Saturday, 30 November 2013

These people could win

When the independence campaign started some time ago, I must admit I was full of enthusiasm. I started a blog, joined a facebook group, tweeted on twitter. I thought hard about the issues, debated with nationalists, sometimes acrimoniously, sometimes as friends. I learned something too. I gained a degree of respect for the nationalist argument. I heard some good arguments from sincere people. Many of these people were really good at politics. These people could win.


But after a year of blogging I became sick to death of the whole thing. All of the arguments had been said. No one was really changing their mind. The result anyway does not depend on people who write or read blogs, but on those millions who do not follow politics. I had other subjects that I had been neglecting, other topics to study.  So I’ve been silent for some time. But I doubt that the nationalists have been silent. They don’t seem so sick of the campaign. As I said these people are good at politics. These people could win. 




Where are we now? There’s less that a year to go and what we have is simply claim and counterclaim. The nationalist case for independence can be summed up as the claim that we would retain nearly all of the benefits of remaining in the UK. Moreover we would retain all of the benefits of being part of the EU. The process of achieving independence would make Scotland a part of the EU on the same terms as we have at present. The negotiations by which we achieved these positions with regard to the EU and the rest of the UK (rUK), would be straightforward and  would be finished in 18 months. There would be no difficulties whatsoever. After independence, we’d keep the pound. The Bank of England would bail out the Scottish banks in the event that  that should become again necessary. All of the things we like and nearly all of the rights that we have now by virtue of being citizens of the UK, we’d retain. On top of that Scotland would be better off economically and fairer too. What’s not to like? I told you these people were clever and were putting forward some good arguments. Most people get bored with political debate. One person says one thing, someone else says something different. It all becomes very tiresome, very quickly. In the end you give up on the arguments and focus on what each side is promising. 

All these nice things could happen to me if only I just put a little cross in the yes box. And if that nice Mr Salmond keeps promising and promising and repeating and repeating over and over again that these things really will take place, then surely it must be true. You see these people really are good. No one wants to listen to the negativity of counterarguments. Those awful people who talk Scotland down. Indeed these people are good. Really good. These people could win. 




Shall I add to the pointless counterarguments? Why bother? Each of the points in the SNP wishlist has been questioned, but a proportion of the Scottish population will keep the faith anyway. It’s just a question of what proportion it turns out to be. But let’s try to look outside Scotland. After all what would happen after a vote for independence would depend quite a lot on those living south of the border. What strikes me is that the mood there has changed. I haven’t spent much time in England recently, but I read comments on the newspaper comment pages and it seems to me that a fair proportion of the English have begun to loathe us. The attitude of many of the English is good riddance. They think that English taxpayers subsidise us. They think that we get our free prescriptions and free tuition on the backs of them. They long for Mr Salmond to win. Well if they hate us so much, wouldn’t it be better if we were independent? Do you see once more how clever the SNP have been? The English used to think of themselves as British and there was hardly any antipathy towards Scotland. But somehow that mood has changed. Its almost as if that nice anglophile Mr Salmond set out with a master plan to make the English feel more English and to hate us in the same way that we hate them. The politics of nationalism in Scotland has contributed to the politics of nationalism in England and by doing so has set one part of Britain against another. Now the English would cheer as we left, while before they would have felt a sense of  loss like bereavement. They really have been clever haven’t they? These people could win. If not now, then the next time.


Personally I think the English are foolish to regard the loss of Scotland with such enthusiasm. But that’s what devolution and nationalism in Scotland has achieved. It’s divided us in a way that would hardly have seemed possible some years ago, when people could still remember how once we fought together alone against what seemed like the whole world. The foolishness of this rancour is that it fails to see the long term strategic value of keeping a territory intact. Why would Japan and China be arguing so vigorously over some uninhabited rocks if maintaining territorial integrity were not vital matter of national interest. Britain would lose a good chunk of territory if Scotland became independent, yet this is treated with delight. Why then are the Spanish so keen to get back tiny Gibraltar? It seems perverse for the Spanish to want so much to gain a tiny bit of territory, what the English treat the loss of perhaps a third of the territory of the UK with something approaching delight.  But that’s the measure of the SNP’s achievement. As I keep repeating, rather like Paul Newman in Butch Cassidy and the Sundance KId: “Who are those guys?” Those guys are good. They keep on chasing. They’re relentless. Those guys are the SNP. Those guys could win. 




But here’s the difficulty. England is now full of little Englanders who vote for that nasty Nigel Farage and UKIP. They don’t seem to be in any mood to cooperate with Mr Salmond’s independence wish list. As they cheer us to the door on leaving the UK, they also have a mood of asking “Well let’s see how they do on their own.” They would prefer to see an independent Scotland struggle even if that meant that England were worse off too. The mood in England is not to let Scotland keep the pound, nor to allow the Bank of England to act as our lender of last resort. The mood in England sometimes seems so bad that they would like to rebuild Hadrian’s wall and put barbed wire on the top. The English don’t want to help us. If we become independent they’d rather see us fail.      




Could Scotland force them to let us keep the pound and the Bank of England? We can threaten to not take our share of the national debt, we can say that their nuclear submarines have to leave right now. We could use whatever leverage we have to get what we want. But what do you think? Would this increase or decrease their hostility?

