The Confebask business association in northern Spain reported that it received a letter from the armed Basque separatist group ETA, announcing the cancellation of “the revolutionary tax” that it has charged businesses over the last 40 years.

Confebask groups 13,000 companies in the three Basque country provinces: Álava, Biscay, and Gipuzkoa.

A few hours earlier, the business associations in the neighbouring northern Spanish community of Navarra, who have suffered the same extortion, stated in a press conference that they had received similar letters, stamped in France, in which ETA (Euskadi ta Askatasuna, or “Basque Fatherland and Freedom” in the Basque language), explained that the end to the “tax” formed part of the unilateral ceasefire it had declared in January.

The ceasefire and the condemnation of violence by the Batasuna party, the political wing of ETA, and other Basque nationalist organisations like Bildu and Sortu, which are seeking legal status in order to field candidates in the next elections, are generating hopes of peace throughout Spain.

Nevertheless, scepticism prevails in broad segments of the population and in most political parties, which remember all too well how the last ceasefire – of a total of 11 declared by ETA since 1981 – ended in 2006.

On Dec. 30, 2006, after nine months of talks with the government of socialist Prime Minister José Luis Rodríguez Zapatero, ETA set off an explosion that demolished the five floors of the car park in the Madrid airport, killed two Ecuadorian workers – Carlos Alonso Palate and Diego Armando Estacio – and injured 30 people.

The attack put an end to ETA’s ceasefire and to the prospect of talks that did not set a requisite for the complete dismantling of the group and the laying down of its weapons.

Earlier talks with ETA carried out by each democratic government in power since dictator Francisco Franco’s death put an end to his 36-year regime also ended in violence.

But this is the first time that the terrorist group has included in its ceasefire an end to the extortion of businesses in the autonomous communities of Basque country and Navarra. The payments were collected, from France, through a sophisticated network of intermediaries and dummy companies in tax havens, by means of threats of violent attacks against the business owners’ property or death threats against them and their families.

After ETA carried out its first attack in June 1960 – a bomb in the San Sebastián railway station that killed 22-month-old Begoña Urroz – it tried to finance its terrorist activities by means of bank robberies.

But the robberies posed risks and led to arrests. Ten years later it abandoned that tactic, and set up a broad network of extortion of large, medium and even small companies, while carrying out numerous kidnappings, some of which ended in the victim’s death.

In December 1970, West German consul Eugen Beihl became the group’s first kidnap victim. He was followed by a list of 76 prominent victims who brought the group millions of dollars in ransom. They included businessman Emiliano Revilla, who was held captive for 249 days, and Julio Iglesias Puga, the father of singer Julio Iglesias, who was found alive after two weeks.

The government of the autonomous Basque community, which is governed by Prime Minister Zapatero’s Socialist Party (PSOE) with the parliamentary support of the centre-right People’s Party (PP), said the letters were a good sign, although it called on ETA to announce once and for all that it was disbanding.

It also urged people to “keep their guard up” – interpreted as advice for the hundreds of politicians, businesspersons and public figures who are protected round the clock by bodyguards in the Basque country, some of whom had announced their intention to ease their vigilance in the new climate created by the ceasefire.

Less optimistic, PP spokesman in the Basque country Leopoldo Barrera said “the only meaningful development would be the definitive disappearance of ETA.”

Navarra governor Miguel Sanz, the leader of the Union of Navarra People, told IPS that the ETA communiqué was “good news,” but said it should be taken with a grain of salt “and in the broader context.”

The context he was referring to is the weak state of the terrorist group and the aim of its political arms – Batasuna, Sortu and Bildu – to take part in the May 22 municipal elections.

Observers familiar with the modus operandi of ETA and its Basque nationalist political allies say it is no coincidence that the ceasefire and cancellation of the “revolutionary tax” have coincided with the armed group’s moment of greatest weakness and discredit.

Never in its 50 years of history has ETA been as hemmed-in as it now. More than 600 of its leaders and militants are in prison, its attempts to reorganise in Spain, France and Portugal have been thwarted, many of its safe houses and arms caches have been discovered, and more and more business owners had been refusing to give in to extortion.

