Abolition of the Basque Economic Agreement: 1937 Decree

Historical Context of the 1937 Decree

This decree-law, issued in 1937, concerns the Basque Economic Agreement abolition, drafted by Francisco Franco. Franco joined the 1936 military uprising that sparked the Civil War and became the sole Nationalist leader following the deaths of Sanjurjo and Mola. He ruled Spain as a dictator from 1939 until 1975. The document was a public decree addressed to all Spaniards, specifically the Basque people.

The law was published on June 24, 1937, in the Spanish Official Bulletin (formerly the Gazette of Madrid) after the Civil War concluded in the Basque Country, following the fall of Biscay to the Nationalists. It was issued in Burgos, the seat of the Nationalist command control during the war.

Key Terminology and Analysis

To better understand the document, we define the following terms:

• National Movement: The dictatorial regime established by General Franco following his victory in the Civil War.
• Economic Agreement: A system allowing Basque inhabitants to pay taxes to Provincial Councils (Diputaciones) rather than directly to the central government. The Diputaciones negotiated the quota (cupo). This system was established by Cánovas del Castillo in 1878 following the abolition of the Foral System in 1876.

Commentary on Exaggerated Expressions

The text utilizes rhetoric such as notable privilege and less sacrifice to justify its stance.

• July 17th: The military uprising in Morocco by the Nationalists that triggered the Spanish Civil War.

Core Objectives of the Decree

The primary purpose of the text is to justify the abolition of the economic agreements in the provinces of Bizkaia and Gipuzkoa.

Arguments for Abolition and Preservation

Franco abolished the economic agreements in Bizkaia and Gipuzkoa as punishment for siding with the Republicans. Conversely, he preserved them in Álava and Navarra as a reward for their support of the Francoist cause and their contribution to the war effort.

Fiscal Impact and Political Power

Effective July 1, 1937, Franco ended the economic agreements with Bizkaia and Gipuzkoa, requiring them to pay all contributions, income, and taxes directly to the State, thereby abolishing their fiscal autonomy. The date of the document, issued before the war's end, demonstrates the power exercised by Franco in the occupied zone from his government in Burgos as he assumed leadership of Nationalist Spain.