đ« SĂĄnchez's right-hand man goes to jail
Plus: Madrid's crap sunshades, Spain's stuck trains, and a ticket scalping crackdown.
Madrid | Issue #109
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đ PM SĂĄnchez holds on for dear life as his former #3 is sent to jail
Why SĂĄnchez hates Mondays. Santos CerdĂĄn â until recently Prime Minister Pedro SĂĄnchezâs right-hand man â was sent to jail without bail on Monday by Spainâs Supreme Court. Judge Leopoldo Puente said thereâs âextraordinarily strong evidenceâ that CerdĂĄn masterminded a criminal network inside the Spanish government â and personally collected the bribes.
Yes, itâs that serious.
The accusation. Puente accused CerdĂĄn of setting up a kickback scheme around public works contracts, using his position as PSOE Secretary of Organization (the #3 of SĂĄnchezâs party) to install loyalists in key posts.
One of them? His protĂ©gĂ© Koldo GarcĂa. You might remember him from the Koldo Case â the ever-expanding corruption scandal that started with dodgy COVID contracts, spiraled into a fuel tax scam, and now points to high-level political payoffs.
This didnât seem dire for SĂĄnchez at first. Koldo was just some shady advisor to former Transport Minister JosĂ© Luis Ăbalos (another PSOE #3 and close SĂĄnchez ally who got quietly axed as the scandal spread toward him), who got arrested for allegedly taking bribes tied to COVID mask contracts. But then Koldoâs business partner got nailed for fraud and⊠started talking. A lot. About everyone. Including CerdĂĄn.
And then came the tapes. Turns out Koldo had been recording conversations. For years. Three weeks ago, the audios dropped, and made everyone on them sound corrupt, stupid, or both.
That doesnât sound good. One of the taped conversations (which include chatter about âŹ620,000 in alleged bribes, shady contracts, and possible ballot-stuffing in the primaries that brought SĂĄnchez to power) features Koldo casually bringing up commissions with CerdĂĄn, and CerdĂĄn replying: âLetâs not discuss this here.â đ
Who, me? CerdĂĄn denied everything and said it was all part of a political persecution. He said that the recordings may have been manipulated, and that he hadnât taken âa single euro.â
The judge wasnât convinced. Neither was anyone else. CerdĂĄn? In jail. And SĂĄnchez? Fighting for his political life.
Out to get me for helping Pedro. In court, CerdĂĄn described himself as the architect behind SĂĄnchezâs rise to power in 2018 â something that didnât go over well with the party. It kinda makes it sound like the call (or corruption) is coming from inside the house.
Sad, yes, but we didnât do this. Government spokesperson Pilar AlegrĂa called CerdĂĄnâs arrest âheartbreaking and disappointing,â but said thereâs âno indicationâ of illegal PSOE party financing so far. (Note: Phrases like âno indicationâ and âat this timeâ are doing a lot of work these days because no one knows who will get implicated next.)
And youâre not the man behind the man. AlegrĂa also slapped down CerdĂĄnâs âI made Pedroâ claim with a (kind of) fact-check: âThe vote of 12 million citizensâ made SĂĄnchez prime minister. (Note #2: PSOE never got 12 million votes, but if you add up all the parties that backed SĂĄnchezâs investiture, sure.)
Jail makes it worse. CerdĂĄnâs arrest has shaken Spainâs governing coalition.
Junior partner. Second Deputy Prime Minister Yolanda DĂaz, leader of junior partner Sumar, warned theyâll walk if thereâs proof the PSOE benefited from illegal financing. But letâs be honest: Sumarâs polling so badly that unless someone drops a literal smoking gun on DĂazâs desk, theyâre staying put.
DĂaz said a bunch of words. She still believes SĂĄnchez is not personally involved â but said heâd better move fast or risk becoming âpart of the problem.â Whatever that means.
The other lefties. Far-left Podemos took a harder line. Ione Belarra accused the PSOE of returning to its âdarkest chapters,â name-checking Filesa and GAL. But theyâre not calling for elections either (because they know the right would win.)
And the PP? Theyâve been feeling out PSOE-allied parties to see if they could find support to turf out SĂĄnchez. No luck so far because of the same reasons we mentioned two weeks ago.
