I have long held the view that Better Together ran a
terrible negative campaign that nearly cost us the referendum in 2014. For this
reason my response to the SNP’s latest attempt to encourage more Scots to
support independence is not going to be to explain why Scottish independence is
impossible. I think everyone in Scotland should accept that Scotland could be a
perfectly prosperous independent country. The issue is not and never has been
could we? Rather it is should we?
There are any number of places which have become
independent in recent years with various degrees of success. Since the fall of
the Soviet Union many new countries have emerged in Eastern Europe helped also
by the break-up of Yugoslavia. Most of
these countries have either their own currency or else they use the Euro. If
these places can become independent and have their own currency then plainly
Scotland could do so also. We are very much wealthier than, for example,
Moldova.
In my view independent countries ought to have their
own currency. The pain of the economic crisis in 2008 was greatly reduced for
both the UK and Iceland because we each had our own currency. The UK avoided
some of the difficulties which were faced by countries like Greece, Italy and
Spain, because we had our own Central Bank and because we were able
to devalue our currency.
The SNP plan as far as I understand is to continue
using the UK Pound unofficially after independence for a good number of years
and then if conditions should allow to move towards creating a Scottish
currency.
Again this would, no doubt, be possible. I think Pro
UK people should be careful not to exaggerate the costs of doing so. Iceland's population is not much more than Aberdeen's, but it managed to set up its own
currency. Lots of countries have done so. It can’t be that hard.
But the SNP’s plans with regard to currency would rule out Scotland joining the EU in the near future. A condition for
EU membership is that a country promises to join the Euro, but this requires
that it has its own currency and Central Bank. An independent Scotland initially would
have neither.
If Scotland did eventually set up its own currency
there would, of course, be downsides. There would be a cost depending on whether
the currency was free-floating or pegged against either the UK Pound. Free-floating would be cheaper and in some circumstances better
economically, but it would have an effect on our trade with our nearest
neighbour.
The vast majority of Scottish trade is with the
other parts of the UK. Having a different currency to your greatest trading
partner can hardly be described as an advantage. Likewise ceasing to be a part
of the UK’s Single Market which would be an inevitable consequence of Scottish
independence would have an economic downside that the SNP never appear to take
into account.
It is easy to point to small countries that are
doing rather better than Britain. Some of these countries are wealthier than us
because they have small populations controlling large natural resources. Others are
wealthier because their Governments have policies which are more effective
economically than ours. Still others have workers who are more productive than
ours.
There isn’t a magic formula that brings prosperity, but I tend to think that free markets, low regulation, low tax economies will more likely than not bring
wealth to their people. If an independent Scotland were to follow the policies
of Singapore, there is little doubt that in time we would reach Singapore’s
level of per capita GDP. But the same could equally well be said of the UK.
Those same Singapore policies might well increase the wealth of pretty much every country. But that doesn't mean it is straightforward to follow these policies. If creating wealth were simply a matter of imitation and imitation was as easy as the SNP thinks, then why isn't every country as wealthy as Singapore?
What really is the point of saying if only Scotland
were more like Denmark, for then we’d be as rich as the Danes. It’s like saying
if only we were as hard working and efficient as the Germans, we’d all get to
drive in a Mercedes.
It isn’t easy for a country to change the fundamentals
of its economy. These fundamentals are a function of its historical development.
You cannot suddenly live like a Dane, work like a Dane and take on aspects of
the Danish economy as if it were a matter of putting on a hat with Viking horns
on it.
The Scandinavians, for the most part, make a success
out of high taxes and high public spending, but in my experience and I once
lived in Denmark and spoke the language fluently, they have a different
mentality to ours. That mentality took centuries to develop.
I think high taxes and high public spending would
make an independent Scotland poorer than we are now. Many countries have tried
social democracy/socialism and few have ended up like Denmark. The Danes are hardworking,
innovative and good at business despite their high taxes. But it is Danish
businesses and the work that ordinary Danes do that has made them wealthy, not
their Governments. Above all the Danes are conformists. They follow rules and for
the most part they are happy to work hard even if they could do nothing on benefits
instead. They don’t generally take the Mickey out of their welfare state’s
generosity. That is why their system works well enough for them, but would not
necessarily work well for us. They are taught from age 0 to be good little Danes and they want to be that. Scots have nothing at all in common with this mentality and nothing much in common with Scandinavia. The places we have most in common with speak English. Funny that.