The trouble with the SNP’s wishlist is that it really does depend on the cooperation and goodwill of others. The difficulty is that England could get on very well without us, but we might find it rather difficult if we were to lose their goodwill. Take an example. When a large country withdraws cooperation from a smaller one things can rapidly get rather ugly. Take the example of Ukraine and Russia. The relationship between these places, which had been together for centuries has deteriorated to the extent that Russians often feel uncomfortable visiting Ukraine and vice versa. The Russians set out to make life as economically difficult as possible for their former fellow countrymen. They’ve turned off the gas supplies. They’ve put restrictions on trade and applied silly, spurious rules to make life harder for their neighbours. They’ve  sabotaged the recent Ukrainian trade deal with the EU by threatening dire economic consequences. You can do quite a lot with soft power and a bad attitude especially if the relationship is between one big powerful country and its smaller neighbour. Of course we’re lucky that it is unlikely that Mr Putin will become prime minister in Westminster, but the mood in England is such while the rUK Government would no doubt fulfil its promise to cooperate with an independent Scotland, while relations would no doubt remain civil, it seems unlikely that the English would be overly anxious to be generous.


Mr Salmond’s wishlist might well happen. I have no way of knowing one way or the other. Everything he wants is possible if only the EU and rUK agree. After all Britain let Ireland keep the pound and the Bank of England. Where there is a will there’s a way. The EU make the rules up as they go along. They broke any number of treaties to bale out Greece. They could let Scotland in with a nod. But will they? I don’t know. But I do know that the EU is against secession and that countries like Spain don’t want to encourage secession in their own backyard. If Mr Salmond achieved all of his wishlist, there’s no reason to suppose that Scotland would be worse off than now. Perhaps we would be a little more prosperous, perhaps a little less. I don’t know. The economic advantages and disadvantages of independence are complex. You can make a case either way. I’ve always thought it would come out about even, but that’s just a guess.


But none of this matters. So long as Scots continue to believe the SNP’s promises they have a chance of winning. It doesn’t matter what happens after the event, whether the promises come true, for independence would have already been achieved. The trick is to just keep promising, just keep repeating a simple message of all the good things that independence will bring. A proportion of the Scottish population will believe. It’s just a question of what proportion. And so they will say anything and do anything, promise anything to get that percentage up. It’s politically masterful, for its not as if we will have another chance. It’s not like a normal election where we can hold them to account for their broken promises. There won’t be another go in five years. This is like an election where you elect a Government for ever. The more I’ve been following the SNP tactics the more I admire them. These guys are good. These people could win.


But let’s just imagine. What if it turns out that the SNP’s wishlist does not come to pass? What if we don’t get to keep the pound? What if we need to set up our own central bank? What if we have to apply to join the EU and it takes us a number of years? What if we simply couldn't afford some of the nice things that are promised us, like free child care? There must at least be a possibility that Mr Salmond does not get all that he wants. But then this means that rationally if I were to consider voting for independence, I should do so only if I were willing to accept that some or all of the SNP wishlist would not occur. If I would still vote for independence even if we lost the pound and were not in the EU, then that would show that I am a true supporter of independence come what may. If we were to debate in this way in Scotland this would be to strip the debate down to its essence.  I cannot possibly know whether we will keep the pound or remain in the EU if we become independent, so I cannot reasonably use these as a basis for a rational choice. But no there naturally there is no chance of such a debate. These guys are far too good for that. The SNP know that the vast majority of the population will not choose on the basis of rationality. They will choose because they are promised that everything will stay the same and they will get some more freebies. It’s masterly politics and has been since the Romans were offered “panem et circenses [bread and circuses]” But then the Romans were good politicians too. Bread and circuses is about the best argument in the history of politics. As I keep saying reiterating with regard to the SNP. As I keep watching as their polls seem to rise, I continue to reflect the obvious fact that these people are good. These people could win.

Saturday, 16 November 2013

Ping



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Sunday, 19 May 2013

Is Scotland a nation?

I sometimes read Scottish nationalists arguing that it is somehow illegitimate to support the Union, as the UK is an artificial construct and Britain is not a nation. Sometimes they back up this argument with discussion about the the history of the Act of Union of 1707 and what was agreed between Scotland and England all those years ago. It is almost as if they consider that Scotland is just the same as it was prior to 1707 and just as much a nation as it would have been if the Union had never happened.

Historical debate is, of course, fascinating, but it can be incredibly difficult to resolve arguments by appealing to history. This is not least because very eminent historians can have such radically different views on the same events. I’ve read historians who think that Scotland was subsumed by the Union, while others emphasise how we retained our distinct nationhood. No doubt, each side brings its present political views to the investigation of the past and attributes to that past ideas that were not even dreamed of then.  

It is however, possible, I believe, for unionists and nationalists to come to some sort of consensus on this matter by reflecting that whatever disagreement there may be between them  is more a confusion about certain words like “nation” and “country” that can be used in a variety of senses.