Survival. If elections happen now, PSOE and coalition partner Sumar get absolutely destroyed. A PP-Vox government is almost guaranteed â and no one wants the tighty far-righties in office. Hold on until 2027 and hope the world changes? Maybe! đ€·ââïž
Money. đ€ SĂĄnchez has offered Catalan separatists Junts and ERC funding and power if they support him. With PP-Vox? They know they probably get res (thatâs ânothingâ in Catalan, FYI).
A prediction. As calls for elections get louder, expect PSOE officials to keep saying: âJust because all our friends are corrupt doesnât mean weâre bad.â And then keep praying the next shoe doesnât drop. Because somewhere in a court basement, thereâs a stack of hard drives and a backlog of recordings from Koldo, Ăbalos, and CerdĂĄn that might say otherwise.
More news below. đđ
đŹ Five things to discuss at dinner parties
1. đž Madrid put sunshades in the Puerta del Sol and pretty much everyone agrees they suck
Madridâs Puerta del Sol â aka Km. 0, aka âtake a selfie with the bear statue and grab a charger at the Apple Storeâ â has a problem. There is not a tree in sight, and as climate change worsens summers get hotter for unknown reasons, people compare it to walking inside an oven.
City Hall to the rescue. Melting like a Gremlin (Google it, kids!) isnât great for tourism. So Mayor JosĂ© Luis MartĂnez Almeida (PP) did what any summer-loving bureaucrat would do: he (and his government) set up a few toldos (aka sunshades) so people could hide from the punishing summer heat.
Bit slow, eh? After months of delays and scorching criticism (both figurative and literal), the sunshades finally went up and they are⊠sorta meh. Not only that, they come in at a hefty âŹ1.5 million.
Ibiza prices. While the white fabric sails offer some needed relief from the merciless sun, the price popped eyes because the project was originally pegged at half a million.
But, but, but⊠The budget ballooned after a design flaw (eyeroll) forced the city to anchor the shades to the benches in the square. But it turns out the benches werenât designed to hold anything but butts. So the city had to reinforce them with steel. That will be âŹ1m extra, please!
Oh, and the sunshades are seasonal. So theyâll be taken down in the fall and reinstalled each spring - just in time for spontaneous combustion season.
Not convinced. This is the first time in 160 years that the Puerta del Sol gets artificial shade đ„ł. But many residents and tourists arenât sold. One local told El Diario that they are âexpensive, late, and not particularly prettyâ, and we kinda agree.
Not just urbanists, locals, and us think it sucks. Almeidaâs political opponents also hate on it: leftish MĂĄs Madridâs Rita Maestre accused the mayor of wasting âŹ13m on a cement plaza wasteland and now throwing another âŹ1.5m at âgaudy canopies that donât provide shade.â (Sheâs not wrong.)
But the city government is not having any of this. Almeida says that the Puerta del Sol is now pedestrianized, accessible, and, for the first time in history, shaded.
Still, one question lingers: why not just plant trees? Because green + natural = good.
Historical preservation rules. Madridâs delegate for public works, Paloma GarcĂa Romero, says that Sol is a protected historic site, so no planting trees or installing permanent structures.
We tried. GarcĂa Romero says this is why original proposals to plant nine trees were blocked by the Heritage Commission and even the anchoring âthumbtacksâ on the structures had to pass multiple reviews (thus explaining the delays).
Look down. Oh, and the Sol metro station is underneath, so scarce soil.
Well, thereâs that. So now Sol looks like a luxury car park with no cars - and a poor manâs Pikachu. But hey, at least itâs not car-choked like in the â60s.
2. đïž New consumer bill comes for short flights, scalpers, and your âecoâ shampoo
Spainâs Ministry of Consumption just dropped a bill that could change how you fly, shop, and score tickets to Bad Bunny. Itâs called the Ley de Consumo Sostenible - because everything is sustainable now.
Presented by Minister Pablo Bustinduy and provisionally approved by the government, the law is designed to protect consumers and the climate. And it doesnât hold back.
First up: short-haul flights. Ads for domestic flights will be banned if a cleaner alternative â like a train â is available that doesnât take more than 2.5 hours longer. So, like, if the MadridâValencia train clocks in under 4 hours, youâll see Renfe ads, not Ryanair ones.
