapatero and to Rajoy underscores the two main 
candidates, differing approaches on the terrorism issue. 
The interviewer asked each candidate what he would do if he 
ran into a key ETA leader (named Anchon) on the street in 
Madrid.  Zapatero said he "would not look at the man."  Rajoy 
replied, "I would call the police." 
 
Regional Autonomy Issues 
 
¶7. (C) The Spanish electorate is also deeply concerned about 
growing separatist trends in the Basque and Catalan regions. 
Spaniards are worried that a separatist plan for the Basque 
region promulgated by Basque government leader Ibarretxe in 
the fall of 2003 could, if played out to its final chapter, 
lead to a constitutional crisis in Spain. The strong showing 
of the Carod-Rovira,s Catalan nationalist party in regional 
elections in December also put the autonomy issue front and 
center, particularly after the party joined the Catalan 
socialist coalition. Carod-Rovira,s meeting with ETA further 
exacerbated these concerns, and linked regional and terrorist 
issues in a way that could be deeply troubling for the 
Spanish electorate. 
 
E.O. 12958: DECL: 03/05/2014 
TAGS: PREL PGOV PGOV PGOV SP SPPREL SPPREL
SUBJECT: SPANISH NATIONAL ELECTIONS:  THE KEY ISSUES 
 
¶8. (C) On Basque issues, Aznar has won praise for his firm 
approach to the Ibarrexte plan, but has also taken criticism 
for the perception that he is unwilling to offer any kind of 
conciliatory gesture to demonstrate he is at least willing to 
hear out Basque separatist concerns.  Zapatero and PSOE,s 
position is perceived to be somewhat weaker and more 
conciliatory, though in reality, his position is quite 
similar to that of Rajoy.   Zapatero has said he would be 
willing to talk to Ibarretxe, though it opposes his ultimate 
separatist goal.  Rajoy said he would talk to Ibarrexte, but 
stood firmly opposed to his separatist plan 
 
¶9. (C) The key issue which now differentiates the PP and the 
Socialists on regional/constitutional issues and terrorism is 
the Carod-ETA meeting scandal.  The PP has sought to position 
itself as the responsible party which will defend the 
constitution, and to paint the Socialists as a disunited 
party that cannot stand up for the unity of the Spanish 
state.  While the issue may hurt, Carod has apparently not 
suffered in Catalonia - his party may increase its seats in 
the national parliament from 1 to 6 seats. 
 
The Economy 
 
¶10. (C) With eight years of strong, steady economic growth 
and record levels of job creation, the PP can claim it is the 
party of economic stability and success.  Rajoy and the PP 
have made current economic minister Rato number two on the 
Madrid party list, second only to Rajoy.  Rajoy pictures 
alternate with those of Rato in campaign posters that line 
the streets of Madrid, clearly demonstrating that both 
continuity and the economy literally are the PP,s banner 
issues.  (FYI:  Pundits here speculate that Rato might become 
Foreign Minister under Rajoy, if he desired the position, but 
that even if he did, he would take it only for a limited 
period of time.  We understand he is actively lobbying, or is 
under consideration for EU/international slots as well.) 
 
¶11. (C) The main economic issues under debate between the two 
parties are: how to handle unemployment (now 11.2 percent 
down from over 20 percent in 1996) and which party's policy 
will generate the most new (and permanent rather than 
temporary) jobs; taxes -- the Socialists want a flat tax with 
more exemptions for the poorest and pensioners versus the 
third round of income tax cuts proposed by PP; and rapidly 
spiraling housing costs.  Most observers believe, however, 
that the generally favorable state of the Spanish economy 
will dominate Spanish voter decisions, and that the PP's 
strong record in this area will carry the day. 
 
Foreign policy 
 
¶12. (C) In recent weeks, Socialist leader Zapatero has 
focused on foreign policy, as a means to tap popular 
discontent with Aznar,s support for the Iraq coalition that 
brought millions into the streets in Spain in February and 
March of 2003.  Yet, in two regional elections since then, 
PSOE has been unable to turn the Iraq issue into an election 
winner for the Socialist party.  Also, Rajoy has pledged to 
continue Aznar's policies, but he has thus far avoided being 
"tarred" with responsibility for the Iraq policy.  Though 
foreign policy will not be the deciding factor in the 
elections, Zapatero is nonetheless aiming to remind voters of 
their unease with the PP,s Iraq policy and close ties to the 
US in order to motivate undecided PSOE voters. 
 
Desire for Change:  How Great a Factor? 
 
¶13. (C) While the key issues dominate, a final trend may 
shape whether the PP receives an absolute majority:  polls 
indicate that at least 56 percent of Spaniards would like to 
see a change in government after eight years of Popular Party 
rule and the firm style of President Jose Maria Aznar. 
 
¶14. (C) Two factors may mitigate this desire.  Rajoy may 
benefit from a popular perception even among the opposition 
that his more conciliatory personal style is far different 
from the strong hand of Aznar; and even PSOE insiders are not 
optimistic that the desire for change will translate into an 
unexpected victory for their party.  They acknowledge without 
prodding that the Socialists have not offered a credible 
alternative to the PP. 
 
¶15. (C) Nonetheless, this amorphous desire for change, 
combined with continued uneasiness over Iraq, could combine 
to reduce the PP's margin of victory and strengthen PSOE's 
electoral showing.   A few PP insiders are beginning to worry 
about this prospect after months of steady showing in the 
polls, as voters start to focus on their electoral choices in 
earnest with barely a week to go before the elections. 
 
The Absolute Majority Question 
 
¶16. (C) The PP strongly desires an absolute majority, and it 
will need to win 176 seats in parliament to claim it.  PP 
could also govern without problem if it wins 172 or 173 
E.O. 12958: DECL: 03/05/2014 
TAGS: PREL PGOV PGOV PGOV SP SPPREL SPPREL
SUBJECT: SPANISH NATIONAL ELECTIONS:  THE KEY ISSUES 
 
seats, as it has an ironclad agreement that the 3-4 Canary 
Islands seats will join with PP on any issue.  An outcome of 
fewer than these needed seats, however, would create a 
difficult government formation process for the PP.  PP almost 
certainly would have to negotiate with the Catalan 
Convergencia and Union party, which will retain an estimated 
dozen parliamentary seats (down from 15 in 2000).  The PP 
drew on CiU votes in the first Aznar administration, but 
CiU,s terms would be very difficult this time around. 
Moreover, CiU does not agree with PP on all issues, including 
on some domestic issues and on Iraq.  A CiU leader has said 
that any CiU support for the PP in Parliament would be 
issues-oriented, not across the board.   Thus, the PP will 
need to win at least 172 seats in Parliament to maintain its 
current tight hold over the Spanish government.  Whether the 
PP will win this number of seats has become the key drama in 
this electoral campaign. 
ARGYROS