Thursday 23 July 2020

I thought Scots were supposed to be canny.

The difference between the United Kingdom and the European Union has been shown perfectly by the EU’s €750bn (£680bn) Recovery Fund. Whereas Rishi Sunak’s Treasury Furlough Scheme and various other forms of bailout were agreed almost immediately and have been added to when necessary, the EU has struggled to do something similar.

The reason for this is that Britain is a sovereign nation state, while the EU is not, at least yet, a state at all. It is perhaps a confederation of sovereign nation states moving gradually towards a federation, but it is not there yet. For this reason, the EU’s Recovery fund has required difficult negotiations between politicians from all of its member states.

 The EU may now have an embryonic Treasury, but it has not reached fiscal union, nor debt mutualisation. Those EU member states led by the Netherlands who are net contributors to the Recovery Fund are worried about fiscal transfers from the wealthier north to the poorer south.

There are all sorts of strings attached the money anyway. If Italy for instance wishes to get money from the Recover Fund, it must submit to whatever the European Commission asks it to do. This amounts to a restoration of the Troika which at times has had supremacy over elected politicians in places like Ireland, Greece and Spain. You only get the money if you agree to implement whatever reforms, spending cuts and tax rises the EU demands.

Any EU member state can pull an emergency brake if it dislikes how the Recovery Fund is working so as to force a review.

The EU may have a form of citizenship, but it not like British citizenship. It is extremely difficult to lose British citizenship. Even people fighting for Islamic State can argue that they should be allowed to keep their British passport. But British EU citizens lost their citizenship when the majority voted to Leave the EU whether we wanted to lose it or not. This is the equivalent of stripping British citizenship from all Scots if Scotland voted for independence.

More importantly although people living in EU member states share a common EU citizenship, they do not view each other as fellow countrymen. It is for this reason that the Dutch do not want to share Dutch money with Italians. The Netherlands and Italy are two independent sovereign states. For this reason, Dutch people do not think they owe Italians anything.

There have been no negotiations in Britain about the Treasury bailout. There has been no long meeting between the various parts of Britain as to who would contribute what to the bailout and how it would be distributed. The reason for this is that Britain is a unitary sovereign nation state and we have a monetary, political and fiscal union with debt mutualisation. We don’t need to have any negotiations because we elected a British Government last December and this gives it the authority to borrow money and spend it wherever there is need in Britain.

Scottish nationalists claim that if Scotland were independent then we could have done the same as Rishi Sunak did or perhaps even more. Whether this is true would depend on Scotland’s financial situation if there were ever to be a repeat of Covid or a similar disease.

But it is worth remembering that many famous European nation states have found it necessary to ask for help from the EU. While Germany, the Netherlands, Austria and others could have managed on their own, places with long and proud histories such as Italy and Spain need help.

Would Scotland have been a net contributor to the EU’s Recovery Fund if we had voted for independence in 2014? Well given that we are not at present a net contributor to the British Treasury it would appear unlikely.

Nine hundred thousand Scots have benefited in one way or another from the Treasury Furlough Scheme. We have also benefitted from other forms of Government funding and the experts from all over Britain. If a vaccine is discovered in Oxford, we will get it as quickly as any other British citizen.

Has anyone asked a furloughed worker to pay back the money that has been given to him? No, the money from the Furlough Scheme will not be paid back by individuals, but rather over the course of future generations the debt will gradually be repaid by British taxpayers.

Has anyone told the Scottish Government that it has to cut spending, raise taxes or do anything else to receive money from the British Treasury? Quite the reverse. The Scottish Government has been allowed to do what it pleases within the scope of its devolved powers. There have been no conditions set for the receipt of Treasury money.

This is not an argument against the EU, which is doing its best under difficult circumstances to deal with Covid. Time will tell if the Recovery Fund needs to be adjusted or increased. But it is obvious that Scottish people are getting a better deal from the UK than Italian people are getting from the EU.

Scottish people have received money from the Treasury freely and without conditions. Richer parts of Britain such as London and Aberdeen have not complained about sharing our money with poorer parts such as Glasgow, Middlesbrough or Llanelli. There has been no discrimination against anyone in Britain because we are all British citizens together.

What is peculiar is that under these circumstances a large number of Scots many of whom would have no money whatsoever if they lived in Italy or Spain would prefer to exchange their British citizenship which gives us lots of benefits for EU citizenship which would see Dutch and German citizens treating them as foreigners. No EU member state would owe Scotland anything at all.

If Scotland were independent right now, we would be relying exclusively on the Scottish taxpayer and whatever we could borrow on the money markets to pay our wages. If that wasn’t enough, we would have to submit an application to the EU which might help out so long as it took control of the Scottish economy. It’s a funny sort of freedom.

It is simply bizarre that so many of the nine hundred thousand furloughed Scots would prefer to ditch British taxpayer’s money given by people who treat us as family in favour of far less generosity from EU citizens who would treat us as foreigners.  We’d do all this just because we like to wave blue and white flags,  hate Tories and can’t forgive them for the Poll Tax? The SNP would trick us out of our birthright for a mess of nationalism. 

I thought Scots were supposed to be canny.