Not a ban. Flights arenât banned â just the ads. Itâs all part of the EUâs slow march toward fossil fuel sobriety.
France has adopted similar measures, restricting flights between cities with rail connections under 2.5 hours. Spain goes a step further by targeting ads â because nothing says âGreen Dealâ like a marketing restriction.
Second: ticket resellers. StubHub and friends will be monitored, and reselling a ticket above the official price (adjusted for inflation) will be illegal â which, we hope, will translate into something good for all of us.
The Ministry will monitor resale websites and marketplaces where tickets are listed. This comes as bots and speculative resales have turned ticket-buying into a nightmare for pretty much everyone, while driving prices through the roof. (Hit us up if you have any Bad Bunny tickets).
The goal? The idea is to kill the profit motive and make live shows more equitable. Platforms violating the new pricing rule could be blocked altogether.
But thereâs more! The bill also cracks down on planned obsolescence by making companies cover part of the repair costs after their productsâ guarantees end; limits âfear-basedâ ads (like alarm firms that warn a squatter may occupy your house while you go to the supermarket); and bans vague âecoâ product claims (âbiodegradableâ, weâre looking at you).
Next up for the bill: a public consultation phase before heading to Parliament.
3. đ Itâs so hot in Spain the trains gave up
Spainâs trains were great (until now). Spainâs high-speed train service has for years been one of the countryâs calling cards, with fast and (more-or-less) economical access to most of the countryâs major cities. But the last year or so? A shit show Problematic.
New drama. This week, during 2025âs First Summer Heat Waveâą, the overhead power lines just⊠died. Around 8:30 p.m. Monday evening somewhere between Madrid and Toledo, the wires that keep the trains running gave up. Over the next 15 hours, 70 trains were delayed across the MadridâAndalucĂa corridor.
Specifics. 318 unhappy people were stuck on one train in the España profunda until it got to Madrid at 10:15 a.m. Tuesday. One wrote: âWhat seemed like a simple trip has turned into a nightmare: weâve been stuck for over 13 hours in the middle of a plain in Toledo, with no electricity, no bathrooms, unbearable heat, and surrounded by insects.â đ The cherry on top? An 84-year-old woman had to be evacuated by ambulance.
Far from the first time. Trains marooned in the middle of nowhere and people stuck in stations has become a regular nightmare for Spainâs train operators.
Derailed. Just three weeks ago, a train derailed at the entrance to Madrid ChamartĂn station, cutting electricity to the trains and affecting 34,000 passengers.
Copper burglary. On May 4 (as we reported), the theft of copper wiring at five spots in Toledo on the Madrid-Sevilla line hit 10,700 passengers on 30 trains with hours-long delays or cancelation (Yes, basically the same place that lost power this week.)
Great Blackout. Just six days before the copper theft, the Great Spain Blackout stranded 35,000 train passengers.
What the heckâs going on? Basically, lots more passengers, not enough investment. Some 8.7m people rode the Madrid-Barcelona route in 2023, up from 4.4m in 2019. Madrid-MĂĄlaga? Up to 2.5m from 2m.
Busy stations, little money. As fellow Substacker Brendan Boyle of La Comunidad points out, new services Iryo and Ouigo are crowding the system: a steep drop in investment after the 2008 financial crisis pushed aging trains to cover more miles; and Madridâs Chamartin last year saw 13.9m passengers, passing a mark it wasnât supposed to hit until 2040.
At least train delays arenât deadly. But the heat is. 330 people died from heat-related causes in Spain last month. Thatâs the third deadliest June on record, behind only 2022 and 2017. So, yes, it is hot enough for us.
4. đŠ BBVA-Sabadell may just be a bank merger but itâs getting hot đ„
Just last week, Spain gave BBVA the green light to buy Sabadell. But told them theyâd have to wait three to five years before consummating the deal. (Yes, they used the word "merge," but we all know what they meant.)
This wasnât about business. Spainâs competition watchdog had already approved the deal. The problem? Politics. Sabadell is Catalan, BBVA is basically a Madrid power bank, and PM Pedro SĂĄnchez didnât want to upset the nationalist parties keeping him in power. So he launched a Eurovision-style âpublic consultationâ and then slapped on new conditions that tanked the dealâs projected returns.
Pretty hot, right? (At least for a bank merger.) But this week it got hotter!
