Felipe VI, Vivat Rex

Felipe VI, Vivat Rex
Profile photo of David Howden

spain-king-felipeOn 20 June 2014, a man little known outside the Spanish-speaking world became a little better known as Felipe Juan Pablo Alfonso de Todos los Santos de Borbón y de Grecia succeeded his father to become King Felipe VI of Spain.

In accordance with the Constitution of Spain, King Felipe is now the Head of State and Commander-in Chief of the Spanish Armed Forces. He will also take on a stronger role of promoting relations within the Ibero-American community, those countries composing the Spanish-speaking world of South and Latin America, the Caribbean and the Iberian Peninsula. At nearly 650 million people, the community is larger, though less formally organized, than the European Union.

Spain, like Great Britain and many countries of the Commonwealth (including Canada), the Netherlands, Belgium, Norway, Sweden and Japan (amongst others) are all constitutional monarchies. To varying degrees this means that a monarch serves as the nonpolitical head of state within the confines of a Constitution.

Spain and these other constitutional monarchies share something in common with other democracies and dictatorships of the world – very few understand what the monarch´s role is. More damning for the institution, there are many who see it as an unnecessary and perhaps expensive layer of politics that a country could do without.

With its strong tradition of Republicanism, these feelings are strong and apparent in Spain. Various separatist movements not only want to leave the political union of Spain, but also shed the baggage of a monarch.

King Felipe has thus inherited two crises from his Father, King Juan Carlos I. On the one hand Spain is embroiled in an economic crisis threatening a generation of youths as well as older workers nearing their retirement years. This economic crisis is not unique to Spain´s history – it has, since its Civil War in the 1930s, suffered from numerous crippling recessions.

The more important crisis is the territorial one. King Felipe´s primary task over the years ahead is to keep Spain as a united Kingdom.

In this article, I don´t wish to comment on the appropriateness of Spain retaining its present boundaries. (For those who want a brief primer, Spain is composed of roughly four separate languages – Galician, Castilian, Catalan and Basque – as well as roughly four different cultural groups corresponding to the languages.) I will comment on some of the political events surrounding King Juan Carlos´ abdication of the crown, and King Felipe´s accession to the throne.

One of Hans Hoppe´s great achievement in his career as an Austrian economist was his application of the concept of time preference to political regimes. In his A Theory of Socialism and Capitalism, he forcefully argues that monarchs will, ceteris paribus, rule better than democracies due to some simple economic facts.

The most important fact for the task at hand is the role time preference plays in making prudent long-term oriented decisions. Compare a renter with a home owner. The renter knows he will not reap the benefits of any investments he makes in his abode. He uses the resource for the time allotted, and worries not what it will look like in the future. He´ll have moved on by that time.

The home owner has a very different mindset. He must be concerned with the fine points of keeping his home in good repair, of maintaining it, and of also keeping track of his neighbours as how they treat their own home will affect his. If he does not maintain his home or if his neighbours pursue imprudent homeownership activities (e.g., use their home for illegal activities, have noisy and disturbing parties, or even just don´t properly maintain the property), he will suffer the consequences. These consequences are not only mental, in the sense that he will either have to live with the outcomes or sell his property, but pecuniary. Since he is the owner of his house, he gets to choose what to do with it. Most homeowners pass on their homes to their heirs (or sell them prior to death and pass along the proceeds).

In short, homeowners have a vested interest in good home management ingrained by the incentives that they face.

Now apply this reasoning to the political system. A democratically-elected ruler is like a four-year renter of the country. He knows he will not be around for too long. If he wants to be liked (i.e., perceived as a “good” ruler) he will try to make the best of a short-term situation. Likewise, if he wants to be reelected he could pursue policies that are beneficial in the short-run but quite damaging in the long-run. Deficit spending is a good example of this. A democratic leader can incur debts today, but pass their payment on to taxpayers in the future.

The monarch on the other hand must maintain his title and country as best he can. His children will inherit his Kingdom, and as such he has an incentive to pursue long-term oriented policies, very much similar to the homeowner.

King Juan Carlos´ signing into law his own abdication is the epitome of such reasoning. He has valiantly remained Head of State through failing health. Think it´s a cushy life being King? Guess again. How many people at the age of 78 do you know who wake up for work every morning? In Spain this figure is near zero, as the official retirement age is 65.

