Writing exclusively for Better Nation, Ruth Davidson, Glasgow MSP and Scottish Conservative leadership contender, sets out her political beliefs on identity and the constitution.
One of the more specious claims made by a number of Nationalists is Unionists can’t make a positive case for the Union. That’s just nonsense. The Union between England and Scotland has led to the most peaceful and prosperous times in our two nations’ history. So here are just a few reasons why I am proud to be Scottish and British.
Firstly I have never understood people who say you have to choose between being British and Scottish. It is like arguing you cannot be passionate about your club and national football team. Or even that supporting Andy Murray is incompatible with supporting Andy Murray in the Davis Cup. It is just absurd. Our identities are created by a number of factors, not just one narrow element. So I am proud to be Scottish and proud to be British. I know I am not alone in this. Millions of Scots instinctively recognise they can retain their Scottish heritage without rejecting the modern United Kingdom.
That dual-identity is at the core of my political beliefs. I am proud to be a Unionist. I believe Scotland is better off as part of the United Kingdom. We have more influence over our future, as well as other parts of the world. We are part of one of the worlds largest economies. We are part of a cultural relationship with our closest neighbour which has made both nations better off. Most of all the United Kingdom is greater than the sum of its parts. As a country we have worked together against some of the greatest tyrants and threats the world has known, and we continue to do so. That shared history, and shared success means people can be proud to be British.
Or as Annabel Goldie said recently: “I want the best for my country – and for me the best is being Scottish and British and working together for the good of us all.”
Yet despite being in this political and economic union, we have still been able to maintain our own sense of nationhood. The Church of Scotland, the Scottish Legal System and of course the Scottish Parliament, are all examples of how we have national institutions which help to ensure we can be Scottish, while also accruing all the benefits of being part of the United Kingdom.
There are other institutions which manage to combine the two as well. Look at the British Army. Despite three hundred years of integration, there are Scottish units with their individual identities, but who work together to create one of the most efficient and effective forces in the world. And look at the Scottish soldiers, seamen and airmen who serve in the Armed Forces. They do that because it serves both their nation, and their state. That role is one of protection, but also a chance to help make a difference in a wider arena
Because it isn’t just Scotland and Britain as entities that benefit, it’s individual Scots as well. By being British citizens it’s possible for Scots to be able to make a real difference across the world. There is nothing to stop a Scot from joining the army, or the Foreign Office where they can affect international politics. The United Kingdom is still a major power, one of the world’s largest economies, a permanent Security Council member, with one of the most effective diplomatic and military corps on the planet.
Scots influence the direction of a great nation. That is something we would lose if we lost the Union.
Unfortunately, small independent nations don’t have that influence. Look at the impact of the credit crisis upon Scotland and Ireland. In Scotland our banks were recapitalised by the UK Government. That protected jobs, protected the savings of millions, and ensured Scotland was spared the economic disaster which engulfed the (regrettably named) Arc of Prosperity. The Irish Banking sector was also bailed out, but much later, and without the guarantees which RBS and HBOS received.
The reason why we are better off is simple. Scotland is part of the United Kingdom, and that means the United Kingdom owes duties towards Scotland. Our security and our economy are guaranteed.
Of course there are issues where one part of the Union has done better than another. That is an argument for politicians to stand up for Scotland, not to give up on a partnership which has brought enormous advantage.
I am a Unionist because it is part of my identity. It provides me, and every other Scot with amazing opportunities to change the world. And being part of the United Kingdom allows us to be part of a greater country, one which is better able to face the threats, expected and unexpected, economic and security, which face us today. Scotland and Britain benefit from the Union and I am very proud to defend it.
So there can be no doubt Scotland and Scots benefit enormously from being part of the Union. I will never back down from defending the United Kingdom from separation. But it shouldn’t be the only focus of Scottish political discussion. I want to move the debate on. That is why once the Scotland Bill becomes law I think we need to stop discussing political process and start talking about real issues. That doesn’t mean there can never be any change in the devolution settlement afterwards, but it does mean we should work with the powers we have before evaluating whether more, or fewer powers are required.
I want this to be the decade when Scotland moves on from discussing devolution to making devolution work. I want to use the powers the Scottish Parliament has to make my vision of Scotland a reality. That means supporting families. It means supporting aspiration, and encouraging entrepreneurs.  It means ensuring our streets are safe, our schools are the best, and that everyone receives the best healthcare available.
Scotland faces huge challenges over the next decade. It is up to politicians to work on facing these real challenges, not engaging in unnecessary discourse.  Scotland deserves better.
As a Conservative, I am an optimist. I believe we can overcome the challenges Scotland faces. But there is no doubt it will be easier to accomplish as part of a strong United Kingdom. That is why I am proud to be Scottish, Conservative, and Unionist.
#1 by Craig Gallagher on September 26, 2011 - 6:29 am
There are more points of genuine debate in this post than in the two Labour ones that preceded it combined. I don’t think anyone expects the Conservatives to be anything other than staunch Unionists, but you’re not going to find many people seriously expecting them to win in an argument with the SNP about which of the two parties has Scotland’s best interests at heart.
Unfortunately (for them), Ruth Davidson and the Conservative Party (if they opt out of Murdo’s rejigging, which I imagine she hopes they will) are carrying a stigma which is extremely unhelpful to the Unionist cause as a whole. It should be profoundly worrying for anti-independence campaigners that the best arguments in favour of the UK are coming from the Tories rather than Labour or the Liberal Democrats. Many of them would do well to consider appropriating large swathes of this argument (Labour having appropriation form recently, as we know) if they seriously want to present an alternative to Scottish Independence. As an SNP man, I obviously hope they don’t, but as someone who at the same time is a little afraid of a unilateral SNP plan for independence proving very divisive, I hope they wise up.
#2 by Don McC on September 26, 2011 - 10:22 am
Sorry Craig, got to disagree. Ruth asserts there are many reasons for the Union but they all seem to boil down to the usual “too wee, too poor, too stupid” variety.
I guess we’re still waiting for a truly indisputable positive argument for the Union.
#3 by Aldos Rendos on September 26, 2011 - 9:49 pm
Completely agree Craig with your first point, no really nat bashing but good honest reasons for maintaining the Union. At the moment i’m pro independence but open to persuasion. Ruth’s positivity is far more likely to change opinion than any of the ‘we’re too small’ ‘we’re too poor’ rhetoric that Labour constantly peddle.
#4 by GML1320 on September 26, 2011 - 8:17 am
Despite Ruth Davidson’s service in the TA her use of the armed forces and the diplomatic corps as a defence of the Union seems a strange choice. The merger of the Scottish regiments was pushed through despite being extremely unpopular with many of the rank & file, RAF Leuchars is closing with very serious consequences for the local economy & there is a general programme of redundancies that look set to hit the military in Scotland (& the rest of the UK) very hard. This all coincides with a period when the armed forces have been engaged in vicious conflicts that have come to be characterised by an abject failure of UK diplomacy.
Whether you supported the wars in Afghanistan and Iraq or not (I don’t know Ruth Davidson’s opinions on these) the UK utterly failed to punch at its weight diplomatically & was dragged into both wars despite the great concerns that many had, opponents & supporters of liberal interventionism alike, on issues ranging from the legitimacy & legality of the both invasions to the amount of personnel, materiels & money needed to see them through or credible plans for nation building post conflict.