SĂĄnchez and friends may have thought theyâd killed the merger. But BBVA didnât flinch. On Monday, Chair Carlos Torres Vila said the bank would push forward anyway - calling it a âunique opportunity to build one of the most competitive and innovative banks in Europe.â (Translation: Canât stop me, Pedro.)
So why didnât they just walk away? Sure, the new conditions cut the dealâs expected returns from 20% to 13%. But thatâs still money. Torres Vila says the deal would boost lending by âŹ5 billion a year and create âsignificant valueâ for shareholders.
Enter: Weak Pedro. El Mundo reports BBVA has support from heavyweight shareholders like BlackRock, Vanguard, and Norges Bank - who think SĂĄnchez might not be around long enough to keep blocking the merger and a new government could soften the conditions. Also in BBVAâs back pocket: The option to sue.
Plot twist! Sabadell fights back - with a dividend bomb. Sabadell announced Tuesday that it had sold its U.K. arm, TSB, to rival Santander for âŹ3.1bn.
So? Sabadell plans to hand most of that cash to shareholders - hoping theyâll prefer keeping the windfall to sharing it with BBVA if the merger goes through. Itâs a classic poison pill strategy: raise the payout to shareholders, raise the price BBVA has to offer. Think of Sabadell as a porcupine: you still want to hug me with my spines out?
A stock guy speaks. The deal âseems to be a last major effort to convince Sabadellâs shareholders to not accept BBVAâs offer during the upcoming take-up period,â RBC analyst Pablo de la Torre wrote in a note about the deal.
Whatâs next? Sabadellâs shareholders vote in August, and BBVA still has to update its offer. Stay tuned for the next chapter of As the Bank Merger Turns. This soapâs just getting good.
5. đȘđž Is Spain really richer than Japan today?
Depends who you listen to. According to the IMF, yes. At least on paper. (h/t to El Economista for pointing this out.)
It happened in 2024. Spainâs GDP per capita - the average output per person - officially overtook Japanâs in 2024: $35,092 vs. $32,498. A country known (to people who donât really know it) for sangrĂa and siestas is now, statistically, âricherâ than the land of robots, underwear vending machines, and no immigrants (more on that last bit in a second).
Vibe shift. But the headline masks something much bigger: a shift in the global economy away from goods (cars, tech, electronics) and toward services (tourism, hospitality, âexperiencesâ). Spain thrives in the latter. Japan⊠not so much.
From goods to good vibes đ·. Thereâs been a big shift as China basically kills the classic manufacturing countries with its low, low costs (and therefore prices).
Industrial machine. Japan was seen for decades as the worldâs ultimate industrial machine. But that machine is stalling. The country is shrinking â by about 5 million people in 15 years â and aging faster than anyone else. Growth is flat, inflation is rising, and the once-infallible public debt model now looks shaky. (Plus itâs fighting with Trump about auto exports, but thatâs for another day.)
Experience the service. Meanwhile, Spain has become a services juggernaut. Tourism is booming, immigration is pushing the population toward 50 million, and more people are working than ever. In 2012, Japan had a $21,000 lead in GDP per capita. Twelve years later, Spain pulled ahead.
The reason? The world economy has changed. The average Brit or American is more willing to splurge on a rooftop cocktail in Madrid than a new tablet. That shift - from goods to experiences - has supercharged economies like Spainâs.
Booming share. Between 1970 and 2021, the service sectorâs share of global GDP rose from 53% to 67%, the WTO says. And here? Services now make up over 70% of Spanish GDP.
But is Spain actually richer? đ Not necessarily. The GDP jump is partly driven by demographics: more working people, many of them migrants, lifting overall output. That doesnât mean the average Spaniard feels richer â ask the next barman you order a caña from â just that there are more people generating income.
Itâs how you look. Still, in a world where industrial giants like Japan, Germany, and South Korea are losing ground to lifestyle-heavy service economies, the symbolic value is real.
And weâll keep looking good. In fact, the IMF predicts Spain will stay ahead of Japan in GDP per capita through 2030. The sorpasso might be here to stay.
Weâll take it. So yes, Spain is âricherâ than Japan â at least until someone invents a robot that can pour a proper vermouth and tell you where to find the best tortilla (weâd tell you, but weâd have to kill you).
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