While the Scandinavians have achieved success
with high taxes and high public spending, most small countries reach prosperity by
cutting bureaucracy, public spending and taxes. An independent Scotland could
do the same, but once more so could the UK.
There is something foolish about pointing to other
countries and saying we could be like that. Of course, anyone could. But it
doesn’t mean that it would be easy or indeed that it would happen at all.
Large countries like the United States are more
prosperous than present day Scotland. If we followed similar policies to the US we would
no doubt improve our prosperity. But then again Shetland could be more
prosperous than Scotland if it emulated the Faroe Islands and had exclusive
access to the marine resources around it. If Scotland could be like Denmark,
then Shetland could be like the Faroes. The argument is the same.
But the point to realise is that none of these
possible models for future prosperity require Scotland to be independent.
Scotland right now could raise taxes to Danish levels and could consequently
increase public spending. We could also cut income tax and reduce the regulations
that inhibit Scottish business.
I believe the UK as a whole could become much more
competitive if we lowered public spending, lowered taxes and promised not to
impose trade tariffs on any imports no matter what.
What hinders us from doing this? Well mainly the Lib Dems, Labour and the SNP.
I oppose Scottish independence, not because I think
it is impossible, nor because I think Scotland would necessarily be poorer. Our
future prosperity would depend mainly on creating a small government that interfered
as little as possible in the economy. Our economy would then depend on the
efforts of ordinary Scots to study hard, create businesses, products and
services that people actually wanted to buy.
None of these things are impossible, but then again
none of them are impossible in Scotland right now. Prosperity is not impossible
in an independent Scotland, but nor does it require independence.
However, everything I seen about the SNP over the
past few years tells me that the likelihood of them creating an independent
prosperous Scotland is small. The SNP gained power by promising free this and
free that, even though none of these things are actually free, but rather paid
for by taxation. The SNP always wishes to centralise power rather so that it
rests with themselves rather than allowing individuals to make their own choices.
This suggests that an independent Scotland would be hindered because too many
Scots would wait for independence to bring them prosperity rather than by using their
own efforts to create that prosperity.
The SNP themselves at least in the short term would
cause independence to be a disappointment.
But anyway I oppose Scottish independence, not for this
reason, but because I am British and have and want to have a shared identity
and citizenship with everyone who lives in the UK. I want all of the UK to be
prosperous, not just Scotland. I think the UK is a great country with a marvellous
past that has made us the way we are, but perhaps an even better future now that
after Brexit we will be more in control of the path that we choose to take. We can use
the full sovereignty we will regain to create a low tax, free enterprise, free trade
hub off the coast of Europe. We can do much better than we are doing now. We
can all be much more prosperous.
There isn’t an optimum size for a country. Singapore is tiny. The United States is huge. It’s not independence in itself
that brings with it prosperity, it’s sensible economic policies, living within
your means and creating successful businesses. There is nothing about being a
part of the UK that hinders or prevents Scotland following policies that might
increase our chances of creating wealth. Quite the reverse, the kind of free
market, small government policies that tend to lead to increased wealth are
more often than not opposed by the SNP. They then blame someone else for their own failure at running our economy.
What hinders Scotland the most however is that the SNP go on and on about independence. Business hates uncertainty. The prospect of having to go through yet another SNP attempt to drum up support for independence makes huge numbers of us weary. The prospect of ever having to go through the division and acrimony of an independence campaign fills millions of Scots simply with dread. These sort of feelings do not a successful economy make.
If the SNP put a fraction of the effort its puts into its never-ending push for independence into actually trying to make Scotland a wealthier more pleasant, happier place to live, it might find that in time we would quite soon approach Danish living standards. But I strongly suspect the SNP would rather we were poor and independent, than even a much more prosperous part of the UK. There's nothing wrong with Scotland nor with our prospects. It's only the SNP that holds us back.
What hinders Scotland the most however is that the SNP go on and on about independence. Business hates uncertainty. The prospect of having to go through yet another SNP attempt to drum up support for independence makes huge numbers of us weary. The prospect of ever having to go through the division and acrimony of an independence campaign fills millions of Scots simply with dread. These sort of feelings do not a successful economy make.
If the SNP put a fraction of the effort its puts into its never-ending push for independence into actually trying to make Scotland a wealthier more pleasant, happier place to live, it might find that in time we would quite soon approach Danish living standards. But I strongly suspect the SNP would rather we were poor and independent, than even a much more prosperous part of the UK. There's nothing wrong with Scotland nor with our prospects. It's only the SNP that holds us back.