Is Scotland a nation? Yes, of course. After all, we talk of the Six Nations Rugby Championship in which Scotland takes part. Moreover, the UK is commonly described as a multinational state, which implies that it is made up of nations. This type of state is not particularly uncommon. India is a multinational state made up of many ethnic groups who speak a variety of languages and follow a variety of religions. Present day Russia likewise has many different ethnic groups, religions and languages and has many constituent Republics. Nearly every European Country is formed from formerly independent countries. Some of these may be referred to as nations. Often this depends on a person’s political viewpoint. Someone who supports independence may describe Catalonia or Flanders as a nation. Someone else may not. There is nothing therefore incorrect or unusual about describing Scotland as a nation. The words may be different in various languages and the useage somewhat varied, but in principle we’re dealing with the same idea. I can ask someone in Germany what “Land” he is from and it would be correct for him to answer Saxony. I can ask someone in the United States what State he is from and it would be correct to for him to answer Texas. If such a person were a nationalist, or if the useage of his language allowed it, he might describe where he comes from as his nation. In all events however, the reality would be the same. A constituent part of a multinational state can be described as a nation, or a country or a state. It amounts to the same thing. However, the word “nation” when it is used in this way is crucially used in a different sense from when it is used as part of the the phrase “nation-state.”

If asked which country I’m from I can answer Scotland or Britain or the UK. Some people prefer to describe themselves as Scottish and not British. This is perfectly legitimate. Here language is determined by identity and the aspiration for Scotland to be independent. No one has to feel British. It should however, be admitted by Scottish independence supporters that many Scots do feel British and that this is likewise legitimate. But if I am asked my nationality on an official form, it is likely that in certain circumstances I will have less leeway. Often it is necessary to reply that I am British. This is because such forms are commonly not asking about my sense of identity but about the nation-state where I am a citizen. If, for example, I filled out a Russian visa form and put that I was Scottish, there would be every chance that the form would be rejected. The conclusion that can be drawn from this is that the word “nation” can be used fairly loosely and in a variety of senses, but the word “nation-state” cannot.

Many nation-states can be described as more or less artificial constructs. If this means anything, it means that they were constructed from formerly independent constituent parts and that this happened owing to the accidents of history and for a variety of complex reasons. In this sense, the United States is an artificial construct, as is Spain, as is the Netherlands. The history of most nation-states is the history of often arbitrary decisions, of wars won that might have been lost, of conquest and of injustice. All of these things can be described as artificial and they all were necessary to make the present day nation-state. Even Scotland was once a collection of warring kingdoms called unfamiliar names like Fortriu and Dál Riata, speaking a variety of languages and with various cultures and identities. Prior to this, no doubt, we were a collection of warring tribes. If I had a mind to, I could probably go back to a time when Aberdeenshire was independent, ruled by some feudal lord. I could, if I chose, describe this place as my nation. When we delve into history looking for our nation, there is no particular reason to pick the present day boundaries of Scotland. All is arbitrary. All an artificial construct. Scotland is just as much a union as the UK. It’s just that this union occurred some hundreds of years earlier. There’s no rational reason why that should be decisive in determining our present day nation-state.

The question of whether Scotland is a nation can then be answered. Scotland in one sense is a nation and in another it is not. Scotland can be described as a nation in the same sense that Bavaria is described as a “Land”, Texas a “State” or Catalonia a “Nacionalidad” (nationality). This is simply a matter of language usage. Some constituent parts of nation-states are described as nations, others described as countries, others as republics, others still as regions. The reality is the same. Some of these places, like Catalonia or Flanders have significant numbers of people who seek independence, others do not. But there is nothing intrinsic in such places being constituent parts of nation-states, which makes independence either inevitable or desirable. Otherwise, it would follow that every nation-state, which was formed from formerly independent countries should break-up into those parts.

The sense in which Scotland is not a nation is the sense in which we are not a nation-state. It is this, which independence supporters want us to become, for the defining characteristic of a nation-state is that it is independent. Something clearly cannot become what it already is. Therefore, it is uncontroversial and independence supporters must agree that Scotland is not a nation in the sense of being a nation-state. This usage of the word “nation” as short for “nation-state” is the most common usage the world over and what most people mean when they talk of their nation. There are exceptions to this usage when a place or a people can be described as a nation even though they lack a nation-state. In Canada for instance there are “First Nations.” Such “nations” even sometimes have a seat at the United Nations. But the vast majority of UN nations are nation-states.

Is Britain a nation? In the most common usage of the word “nation” clearly it is, for Britain is a nation-state. To attempt to deny that Britain is a nation is therefore to simply misunderstand the the most ordinary usage of the word “nation.” Is Britain a nation in the looser sense that Scotland is a nation? This is more a question of identity. Is there such a thing as a British identity? Clearly there is. Lots of Scots feel it. Some do not. Some independence supporters don’t like the idea of a British identity. But to deny it exists is like trying to deny that Germans have an identity or that Spaniards do. Even if some Bavarians or Catalans want independence and deny their German or Spanish identity, it does not follow that everyone must do the same.

