Transition to Democracy, Oil Crisis, and Further Bank Reforms

Franco’s dictatorship ended with his death on 20 November 1975. From that moment on the transition towards democracy proceeded not without serious hindrances, but carried over by popular enthusiasm and faith in the benefits of a democratic system. It took a complex process of dismounting a dictatorial order which Franco himself said that he would leave ‘well tied and knotted’ when he died. Untying the knots took one year and a half. Alexander’s method with the Gordian knot was carefully avoided. Every step was achieved through consensus. Spaniards, politicians and constituents alike, had developed a strong and lasting distaste for swords. The first democratic elections in 41 years finally took place in June 1977. Constituent Cortes were elected by universal suffrage and they promulgated a constitution in December 1978. As political reform advanced, economic reform proceeded in a parallel way. Fiscal and financial reforms were carried out, to which we will refer presently. Meanwhile, to consolidate these political and economic reforms, and with almost unanimous popular support, Spain began a process of integration into the European Economic Community (since the Maastricht Treaty of 1992, European Union, EU) that culminated with its admission as a full member on 1 January 1986.