I don’t pretend to know what would happen to the military in an independent Scotland but the Union doesn’t seem to be doing too well by them now.
#5 by JPJ2 on September 26, 2011 - 9:22 am
“…and of course the Scottish Parliament”
Ruth, I love the “of course”.
The implication of your statement must surely be that your party just a few short years ago was horrendously wrong in opposing the creation of a Scottish Parliament.
Then it said that devolution was not in the interests of Scotland, would even destroy our nation-so why should any Scot believe anything other than that you are wrong about independence as well?
#6 by Gaz on September 26, 2011 - 10:29 am
Unfortunately, explaining why one is proud to be Scottish and British doesn’t amount to a positive case for the Union.
Some of the points Ruth makes are obviously genuinely held feelings but outside of these feelings her intellectual case does not stand up to any scrutiny.
I find it odd that nationalists are always accused of harking back to the days of Wallace and Bruce by the very people who hark back to the ‘glory days’ of the Empire. They are no more relevant (and in many ways far less relevant) to the Scotland of today.
And let’s not forget that every good thing the Empire delivered for us came at the cost of tyranny and slavery for millions round the world. Is imperialism really something the unionists want to base their ‘positive’ case for the Union on?
This imperialist tendency lives on today when Unionists talk about Scotland being able to influence the world through the UK and its seat on the UN Security Council. The reality of such rhetoric is that the UK is the poodle of the US of A and I don’t think this is the kind of ‘influence’ that most Scots would want to have. In any case, such influence is an aspiration for politicians with delusions of granduer (Blair, Brown et al) rather than for the ordinary Scot. I would think most Scots would seek to influence the world through trade, relief and exchange rather than political grandstanding. In essence a Nordic rather than American approach to the rest of the world.
Ruth is right to say the UK Government bailed out our banks. (By the way, isn’t it convenient that HBOS is considered a Scottish Bank when, in fact, Halifax took over BoS many moons ago). What she fails to mention is that the bail out was made with borrowed money – money which any government would have been able to borrow if it had the collateral to back it. And what is the major asset the UK has to offer in this regard? You guessed it – North Sea Oil and Gas reserves.
It’s also sad to see the too wee and too stupid argument rearing its head through condescending claptrap about the economies of Ireland and Iceland. These economies have had to withstand a severe test alright but they are recovering far better than good old Blighty. You would think from the way some people have been talking that we would have been swamped with refugees from the West. The standard of living in Ireland and Iceland remains substantially better than in Scotland and looks like it is going to improve faster too.
The countries with the real economic problems seem to me to be the USA, Greece, Italy and Spain with the UK not far behind. Funny how they are all states made from the political union of several smaller, previously independent nations/states. How inconvenient!!!
#7 by Mike on September 26, 2011 - 10:52 am
Oh dear.
“Scotland and Britain benefit from the Union and I am very proud to defend it.
So there can be no doubt Scotland and Scots benefit enormously from being part of the Union. I will never back down from defending the United Kingdom from separation. I want to move the debate on. That is why once the Scotland Bill becomes law I think we need to stop discussing political process and start talking about real issues.”
Ruth, sorry this won’t happen. You give the impression of someone utterly disengaged from the political process your amongst, its quite extraordinary.
#8 by lionel on September 26, 2011 - 10:59 am
“In Scotland our banks were recapitalised by the UK Government.”
Same old has-been argument from the Britnats isn’t it. Scotland (and Wales) would be too poor to be independent. Trying to push the inferiority complex doesn’t work any more. The Scottish people understand where their wealth would come from as an Independent country. It is that which the Westminster government and the leeching “Union” is happily taking away from Scotland, knowing that actually the Union needs the Oil and all of Scotland and Wales’ natural resources and will do everything possible to hang on to it. Including peddling the crap about England paying for the Celts.
#9 by Davie Park on September 26, 2011 - 11:25 am
First impression is that this is vacuous, ‘back-het’ stuff.
The usual invocations of military glory, world influence (to what purpose?), and straw-men eg;
” I have never understood people who say you have to choose between being British and Scottish.”
Who’s saying this?
There is absolutely no reason you can’t continue to consider yourself British just because you live in a Scotland which is no longer in a politically incorporating union with England.
Is it you who is saying we have to choose, Ruth?
I’ll return with a more considered response (hopefully) once I’ve walked the dogs and cut my toenails.
#10 by Manny on September 26, 2011 - 12:17 pm
“The Irish Banking sector was also bailed out, but much later, and without the guarantees which RBS and HBOS received.”
My understanding was that the Government did not bail out the Halifax Bank of Scotland but in fact gave the go ahead for a takeover by Lloyds TSB (An English bank).
Was this not the case?
This from Wikipedia: “HBOS plc is a banking and insurance company in the United Kingdom, a wholly owned subsidiary of the Lloyds Banking Group having been taken over in January 2009.”
#11 by Observer on September 26, 2011 - 12:22 pm
”In Scotland our banks were recapitalised by the UK Government”
That is the sort of statement I expect to read in the comments section of a newspaper, I do not expect to hear such a misleading statement from a candidate for the leadership of the Tory party in Scotland.
They were not ”our” banks, because their trading was not confined to Scotland. Therefore the responsibility for re-capitalising them would not have fallen to Scotland alone.
That is one of the sillier arguments against Scottish independence, I am disappointed that someone in Ms Davidson’s position would use it.
#12 by itsyourself on September 26, 2011 - 12:44 pm
I did not think much of this to be honest.
Say you are a Scot on the Daily Telegraph or Daily Mail comment sites and see how far that gets you Ruth.
I am well aware of what Tories really think of us. The recent Tweets confirm what they think of my missus and the kids too. There is no place for my family in your vision Ruth, no acknowledgement we are even people in your flag waving Portillista SAS style rant.
Narrow, paranoid, threatening and irrelevant to Scotland and its future.
#13 by James Morton on September 27, 2011 - 11:54 am
Well said – when I see some of those bile filled rants on conservative blogs referring to us subsidy junkies or our cities as welfare colonies – I am outraged and saddened. But then I get angry when I see the politicians get involved or those who would support union stay silent.
#14 by M G on September 26, 2011 - 12:45 pm
As a Scot I say this with a heavy heart, “Scots influence the direction of a great nation “,they sure did and if you seriously think any English person will welcome ‘a Scot ‘ to a position of power again ie PM ,in the current climate , perhaps Ruth you need to speak to your colleagues in London. Please don.t even go there regarding David Camerons background
#15 by Craig Kelly on September 26, 2011 - 12:46 pm
This is an excellent post and is exactly the kind of contribution that I was calling for yesterday in a comment I posted below Tom Harris’ article.
Ruth Davidson correctly points out that most Scots have a multi identity to varying degrees. Where she is wrong is that it is an exclusively Scots/British identity. For most, their identity is also laced with European – to varying degrees – and that is before we even begin on the plethora of other factors which make up our sense of ourselves.
Ruth makes various valid points and the tone of her article is almost perfect – I only wish she would drop the ‘separatist’ jibe. There are, however, also many problems with Ruth’s argument, such as this notion that Scotland would have collapsed in the midst of the economic crisis if we were not part of the UK. This is demonstrably untrue when we look at the way in which the EU has bailed out various struggling member states. That is where the term ‘separation’ is dangerous, because independence – for the SNP – is independence within Europe. Why would Scotland be anomalously abandoned by the EU amidst other bail out packages?