If Scotland were to become a nation-state it would be the goal of the Scottish Government and people to preserve this nation-state. It is in the natural order of things for a nation-state to seek to defend its borders and maintain its territorial integrity. In the event of independence therefore, it would be uncontroversial for Scots to seek to prevent the breakup of this nation-state called Scotland. But by the same token it is natural for British people to seek to prevent the breakup of our nation-state called the United Kingdom. In this we are no different from a German or an Italian striving to maintain the territorial integrity of his nation-state. It is this which Scottish nationalists frequently fail to understand and why there is commonly so little understanding between the opponents in the independence debate. Independence supporters frequently conflate the meanings of the word “nation.” The justification for independence is frequently founded on the implied assumption that Scotland already has or has somehow retained the properties of a nation-state. But this is not only circular, it is also self-defeating. For if Scotland already is a sovereign nation-state, there is no need to seek independence. It’s a simple matter of logic that you cannot become what you already are.

Sunday, 5 May 2013

Do Independent countries have the right to their own currency?

One of the things that independence grants a country is choice. For example, an independent Scotland could decide to join the Euro. Alternatively, it could decide to set up a Scottish pound. There would rightly be a great deal of indignation in Scotland, if someone else tried to limit our newly won independence by saying that we did not have a choice in these matters. Being a sovereign nation would mean that we would have the right to have a currency that was different from that in the rest of the UK (rUK). If we did not have that right, we could not properly be called independent at all. Independence is always a relational concept. I am independent as I am independent from something else. But if Scotland became independent from rUK, it follows logically that rUK would become independent from Scotland. They too would gain independence. Not only us. But it would be unjust if we were to deny to newly independent rUK something that we would demand for ourselves. Just as an independent Scotland would have the right to choose a currency different from rUK, such as a new Scottish pound, or the Euro, so newly independent rUK would have the right to have a different currency from Scotland. For either side not to have this right would be to imply that were not properly independent.

The Scottish government has expressed a desire to retain pound sterling after independence. This is a perfectly proper and reasonable aspiration. But no supporter of independence would want to say that Scotland could not at a later date change its mind. Perhaps, in time the Euro would prove to be such a success that we would want to join it, or perhaps we might decide that having our own currency would be better still. No one could force us to retain the pound if we did not want it post independence, and we would resent it deeply if anyone tried. But by the same token we could not force rUK to retain a currency union with us if they did not want to.

At the moment the UK government, in an official paper, is saying that it probably would not be in rUK’s interest to maintain a currency union with Scotland post independence. This has been met with some indignation by the SNP. They have argued that it is in everyone’s best interest that Scotland retains the pound. This is because they think that it would be beneficial economically to rUK to retain Scotland’s economy within a sterling zone, not least because it would help rUK’s balance of payments. They have even gone so far as to suggest that if rUK were unwilling to allow Scotland to remain in a sterling zone, then they would not accept a share of the UK’s national debt. This share could amount to around 125 billion pounds. It’s always tricky to know for sure what’s going on when we get into economics. One side comes up with a set of figures and economic arguments that look very sensible, only for the other side to come up with a set of figures that are equally hard to dispute. In this case, it might be better to look at the psychology of the situation.

The SNP seem pretty keen to keep the pound post independence, even going so far as to make threats if they don’t get their way. The UK government,  on the other hand, does not exactly appear to be begging an independent Scotland to stay in the pound. It may well, of course, be just as the SNP suggest that it would be foolish for rUK not to keep Scotland in the sterling zone, but then if that were the case, it would hardly be necessary to resort to threats. If it were so self-evident that it was in rUK’s interest to keep Scotland in the pound, there would be no need to persuade at all. Naturally, this might all be a bluff in order to discourage Scots from voting for independence and that in the event of independence, everyone would see sense. But again, it would be a fairly feeble bluff if it were so obvious to all concerned that monetary union between rUK and an independent Scotland was so self-evidently desirable.  

The best argument in favour of currency union between rUK and Scotland is the example of the Republic of Ireland, which retained the pound after independence and kept it until the 1970s. Currency unions between independent states are clearly possible. We already have a currency union between the UK and the crown dependencies  (Jersey, Guernsey, Isle of Man) and the overseas territories (Gibraltar, the Falklands etc). Why couldn’t we have a currency union between an independent Scotland and rUK? There are some limitations and constraints on all sides from being in a currency union and to say the least the crisis in the Eurozone has ably demonstrated that monetary union without political and fiscal union is at best problematic. But if both rUK and Scotland considered a currency union to be in their own economic interest, no doubt it could be made to work.  

But here’s where it looks more difficult for the SNP. If rUK really did not want a currency union with Scotland, then it could not be forced. Scotland could continue to use the pound unilaterally and unofficially, but this would not be a currency union. For a country as developed as Scotland, with a large banking sector, this is hardly a serious option. A Scottish government under these circumstances would have no control whatsoever over monetary policy. To become independent only to have the status of Kosovo, Montenegro or Panama is hardly a pleasing prospect.

The threat of not accepting a share of the national debt, can likewise hardly be considered as serious. Having refused to accept a share of the UK’s national debt, Scotland would not exactly appear to be a trustworthy country to lend money to. Trying to sell bonds on the international market, quite possibly in London would be tricky at best. The credit rating of an independent Scotland would hardly be helped if we had  just shown ourselves willing to renege on our debts. Most importantly however, if relations between rUK and Scotland deteriorated to the extent of Scotland walking away from the debt we had built up together, it would mean that the post independence negotiations had effectively reached deadlock with neither side willing to cooperate with the other. Relations between the two nation states would be characterised by recrimination and hostility. This would be a disaster for everyone no matter on which side of the border we live.

