Let's think for a moment about the work behind the Phoenix Report, published this May. Six economists of undisputed prestige —Xavier Cuadras Morató, Jordi Galí, Modest Guinjoan, Guillem López Casasnovas, Miquel Puig and Jaume Ventura, coordinated by Xavier Roig— have had to agree on more than one hundred and twenty pages of analysis, accept external arguments, renounce their own personal positions, and put their academic and social capital at stake to achieve a greater good: to awaken a country. To hold it up to the mirror. To proclaim, with data and rigor, that the emperor has no clothes. And the king is naked because while Catalonia's GDP has grown above the European average in the last 25 years, GDP per capita has fallen 12 percentage points compared to our European partners. A quarter of a century ago we were six points above the European average. Today we are six points below. We have created wealth, yes. But we have distributed it among more and more people and in a worse and worse way. This is where we need to stop and think. Because there is a deep confusion, whether interested or naive, about what distributing wealth means. The State tends to understand distribution as providing more services to those who cannot afford them. And it is true that in an advanced society collective solidarity reaches where the individual cannot reach alone. But there is no better distribution of wealth than increasing people's wages. That fewer and fewer people have to depend on public resources to have a full life. That every worker can feel responsible for their own future and have control over their life. Jarvis Cocker, from Pulp, sang it with bitter irony in "Common People": "how does it feel to live your life without no meaning or control?" It is a song about the romanticization of poverty. Today it could be the soundtrack to a growing part of Catalan society.
The State captures a part of GDP in the form of taxes. If GDP rises, revenue rises. But if this growing revenue is not enough to cover the services demanded by an ever-larger population, the temptation is obvious: raise taxes. The problem is that this mechanism has a mathematical limit, which would be one hundred percent of GDP. What should the State do: collect this percentage? And what if one hundred percent is still not enough? That's why we have what we have: every year more is collected, every year more jobs are created, every year the active population grows, and despite everything, people are poorer and dependence on the State continues to increase. The paradox is real and thePhoenix Report documents it with surgical precision. The reason is that the significant growth of our GDP has been based on low-wage sectors. In leveraging a workforce that works in exchange for wages below the poverty line. In activities that do not require qualifications and that, therefore, can recruit workers from anywhere in the world, without the need to invest in training, technology, or process improvement. 44% of employment created between 2008 and 2023 has been in sectors with salaries below 27,500 euros per year (in 2023 euros), the threshold from which a worker does not generate enough contributions throughout their working life to cover even the basic public services they themselves consume. In other words: more than a third of the Catalan economy operates thanks to an implicit subsidy that we all pay for. Business owners also have a responsibility that we cannot evade. A business model based on a poorly paid workforce is not a sustainable business model: it is an outsourcing of the real cost of the activity to society. And society, sooner or later, presents the bill.
But the greatest responsibility lies with the administrations. Employers are not irrational: they invest where it is profitable. And if for 25 years it has been profitable to invest in low value-added sectors, it is, in large part, because the tax system has allowed and even favored it. Fiscal policy is not neutral: it determines which investments are more attractive and, therefore, shapes a country's productive structure. If we want private capital to flow into high value-added sectors —those that generate decent wages, that do not require implicit subsidies, that compete on quality and not on the cheapening of labor costs— administrations must design a tax system that incentivizes it. The challenge is not to increase taxes, but to collect better: to build an economic base productive enough to maintain —and even reduce— the tax pressure on those who contribute the most, without sacrificing the quality of public services. It is possible. The most productive countries in Europe demonstrate this. But it requires decisions that hurt in the short term and that no government wants to make unless there is a society that demands them.
The Fènix Report is not a political document. It is an economic diagnosis made with rigor and courage. But its conclusions have a moral dimension that goes beyond graphs and tables. If we continue on the same path, by 2050 Catalonia will be the fourth autonomous community in GDP per capita, behind Aragon. We will have abandoned forever the idea of a Catalonia with a productive tradition and generator of real wealth. Six economists have had the courage to say it out loud. Now it is necessary that Catalan society —businesspeople, politicians, unions, citizens— have the courage to listen to them and stop this cheerful parade towards the precipice of impoverishment.