How man politicians voluntarily leave their position for the “good of the party”? Richard Nixon famously resigned office rather than be embarrassingly impeached, but otherwise I´m hard-pressed to come up with an example in recent history.

In fact, King Juan Carlos I gave up the throne twice. This more recent abdication was foreshadowed (in a way) in 1976. After the demise of the Franco dictatorship, King Juan Carlos became ruler of Spain. To forestall another bloody civil war he gave his responsibilities to the Congress in order to save his Republic. (Not only that, the man he appointed as the first prime minister of the newly democratic Spain, Adolfo Suarez, was the leader of the Movimiento Nacional Party. It included members who voted against recognizing him as King.)

Say what you will about him as a man, I can´t think of too many elected politicians that voluntarily renunciate their powers for the good of their country. King Juan Carlos did it twice.

King Felipe VI has some large shoes to fill. Unlike many democratically elected politicians, however, he has been groomed for this role his whole life. He has served in all three branches of the Spanish military. He has studied abroad. (He completed high school incidentally, in Canada, at Lakefield College School.) He is an able negotiator who has spent his life understanding the world he would become part of. He may have grown up in a privileged position, but he didn’t spend his youth playing video games, sleeping in or getting drunk at frat parties. He was forced to dedicate his life to prepare for a role he never chose: to inherit the crown of Spain.

I will close by addressing a common complaint of the monarchy – you can´t do away with them. Regicide is no longer a popular option, and so we are stuck with the institution. Since you cannot vote them out of power, a bad monarch can haunt a country for a generation.

A ruler can only rule with the consent of the governed. King Felipe need look no further than his mother to understand this point.

Queen Sofia is the brother of the deposed King Constantine II of Greece. After succeeding his father to the throne of Greece, King Constantine was forced to flee the country during a coup in 1967. He remained head of state in exile until 1973, when the monarchy was officially abolished. He has remained in exile ever since. The new democratic government of Greece seized his property, and although he lodged a €500 mn. lawsuit at the European Court of Human Rights, he was awarded only €12 mn., a sum that would make most footballers laugh.

King Constantine I was only allowed to return to his beloved country once, for a few hours to attend the funeral of his mother, Queen Frederica. King Constantine I was not just deposed as ruler of the country, he was exiled from the country he loved his whole life.

King Felipe VI might suffer a similar fate, unless he advocates policies favoured by the Spanish populace. Since his daughter, Princess of Asturias Leanor, will inherit the crown when he dies or abdicates, he will no doubt try to leave the country a little better than the one he inherited from his father.

  • Patrick Barron

    As an American I grew up thinking that the British royal family was kept simply for pomp and ceremonies. No more. The queen has fulfilled her roll very well and, frankly, is a better roll model than almost any elected head of state in the world today. David Howden is right to agree with Hoppe that elected politicians are like renters who cannot be evicted; they destroy their property by plundering the treasury. There is no way that Queen Elizabeth would act like that. Tyrants who are not constitutionally placed in power act just like elected heads of state, because there is no legal precedence to legitimize their rule.

    The U.S. and Britain could hardly make things worse if both restored the British monarch as a true head of state. Does anyone really think that Queen Elizabeth would have gotten our countries into all these disastrous wars or would have plundered the treasury to buy votes from welfare recipients (not needed!) or given away the nation's sovereignty to a group of continental spendthrifts?

  • austrianinquisitor

    But for it to matter the Queen – and the House of Lords – would require power to be restored to them. This, plus a restoration of voting based on property ownership, would be a big step forwards.

  • M.R.Man

    Monarchs are extremely arrogant and they think that they are in a some way special. That their mere existence is a benefit to human kind. That they contribute to society more than others just because they breathe and have a prominent lineage.

    You saw how arogant was the Queen after the Diana's death. Monarchs are not as bad as politicians, but a monarchy is not an answer to all of our troubles.

    I think that we should ditch all rulers (monarchs, politicians, banksters) and move on already …

Profile photo of David Howden

David Howden is Chair of the Department of Business and Economics, and professor of economics at St. Louis University, at its Madrid Campus, Academic Vice President of the Ludwig von Mises Institute of Canada, and winner of the Mises Institute's Douglas E. French Prize. Send him mail.

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