Urgent need to rethink fiscal policy in Spain in light of economic uncertainty.

The debate on fiscal policy in Spain has gained unprecedented relevance in recent months, as the country navigates a sea of economic and political uncertainties. As proposals for the next fiscal year are delayed, the lack of a clear fiscal strategy has emerged as a critical issue that requires immediate attention. While some European countries are experiencing a similar sense of provisionality, Spain has a particularity: its economy is growing above its potential, creating opportunities to address the structural deficit that has persisted for years. The current situation is complex, marked by extended budgets and the absence of fundamental pillars such as the spending cap and the medium-term fiscal path. This stagnation not only reflects confusion in the political sphere but also raises the urgent need to rethink fiscal policy. In this context, it is vital to question what the fiscal strategy should be to sustainably enhance the well-being of citizens. Despite the favorable conditions in which the Spanish economy finds itself, data reveals that the deficit persists, although it is slightly lower than last year. This primary deficit, which excludes debt interest payments, remains a concerning indicator. The growing burden of liabilities for public administrations, which increased by more than 51 billion euros in the first half of the year, signals that public finances need urgent adjustment. The current approach to fiscal policy must focus on stimulating productive investment, the Achilles' heel of the economy. In this regard, an announcement from the European Central Bank (ECB) that could result in a slight reduction in interest rates is eagerly anticipated. This gesture, although limited, could clear investment expectations and boost the positive effect of European funds. However, the combination of fiscal and monetary stimuli in an expansive environment poses risks, such as the possibility of resources being diverted to less productive activities. To consolidate financing for the deficit, it would be prudent to adopt a strategy more aligned with the economic cycle. So far, Spain has managed to place debt under favorable conditions, unlike other countries such as France, which faces tensions in its risk premium. However, the ECB's announcement to cease debt purchases starting next year presents a challenge. The end of these purchases could translate into increased costs for new debt issuances. In light of this scenario, it is evident that a reevaluation of fiscal policy is unavoidable. The continuation of budget extensions cannot be the norm, especially in a context where the impact of a new delay will be more perceptible. The current accounts, conceived in a year marked by health and economic challenges, are insufficient to address present and future realities. The prolongation of the expansionary cycle and the possibility of implementing governance reforms, including regional financing, depend on the implementation of a credible fiscal strategy. Decisions made in this area will not only affect public finances but will also have repercussions on the quality of life of citizens and the country's ability to face upcoming crises. Moreover, the absence of consensus around major fiscal guidelines only exacerbates the dilemmas faced by the government. The lack of alignment among different political actors regarding fiscal policy could result in a stagnation that affects economic stability. The urgency to find a clear and sustainable path is more necessary than ever. In summary, Spain's economic future stands at a crossroads. Fiscal policy must be reviewed and adapted to the new realities the country faces. Without a clear strategy to guide the way forward, the Spanish economy could miss the opportunity to consolidate its growth and ultimately enhance the well-being of its citizens sustainably. The debate on the budget should not be a mere parliamentary formality, but rather an opportunity to rethink and redesign the foundations that will support the economy in the years to come.