COMMENT José Luis Rodríguez Zapatero, Spain’s prime minister, boasts that his country is wealthier than Italy. Overtaking France, he declares, is now a national goal. In the middle of a bitter election campaign, patriotic triumphalism is understandable. But Mr Zapatero could come to regret remarks that also appear hubristic. After three transforming decades, in which the Spanish economy has become a star European performer, it may be about to suffer the consequences of a credit-fuelled spending and property boom.
Only last September, the economic outlook was different. The Socialist government had reason to be satisfied. Growth was cooling and house price inflation slowing. This was a necessary antidote to years of consumer-led exuberance and construction spending, not helped by very low real eurozone interest rates. Third-quarter annual output growth of 3.8 per cent was still well above the long-term average.
