It is best to say it as soon as possible because the proposal is simple: to substitute the wasted subsidies and grants for involuntary unemployed, public and private companies, autonomous communities, town councils, autonomous organisms etc, by loans or social credits without interest that would have to be returned under affordable conditions in the future. In this way the unstoppable growth of Public Expense and Debt could be reduced, at the same time as the increase of the future margin of manoeuvre for monetary policy to stimulate economic activity. In short, it is about changing the so widespread culture of the subsidy for the much more demanding and at the same time stimulating culture of the loan.
As all economic decisions of certain significance, its establishment should not be of a drastic and traumatic nature, but gradual and respecting the rights and commitments contracted in the current legislation. Sound judgement, especially necessary in social questions that involve a great number of people, would lead to collating current systems of a marked mutually binding but shameful nuance and, why not, many times electoral to charitably self-seeking, with loan systems of multiple varieties and concrete specifications. In this way the trend towards that new form of understanding solidarity would be initiated that consists of increasing trust in the capacity of effort and in future work for involuntary unemployed or in the young (or not so young) managerial projects lacking capital or in delicate situations.
Due to the current importance and dimension of the problem it is as well to focus on the unemployment subsidy although I insist that it is applicable in many other environments. The economic crisis has dramatically put under discussion the great query of knowing if the State is, and will be able to maintain such a high level of expense lost in unemployment in this and the next few years. In 1993 the figure will be about two billion pesetas (with twelve zeros).
The query is extended when many experts already admit that the current system, so socialist and so promoted by unions (theoretical representatives of the workers that work), has perverse effects on the work market, the development of employment, the companies that create work positions and especially on those workers that work actively and that have to finance and sustain a greater volume of inactive population. The temptation to abandon the wagon of activity could be irresistible for them.
The current prevailing systems lead to the active population being divided into two big blocs: those that have stable contracts and those see a to and fro looming, alternating indefinitely periods of employment with periods of subsidized unemployment. The selfsame Julio Seguro affirmed, "There is the paradoxical situation that the more employment is created, the greater are the payments for unemployment derived from a growing covering rate as well as the intense rate of rotation of manpower derived from temporary contracts and the benefits that are attached to these."
That going to and fro, many times necessary but also with an ulterior motive many other times, for personnel as well as the very companies, impinges on the scarce possibilities and on the scarce interest to improve in something of such vital importance in the changing world of today as professional training and qualification at all levels. Temporary contracts bound to insurance thoroughly lost motivate to work only a certain time thinking that later one is entitled to a period of subsidy.
The unemployed that perceive these benefits look for employment with less intensity increasing the time in that they remain unemployed. Many times existent work demands are not accepted and the companies also take advantage of this labyrinth of labour dispositions that foments passivity and trickery. Those perverse effects give rise to an increase in existent unemployment, a certain passive apathy is stimulated in society, effective employment recovery is hindered in times of economic growth, and social roguishness and pure hard fraud is fomented at all levels.
It is better never to lose sight of the fact that, contrary to the simpleton and obsolete zero sum reasoning, active work engenders work and the passivity of labour and managerial unemployment generates more economic, social and human depression.
The proposal that I make hastily in these pages of "La Gaceta de los Negocios" is not only based on the peremptory convenience of reducing public deficit and the galloping partner Debt but also, on the still more important necessity of "giving everybody work". This means trusting in ones own personal forces and also of teams, companies, regions or nations, and surely knowing that paradoxically, the scarcest resource continues and will continue to be good human work. The substitution of the concept of national lay charity by that of the social loan means aiming at a higher level that implicates each and every one, individually and socially, in the task of imaginative, creative and confident work faced with the future. It is necessary to forget that the non-existent magic wallet of Felipe Gonzalez will solve everything.
A loan that it is necessary to return would not only solve basic and urgent necessities, but it would also eliminate the majority of those perverse effects. It would erase an important fraud pocket from the social framework and it would stimulate the search for employment and the dedication of time and interest to the continuous improvement of intellectual, technical and manual vocational training.
I do not want to go into concrete details here for the effective implementation of this new system of economic and social assistance (the State has expert technicians) but I do want to indicate the automatic stabilizing effect of this system. In times of recession the loans that encourage activity would increase and in times of expansion and recovery it would be easier to return those social loans, in this way curbing inflationary danger. To give just one example: of the 4.3 billion pesetas that were paid between 1982 and 1985, most could have been recovered in the expansive phase of the following years. In turn, that recovery of the social loan would have served as a security cushion for the strong fall of the cycle that we are experiencing. It goes without saying that the amount of social aid in these periods of crisis could have been more generous if the burden of the recovery of future economic activity had not been assumed. With the intervention of financial institutions in the putting into practice of these systems and with the help, not only of companies, that always act as collectors on behalf of the State, but especially of unions, a stimulating proposal can be set in motion that recovers the force and illusion that has characterized our society on so many difficult occasions.
It is as well to start projects in which everybody is a participant, whatever the extent of their possibilities and that they transform the subsidy into confident investment in human capital. A word to the wise is sufficient. Not everything has to be a distressing recoil of the opportune and sensible proposals of Balladur in France and Kohl in Germany to transform the bad state of the Welfare State into a mutually binding and active State of Well-doing.

Joseph John Franch Menéu
Gaceta de los Negocios, Wednesday September 8th 1993