Spain's Future Hinges on Socialist Party Showdown

THE day following the French Socialists' unprecedented drubbing at the polls last month, Spain's political right wing took out full-page ads in national newspapers trumpeting the event as another domino in a long line of falling left-wing European governments.

"First Britain, next Germany, then Belgium, Portugal, Sweden, and now France," the ads taunt gleefully. The point is clear: After more than 10 years of socialist government, won't Spain be next?

The answer to that question may come this weekend, when a showdown within Spain's ruling Socialist Workers' Party (PSOE) is likely to determine whether the badly divided party can stay united to contest national elections set for this fall - and whether Spanish president and party leader Felipe Gonzalez Marquez will still be around to lead it.

Ostensibly, tomorrow's meeting of the party executive committee will take up a party-financing scandal that has rocked the PSOE and sent it skidding in opinion polls. Mr. Gonzalez has said that unless heads roll in response to the scandal, he may resign as party general secretary.

What it amounts to, however, is a kind of OK Corral pitting the Socialists' moderate wing, heavily represented in the Gonzalez government, against the leftist orthodoxy of deputy party leader Alfonso Guerra Gonzalez and much of the party bureaucracy.

"I am convinced there is nothing fortuitous about what has happened" within the party, wrote Jose Maria Benegas, PSOE's chief administrator and third in command, in a letter of resignation the executive committee will accept or reject tomorrow. His words reflect widespread suspicions within the party that moderates are using the scandal to "clean house," in the words of one official, before elections that promise to be difficult.

What the party's "renovators" want, observers say, is to give the PSOE a fresh, moderate, and clean face before the vote.

Spain needs "a change of change," Gonzalez said in a recent interview with the Spanish news agency EFE. The message is that the Socialist Party, long associated with Spain's impressive democratic and economic leap forward over the past decade, must evolve and modernize or become increasingly associated with stagnation, spent ideology, abuse of power, and alienation from the voters.

The Socialists' problems are compounded by the fact that they are happening against a backdrop of deteriorating economic conditions - something Spain, after the boom that followed entry into the European Community in 1986, had almost forgotten about. Unemployment now affects more than 3 million and some economists believe Spain could register a decline in GNP this year, making for the gloomiest performance since World War II.

With growing numbers of Spaniards feeling the pinch, financial scandals and rumors of high-living Socialist officials tarnish the party all the more. A major opinion poll taken last month by the Madrid daily El Pais suggested the Socialists would lose their absolute parliamentary majority and be forced into a coalition government. And that was before the full effect of the current scandal over illegal party financing struck and the Socialists' internal battle burst out in the open.

The poll also showed the country's principal conservative party, Popular Party (PP), increasing its share of the vote by almost 50 percent, to 36 percent, since the last elections in October 1989.

Yet whether Spain is ready for the first time in its history to democratically hand power to the right is far from certain.

Knowing that he is up against memories of the country's not-so-distant fascist past, PP leader Jose Maria Aznar carefully describes his party as "center-right," and insists that it has successfully undertaken a "generational change."

Especially following the French elections, Mr. Aznar has taken to saying it would be a "European anachronism" for Spain to retain a socialist government. This argument may be winning some points at a time when much of Europe's left is either stalled, as in Britain and Germany, or facing disintegration, as in France and Italy.

Still, many observers believe events in Spain will be determined by Gonzalez, who, unlike socialist leaders elsewhere in Europe, remains popular at home.

If he does not get the party housecleaning he wants and resigns, he could call early elections and watch a leftist PSOE sink. But no one is ruling out the scenario by which "Felipe," as the Spanish call their leader, accomplishes a party face lift and leads his Socialists in holding off the "center-right" assault.