Rajoy must go if Spain is to confront the threats it faces Solving the political problems is impossible while the prime minister remains, says Luis Garicano Mariano Rajoy, Spain's prime minister A stable two-party political system has been among Spain's greatest strengths in the post-Franco era. But since 2008 the brutal economic crisis - together with growing evidence that large sections of both parties have operated as engines of patronage, graft and influence peddling - has undermined the legitimacy of the system and allowed two existential threats to the constitutional order to flourish. The first, in Catalonia, seeks to fragment the existing state. The second seeks to turn the entire country away from its post-1975 shift to modernity and towards a "national-populist" system similar to that of Venezuela and other Latin American countries. The conflict over Catalonia's self-determination is fuelled by the belief among many Catalans that the northeastern region pays a disproportionately large share of Spain's bills, along with a perception that the central government is trying to curtail Catalan autonomy on language and education. Moreover, in the current depressed climate it is easy for Catalan nationalists to cultivate the perception that - although corruption, high public and private debt and unemployment are as endemic as in the rest of Spain - Catalonia can do better on its own. Intelligently, rather than agitating for independence (historically never desired by a majority), nationalists have rallied a large majority of the population around a "right to choose" that is incompatible with the current constitution. Even Catalans who would rather see Catalonia continue to be part of Spain demand the right to vote on their own destiny. The conflict comes to a head this Sunday in a pseudo-referendum on independence that was ruled illegal by the constitutional court in Madrid on Tuesday. The confrontation is growing increasingly dangerous as it is plagued by mutual misunderstandings about beliefs, bargaining power and threats. Radical Catalan nationalists believe pressure from the debt markets and global public opinion will make Madrid yield. They ignore the fact that for many in Spain the integrity of the constitution and of the country is an existential (not an economic) question. Rather than a negotiated settlement, the Spanish government is relying on two things. The first is perceived contradictions be­tween moderate and more radical Catalan separatists. The second is the rule of law according to the constitution. To make things worse, the economic crisis and the political scandals mean leaders on both sides are too weak to negotiate. Regardless of the outcome of the referendum clash, the war of attrition will continue beyond November 9. As in the global war of attrition that began 100 years ago, the first world war, each side thinks optimistically that the only possible outcome is victory for its cause. And, as in the Great War, the only outcome outsiders can envision is one where both players lose heavily. Wars of attrition are long and costly, not for psychological reasons alone (both players hate to lose face) but also because at each step the costs incurred are irrecoverable and the incremental cost of holding out for a bit longer are relatively small. The spirit of disgust with the current system that fuels the Catalan independence movement is also inflicting a shock on the political system nationwide. Podemos, a party created by a few professors only nine months ago, is now the most popular grouping in the country, the choice of fed-up Spaniards across the entire spectrum wishing to punish corrupt politicians. Sadly for the nation, Podemos is not a reformist group nor a disorganised, festive, progressive collective in the image of Italy's Five Star Movement, but a revolutionary party, tightly led by a compact cadre of tough, smart, pragmatic intellectuals in the best (or worst) Leninist tradition, hardened through their work as advisers to Hugo Chávez, Evo Morales and other Latin American socialists. Since Prime Minister Mariano Rajoy was directly responsible for every appointment in the highly centralised Popular party, dealing with Spain's twin political challenges is impossible while he remains in place. Soraya Sáenz de Santamaría, his deputy prime minister, is professional, well regarded and appears untainted by corruption. With her in charge of the party and the government, a reform of the Spanish constitution and judiciary process can be agreed by the main parties with the aim of tackling corruption, introducing much-needed accountability and openness into the patronage-based party system and transforming Spain into a multinational state with increasing recognition for Catalan (and Basque) identity. It is Mr Rajoy's duty to fall on his sword to allow Spain to defuse these existential challenges. The writer is professor of economics and strategy at LSE and author of "El Dilema de España"