The mayor of Madrid, Alberto Ruiz-Gallardón, has called for a law for compulsory removals of homeless people off the streets, but this has met with resistance from civil society organisations and has split Ruiz-Gallardo’s own People’s Party (PP).

Ruiz-Gallardón wants the centre-right PP, the main opposition party in Spain, to include in its platform for next year’s general elections a bill to authorise the expulsion of homeless people sleeping in public spaces in the country’s big cities, against their will if necessary.

News of the proposal triggered controversy across Spain, where protests were mounted by political and social groups and human rights organisations.

Even the president (governor) of the autonomous community (province) of Madrid, Esperanza Aguirre, also of the PP, said she was against “prohibitions of any kind” and “depriving anyone of his or her rights.”

Aguirre spoke up at a meeting on citizen security attended by the mayor, which was held at the headquarters of the Madrid municipal police, where criticism of the mayor’s proposition was also voiced by homeless people and by representatives of practically all the political parties in the parliamentary spectrum.

A vigorously-worded communiqué from the Federation of Entities Supporting Homeless People (FEPSH) expressed “alarm” at the initiative, and accused the mayor of “worrying ignorance” when he stated that “anyone sleeping on the streets of Madrid does so voluntarily and not out of necessity.”

The communiqué goes on to say that the initiative is an “attempt to make poverty invisible,” rather than to seek ways of integrating homeless people into society.

Elena Valenciano, a member of the leadership of the governing Spanish Socialist Workers Party (PSOE) and spokeswoman for its Electoral Committee, told IPS that Ruiz-Gallardón’s aims “are profoundly xenophobic” and remind her of “the law on Vagrants and Criminals used by the Francisco Franco dictatorship (1939-1975), which fortunately was repealed after democracy was restored.”

For his part, Jaime Lissavetzky, a socialist candidate for the Madrid city government in the local elections in May, told the El País newspaper that the proposal has a “whiff” of the Franco regime about it.

“It’s unacceptable to call for the reinstatement of a law to ‘clean up’ Madrid that would force homeless people off public thoroughfares, while cynically saying that the city government has the social resources to look after them,” he said.

Similar criticisms were levelled at Ruiz-Gallardón by Ángel Pérez, a candidate for the Madrid city government for Izquierda Unida (United Left), a coalition of communists, “greens” and other progressive groups. He said “the mayor sees social problems as aesthetic ones, and wants them to disappear: he apparently believes that if they are out of sight, they cease to exist.”

IPS sought the view of the regional president of the Madrid Neighbours’ Associations, who held the same opinion. “The problem of homeless people is not a question of urban landscaping, but of poverty,” he said.

José Diéguez, an Ecuadorian immigrant who became jobless and homeless two years ago because of the economic crisis and sleeps on cardboard in the central Plaza Mayor, told IPS “although it’s true that, as the mayor says, there are hostels and homeless shelters, there aren’t enough of them: they are always full, and there are waiting lists of weeks or even months for a place.”

The controversy about the homeless has been taken to heart by public opinion in Spain, and judging by the torrent of protests to be seen in online newspapers, blogs and web sites, the general feeling is against Ruiz-Gallardón’s idea.

Everyone on both sides of the argument is aware that the vast majority of the people sleeping rough and enduring the cold at nights are unemployed and homeless as a result of the prolonged global economic crisis. They are immigrants from Latin America, Africa and Eastern Europe, as well as large numbers of Spaniards.

But they are also aware that the proposal is not a new one, as in 2006 Pedro Calvo, a Madrid city councillor for Security, put forward an amendment to the law on State Security Corps and Forces that would allow the police to remove beggars, prostitutes and drug addicts to shelters and hostels, even against their will.

“Ruiz-Gallardón’s proposed law is fairly similar to Calvo’s bill,” Diéguez said. “They want to lump us all together in the same basket, but almost all the homeless people I know are working people who lost their jobs.”