Furthermore, whilst scoffing at the ‘Arc of Prosperity’ in relation to Ireland, Ruth conveniently omits the example of Norway or the other Nordic countries, who, bytheway, are a far better comparator for Scotland than our Celtic neighbour.
Anyway, whilst I may not agree and I find it hard to relate to many of Ruth’s points, I think this is the kind of intelligent discourse that the constitutional debate deserves. It’s only unfortunate that she sees the discourse as ‘unnecessary’. If she would only revisit that argument, Ruth could make an excellent contribution to the Unionist cause.
#16 by Iain Menzies on September 26, 2011 - 7:04 pm
yeah…your european bail out point doesnt stand up old boy.
unless i have missed some pretty HUGE news, all the bailouts have been to Euro member states. now…unless the suggestion is that an indy scotland would automatically joing the Euro (and youd be having a laugh with that) then there is no reason to assume that a european bailout would happen.
But even if it did…..the assumption in your comments is that that would be a good thing. now i dont watch CNBC as much as i used to…..but i rather think that a scotland bailed out by the eu just now would be royally banjoed.
#17 by Indy on September 26, 2011 - 1:28 pm
I couldn’t even get past the first couple of sentences. The Union has led to the most peaceful and prosperous times in our two nations’ history? Eh? Maybe what she meant was that the Union led to an end to wars between Scotland and England but its a bit of a clumsy way of saying it. (And one would hope that it is not necessary, in the modern world, for two countries to enter into an incorporating Union in order to prevent wars!)
But if we are going to identify a political institution which has led to the most peaceful and prosperous times in our two nations’ history, surely it is the European Union?
#18 by Iain Menzies on September 26, 2011 - 7:08 pm
you could say the European union has done that…..of course there is a body of thought that would suggest that it was NATO rather than the EU that maintained the peace in western europe
#19 by Doug Daniel on September 26, 2011 - 9:35 pm
Well, the whole point of the EU was to lock Germany and France together to stop another war in Europe. It’s interesting you specifically say “western” Europe – after all, NATO had no interest in protecting Eastern Europe from war during the Cold War.
#20 by Iain Menzies on September 26, 2011 - 11:07 pm
pretty sure that the EU, and those institutions that came before it, didnt have any interest in protecting eastern europe during the cold war either.
#21 by Indy on September 27, 2011 - 7:52 am
No I would definitely say that it is the European Union that has cemented peace rather than NATO. Put simply NATO is a military alliance. The military don’t actually start wars. They fight them – but they don’t start them.
#22 by Iain Menzies on September 27, 2011 - 11:49 am
which moves us into the area of deterrence theory.
im not really sure how you can say that the EU cemented peace, if, as i assume, you mean by economic inter-connection, well that doesnt stand up to historical scrutiny. in 1914 Germany was one of, if not the, largest trading partner for the UK, and in ’39 France was Germany’s largest trade partner.
#23 by CassiusClaymore on September 26, 2011 - 1:51 pm
I didn’t bother commenting on the Tom Harris piece. The more he speaks, the better – as far as the Nationalist cause is concerned.
Ruth’s piece deserves closer examination. Here we go:-
“One of the more specious claims made by a number of Nationalists is Unionists can’t make a positive case for the Union. That’s just nonsense.”
Well, Ruth, it isn’t nonsense. But I’m glad you’re apparently going to break the mould and make a positive case for the status quo.
“I have never understood people who say you have to choose between being British and Scottish.”
Neither do I, Ruth. The island we live on is called Great Britain, so it would be geographically illiterate for any Scot to deny their Britishness.
“It is like arguing you cannot be passionate about your club and national football team.”
Oh dear. Is Ruth implying that the UK is a nation, but Scotland is not? The mask slips…..
“I believe Scotland is better off as part of the United Kingdom. We have more influence over our future, as well as other parts of the world.”
We don’t have more influence over our future, because we can be outvoted by the rest of the UK. If we were independent, we would have entire control. So, this is patent nonsense (and, if Ruth thinks that the UK is an influential nation, she is mired in post-imperial delusion. We’ve been relatively unimportant for a long time, and this has been increasingly visible since Suez)
“We are part of one of the worlds largest economies.”
Wow, Ruth. Should we seek a merger with America, so we can be part of the largest economy?
“We are part of a cultural relationship with our closest neighbour.”
Yes, Ruth, but I don’t see how our cultural relationship with England would necessarily change post-independence. For example, my wife would presumably still be English and I’m sure we’ll still get X Factor. They do in Ireland, after all……
“…….which has made both nations better off”
Is Ruth seriously saying that if Scotland had become independent in 1973, we wouldn’t have been better off financially than we are now? Oil, Ruth. Black and….oily. Worth a few bob. Heard of it?
“As a country we have worked together against some of the greatest tyrants and threats the world has known, and we continue to do so.”
Ruth could do with learning her history here. If she’s talking about WW2, she might recall that the US, Canada, Australia, New Zealand etc. managed to form part of the allied forces without being part of the UK.
In a contemporary setting, is she expecting us to be grateful for our opportunity to participate in Iraq, Afghanistan etc.?
“the Scottish Legal System”
Currently subject to a Supreme Court where only one member is Scottish-qualified, if I recall correctly. Thanks for that, Ruth.
“and of course the Scottish Parliament”
as long as it knows its place, eh Ruth?
“Look at the British Army. Despite three hundred years of integration, there are Scottish units with their individual identities, but who work together to create one of the most efficient and effective forces in the world.”
Yes, thanks for scrapping our historic regiments, closing 66% of our airbases and using us to store nukes a safe distance from the Home Counties. Oh, and for spending a disproportionately small pecentage of the defence budget. Another union dividend, I presume.
“By being British citizens it’s possible for Scots to be able to make a real difference across the world.”
Translation – as a Unionist politician I’d love a cushy gig at NATO, the UN, the World Bank or the IMF after I am turfed oot of power!
“Scots influence the direction of a great nation. That is something we would lose if we lost the Union.”
So…..an independent Scotland wouldn’t be a great nation? The mask slips once more.
“Unfortunately, small independent nations don’t have that influence.”
You’re so right, Ruth. Norway? Forget their immense wealth and rock-hard currency, they’re just irrelevant. Singapore? They’re just tiny and in no way the dominant Pacific Rim financial centre.
“Look at the impact of the credit crisis upon Scotland and Ireland. In Scotland our banks were recapitalised by the UK Government.”
Would this be the same UK Government which failed to regulate the UK banking sector, allowing our banks to leverage themselves to an unacceptable degree and exposing the citizenry of Scotland to the credit crunch? It didn’t have to be that way. Ask the Canadians or the Aussies.
“That protected jobs, protected the savings of millions, and ensured Scotland was spared the economic disaster which engulfed the (regrettably named) Arc of Prosperity.”
Yup, Norway’s really struggling….and Irish GDP per capita is still miles in excess of the UK’s…..but don’t let that stop you, Ruth.
“The Irish Banking sector was also bailed out”
Wow! How did a tiny, irrelevant country manage that then? (Answer – same way as the UK did – by borrowing the necessary sums)
“Our security and our economy are guaranteed.”
Jesus. Is this what you’re reduced to? We don’t need to be able to run our economy, because we’ve got a bunch of old Etonians in London to do it for us. Marvellous.
“Of course there are issues where one part of the Union has done better than another. That is an argument for politicians to stand up for Scotland.”
