Sunday 30 November 2014

Look where nationalism leads

Nationalist arguments are frequently made on the basis that a relatively rich part of a nation state should be able to secede so as to become richer by not having to subsidise the poorer parts. This is the foundation for the independence movements in Northern Italy, Catalonia, Flanders and Scotland. In the seventies Scottish nationalism gained support on the basis that the newly discovered oil wealth, if not shared with the whole of the UK, would make Scotland much richer. A similar point is made by wealthy Catalonia about sharing with the poorer parts of Spain, though this wealth is not the result of a discovery of a resource. More or less, the same argument is made by the other European secession movements.  One of the odd things, however, is that these arguments are often framed in terms of fairness, while a similar, at least theoretically possible form of secession would be considered to be grossly unfair. There is a contradiction at the heart of nationalism that can be illustrated in the following way.

Imagine I’m a merchant banker. I earn a huge amount of money, far too large for me to own up to. I have private health insurance. I went to a private school. My parents paid for me to go to university. I’ve never received any social security benefits of any kind. How much tax do I pay all together? The average amount of tax paid by everyone is closely related to the percentage of GDP that is taken up by state spending. Apart from borrowing, governments get their money from us. For average earners this amounts to us paying somewhere between 40% and 50% on tax.  When you add up income tax, national insurance, VAT, council tax and all the other ways that are found to tax us, it’s easy to see how taken together even average earners pay the government about half of everything we earn. But because I’m a wealthy merchant banker, I pay much more than that. Someone has to make up for all the non-tax payers.  Let’s say I pay 70% of everything I earn in tax. It could be more, it could be less. The argument does not dependent on the figures. What do I receive in return? Almost nothing. I live in the countryside where there aren’t even any street lights. My bins are collected once a week. There is a police force and there are armed forces. However, the vast majority of the tax I pay goes either to other people or for things I either don’t need or don’t want. This situation is universally described as fair.

Contrast this situation with the following scenario. Imagine I’m someone who has throughout my life used the National Health Service. I have also benefited from a state education. I live in a big city and so benefit from all of the things that the council provides for me. But I’ve never worked. Under these circumstances I receive everything from the state, but contribute nothing. Even the VAT I pay on the things that I buy is just a way for the state to recycle money. It pays me benefits and I pay some of it back. This situation is universally described as unfair. The solution to the unfairness that nationalists, in particular, advocate and the reason they support independence is that the person who receives everything and contributes nothing should receive more, while the person who pays everything and receives nothing should pay still more, indeed much more. This amounts to someone who is complexly dependent on the state wanting independence in order to receive more money for being dependent. 

Why should the merchant banker pay such high rates of tax? One reason is that both he and the unemployed person benefit from living in a cohesive society. The condition for the possibility of the banker earning such vast sums of money is that he lives in a liberal democracy. What use would his money be if society broke down and the poorest simply chose to revolt and seize wealth? It is in the interests of everyone that poverty is alleviated. It makes life more pleasant not only for the poor, but also for the rich. This is the social contract that unites a country. The benefit that the merchant banker receives is living in a country like Britain which has an economy and an infrastructure which enables him to earn a lot of money. The cost of that is that he pays a lot of tax in order to help provide services and benefits to those who otherwise could not afford them.

But the deal cuts both ways. There is a point at which the rich will always think they are being taken for mugs. Most will be more or less willing to pay even as much as 70% of their income in tax for the privilege of living in Britain, but they won’t accept paying 90% of their income in tax. Under these circumstances they vote with their feet. They secede. An extreme example of this is imagined in the novel ‘Atlas Shrugged’What would happen if all the inventors and wealth creators found a secret place where they could all live? What would happen if the wealthy chose to secede? This seems far-fetched and even impossible. But there is a modern example. In response to Fran├žois Hollande increasing the tax rate for wealthy people to 75%, they simply voted with their feet and moved to London. This benefited London massively, but hugely damaged France. In the modern world the wealthiest people are the most mobile. A merchant banker can move to Singapore, a businessman can relocate. We no longer have capital controls. They can take their wealth with them. There is no way to stop them in a globalised world.

