Spain's bailout met with protests in Madrid

spain, protesters, bailout
Protesters in Spain gather to demonstrate against the country's recent $125 billion bailout
CBS News

(CBS News) Spain's prime minister on Sunday applauded the $125 billion lifeline given to his country's banks, calling the decision by EU finance ministers a "victory for the euro."

Not everyone, however, is so thrilled. Spain has become the fourth European country to ask European partners for a bailout, but it is by far the largest.

Within hours of the news of the bailout came the backlash.

Protestors in Madrid demanded to know why billions in aid would go to prop up broken Spanish banks, instead of helping people who are suffering because of their mistakes.

Moody Analytic's Mark Zandi said the reason Spain's in so much trouble may sound familiar to Americans.

"Spain had a bigger housing boom and bust than we had here in the United States and that means a lot of bad mortgage loans bad real estate loans that undermined the capital positions of the banks. They are broke, they need help from the European Union," Zandi said.

Spanish officials refuse to use the words "rescue" or "bailout" to describe the $125 billion package, referring to it as line of credit instead.

That may be a point of pride, but the distinction is an important one: Spain's package doesn't come with as many strings attached as the cash given to Greece, Portugal and Ireland.

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In short, European partners don't get to tell Spain how to run its finances.

"The Spanish must be very humiliated by having to take the aid. For them to actually have to go to the European Union for help like this, i'm sure was very difficult," Zandi said.

But the pain in Spain runs deep: 1 in 4 Spaniards is out of work, and among the young, unemployment is more than 50 percent.

With the country in chaos, Prime Minister Mariano Rajoy this morning jetted off to Poland to attend the European Soccer Championships.

Spain is the defending champion, and the Prime Minister is tapping into a source of national pride when there isn't a lot to cheer about.

He may figure it's a lot better to have thousands of people waving flags in the city squares in support, than burning them in protest.