Sure. Just like Ted Heath did for our fisheries. Thanks Ted. And when oil was discovered in Scotland, the SoS stood up and got the revenues for us, didn’t he? NO?!
“So there can be no doubt Scotland and Scots benefit enormously from being part of the Union.”
Oh yeah, Ruth, you’ve really established that definitively. I now understand how stupid I’ve been.
“I will never back down from defending the United Kingdom from separation.”
Congratulations, Ruth.
“That is why once the Scotland Bill becomes law I think we need to stop discussing political process and start talking about real issues.”
Yes. The right to self-determination of the people of Scotland clearly isn’t a ‘real’ issue. My mistake.
“….fewer powers are required”.
You’re right, Ruth. We’re so stupid, I really worry that we have all these minor powers.
“I want this to be the decade when Scotland moves on….”
It will be, Ruth. Just not the way you want.
“As a Conservative, I am an optimist.”
Just as well, Ruth.
CC
#24 by Doug Daniel on September 26, 2011 - 2:12 pm
“Excellent, we’re getting somewhere” i thought when I started reading this article. However, the reality is this is just a better worded version of the same old rubbish spouted by every other unionist.
Ruth is proud of the shared history of Britain. That’s fine, but shared history does not mean we need to have a shared future. History is full of unions that have come and go, and there is nothing special about the UK that means it must be the only one to remain indefinitely.
“As a country we have worked together against some of the greatest tyrants and threats the world has known”
It’s a long time since Britain took unilateral action against a tyrant. Does this mean the UK should form a political union with everyone we’ve allied ourselves with in international conflict, particularly the USA, since we seem to take part in all their imperial adventures? Besides, there is much to be ashamed of from the building of the British Empire.
“I believe Scotland is better off as part of the United Kingdom. We have more influence over our future, as well as other parts of the world. We are part of one of the worlds largest economies.”
Seriously, how can Scotland have more influence over its own future while part of the union than it can as an independent nation? That’s completely non-sensical. As for having more influence over other parts of the world, well, it’s no surprise a Tory should be interested in influencing others. Personally, one of the attractions of independence for me would be a sudden lack of poking our noses into other people’s business. All the influencing we need to do can be done at EU and UN levels, without helping the UK government pretend it’s still the head of an empire.
“The reason why we are better off is simple. Scotland is part of the United Kingdom, and that means the United Kingdom owes duties towards Scotland. Our security and our economy are guaranteed.”
Security? So the only thing stopping Scotland from being invaded by America is that we’re part of the UK? Does anyone seriously think Glasgow airport would have been a terrorist target if the UK hadn’t dragged us into their oil wars?
And tell the deprived areas of Glasgow that their economy is guaranteed.
“Unfortunately, small independent nations don’t have that influence. Look at the impact of the credit crisis upon Scotland and Ireland.”
Are we still peddling this nonsense? Look at the impact of the credit crisis on the EU. Look at its impact on the USA. Look at its impact on the UK for Foulkes’ sake! If size had anything to do with how a country survived, then the USA, Italy and Spain would all be standing proud, and Norway, Finland and Sweden would be against the wall. Why is the UK government having to make all these cuts if it weathered the storm so well? Why are people telling Gideon Osbourne that he needs to change to plan B if the UK has done so well getting out of the crisis?
As for the banks this has been dealt with. Can we please stop with the simplistic rubbish that all the debt from international banks would belong to Scotland, purely because they used to be Scottish and their head offices were in Edinburgh?
“once the Scotland Bill becomes law I think we need to stop discussing political process and start talking about real issues. That doesn’t mean there can never be any change in the devolution settlement afterwards, but it does mean we should work with the powers we have before evaluating whether more, or fewer powers are required”
Ah yes, Ruth Davidson, the voice of progress in the Tory party.
“I believe we can overcome the challenges Scotland faces. But there is no doubt it will be easier to accomplish as part of a strong United Kingdom”
The problem is, you’re assuming the UK is strong in the first place. it isn’t.
The thrust of this article seems to be saying we should stay in the union because of all the great things the UK does on the world stage. For one thing, I don’t see how that benefits Scotland, and for another, I don’t actually agree that the UK does do all these great things. I don’t care about telling other countries how they should do things. As for being part of a big economy, well, some of the countries in the most trouble at the moment are massive economies – USA, Spain , Italy… and the UK! I don’t care about big, I care about better.
Still, an interesting read. At least we know now that, despite the hype, Ruth is no different from the rest of her party. I hope BN can get similar articles from Murdo and the rest.
#25 by Observer on September 26, 2011 - 8:15 pm
”As a country we have worked together against some of the greatest tyrants and threats the world has knownâ€
I rather fear she is referring to Iraq. If I am wrong she can correct me.
If she is referring to WW2 she should note that the first GE after the close of business then saw Churchill put out & Labour put in with their first ever majority. There is a theory that having a good war makes you popular. Not always.
#26 by Steve on September 26, 2011 - 3:53 pm
Has anyone read this piece by Kenny Farquharson in the SoS?
http://news.scotsman.com/kennyfarquharson/Kenny-Farquharson-Why-Union39s-fate.6842115.jp
When I first read it, I thought it was a bit far fetched, but reading this blog post from Ruth, I’m coming around to Kenny’s way of thinking.
#27 by James Morton on September 27, 2011 - 12:12 pm
I read the article but I am of the opinion something else is more likely to happen. If Fraser does not win, and one of the other candidates does – the Scots Tories will slowly wither on the vine becoming more irrelevant with each passing year. When the referendum does come, they will as old King Canute trying to hold back the tide. If Fraser wins, and he may very well do, the party will split down the middle and both will be consigned to rump party status. By the time the next election comes round, voters may very well leave it as they see no way for this new centre right party holding or gaining any influence with the larger electorate which has rejected centre right conservative politics since 1997.
But I suspect he is right about independence though. I don’t see the conservatives or Murdo Fraser being able to effectively champion the union.
#28 by Toque on September 26, 2011 - 4:33 pm
Hi Ruth,
If the Scottish Parliament is an example of “how we have national institutions which help to ensure we can be Scottish”, I’m presuming that you support the creation of an English parliament which help to ensure that the English can be English.
#29 by Barbarian on September 26, 2011 - 7:39 pm
I’m not overly keen on the Tories, not since they decided to make me redundant from the RAF many years ago, comletely messing up my career plans.
One point in her article however is correct – small nations do not have the same influence that larger ones possess. If that was the only argument for remaining in the union, it would be valid. However, it is not and there are more important issues at stake.
#30 by Observer on September 26, 2011 - 8:22 pm
I would prefer to be a small nation – because to state the bleedin obvious we are – & have our own little voice, than have to sign up to Imperialist pretensions. The only way the UK looks big is when it is Uncle Sam’s poodle. It is a Folie à deux that Britain has been locked into, Iraq, Afghanistan etc. Count me out.
#31 by Don McC on September 27, 2011 - 12:42 am
Barbarian, if this point had any merit, Ruth could point to an example where Scotland wanted one thing, England wanted another and the UK government stepped back, said “No, Scotland’s got a point here” and sided with Scotland. Just one example.
Of course, if no such example actually exists, it nails the whole lie about Scotland having any influence at all.
I’d rather have the influence of a small nation, minute though that might be, than the patronising talk about having influence as part of a greater nation (as long as you agree with the rest of the UK).