The social contract that keeps Britain together and prevents people voting with their feet is the same contract that keeps us together as a single country. Countries are fundamentally arbitrary. A different set of historical circumstances could have led to a different way of dividing up the map of Europe. Nevertheless, countries are vital for the social contract that means everyone is willing to contribute to the welfare of other people and the welfare of the whole. Through having a shared history we develop the idea that we have an obligation to the state. Why risk my life for my country if I lack this obligation? Soldiers in two World Wars were willing to die for Britain for exactly the same reason that the merchant banker is willing to give most of his money to the poor. Just as I have an obligation to the state, so I have an obligation to other people in the state. This obligation is greater than it is to people living in other countries precisely because my fellow citizens are from my country. If this is not the case, why can I not claim benefits from Norway when I have no connection with that country?

Scottish nationalists break the social contract within the UK. They are saying that I have no more obligation to share my wealth with people from Wales, England and Northern Ireland, than I do with people from Germany. It is for this reason that they fundamentally treat the people from the other parts of the UK as foreigners. But if I have no obligation to the other people of the UK, why should I have an obligation to other Scots?  By breaking the historical UK social contract, which amounts to our obligation to the state in both peace and war, our obligation to share both our lives and our money, the nationalists also undermine the social contract that makes Scotland cohesive. This can be illustrated by the example of another secession movement.

If it is morally justified for rich Catalonia to secede from poorer Spain, then it is obviously equally morally justified for rich Catalans to secede from poor Catalans.  The same is true of Scotland. It is for this reason above all that so many Scots were planning to vote with their feet if there had been a Yes vote.

The social contract whereby the rich subsidise the poor is the same social contract whereby the rich parts of a nation state subsidise the poorer parts. Morally the attempt to avoid this subsidy is the same as the rich man’s attempt to avoid his obligation. Nationalism amounts to tax evasion.

The UK is a country like every other country that arose by accident, but we have a duty to each other because of our shared history, fundamentally because all fought for all. It is the duty shown by our ancestors that created the obligation that we owe to each other now. The poor fought just as much as the rich. It is a betrayal of their sacrifice to refuse to share the wealth that you earn in exactly the same way as it is a betrayal to try to break up your country.

There is a limit to secession. Just as it is wrong for a rich man to say I have no duty to the poor, so it is wrong for a Scot to say I have no duty to my fellow British citizen. Each action breaks the social contract of our country and leads to fragmentation. Morality depends on acting selflessly. If Catalans can be selfish in relation to Spain, why can they not be selfish in relation to each other? It is the unselfish duty to my country that forms the basis of my unselfish duty to everyone living in my country. If you destroy the one, you destroy the other. Scottish nationalism is morally self-defeating. If it were moral for Scotland to secede from the UK, it would be equally moral for rich Scots to vote with their feet and secede from poor Scots.  The morality of selfishness leads to Atlas shrugging and the rich doing all they can to avoid their duty to everyone else, the poor doing all they can to force them to share. Instead of a social contract of consent and some sort of harmony in a nation state, we have what amounts to low level permanent revolution.

Scotland has become fragmented precisely because the nationalists have broken our social contract. Why should I have an obligation to someone who wants to break up my country? On the other hand, why should a nationalist have an obligation to someone like me who prevented his dearest wish for Scottish independence? The word “Scottish” describes different places for us both and we have become foreigners to each other. Independence becomes a prize that is not worth having as there is no longer even a united Scotland to become independent. There is my Scotland and there is your Scotland. They are both here, but they are separated by a gap that we cannot cross. This is why Scotland has never been more divided both in terms of our relationships within and in terms of our relationship with the other parts of the UK. The tragedy is that once you break the social contract that keeps society together, it’s very difficult to put it together again. As I always say, look where nationalism leads.

If you like my writing please follow the link to my book Scarlet on the Horizon. The first five chapters can be read as a preview.