In the end, we in Scotland have to accept that in the event of independence, rUK would have a perfect right to have a different currency from us. We might regret this, we might think it foolish, we might even think that they are acting against their own best interests, but that really is their business. After all, they might think it foolish for Scotland to leave the UK. A supporter of independence would hardly let that influence his judgement. These are matters on which reasonable people can disagree. So if there were to be a difference of opinion about economic self-interest between Scotland and rUK, Scots would have to extend the same right to those south of the border to disagree with us. An independent Scotland could not force them to have us in a currency union, nor should we want to force them.

An independence supporter who is completely unwilling to accept the possibility of losing the pound should seriously consider whether he really understands the concept of independence. It might indeed be possible to remain in a currency union with rUK. No one will know for sure until the negotiations begin after a “yes” vote in the independence referendum. But recognising the fact that the people living in rUK would clearly have the right to judge for themselves and make their decision independently of us as to whether they thought it was in their own economic interest to remain in a currency union with Scotland, means accepting that it must be possible that Scottish independence would lead to us losing the pound. Even if we were to disagree with the rUK position, even if we desperately wanted to retain the pound, we would have to allow them the choice. Otherwise we would not be respecting their independence. Honesty therefore requires supporters of independence to admit that a vote for independence might also be a vote for losing the pound. After all, the UK government has stated its official position that it is unlikely to be in the rUK’s interest to retain a currency union with an independent Scotland. This we must assume would be their negotiating position in the event of Scotland choosing to vote for independence.

This need not discourage independence supporters. There are advantages that come with having an independent currency for which reason most newly independent countries, like Latvia or Ukraine made establishing their own currency one of their top priorities. An independent Scotland, of course, could do likewise. It may be that we would have no alternative but to do so.

Sunday, 21 April 2013

The Union is an accident of history

A set of quite unlikely historical circumstances led to Scotland becoming part of the United Kingdom. The first of these was that Henry VIII’s sister, Margaret Tudor, married James IV of Scotland, who died fighting the English at Flodden. The second unlikely circumstance was that none of Henry VIII’s legitimate children gave birth to an heir. This despite him being married so many times. What this meant was that the descendants of Margaret Tudor, through her son James V, her granddaughter Mary Queen of Scots and her great grandson James VI and I eventually gained the throne of England. It was as much as anything a Scottish takeover, owing to the succession crisis left by Elizabeth I choosing to be known as the Virgin Queen.


Two other European countries were also experimenting with a union of the crowns at around the same time as these events in Scotland and England. The Portuguese King Sebastian I died in battle in 1578 without an immediate heir. This led to a succession crisis, which eventually, after the War of Portuguese succession (1580-1583)  led to the Union of the crowns of Portugal and Spain, with Philip II of Spain king of both countries. This union however, did not last. The Portuguese revolted in 1640 and fought a long restoration war with Spain, leading to the eventual Spanish recognition of Portuguese sovereignty in 1688. It is for this reason that Spain and Portugal are today two nation states rather than one.


It is entirely an accident of history that Scotland likewise, is not a separate nation state from England. The Union of the crowns in 1603 was an unlikely end to a series of unlikely events. Moreover, it might well have broken up, especially because, owing to the execution of Charles I in 1649, there was a time when the Union of the crowns was broken. For six years Britain was ruled by Cromwell’s Protectorate. At this point it is easy to imagine how history might have played out differently. With civil war being fought throughout Britain there must have been times when it seemed unlikely that a Stuart king would again rule the whole of the UK. There was nothing inevitable also in the eventual political union of Scotland and England. At any point Scotland could have gone the way of Portugal and reasserted full sovereignty.


What would have been the result of this? Scotland’s position would be rather similar to that of Portugal today. The Portuguese speak a language which is similar to Spanish, but it is not fully comprehensible to Spaniards and thus has to be translated. If Scotland had not joined the Union, or if the Union had broken up, the Scots language would have remained the spoken and written language of daily use for Scots living in the Lowlands, as it was prior to the Union, and would have diverged further from English. Scottish Gaelic would also have remained an important feature of the life of the Highlands. After all, as late as the 18th century over 20% of Scots were monolingual Gaelic speakers. Without the pressure and influence of the English language, which came with the Union, Scotland  would have been very different linguistically from the place we know today. We would have been a bilingual society, speaking the historic languages of Scotland.


Describing this Scotland that might have been is to describe something romantic that appeals to a Scottish sense of patriotism. But it is also to describe a place and a people which are unfamiliar to us. I grew up speaking Doric, the form of Scots used in Aberdeenshire, but I struggle to understand the Scots that was common even in the 18th and 19th centuries, let alone earlier. When I read Walter Scott I frequently need to use the glossary. The vocabulary of Burns is quite remote from the language we hear on the street today. Like the vast majority of Scots I hardly speak a word of Gaelic. But, even as we regret how the language of the Gaels has been lost, it is also necessary to recognise that when Scotland was a bilingual society, it was also a very divided society. The division between the Highlands and the Lowlands was a real one with mutual misunderstanding and mistrust. A Lowlander considered a kilt to be the proper dress of a thief. Which side a person took during the Jacobite rebellions was to a considerable extent determined by which language he spoke.


