The Economist's negative opinion on Spain's economic reforms

[patslatt]

See Labour reform in Spain: Spain isn't working | The Economist

Quotes:
"...the decree [on labour law reforms] should be transformed into a fullblown parliamentary bill.This will require months of negotiation..."

"The reforms will not help to create new jobs,says Gerardo Diaz Ferran,head of the Spanish Confederation of Business Organisations,Spain's biggest employers' federation."

"Some things will say the same. The reformed laws will still be open to interpretation by judges,an experience many Spanish employers have come to dread...Spain's inefficient collective bargaining system has been left intact*."

"The reform announcement also coincided with a rise in Spain's borrowing costs to record levels."

Spanish economic reform is very important as debt restructuring by Spain would bankrupt many banks in France and Germany.

*According to this report http://docs.google.com/viewer?a=v&q=..._YLqV3ogzWllbg
around 90% of private sector workers have their wage and working conditions set in collective bargaining,an extremely high percentage internationally. In my opinion,this level of interference with wage markets is bound to produce major inefficiencies and inflexibility even when employers' groups willingly agree to contracts. That's because free market wages can respond quickly to business conditions by falling as necessary to maintain employment or rising swiftly to attract labour to expanding businesses.