"You have to know how to win and lose a parliamentary motion," Mr Gonzalez told reporters after parliament rejected the minority Socialist government's budget by 183 votes to 158 with one abstention in the 350-seat lower house. Only the Socialists voted in favour.
Responding to his first parliamentary defeat since he took office 13 years ago, the Prime Minister indicated his government would continue trying to pass legislation and remain in office through Spain's presidency of the European Union which ends on 31 December. "I think there is a majority to pass pending legislation," he said after his former allies of the Catalan nationalist coalition joined the conservative Popular Party (PP) to defeat the budget.
The vote was an indication of just how far Mr Gonzalez's star has fallen since the Socialists swept into office in 1982 with more than 40 per cent of the vote. Opinion polls indicate that a wave of scandals has made deep inroads in his credibility and that the PP would win if elections were held now.
Opposition parties had announced they would reject the budget as a symbolic vote of no confidence in order to force Mr Gonzalez to dissolve parliament and call immediate early elections.
"This is not the time for working on and debating budget proposals, but rather for clarifying electoral [issues]," said Joaquim Molins, spokesman for the Catalan Convergence and Union coalition which had backed the Socialists' minority government from June 1993 until September. But Mr Gonzalez, who has insisted since last July he would call not call elections until next March, a year ahead of schedule, reiterated that he would stick to that timetable.
The PP leader, Jose Maria Aznar, said that the government's credibility has been thrown into question by the budget defeat. But the Finance Minister, Pedro Solbes, countered that the opposition ought to call for a vote of no confidence rather than subject the nation's economy to "unnecessary uncertainty".
Mr Solbes said that if the budget were defeated, the 1995 budget would automatically be extended to next year.
Parliament and the Spanish media have spent most of their time since last spring focused on scandals involving Socialist Party officials and appointees.
A former interior minister and 13 former law officials have been implicated through judicial investigations in the GAL (Armed Liberation Group) death squads case. The GAL killed 29 people in southern France between 1983 and 1987 in a campaign against the Basque separatist group ETA.
Other scandals have involved a former Socialist Party finance chief charged with illegal campaign financing, a former Civil Guard general accused of amassing a fortune through embezzlement, and a former Bank of Spain governor charged with insider trading.