Spain's crisis fuels Catalan independence fervour
* Bolder, bigger march on Catalan independence day
* Anger of austerity is focused on the central government
* Catalan leader calls for more tax autonomy
By Andrés González
BARCELONA, Spain, Sept 11 (Reuters) - Catalan National Day is bigger and bolder this year, reflecting the severity of the worst economic crisis of the post-Franco era that has fuelled separatism and highlighted fractures between Spain's wealthy northeast and the central government in Madrid.
With recession biting and unemployment gripping their region, Catalans complain bitterly that they are paying more in taxes than they receive back from Madrid and are demanding more control over their financial affairs.
"Catalonia produces sufficient resources to live better than we live," said Catalan President Artur Mas, who has promoted a powerful autonomy message for this year's celebration.
National Day, or Diada, in fact, marks the defeat of Catalan forces on September 11, 1714, at the hands of Philip V of Spain after a 13-month siege of Barcelona.
Commemorated with a fiesta in the Catalan capital with song, dance and a floral offering to Rafael Casanova, a hero of the siege, this year's marches also plan to deliver a powerful message in a white-hot row stoked by the issue of taxation.
"There is no more urgent battle or challenge than fiscal sovereignty, and now more than ever," Mas, of the nationalist Convergence and Union Party (CiU), said on the eve of the celebration.
Tens of thousands of people waving red and yellow striped Catalan flags, said to be one of the oldest flags still in use in Europe, gathered at midday on Tuesday in the Ciudadela Park in Barcelona for a noisy tribute to Catalan culture.
Later, demonstrators from across the region, some urging full independence, others calling for more autonomy from Madrid, will march under the slogan "Catalonia, a new European state."
When Spain returned to democracy in the mid-1970s, regions such as Catalonia and the Basque Country saw a vibrant resurgence of their culture and languages that had been crushed during the dictatorship of Francisco Franco.
Catalonia - home to 15 percent of Spaniards and with 20 percent of the country's economic output - has long fought for more autonomy from Madrid, although it never had a violent separatist movement like the Basque Country's ETA.
A poll by the regional government in July showed for the first time that more than half of Catalonia's population favours independence.
A BROKEN MARRIAGE
With an economy nearly as large as Portugal's, Catalans feel they are bearing more than their fair share of Spain's crisis.
Economists calculate that Catalans pay 12 billion euros more in taxes per year to Madrid than they receive back for services like schools and hospitals. Many Catalans say the figure - difficult to calculate because of a complex system of transfers - is even higher, up to 16 billion.
"It's like a marriage you can't put up with any more," said Jauma Turra, a government worker who said his friends from outside the region who now live in Catalonia are increasingly sympathetic toward autonomy as the downturn drags on.
"A lot of people who were not into independence are more and more into it now," said Elvira Farre, a retired secretary from Barcelona. "They are being driven into it by their feelings but also by their wallets."
The Madrid government took a dim view of what they saw as Mas's stirring up Catalans ahead of the march.
"Catalonia has serious deficit and employment problems and this is not the moment for messing around or disputes or controversy," Prime Minister Mariano Rajoy of the conservative People's Party said on Monday.
Many Catalans are suspicious of what they see as the centralising aims of the People's Party. Devolution has long been a central pillar of Spain's post-Franco democracy.
Although Catalonia's unemployment is somewhat lower than Spain's as a whole - 22 percent instead of more than 24 percent - the region has suffered badly due to the Spanish debt crisis.
There are 700,000 jobless in Catalonia and the government cannot pay its bills because, like other Spanish regions, its debt was downgraded to junk status and it cannot issue bonds to borrow money on international markets.
Catalonia was among the first of Spain's 17 autonomous regions to start making budget cuts to its public services in 2010 and cuts have grown deeper, with civil servant pay cuts causing a public backlash in recent months.
Despite his austerity drive, Mas has managed to deflect fury over his region's economic problems onto the central government, saying if the tax system were set up differently Catalonia would not be in its present fiscal quagmire.
"It's part of a political game that has been going on for years. The only difference is that the crisis has changed the stakes," said Antonio Barroso, political analyst with Eurasia Group consulting firm.
Catalans were particularly galled when the central government raised the value-added tax across Spain from Sept 1, but said it would not pass the extra revenue to the regions.
"The feeling in the street is of brutal discrimination. People have had it up to here with this unbelievable treatment," said Ramon Tremosa, a European Parliament member from the CiU.
Catalonia has already had to tap billions of euros in emergency central government funds this year to catch up on months of back payments to service providers. Mas says he now needs another 5.7 billion euros to pay maturing debt.
He argues that the only way out of the mess is for Catalonia to oversee its own taxes, and create its own tax authority, proposals he has outlined in a "fiscal pact".
Mas and Rajoy are scheduled to meet on September 20 to discuss the fiscal pact, but Rajoy is not expected to accept it.
"The economic situation has triggered a rise in nationalism ... but pretty much nobody in Spain or in Catalonia, believes that there is even a slight chance of the fiscal pact happening," said Carlos Barrera, director of the masters' programme in political communication at Navarra University.
If he meets the expected resistance from Rajoy on the fiscal pact, Mas is expected to call early elections to try to win an absolute majority in the regional parliament, where he currently governs through alliances with other parties.
He could use such wider backing to press Madrid for more autonomy, though on the national stage his CiU party has limited weight since Rajoy has control of parliament.
Meanwhile, on Tuesday, separatists dream of fulfilling the opening lines from the Catalan anthem:
Will once again be rich and full!"
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