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especially pensioners, are an important constituency, and direct welfare trans-
fers (such as pensions) are an important tool to build coalitions of political
support (Esping-Andersen
1985
). Proportional representation in national elec-
tions ensures that benefits targeted to pensioners distributed across multiple
regions yield high political returns. Hence, the tendency by national party lead-
ers to resort to Social Security as a political weapon during electoral cycles,
in Spain and elsewhere (Orriols
2009
). Put shortly, given centripetal electoral
rules, national incumbents have no incentive to give up an effective electoral
tool. Moreover, given that regions benefiting from a centralized social secu-
rity, almost by definition, tend to have a stronger concentration of pensioners
in their voting age population, and to the extent that these regions are nec-
essary to win a majority of seats in Parliament (as it is the case in Spain
38
),
the consideration of any proposal to decentralize social security brings about
considerable political costs.
Furthermore, the leaders of benefiting regions also know that losing the
implicit transfers from social security would limit the resources available to
them and, therefore, jeopardize their electoral survival. Unlike regional financ-
ing, a decentralization of Social Security would be a net loss that could not
be compensated by additional resouces put forward by the central government
(
Figure 7.3
). As a result, any suggestion that could remotely lead to break-
ing the common pool and limiting its redistributive impact meets the fiercest
resistance by all other regional leaders of the party.
39
Aware of these electoral
and organizational risks, national leaders have every incentive not to give in
to demands to question the centralized and unitary nature of Social Security in
Spain.
THEORETICAL IMPLICATIONS
This chapter has analyzed the link between economic geography and decentral-
ization in a system with a centralized fiscal structure and a centripetal repre-
sentation system at the status quo. The study identifies two engines of change.
First, the distributive consequences of existing fiscal arrangements fuel prefer-
ences for higher levels of fiscal autonomy in net-contributing regions, particu-
larly those in which distributional and identity grievances are jointly mobilized
by succesful nationalist parties. Second, the presence of dominant nationalist
parties alters the structure of political competition in several regions, most
notably Catalonia, and introduces a centrifugal element in the political system
that, over time, counterbalances the centripetal nature of the electoral system.
38
For evidence on the electoral behavior of social security beneficiaries see Gonzalez (
2004
).
39
In the case of the socialist party, for instance, this would only exacerbate past tensions between
the socialist leaders in Andalucia and Extremadura and their Catalan counterparts over the
architecture of redistribution in Spain. See for instance Rodriguez-Ibarra's fierce opposition
in the PSOE Executive Committee to the regional financing proposals in the Constitution of
Catalonia, which he considered an undue attack on solidarity between regions (
El Pais
January
11, 2006).