Franco’s Regime: Economic Growth and Political Stagnation (1959-1975)
**Franco’s Regime: Economic Growth and Political Stagnation (1959-1975)**
**Stage 3: Economic Development and Political Atrophy (1959-1973)**
This period was characterized by significant economic development alongside continued political stagnation. The economic boom was fueled by U.S. support for technocrats and backing from international banks. These technocrats, the new financial elite, aimed to integrate capitalism into the Spanish economy through the *Stabilization Plan*. This plan included a single exchange rate, reduced public expenditures (through wage freezes and credit limitations), devaluation of the peseta, and relaxed legislation.
The positive consequences of these measures included:
- Curbed inflation
- Stabilized prices
- Balanced budgets
- Improved balance of payments
- Freer foreign relations
- Increased foreign capital investment
These changes collectively contributed to the “Spanish Miracle.”
Regarding industry, Franco implemented development plans to address imbalances, offering tax breaks and infrastructure improvements. He allowed foreign investment, capitalizing on cheap and disciplined labor. Public housing and highways were built, but research funding remained scarce.
In trade, imports rose with increased per capita income, reflecting growing consumption capacity. Exports also grew, including cars, ships, chemicals, and electronics. Tourism flourished along the coast, driven by sunshine and pleasant temperatures, and remittances from emigrants working in Germany further boosted the economy.
Agriculture experienced an exodus as people moved to cities for industrial jobs, leading to increased productivity through mechanization. Society saw a rise in the urban population, dedicated to industry, and an aging rural population. The middle class expanded, embracing a more European lifestyle, particularly during the opening of the 1960s.
The political landscape remained immobile, marked by a totalitarian dictatorship and personal rule. Key laws enacted during this period included:
- **Law of Basis of Social Security (1963):** Established social security and medical care.
- **Press Law (1966):** Introduced by Fraga Iribarne, it reduced censorship and granted greater freedom of expression.
- **Official Secrets Act:** Defined public interest and restricted sensitive information from the press.
- **Organic Law of the State (1967):** Differentiated between the Chief of State and the Head of Government.
- **General Education Law (1970):** Made education compulsory until age 14, combating illiteracy.
In 1969, Franco designated Juan Carlos I as his successor.
Internal power struggles arose between Catholics and technocrats, and between the immobile Falangists and those favoring openness. Notable controversies included the Matesa financial scandal and the Palomares incident, where U.S. nuclear weapons were accidentally dropped off the coast of Almería. Fraga famously swam at the beach to downplay the incident’s severity.
External issues included tensions over Gibraltar and the Vatican Council II (1962), where the Church adopted a more democratic and humble stance, rejecting U.S. influence. Spain also decolonized Equatorial Guinea and Sidi Ifni, leaving only the Sahara.
Opposition grew, driven by the labor movement’s demands for better wages and working conditions. Communist leader Santiago Carrillo operated clandestinely, organizing strikes. Universities demanded democratization, leading to the imprisonment of many professors. Political opposition included the PSOE, republicans, nationalists, the CNT, and disillusioned Falangists, who formed a platform in Munich. Franco labeled this the “Munich Contubernium” and threatened imprisonment upon their return. ETA assassinated state members, including Civil Guards. The Burgos Trials, where ETA members were sentenced to death, sparked international outcry, leading Franco to commute the sentences to life imprisonment. The Church, under Cardinal Tarancón, supported Basque ETA members and opposed the Burgos Trials, later apologizing for its past actions.
**Stage 4: Decline and Death of Franco (1973-1975)**
This period marked the regime’s decline and Franco’s death. In 1973, Carrero Blanco, a close associate of Franco, became president. He faced the “Hot Autumn,” a period of inflation and shortages caused by the Yom Kippur War, as Arab nations supported the Palestinians, leading to oil price hikes. The Workers’ Commissions were blamed for strikes, culminating in the “Process 1001” trial. The day before the trial concluded, ETA assassinated Carrero Blanco.
In 1974, Arias Navarro became president, initially promising reforms but later reverting to repression after the Carnation Revolution in Portugal. Terrorism intensified, with the PCE and the PSOE’s Democratic Convergence Platform, led by Felipe González, demanding democratization.
In 1975, political divisions deepened, and Spain faced international isolation. As Franco neared death, he ceded power to Juan Carlos I. The planned referendum for the Sahrawi people was disrupted by the Green March on November 5, when King Hassan II of Morocco militarily occupied the Sahara. On November 14, Juan Carlos I signed the Tripartite Agreement, granting administrative control of the Sahara to Morocco and Mauritania, but not sovereignty. On November 20, 1975, Franco died.