The language, which I speak and to a large extent the culture that I recognise as mine, would have been massively different without the accident of history which saw Scotland join the Union. It might have been, under those circumstances, that we would now be learning English as a foreign language in order to do business in a language the rest of the world could understand. Three or four centuries of being in a Union with the other parts of the UK have influenced us in ways that we are hardly even aware of. To wish that the Union had never happened is to wish that I am someone other than I am. The Scot who would be today if the Union had never happened would be someone I might even struggle to converse with. There is no resurrecting that Scotland, because it really has been lost, not least because it has few connections with who we are today.


To deny that our language and our culture has been shaped by the Union is to suppose that the Scottish people have not changed since 1707, have not grown and developed and been influenced by our historical circumstances. But once we recognise that our language and our culture has to a large extent been shaped by the Union, it begins to seem strange that we should want to break up the very thing which has most influenced how we are today. It’s as if nationalists look back to a period remote from nearly everything we are today, a period we can barely comprehend, seeking to recreate a land that was lost. But even if we could recreate that lost Scotland, we could not understand anyone who lived there. It would be quite foreign to us. Like it or not, the Union has made us British. The Scotland that would have existed without the Union is another country, where we have never lived and where we would struggle to recognise ourselves. The denial of our Britishness, which is at the heart of the independence campaign, is to deny how we have been changed by the Union. It is really to deny ourselves and to resent or regret a part of each of our identities.


Scotland is part of the UK due to an accident of history, but that accident has had consequences and has changed each and every one of us. If Henry VIII’s sister had married someone else and Scotland had remained independent, the Scotland of today would have been massively different from the Scotland that we actually live in. It would have been as different as Portugal and Spain. The gap between these two Scotland’s is the amount that the Union has influenced us in terms of language, culture and history. It is the measure of our Britishness. To deny this is to deny even the language with which I write, what is familiar to me, and what I know of my culture. All of this has been influenced by the Union, all of this would not have been without the Union. Scottish nationalists would cut each of us off from a part of ourselves, for each of us is the product of the Union, influenced and changed by the common history that we share with the people in the other parts of the UK. The accidents of history have made us what we are. We are Scottish, but we are also British. To fail to understand this is to fail to understand Scotland, its history and its people.

Sunday, 7 April 2013

Could an independent Scotland avoid austerity?

There have been a lot of complaints recently from Scottish independence supporters about cuts and austerity. Leaving the UK is portrayed as a way of avoiding all of the nasty things that the Conservatives are once again doing to us Scots. Not only would we get rid of the “bedroom tax” and other such horrors, we would get rid of the Tories to boot. What’s not to like?


The Tories have become a sort of mythical hate figure in Scotland that children learn about at their mother’s knee. I’ve met lots of Scots who read the Daily Mail and agree with much of what is written there. But on the suggestion that they might be Conservative supporters, they recoil in horror. The folk memory of Margaret Thatcher and the poll tax is just too strong, almost as if she were Cromwell in Ireland. But the danger is that the sort of prejudice, which most Scots feel against Tories, will prevent us from sensibly analysing the present economic situation in the UK and the potential economic situation of an independent Scotland.


Like most people I’ve received benefits. When I was a student there were full grants, plus dole and housing benefit during the holidays. I used to spend the summers studying and had absolutely no need to look for work. It was great. I benefited. I loved it and I’m very glad that I had such advantages. I spent around 9 years studying at public expense and came out of it with a considerable profit. Having benefited so much, it would hardly be sensible for me to oppose public spending or welfare. But that does not mean that I should be incapable of trying to understand the problems of today.


Let’s all agree that it would be great if the NHS had an unlimited budget, if everyone got as much unemployment and housing benefit as they desired and that pensions were twice average earnings. Fine, but all of these nice things have to be paid for. Where does the money come from? Obviously it comes from the wealth of a country. After all, poor countries tend to have a very limited welfare state. Now let’s look at the present economic situation in the UK. We have a national debt and we have a deficit. I used to be a bit confused about these terms until I began to think of them in a more manageable way. Let’s say, I run a small shop. In order to start my business I might have had to go to the bank and taken out a loan. That’s the scale of my debt. But in running my shop if I make a profit I am running a surplus, which I can use to pay down my debt, while if I make a loss I am running a deficit, which gradually increases my debt. Would anyone call a shopkeeper who continually ran a deficit wealthy? Obviously not. But neither should we call the UK wealthy. Our national debt amounts to £1.1 trillion, or £18,000 per person. Our deficit last year, despite all the talk of austerity, was nearly £100 billion. The UK has been running a deficit since 2001, which means we’ve been making a loss for over a decade.