#32 by Barbarian on September 27, 2011 - 7:49 pm
I’m not arguing against having influence. It’s just that some people would have us believe Scotland will be come the Most Important Country in the World (apologies to Rhianna!). I’d rather Scotland prospered and any influence we would have would be welcome, rather than necessary.
#33 by DougtheDug on September 26, 2011 - 8:14 pm
Firstly I have never understood people who say you have to choose between being British and Scottish. It is like arguing you cannot be passionate about your club and national football team.
And there lies the difference between Ruth Davidson’s sense of nationality and mine. Alaskans can be proud to be Alaskan and US citizens, Queenslanders can be proud to be from Queensland and from Australia and Albertans can be proud to be Albertan and Canadian.
In each case their regional identity doesn’t interfere with the national one and since Ruth regards Scotland as the local team not the national one it therefore doesn’t interfere with hers either.
However I regard Scotland as my national team, a country not a region so I can’t be Scottish and British. You’re either one national identity or the other.
It’s just a confirmation of the Tory view of Scotland as a British region not a country.
#34 by Roll on Sausage on September 26, 2011 - 9:16 pm
Plenty of small nations, have a significant influence on the world – Norway and Switzerland, in particular spring to mind. I’d query exactly what the UK’s “influence” in the world is, because it the rhetoric seems to be baseless and vainglorious rather than backed up by hard evidence. We talk about independence for Scotland, where is the UK’s independence when it comes to the exercise of foreign policy?
On this issue of being proud to be Scottish and British. Absolutely fine. Whatever floats your boat. Why does independence mean you have to choose between being Scottish and British? Why?
Why does this British identity hinge purely on the existence of a parliamentary and sovereign union? Why could that identity not exist outside of the incorporating political union, we currently have? Is this dual identity so weak and so shallow that it would wither and crumble should Westminster be stripped of its ability to legislate for Scotland in the reserved areas of the Scotland Act? Seriously??
I’m deeply sceptical and slightly alarmed by this argument pedalled by Unionists and others that they need some kind of constitutional structure (ie the UK) to legitimise their identity. England, Scotland and Wales have deep, historical links and shared experiences, no question. But Unionists do have to understand that independence will not mean the end of that history or the ending of those shared experiences. It won’t mean the end of the Social Union. Or Britishness. It won’t even mean the end of Scotland working together in political and economic terms with the other nations of these islands. Things will be done in a different way compared to the top-down, quasi-imperial approach we have now, which benefits none of the countries on these islands.
#35 by Hugh on September 26, 2011 - 9:55 pm
I hear a lot of people here trying to claim that unionists always jump to the ‘too wee, too poor’ argument:
“Same old has-been argument from the Britnats isn’t it. Scotland (and Wales) would be too poor to be independent.”
That isn’t what is being said at all. No part of europe, if separated away from its constituent nation, would be too poor in the 21st century. Look at Ireland, horribly poor for decades but after reforms in the ’80s (combined with an educated workforce and cheap labour) became prosperous very quickly and pre-financial crisis was one of the richest countries per-capita in europe. What you loose in a small country is large capital spending on big infrastructure projects which they can’t finance on their own. High Speed Rail, if it ever comes, is an example – it requires huge initial state-backed investment in order to get off the ground.
Another familiar attack seems, oddly, to be on those who use the bail-out of the banks as a valid argument for defending the union.
“They were not â€our†banks, because their trading was not confined to Scotland. Therefore the responsibility for re-capitalising them would not have fallen to Scotland alone.
That is one of the sillier arguments against Scottish independence, I am disappointed that someone in Ms Davidson’s position would use it.”
This, to be perfectly honest, astounds me. Have we not forgotten how bad things got in the autumn of 2008? The Scottish Gov’t was planning a capital injection of £200m-odd to rescue HBOS (registered and headquartered in edinburgh) and RBS. The final bill to bailout the banks (admittedly includes northern rock and b&b) will be at least £850bn, possibly more. There is no way an independent scottish administration could have coped with this amount of debt on its own. The exposure was more than ireland, or iceland. Have you noticed how the ‘case studies’ of better off nations has been removed from the SNP website? If you go to Ireland now and see just how bad the cuts are you will understand that in Scotland and the rest of the UK as a whole we are far better off. Our cuts may be bad, and we will protest against the ideologically driven ones, but they are in no way near those in ireland, where taxes are rising sharply and welfare payments cut (even the minimum wage). Scotland would have had to default on its own, spreading the malaise, and face huge budget cuts and bailouts. This has not happened because it is in the UK. The conceptual point is simple. If anyone here now thinks that the world is now more prone to financial crises (I certainly do), the optimal size for a nation-state has gone up. Risk-sharing really matters.
As for the economic argument, the figures are all available, in the public domain. Public spending in England is £7,535 per person, while in Scotland it is £9,179 and since the Scottish Parliament was created in 1999, public spending has outstripped tax generated there by 45 per cent. These figures are often disputed because of the role of oil. North Sea oil and gas is not only decline in the north sea (with production falling from 2559 million barrels in 1999 to 1452 million in 2007) but it also is in terms of its usage, with Sweden for example trying to phase out oil altogether by 2020. Its simply economic madness to try and base the future of a nation’s economy on oil and gas, and financial services, especially in this climate. All the talk of more renewables and a ‘reindustrialisation’ of scotland is empty with budget cuts and declining private investment. A cheap point, but the FN of France have the same argument, its merely a pipe dream.
The SNP and their supporters like to have it both ways. For example if the economy is doing well, they say it proves that Scotland can go it alone. If the economy is doing badly, they say it proves that Scotland is being constrained because it is in the union and it should go it alone to realise its economic capability.
As for the ‘imperialist’ argument, and the one over the reduced role of Scotland in the world post independence, don’t just look back over the wars of the labour years. Yes it is embarassing, and I do also disagree with the wars in iraq in afghanistan. But I agree with other aspects of Britain’s foreign policy, and its lead on many things in the world. Take economic aid to the third world for example. We will have exceeded our own aid targets set at Gleneagles in 2005, far in excess of comparable eu economies, but also more than even the US. However much I dislike cameron, I think he is right that we should stand for something in the world, even in this age of austerity. Look what has happened in Libya. Britain and France took the lead to help the libyan rebels rid themselves of one of Africa’s most horrific despots, in power for 41 years, ahead of the americans. And we are pressurising Syria too. So our foreign policy has tangible benefits too, and Scotland plays an important part in this as part of the UK.
#36 by Richard Thomson on September 27, 2011 - 11:22 am
“There is no way an independent scottish administration could have coped with this amount of debt on its own.”
Hugh – let’s suppose for a minute you’re right and that a Scottish Government would have had to have taken on all this debt by itself, which it would then have lacked the resource to manage.
What would have happened next?
#37 by Richard Thomson on September 28, 2011 - 10:46 am
No answer, Hugh? 🙂
#38 by Hugh on September 28, 2011 - 6:47 pm
Sorry, didn’t see this one!
What do you mean what would’ve happened next? Personally I have no idea, the following is just speculation, a bit like the economic argument for independence.
