History being repeated
I have thoroughly read all comments made herein by you Spaniards. I am Greek but I believe in the concept of United Europe (with common Constitution, common Defense and common Foreign Service) and as such I see all Europeans as my fellow citizens and compatriots, if you will. However, you all Spaniards, are the only authority to determine the future and polity (political system) within your beautiful State, Spain, which has suffered a lot in the past - no other European country (excluding those under communist regime) has had such a long period of fascism (39 years of Franco as opposed to 36 years of Salazar in neighboring Portugal).
I am going to express some thoughts here, because I feel that history is repeating itself, like replicating DNA, so to speak. In Greece, we had a civil war immediately after WWII and, amidst this war, King George II returned to the country following a rigged plebiscite. However, the people tolerated the fraudulent result, because they feared Communism. Twenty eight years later, in 1974, an impeccably conducted referendum yielded 69% of the popular vote for the Republic, and 31% for the Monarchy. The king was young, had made a lot of mistakes, and his mother before him, but the reason behind the result was that the monarchy had fulfilled its purpose and it was high time for what Greece is all about, Pericles's Republic. Even if Greece had enjoyed the best monarch, say, one like QEII, the result could have differed quantitatively but the majority would still have been in favor of the Republic.
Your country passed overnight from institutionalized terror to democracy in a remarkable fashion such that the whole World has expressed veneration for King Juan Carlos de Borbon y Borbon e y Battenberg. In addition, you were lucky to have as queen consort a genuinely kind, perceptive and sensible person who had learnt a lot through the mistakes and vicissitudes of her own family. Let face it guys, it can't get any better than Sofia. She is a veritable sofia (=wisdom in Greek). However, it seems that the monarchy has now fulfilled its role and the "circle" is getting closer to being completed. Spain is no more at risk of becoming unstable or a dictatorship again (particularly in light of its membership to the EU). Thus, the issue, here, is no more whether a transition to Republic will ever happen but when.
What a participant, I believe crisinaki, said about the illegitimacy of transition, from fascism to democracy, is true. Even though it proved to be a wise move, it was Franco's decision, not the people's, to switch back to monarchy. Sooner or later, therefore, the question royale will come up and a referendum shall be in order and, like crisinaki put it superbly, Vox Populi, Vox Dei. Technically speaking, legitimacy cannot and will not be fully restored except via a referendum.
All the things you are quoting, such as the finances of the Palace, the yachts, the villas, the gossip are not causations but can act as precipitators/accelerators or, a good performance by Felipe, as a decelerating factor toward the inevitable. Some psychology scholars and public relations specialists have argued that a negative role here is that played by the Letizia factor, referring not to the specific individual, but the commoner. Why is that?
You folks, like us, Hellenes, and the Italians are headstrong Mediterranean people and find it difficult to reconcile yourselves with the somewhat absurd idea of birth rights let alone the concept of hereditary heads of state. The wedding of the Prince of the Asturias to a commoner has intensified this perception, because it is twice as absurd (and, not least, unfair) to envision "one like us" becoming a member of a clan with hereditary rights.
Moreover, I submit to you, familiarity and demystification are capable of prompting contempt and an implosion of the fantasy world - and royalty is about fantasy, pomp, circumstance and, above all, mystique.
A few decades back, QEII made a documentary portraying her daily life to which the wise Queen Mother was strongly opposed, arguing that showing to the world that a monarch's life is as mundane as theirs, the mystique, which stimulates and sustains the people's awe, fades away, and that can be fatal! And there is no surprise that, as the World Press indicated at the time, Queen Sofia was opposed to this marriage - and I believe it was not so much because Miss Ortiz was divorced but, more so, that she was a commoner and one from within the nation. Indeed, the familiarity factor ("one of us") brought contempt and the mystique surrounding the Bourbons was gone overnight!
For the time being, it would be most wise on the part of the good King to request the government and parliament to repeal all laws permitting prosecution of people criticizing the royal family (no matter how unfairly or rudely), to establish full transparency of their finances and to have the Prince of the Asturias roll up his sleeves and get down to business on an, at least, 8-hour-per-day basis - big privileges beget big duties.
However, I feel strenuously that, regardless of their continued good and genuine efforts, King Juan Carlos is likely to be the last king of Spain.