What can a government do in these circumstances? It can raise taxes, cut spending and it can hope that economic growth will bring it more profit. But there’s a tricky balance. If you raise taxes too high, it will discourage growth. Clearly, if my small shop is taxed too highly, it is unlikely to make a profit. But what goes for shops goes for people, too. There’s a limit to how high a government can raise taxes without seriously damaging economic growth. At present, UK public spending as a percentage of GDP is around 45%. But ideally it would be somewhat lower. This is owing to the fact that when public spending rises above around 25% it begins to have an adverse impact on growth. There’s a trade-off between economic growth and funding the things we want, like welfare, the NHS and education. At 25% we would have ideal conditions for economic growth, but less than ideal social provision. Therefore, it is reasonable to sacrifice a certain amount of potential economic growth in order to pay for things which make our society more pleasant. But any government has to be aware that the nice things we want come from economic growth and so a balance has to be struck. Raise public spending too high and you will do lasting damage to the welfare state, because you will damage the source of its funding. What this means is that there comes a point when a government cannot sensibly continue to raise taxes, otherwise the economy would become a planned economy along Soviet lines. That way lies North Korea, poverty and madness. Politicians can debate where to put the line, but they cannot change the reality. If you want a competitive society with economic growth, you can only raise taxes so much.


Any government faced with the present UK economic circumstances would have to cut public spending. The Labour Party are often pretty good in a national crisis. They too would be making cuts. The only question then is where the cuts fall. The difficulty is that most public spending is on things we really want. The areas we spend most on are pensions 18%, welfare 17%, healthcare 17% and education 13%. So if we are to make any sort of serious cut in public spending, it is in these areas that we have to do it. That’s why making cuts is so painful.


Could Scotland avoid all of this by becoming independent? The problem is that an independent Scotland would also have a national debt. It would retain a proportion of the UK national debt. Dividing it according to population would make it somewhere around £100 billion. If an independent Scotland were to be immediately making a profit, we could use that profit to pay down a proportion of our national debt. But just like the UK now, Scotland would be making a loss. North Sea oil would be a large contributor to an independent Scotland’s budget, but we would still be running a deficit. Both sides of the independence debate dispute the size of an independent Scotland’s deficit, whether it would be smaller or larger than the rest of the UK. But it is uncontroversial to point out that an independent Scotland would be running a deficit. No one disputes this. Given then that Scotland would have a large national debt and would have a deficit, we would face the same choice as the UK does at present. Scotland’s public spending as a percentage of GDP is somewhat higher, at around 50%, than the the UK average as we already have a larger public sector and have certain benefits which are unavailable elsewhere. An independent Scotland could not sensibly raise taxes and indeed, Alex Salmond with good reason favours cutting corporation tax. What this means is that an independent Scotland would have to make public spending cuts. Some of these cuts would have to fall in areas like pensions, health, welfare and education, as these are the areas where we spend the most. But given that we want all of these nice things, public spending cuts would inevitably have to be painful.


The biggest danger to the future prosperity of an independent Scotland is if the Scottish public voted for independence thinking that this was a way of avoiding austerity, cuts and Tories. This might mean that a future Scottish government would be unable politically to make the same sorts of attempts as are at present being made by the UK government to cut the deficit and eventually bring the UK into profit. If an independent Scotland were to fail to address the issues surrounding an unsustainable deficit and an ever increasing national debt, the markets would soon look at the creditworthiness of this new nation. That way leads to bankruptcy and the fate of small nations like Greece and Cyprus.


An independent Scotland, is perfectly viable economically. Whether we would be better or worse of is a matter for debate. But a new nation cannot be built on false promises. Trying to con the Scottish people into voting for independence as a means of avoiding austerity and cuts, which while painful, are necessary is to fail to face up to reality. Supporters of independence have to show that they are willing to make hard economic choices, as failure to do so would lead to the long term destruction of our wealth and a lowering of our standard of living. There’s nothing fair about this except for the fact that it would harm us all equally.

Sunday, 31 March 2013

Independence weighed in the balance

Some Scots support independence come what may and nothing would change their minds. Other Scots want the UK to continue and are just as fixed in their view. But for those people who have not already decided, the debate is really a matter of weighing up the potential advantages and disadvantages of independence. The fact that most commentary on the issues involved is completely one-sided, can hardly be helpful for people looking at the pros and cons in this way. The polarisation of the debate means that nationalists frequently attempt to argue that the UK has no benefits at all, while unionists frequently strive to portray an independent Scotland as if we would be joining the Third World. But this is to treat political opponents as if they were fools. There must be something attractive about independence, otherwise the idea would not have attracted the support of a significant number of Scots and we would not be having the debate at all. Likewise, there must be something attractive about the UK, otherwise we would have become independent long ago. The essence of the debate should be an attempt to investigate these advantages while assessing the corresponding disadvantages.

Looking at the pros and cons of independence is to look fundamentally at two issues, money and power. Economically, the main pro is North Sea oil. It was the discovery of this resource which gave wings to the independence campaign some 40 years ago. Without it few in Scotland would ever have considered independence as an option. This is is not to talk Scotland down, but rather it is to recognise that Scotland’s position without oil would be not dissimilar to that of Wales, Northern Ireland and the North of England. Those parts of the UK, which were centres of heavy industry, have still not fully recovered from the decline of those industries. The difference between a Scottish nationalist and a Welsh nationalist is that independence is an economically viable option for the former, while it is not for the latter. The difference is oil.

