" (Zulaika, 2003) Zulaika states that the: central economic ideology was utilitarian laissez-faire - industry should be self-regulated and government reduced to a minimum. The maximum good would come through the unregulated, self-aggrandizing effort of every individual. With the pecuniary reward the only measure of social value, and with profit the only controlling agent, gross social inequalities took root." (Zulaika,2003)

It is related by Zulaika, that these "techniques of agglomeration" stretched across all sectors of life at work including the English factor waterpower system to the steam engine of Watts and the transportation system of the railroad with Bilbao and other port cities playing a role that was crucial "in the transformations." (Zulaika, 2003) Bilbao became an extension of the economic system of the British with growing populations in the areas of mining as well as along the railroad lines, which were newly built. Growth and congestion was stimulated by the great industrial centers with the two primary elements of the "new urban complex" being the factory and the slum.

According to Zulaika, the nucleus of the "urban organism..." was the factory and everything else was subordinate. The factory laid claim to the sites that were best placed including Bilbao's left bank and waterfronts, rivers and canals were "offered up to industry which used them as convenient dumping grounds, turning many of them into open sewers." (Zulaika,2003) it is stated that anyone who dared to complain about the noise or the dirt was merely labeled as a pansies "and Bilbao became the quintessential 'tough city'." (Zulaika, 2003) Zulaika relates that the novel of Blasco Ibanez entitled:

El intruso" is reflective of the primary difficulties between the cultures that are traditional and those that are modernist as well as between religion and science and between nationalism and socialism in the first part of the twentieth century. In fact, these tensions are important to understand the changes in the traditional Basque society as they became faced with the "...working class culture, industrialization, capitalism and irreligiosity." (2003

VIII. RELIGION and the BASQUE CULTURE

Zulaika sates that Ibanez "portrays the pernicious effects of religion on Bilbao's life, exemplified by the intrusion of priests into the household of wealthy businessmen by playing on the spiritual cravings of their wives." (2003) the truth is that in view of the traditional work ethic of the Basque, "business and piety complement each other." (Zulaika, 2003) Many religious fraternities which are stated to date back "to the sixteenth century" stand as a monument to the 'religious conviction of Basque entrepreneurs." (Zulaika, 2003)

The business elite in Bilbao in the nineteenth century were also characterized by the selfsame combined piety and industriousness. This is evidenced by mines being named after saints and private chapels being situate in the homes of private businessmen. Moreover, the children of these individuals often became priests and nuns and Rafaela Ybarra, a nun from the Ybarra family, a very wealthy family "was beatified." (2003) Furthermore, often large merchants stated in their will that they desired to be buried "wearing the habit of religious orders." (Zulaika, 2003)

IX. CONSUMPTION PATTERNS and EXPENDITURES of the BASQUE

Zulaika states that in order to understand the cultural values of the Basque business elite one must view their consumption patterns. Specifically stated is that a study "of twenty-one cases shows that the spending on 'furniture, jewelry, and clothing' accounted for only 1.2% of their total expenditures. Bilbao business elites lived rather modestly compared with the rich Madrid financiers." (2003) There was only one theatre in Bilbao and the theater was considered by the church to be "morally ambiguous." (Zulaika, 2003)

Music however, was a passionate pastime of the middle class and still is sustained as a "vibrant musical tradition" in Bilbao. (Zulaika, 2003) Mansions began to be constructed by the elite in the 1880s and 1890s and organized sporting clubs and events began to be very popular. The work ethic at this time ' was complemented by family networks at home and abroad, by a cosmopolitanism which kept them abreast of new technologies, and by the education their sons abroad, all of which facilitated the importation of new ideas and skills." (Zulaika,2003) Characterizing Bilbao's elite in business were "hard work, personal merit, education, and a disposition to invest rather than consume..." (Zulaika, 2003)

X. SOCIAL REFORM in BILBAO

Zulaika states that while "one reaction to the grime and corruption of industrial Bilbao was nostalgia for the archaic 'purity' of former agrarian life" the reaction just opposite was "the futurism of social reformers inspire by the ideals of Enlightenment." While Christianity was sided against...

