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The middle-class dream
Mr. Cadena's case is typical in many respects. He is, along with one-10th of all Spaniards today, an immigrant - in his case from Ecuador - who worked hard for a dozen years, married, raised a family and was stably employed enough to became naturalized. A house seemed a logical next step; in fact, his neighbours told him, it was insane to continue renting.
In 2006, a Barcelona bank offered him a "free" mortgage - with no down payment - that was offered, signed and closed in one day. His salary of €1,100 a month was combined with his wife's earnings of €600, and the bank asked them to claim they worked weekends (they didn't) in order to make their income appear high enough to qualify them.
Before he had a chance to think about it, Mr. Cadena was given the keys to the apartment and a 2-centimetre-thick package of fine-print pages he either couldn't or didn't read, and was told the mortgage payments would be €900 a month, withdrawn from his account.
He had no idea how much he'd paid for the 3-bedroom basement apartment (only this year did he realize it was an extraordinary €253,000) or the interest rate (5 per cent above prime).
The monthly payments, he soon learned, were calibrated to rise over time, first to €1,100 euros and then, in 2009, to €1,600 - a mortgage structure, also popular in the United States, that only made sense under the assumption both the borrower's income and the house's value would rise quickly and constantly.
They didn't. The collapse of Spain's property bubble coincided with the rising mortgage rates faced by Mr. Cadena (and many others). In early 2009, his construction company cut his shifts to six hours per day; in November they folded completely.
His wife left him, apparently frustrated by his sudden loss of fortune, and he is now a single father watching over children aged 14 to 21 who face even worse prospects than him: Spain's youth unemployment rate is more than 40 per cent. Two years ago, he expected to be using his home equity to pay for post-secondary educations for them; now he is worried they might fall into gangs and drugs in an apartment neighbourhood that is becoming a ghost town.
Mr. Cadena spends his days looking for jobs, but so far this year, he has only had a month of steady work. Beyond that, he is dependent on the state. At the moment, unemployment-insurance payments give him €1,100 a month, but will end in November, a year after they began; after that, he will rely on welfare payments of €420 a month.
It is widely believed Mr. Zapatero will have to slash Spain's welfare and unemployment-insurance programs in order to meet his deficit targets, although he has refused to speculate on the possibility. If these benefits are cut, millions of people like Mr. Cadena will be thrust into even worse situations.
"I talk to hundreds of people in this position, and many of them just decide to take their own life," says Adria Alemany, head of a housing-rights group pushing for an end to the mortgage policies that cost Mr. Cadena his home. "And why not? What is there to live for? Fighting back for them is the only way to survive."
For Mr. Cadena, a surprisingly fit and cheerful man in the face of personal doom, survival is for his children. "I had my chance," he says, "and I hope they will do better in their time. I'll need the rest of my life to get out of this."
About the series:
The debt crisis has turned the formerly stable countries of Europe upside down. Even as the economy begins to emerge from recession, drastic efforts to avoid a debt and currency emergency have changed life in the Old World forever; ending ancient working traditions, rupturing families and communities and forcing long-dormant societies to seek new ways of getting by. Doug Saunders looks at the human effects of a continent's economic disintegration, visiting people and families in six countries at the centre of the crisis.
- Spain: Rising unemployment and plummeting housing prices create a perfect storm
- Ireland: The exodus returns
- Britain: Learning to make things again
- France: The lifestyle of the state
- Germany: In the vortex, a calculated calm
- Greece: Families moving underground
- Follow Doug on Twitter as he travels into the depths of the crisis
- Video reports from each stop
- Full coverage of the crisisReport Typo/Error