In the midst of the euro zone crisis, controversy is raging. Those in favor of growth at all costs are attacking the persistent advocates of austerity, including the European Commission, the ECB, the IMF (the so-called Troika) and the main European creditor countries led by Germany. Common sense indicates that both contenders are right. Austerity is necessary in any case, as nothing lasting can be built on mountains of debt. On the other hand, growth is necessary to get out of the crisis and create employment.

At the beginning of the crisis in Spain, back in 2007 and 2008, the Zapatero government made a fatal misdiagnosis. The crisis was one of debt and supply rather than demand and, based on this mistake, it made the bad decision to increase the public expense to compensate for the fall in demand. In doing so, he greatly aggravated the debt problem (he added the problem of public debt to the already existing problem of private debt), increased the public deficit, did not address the structural reforms needed by the productive system and did not solve the weakness of demand. He left Spain on the verge of bankruptcy until May 2010 when he was called to account by Brussels and had to radically rectify that suicidal economic policy. He had placed us in the worst case scenario: we had not been austere, we had not managed to grow, we had not reformed the productive system and we were up to our eyebrows in debt. This is the tragic inheritance that Zapatero left to Rajoy and the one that the tripartite left to Mas in Catalonia.

The same mistake cannot be repeated now. Austerity is necessary but, of course, applying it in an appropriate manner. This has been recognized by the Troika and hence the flexibility recommended in recent times.

The Portuguese politician manager has just visited Barcelona to deal directly with the Troika and has been very clear in saying that, also in Portugal, the medicine is bitter but there is no alternative, that growth financed with more expense and, therefore, more debt, would lead nowhere. Growth must come through a combination of austerity via costs (internal devaluation), fiscal adjustment (spending less and trying to bring in more) and, above all, structural reforms that will give rise to the possibility of a new productive system with greater competitiveness. Other countries have achieved this: Sweden in the 1990s (the welfare state is not sustainable without profound reforms), Germany at the beginning of the century (when everyone called it "the sick man of Europe") and the three Baltic countries. It is a painful medicine, but it ends up curing.