The very forces of ugly repression would turn into the forces of secular redemption." (Zulaika, 2003)
Bilbao was the location for Basque nationalism and the politics that went along with that nationalism which held the goals of "the preservation of the local pre-Indo-European language and culture. Basque traditional ethnographic culture was heavily racialized by European anthropology. The mystified role played by Basques in academic representations is that or an original enclave of non-Indo-European stock, not only in linguistic terms, but in racial ones as well." (Zulaika, 2003) it is unfortunate that Basque nationalism was so reliant on "such academic representations" according to Zulaika (2003)

XI. HEAVY INDUSTRIALIZATION CAUSES PROBLEMS in BILBAO

Douglass and Zulaika (2003) relate that by the time the century came to an end "the financial institutions had moved to the Ensanche, the control center" of the economy of Bilbao and it was believed that the city must be expanded even more than previously. In the beginning of the planning it was conceived that 70,000 residents would be planned for however by 1924 there were more than 140,000, more than double what had been anticipated. Resulting was a problem with housing and this problem was one in which "could not be resolved within the restricted quarters of the original enlargement." (Zulaika, 2003)

Between the years of 1950 and 1975 the population in Bilbao "increased by 1,112,000 bringing the total population to 2,556,000." (Zulaika, 2003) Zulaika relates that this economic model, one that was heavily industrialized was unable to be maintained and added to this was the severe affects to the economy of the Basques of the economic crisis that was international in nature in the latter part of the 1970s. The small size of the economy and little diversification in the heavy industrialization resulted in the Basque economy being "highly dependent on external factors." (Zulaika, 2003)

Structural changes are noted by Zulaika to have occurred in that "the industry sector shrank from 47.9% of the Basque economy in 1972 to 41.8% in 1985. At the same time the sector grew from 43.1% in 1972 to 50.3% in 1985. Finally, after 1981, investments improved due to the improved international situation, a better benefit ratio for enterprises, the recovery of the NEP, the lowering of interest rates, the consolidation of democracy, public financing of horizontal investment, sectorial plans for reconversion, and Spain's entrance into the EEC." (Zulaika, 2003)

The following chart lists the comparative percentage participation of the first six sector of the industrial development in Spain and the Basque country as stated in the work of Zuliaka (2003).

Comparative percentage participation of the first six sector of the industrial development in Spain and the Basque country

Basque Country

Spain

1982-1986

1981-1985

Steel and Iron 28.7

Food, Drink and Tobacco 9.5

Tools and metallurgic products 8.7

Paper 5.7

Electronic materials 5.6

Automobiles 4.1

Construction excluded

Source: Zulaika (2003)

The primary indicator of the severe nature of the economic crisis is stated to have been that of unemployment and especially among women and youth as 194,000 positions of employment were lost in the Basque economy between 1973 and 1985. During the 1960s the population was in excess of 900,000 and the unemployment rate was at 23.1% while Spain was at 21.5% and other European countries was at a mere comparative ten percent. In Bilbao, unemployment was in excess of 20% during the 1990s. The birthrate and resulting population rate in Bilbao experienced a drastic decrease in the latter part of the 1970s and this was added to a "negative migration." (Zulaika,2003)

It became readily apparent by the middle of the decade of the 1980s that "there was a clear exhaustion of the previous model of development imposed by Bilbao's industrial history. Structural changes were necessary to insulate the Basque economy from international crises." (2003) While a dominant role was still played by industry and added to this were new investments that were inefficient and "returned to low profits in the face of great technological changes." (Zulaika, 2003) at this time Bilbao's economy was characterized by "little research and technological innovation and high rates of unemployment." (Zulaika, 2003)

XII. An ECONOMIC RECOVERY 'OF SORTS'

Following 1985 an economic recovery followed although Zulaika states it was not "a very harmonious one" as the…