In my humble opinion, I’d say possibly a bailout (EU, IMF or otherwise), if there was one if would almost be accompanied by a horrible austerity plan (as seen in Ireland & Greece). If that didn’t work, maybe a default? If that were the case borrowing on the world markets would be out of the question, liquidity might then dry up. Government investment would almost drive to a standstill, and private investors would be scared off by the uncertain climate (confidence is a very strange thing). Scotland, if she were in the euro, would probably have to leave, but even persistent devaluation would not guarantee a quick recovery because of the difficulty of raising capital on international markets as a result of the default.
These are all quite gloomy scenarios, but they’re not without precedent. Argentina defaulted back in 2001, and it was fairly messy. But its quick recovery was mostly because of the rosier global economic circumstances in which it took place. If we look at 2008 the picture was far gloomier, the IMF had already shelled out for the icelanders and if I am not mistaken contributed to the EU bailout fund, so the kitty was less full than it had been in 2001. Also it was becoming increasingly politically toxic for the big creditor nations in the EU of Germany and to a lesser extent the Netherlands to contribute to the bailout fund for what they saw as reckless economic policy. Of course it is possible that, given the size of the banks headquartered in Scotland, the rest of the world would have had to intervene in order to save them to prevent the malaise spreading. We also need to take into account the possibility of Scotland already running an account defecit; this is not certain but a number of economists believe that she would (http://www.guardian.co.uk/politics/2007/feb/08/scotland.britishidentity1).
All in all it’s difficult to answer a counterfactually grounded question such as that, but I for one believe that it is undeniable that Scotland had the best deal given the circumstances by being part of the UK which had the economic buffer to cushion the impact of the bank bailout, and prevent far-reaching austerity measures that might have been implemented by a foreign authority (such as the IMF or EFSF).
What’s your view?
#39 by Richard Thomson on September 28, 2011 - 9:35 pm
Thanks for that, Hugh.
“What do you mean what would’ve happened next?â€
I mean exactly what I asked. I’m always curious when confronted with the ’Scotland couldn’t have bailed out the banks on its own’ argument what the proponent of same imagines would have happened next if they were right, or why it would even matter if others had to step in. Maybe it’s just me, but it conjures up images of the Four Horsemen of the Apocalypse thundering over the horizon, along with years of famine and the selling of first-borns into slavery. Or I could just have spent too long listening to Jim Murphy on the subject 🙂
I think you get it about right when you allude to the fact that RBS was too big to be allowed to fail and that’s what this comes down to – the banks concerned operated well beyond Scottish markets and as such, if they had been allowed to fail, the implications would not have been confined to Scotland.
To that extent, I don’t think would have mattered whether Scotland was independent or not or even in the Eurozonre or not. If RBS and HBOS had been allowed to fail, the rest of the UK economy would have been taken down with them. For that reason alone, it wouldn’t have been allowed to happen and the end outcome would likely be pretty similar to what we have now – the Bank of England as lender of last resort would have been compelled to step in to cover a sizeable share of the guarantees needed.
Remember, the BoE would still have been the central bank for an independent Scotland within the Sterling zone, while the FSA, not the Government of an independent Scotland, would have been responsible for regulating the banks’ operations in rUK. If you’re looking to precedent, think the cross-border bail-out for Fortis. It would have been a bit of a blow to Scottish pride to have RBS 90% owned by UKFI, but it would only have been a recognition of the reality of where much of the banks’ business was conducted.
I can hear the catcalls already – does that make independence a contradiction? It depends what you see as independence. As you say, the economies of Scotland and rUK are heavily intertwined. Then again, so too were (are) the economies of the UK and Denmark, or the UK and Ireland.
The fact that Standard Life has a lot of policyholders in the Home Counties doesn’t mean that a Scottish Government shouldn’t have full control over taxation and revenues, the ability to represent itself overseas or the ability to decide when to commit forces to military action. Nor does a British banking crisis mean that the maintenance of British state is either necessary or desirable going forward in consequence.
I understand the view that Britain is a force for good in the world and Scotland plays a bigger role for being part of the UK, even if I don’t happen to agree. However, the fact that the economies of Scotland and rUK are heavily intertwined, in good times and in bad, to my mind at least doesn’t affect the desirability of Scottish Independence. We’re talking about self-government, not isolation, after all.
#40 by Hugh on September 29, 2011 - 12:28 am
Hello again!
I should start by saying that I do think that the fact that Scotland is part of the UK has made a huge difference, and that the scenario might well have been far worse had she been independent. Those coming from a nationalist perspective have permission to roll their eyes here, ‘not another apocalyptic argument’ you may say, but there are several reasons in my view as to why Scotland was better placed as part of the UK than out of it.
i) As we know, those countries which have been bailed out have not had a blank cheque written for them by the EFSF or the IMF, but instead numerous strings have been attached to the various bailout funds.
Ireland for example had a huge banking system which was horribly exposed to US sub-prime debt. As part of its £85bn plan, over the next four years there will be £10bn of spending cuts and £5bn of tax increases. 25,000 jobs will be cut, and £15bn will be saved by 2014 through cuts in public sector pay, pensions and social welfare. Now I don’t know for sure how bad the ‘austerity’ measures planned by the present government will be, but I don’t think it will be as bad as what is being asked of Ireland by its creditors. They currently have a 14.5% unemployment rate, many well educated professionals are moving abroad, creating a so-called ‘brain drain’ which may affect their economy for several years hence.
Scotland on the other hand, despite having an equally unstable banking system, had the luxury of a safety net which, as part of the UK, prevented her from facing such harsh financial penalties. Ireland will be paying back these loans for years, but Scotland, as part of the UK, will be paying back a far lower amount per-capita because the debt burden was, in a sense, diluted by the UK’s stronger economy and larger population.
ii) Depending on how soon into the crisis Scotland was bailed out, she might have had to be bailed out again because of its exposure to the debt burden of other nations by its poorly capitalised banks. If, hypothetically speaking, Scotland had to be bailed out before Ireland because of its more heavily indebted banks, it might have had to be bailed out again because the financial markets turned on Ireland and it was no longer able to refinance its debt in a sustainable way. This chart goes some way to showing how exposed the UK was (we gave a £7bn bilateral loan, being absent from the EFSF as we’re not in the eurozone).
http://www.ritholtz.com/blog/wp-content/uploads/2010/11/IRELAND_bail_out-002.jpg
Two of the three British banks mentioned are headquartered and registered in Scotland (I make the assumption that Lloyds on the diagram includes HBOS, since it was published at the time of the Irish bailout in nov 2010, whilst the Lloyds/HBOS tie up was completed in jan ’09).
iii) As bad as it might sound, there would be no guarantee in your scenario that Scotland would have actually been bailed out by the rest of the UK. As we have seen from the toxic politics of the eurozone bailouts, the electorate in Germany and other ‘creditor nations’ has been unwilling to stump up the cash to bail out the eurozone, despite the pressing nature of the issue. Of course you could argue that this is because the case for bail-out hasn’t been adequately communicated to the electorate by politicians in Germany, but the fact remains. If Scotland were to need further bailouts (hopefully unlikely but not an altogether remote possibility) then who’s to say that the electorate in the rest of the UK would stump up the cash if Scotland was independent? Especially if she had only recently become independent, then I’d say there would probably be more antipathy, a sort of ‘you chose to leave, so pay your way’ scenario. Now this is potentially quite a weak argument given the number of assumptions it is based on, but I certainly think that it would have been possible for the gov’t to turn around and say no, if that were what the electorate were demanding.