At the moment oil revenues are shared in Britain. They help Scotland economically, but they also help Northern Ireland, Wales and England. But if we had these revenues to ourselves, clearly we would get more. It’s like a cake divided between four at present. If Scotland had the cake to ourselves, we could scoff the lot. For people, supposedly on the left, to put forward this argument has always struck me as hypocritical, but nevertheless, having all of the revenue from oil is clearly something to be counted on the pro side of the debate about  independence.

But what of the the downside? At present Scotland gains a share of central government funding from the UK, calculated according to the Barnett formula. This enables the level of public spending per person in Scotland to be somewhat higher than in England. In the event of independence,  this funding would obviously cease. As a newly independent country, we would also have a number of disadvantages. Our borrowing costs would certainly be higher than the rest of the UK (rUK). Assuming that we kept the pound, we would be borrowing in a foreign currency, which is inherently more risky than borrowing in our own currency. Moreover, as a new country we would have to establish a track record economically before the markets could assume that we would be economically prudent. We would likewise have certain start-up costs. We would have to set up things like a tax collecting agency, a pensions agency and a passport’s agency, not to mention an army, navy and airforce. No doubt, much of this would already be in place, but just as any new business has start-up costs, so too would Scotland. There would be some loss of the economies of scale, which at present we enjoy by being a part of the UK and most likely some disruption to the UK single market, which to an extent depends on us all living in the same country.

No one knows the exact figures and anyway they are subject to the bias inherent in this debate, but it is reasonable to guess that the advantages of having all of the oil revenue versus the disadvantages already mentioned, would leave us perhaps a little bit better off than we are at present, but not by much and maybe not at all. But it must be remembered that oil revenues fluctuate greatly and anyway are in decline. Scotland will not become Norway. Its too late and besides we are not remotely like Scandinavians. The main economic advantage of independence therefore can be summed up as a much greater share of a declining resource. Even if it we were to be better off in the short term, what about 30 years from now?

The other main advantage of independence is that we would not have to share power with Westminster. We would have complete political control from Edinburgh. But let’s look at how the political situation works at present. Under devolution the Scottish parliament already controls health, law, education, local government, road, rail and air, farming, fisheries and sport. The Scotland Act 2012 gave the Scottish parliament the power to raise and lower income tax. At present around two thirds of public spending is controlled by the Scottish parliament. What this means, in practice, is that we already have two thirds of the power. What power on the other hand is retained by Westminster? The UK government controls defence,  macroeconomic policy, foreign affairs, immigration, broadcasting, social security, pensions and the constitution. What this all means is that the debate about independence is really a debate about gaining power over these issues as to all intents and purposes we are already independent with regard to those issues that are already controlled by Holyrood.  

People in Scotland are able to influence the powers that are retained by Westminster, because we have a vote in each General Election and MPs from Scotland have frequently been important members of successive governments. This would clearly cease to be the case in the event of independence. Moreover, if Scotland became independent and kept the pound, it is doubtful that we would gain much control over macroeconomic policy. The Bank of England would still control matters such as interest rates and monetary policy. To remain successfully in a currency union with rUK, Scotland would largely have to follow the same economic policies as rUK. It might even be necessary for the rUK Chancellor to oversee the Scottish budget. The foreign policies of most Western European nations are generally very similar and  follow reasonably closely the line of the larger powers. To be frank, we neither know nor care about the foreign policy of a country like Denmark and Scotland’s foreign policy would be similarly irrelevant. If an independent Scotland were to be a member of NATO, we would be further pressured to follow the American line or face the consequences of US displeasure. If an independent Scotland wanted to retain an open border with rUK, we would not be able to have our own immigration policy as immigrants to Scotland could immediately move south of the border. Scots should ask themselves if gaining control over broadcasting, losing the BBC and ITV,  would give us better television and radio. Would gaining control over defence, including setting up our own version of MI5 and MI6 really make us safer? Each of us should think seriously about whether we would rather have our pension and social security rights guaranteed by the UK treasury or by a newly formed Scottish treasury?

While there are advantages to Scottish independence, there are also disadvantages. Most importantly, we would be giving up the shared solidarity of being citizens of UK. What strikes me as strange is that we would be turning ourselves into foreigners in order to take control over matters, which are often fairly abstract like the constitution, or which work well at a UK level and which frequently are not at all big issues at the average election. Holyrood already controls the day to day issues that affect our lives, like health and education. In the event of independence, there would be a new sovereign nation called Scotland. There would be a seat at the UN and no doubt, there would be a lot of flag waving. But practically speaking, we would not have gained much extra power. Breaking up the UK would cause years of negotiation and uncertainty. It would certainly spook the markets and damage the economies both in Scotland and the other parts of the UK, but the potential gains appear marginal and scarcely worth the trouble.

People who are desperate for Scotland to be a sovereign nation will not be concerned by any of this. It’s always worth remembering that some people would argue for independence even if they were to be worse off, because their ambition that Scotland should be a nation again is central to their sense of identity. The rest of us however, need to carefully consider the pros and cons of independence. Otherwise, the deal we are being offered when weighed in the balance might be found wanting.