As in the short-lived Republic of the 1930s, Spain was building a democracy in the teeth of an economic recession, and there was much talk of the country going the way of Argentina, with indexed wages and government-subsidized prices degenerating into hyper-inflation. If this was averted, much of the credit must go to the signatories of the so-called Moncloa Pacts of October 1977, the first in a series of negotiated settlements in which politicians, labour leaders and employers agreed to embark upon a broad range of reforms: devaluation of the currency, an incomes policy, controls on
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