This last quote puzzles me a bit, with a more general point on the economic arguments for independence, leaving the financial crisis aside for one moment;
“Remember, the BoE would still have been the central bank for an independent Scotland within the Sterling zone, while the FSA, not the Government of an independent Scotland, would have been responsible for regulating the banks’ operations in rUK”
Since I made my first comments recently I have noticed that one of the main arguments put forward for independence was ‘to get control of our economy’. So why have independence if the macro-economic levers of raising interest rates, or regulating the banking system, are not available for Scottish ministers? Surely these are the only sure-fast way to regulate the banking system, the collapse of which is often blamed on the light touch laissez-faire regulation ‘london’. It would seem that under the independence you put forward, Scotland would lose any political control she had over those levers (through the democratic process in the westminster parliament). So if anything, Scotland would get [i]less[/i] control over her finances because the political pressure to enfore greater regulation would not be there.
Under the present Eurozone system, the ECB sets interest rates based on the economic performance of the 17 eurozone states. But under the ‘independence’ you put forward, Scotland would lose control over its interest rates since they would be set by the BofE based on the economic interest of the rest of the UK, excluding Scotland. Scotland would essentially be signing up to a currency she would have no control over (let alone her own interest rates), so having all of the problems of a multi-nation currency with none of the benefits. Devaluation and trading out of the debt whole would be extremely difficult without any control over interest rates, as we see in Ireland, but at least the ECB is keeping a close eye on events and may adjust interest rates if things get any worse for its members (as set out in the maastricht treaty), I daresay the BofE would take into account Scotland’s position if she were independent.
The idea that under independence ‘nothing would change’, except that Scotland would be a sovereign nation on its own once again asks the question, why? What benefits would it bring if the political control over the economic levers was lost? The SNP use the ‘nothing would change’ argument to try to make independence more attractive to the electorate, as we know that most people don’t actually like change. This is why I can’t understand the arguments for independence on the economic front. Politically, well there’s devo-max, or a federal UK, and the current position is already very enfranchising, but independence? I’m sorry but I still don’t see where the arguments stand up.
#41 by Richard Thomson on September 29, 2011 - 10:14 am
Hi, Hugh.
You’re right – there’s no guarantee that HM Treasury or the BoE would have lifted a finger. However, the consequences of them not doing so – for savers and borrowers in the rUK, both institutional and individual, would have been pretty catastrophic and ultimately self-defeating.
Yes, the banks were HQ’d in Scotland – even the Lloyds TSB Group was brass plated there. However, I say again, the consequences of a collapse, which arose due to banking activity which took place outside of Scotland, is not one which would or could have been confined to Scotland.
Whatever the domestic rUK reaction to propping up the activities of Scottish registered banks, HM Treasury and the BoE wouldn’t have been able to stand aside and watch the financial conflagration which would then have resulted south of the border. Not even the most Scottophobic elements of the Daily Mail readership would have stood for that if they saw the prospect of their pensions and mortgages disappearing down the plughole.
“So why have independence if the macro-economic levers of raising interest rates, or regulating the banking system, are not available for Scottish ministers? Surely these are the only sure-fast way to regulate the banking system, the collapse of which is often blamed on the light touch laissez-faire regulation ‘london’.â€
No. The only way to control Scottish interest rates would be to have a Scottish currency, which no-one is advocating at present and like every other tradeable currency in the world, interest rates would still, under most circumstances, move in line with those of other major currencies. Even then, financial regulation remains a matter for individual governments, irrespective as to whether or not they operate their own currencies.
I don’t think many could take seriously the idea that Scotland has much control over interest rates through Westminster – remember Eddie George’s quote to the effect that unemployment in the North (presumably meaning anywhere north of Birmingham) was a price worth paying for prosperity in the south? What independence would give – whether in Sterling or the Eurozone – is control over all other aspects of taxation, revenues and allowances. That doesn’t liberate you from the need to meet certain debt requirements, but it gives you the policy levers to mitigate against certain factors and as such, is a far stronger position to be in than that pertaining at present if you wish to be able to steer a path back to growth.
You could, as you say, have ‘devo max’ – which depending on how it is defined might not be too far removed, economically at least, from the SNP view of independence. However, despite the chatter, there doesn’t seem to be much appetite from any of the Westminster parties to deliver anything which would come close. Similarly with a Federal UK – that’s not something which Scotland can impose unilaterally on the rest of the UK. Given the lack of a coherent campaign for an English Parliament and the resistance shown by voters to English ‘regionalisation’, London excepting, Federalism is something which is decades off, barring some sudden and dramatic change in English public opinion.
The economic advantage to independence for me is straightforward. It scraps the Barnet Formula, and breaks the link between Scottish budgets and English public spending. It gives a Scottish Government of whatever hue the maximum opportunity to configure business and personal taxation to meet economic and social objectives. It creates an unbreakable link between government spending and accountability, since you have to justify taxation levels to Scottish voters. It creates an incentive to spend efficiently, and not, as has happened in the past, simply throw cash at popular measures in the hope of an electoral reward. Crucially, it also ends the tedious argument about who subsidises who, while having the positive side effect of allowing an answer to the West Lothian Question.
At a stroke, it removes a lot of the tensions which currently exist in the Anglo-Scottish relationship. Independent EU membership would also, paradoxically, give Scotland and rUK greater combined influence in the Council of Ministers and European Parliament than the UK has at present. Crucially, it would do nothing which would prevent both countries from working together internationally where interests coincided, and where they don’t, we’d be free to make our own arguments and build our own alliances, without undermining the strong economic, social and cultural relationship which would continue to exist between Scotland and England.
I think this is a good debate, and it shows how the much vaunted unionist/nationalist divide actually isn’t that wide in some respects at all. As someone who believes in the idea of the UK as a force for good in the world, you’ll almost certainly disagree with some of my latter points. However, I hope I’ve at least been able to explain the economic rationale, even if it’s not something which you buy into yourself.
Regards,
Richard
#42 by Hugh on September 29, 2011 - 9:43 pm
Richard,
I agree with you that, if Scotland had been independent, the BofE would probably have had to begrudgingly bail her out because of the financial implications for the rest of the UK would have been disastrous. This is true despite the political toxicity of bailing out another nation which is seen to be less prudent (as seen in the Germany-Greece scenario, though thankfully they passed another injection of cash today). But this doesn’t change likelihood that as a condition for the bailout, painful austerity measures would be enforced which I think it is agreed are far worse than those currently being experienced. It also doesn’t address the point I made about the possibility of Scotland being bailed out again, as seen in Greece, with potentially even more deep cuts and austerity measures. As I have said numerous times, and as many economists agree, Scotland was far better placed to weather the storm of the 2008 financial crisis and bank bailout as part of the UK, since at the time our debt/gdp ratio was lower than it had been for decades and we had the ability to bail ourselves out without string-attached-assistance from outside bodies.
“No. The only way to control Scottish interest rates would be to have a Scottish currency, which no-one is advocating at present and like every other tradeable currency in the world, interest rates would still, under most circumstances, move in line with those of other major currencies. Even then, financial regulation remains a matter for individual governments, irrespective as to whether or not they operate their own currencies.”
Firstly interest rates do vary considerably between major currencies, as can be seen here:
http://www.forexpeacearmy.com/trader_tools/interest_rate
The range is a base rate of 0% for the Swiss, and 4.75% for the Australians, partly because the make up of their economies is quite different.
Secondly as we have seen in the eurozone crisis, you can’t realistically have a currency union without an economic union as well. So Scotland would still have quite a lot of economic dependence on the UK, despite its apparent independence. It was the paradox of the economic independence argument that I was trying to make apparent, in the light of the global financial crisis. Here is an (admittedly quite simplistic) article on the weaknesses of the eurozone, which would have inevitably applied had the rest of the UK and Scotland been in monetary union but not fiscal union; http://www.npr.org/2011/01/25/133112932/paul-krugman-the-economic-failure-of-the-euro
And yes, you’re right, financial regulation remains a matter for each individual country. But the SNP’s economic argument for independence rested half on the fact that Scotland’s financial sector was a success. And success it was, pre-crisis, RBS was one of the world’s biggest banks. What I’m trying to say is why would Scotland have regulated things any better than the UK?
And to the point about Scotland not having control over the UK’s interest rates, well EG was talking about the north of England, not Scotland, and that was back in 1998. And the Bank of England base rate is the rate at which it lends to financial institutions, many of which are majority owned by the state and headquartered in Scotland, so it does have an affect in Scotland, the financial crisis has redoubled that.
As for talk of a federal UK, yes it’s very nascent now, but I think that is the way things will go if Scotland does not become independent. The relationship between the constituent countries of the UK is changing and I think the constitutional settlement needs to reflect that. The main problem, yes, would be how to sort out England – pointless having its own parliament due to its size. There was a referendum a few years ago on this but I think it was defeated mainly due to infighting over where the HQ of the regional assembly would be, although I may be wrong on this. I would say that for your point on the tensions that exist in the anglo-scottish relationship, the SNP’s policies on tuition fees and prescription charges have whipped these up somewhat (I do think it a little conniving for the SNP to create policies designed to create more animosity, as a way of getting the English to agree to Scottish independence, even if the Scots themselves don’t). As for the argument of Scotland and England working together if Scotland became independent, well don’t they work together well enough now?
I agree with you on the merits of the debate. I have to say that I believe we are repeating ourselves a little now, so I may not post anymore on this particular article. I do personally believe that the economic argument will be where independence is won or lost; although perhaps a little soulless to think only in terms of cost-benefit analysis, if Scots’ quality of life and per capita income doesn’t increase then what’s the point of seceding? It is also my view that at the moment there is not a strong economic argument for independence, although perhaps over the next decade one will emerge, and if it does I am open to be swayed over to the independence camp.
#43 by Richard Thomson on September 30, 2011 - 10:21 am
Not sure why it won’t let me reply to your comment below, Hugh. Anyway, I agree this is in danger of going over old ground, so I’ll confine myself to the following:
As someone else wisely said earlier, all of this is conjecture, as we just don’t know what would have happened. Its hard to know how an independent Scotland would have regulated the banks. As for more severe austerity measures, we can’t rule that out under any circumstances. My point is and remains solely that it wouldn’t have been left to Scotland alone to resolve the problems around HBOS and RBS.
Yes, interest rates do vary. My point wasn’t that they couldn’t vary considerably between countries, but that the direction of travel and the scale of increases/decreases was broadly similar. When the old Bundesbank or the Fed increased rates by half a point, the BoE followed next day. That sort of thing.
If the crisis shows anything, it’s that no country, not even Cuba or North Korea, is economically independent. Scotland carries out about 2/3rds of its trade with the rUK, which is actually a lower share than was the case for Ireland and Denmark back in 1973. It’s not of itself an argument for political union, although I take your point about the precarious nature of currency unions in the absence of enforceable indicators and resource transfers.
If Eddie George was talking only about the North of England, he didn’t do much to clarify that at the time. The point of the outrage was precisely because the BoE interest rate was highly relevant to Scotland and was perceived by many to be too high.
As for the SNP ‘doing it deliberately’, as a certain Peer of the realm once wailed, it’s a fundamental misunderstanding to assume that the SNP sets a policy agenda with the intention of whipping up tensions. The party’s free education policy is one which predates Holyrood, as is free prescriptions – you might as well argue that Labour and the Lib Dems were only trying to whip up animosity by introducing free personal care 🙂
And that’s part of the problem. Devolution wasn’t about Holyrood maintaining the status quo, or simply providing a different forum in which to implementing policies decided at Westminster which weren’t supported in Scotland. If Westminster wants to go down the route of cutting central gvt support for English universities, filling the gaps with student contributions, then I can’t really argue with that. What I can argue with is the contention that by not following suit, the Scottish gvt is only doing so not out of principle, but simply to wind up the Daily Mail readership.
I can also find fault with the fact that the Westminster decision has had such a knock-on effect on the Scottish budget through Barnett. Just imagine a future Cameron government decided to increase the involvement of the private sector in the NHS south of the border, cutting government NHS spending by 25% in favour of a system of private insurance – would it be similarly stirring things if a Scottish government decided to maintain the status quo? And don’t the resulting financial knock-ons of Barnett make a mockery of devolution, since it creates intense pressure to follow suit?
To end, I think the quality and responsiveness of government is the main argument I have in favour of independence, rather than just simple economics. However, it’s encouraging to see you say you might be open to independence, even if you’re not right now. One thing unionists and nationalist should be able to agree on is that Scotland is a great place to live in, and that it makes a big contribution to the UK. Where we differ is on the manner in which that contribution and co-operation should take place in future.
#44 by Observer on September 27, 2011 - 5:08 pm
You are making the same fundamentally stupid mistake that Ruth did. No way would an independent Scottish government have bailed out the RBS (which was the big one) on its own. It could not have afforded that & it would not have been obliged to do that out alone – because the majority of its trading was outside Scotland. The Framework Document for Crisis Management in the Banking Sector from the EU makes it absolutely clear that when approaching cross border financial interventions the principle of trade in the affected jurisdictions determines what financial commitment is made. It is simple scare mongering to threaten Scots with the prospect of bankruptcy if there is another banking crisis. You might as well say that the sky will fall in.
#45 by Aidan on September 27, 2011 - 5:46 pm
that document post-dates the financial crises, it was produced as a response to it, it didn’t exist at the time of the HBOS or RBS bailouts.
#46 by Observer on September 27, 2011 - 7:27 pm
That’s correct Aidan. The document spells out how cross border banking crisis would be dealt with. It makes a rubbish of the argument that Scotland would be bankrupted in a future repeat of the 2008 crash. So why do people like Ruth ignore it?
#47 by Aidan on September 28, 2011 - 10:29 am
The point though isn’t that Scotland would now be in a position to deal with the last crisis if it happened again, it’s that by standing in solidarity with the rest of the UK we’re in a better position to deal with the unknown slings and arrows of the next crisis.
#48 by Doug Daniel on September 28, 2011 - 12:17 pm
Well, you’ve got one thing right: as long as we remain in the union, we can expect another crisis.
#49 by Aidan on September 28, 2011 - 12:26 pm
Oh aye, cause the global financial crisis totally avoided the independent arc of prosperity didn’t it? ‘Sake…
#50 by Nik on September 26, 2011 - 10:58 pm
Hugh, no-one has forgotten how bad things got in Autumn 2008. It still doesn’t change the fact that Scotland wouldn’t have been liable for most of that debt, though.
With regards to the bank bailout going to cost £850bn, perhaps you should read this:
http://www.guardian.co.uk/politics/reality-check-with-polly-curtis/2011/sep/12/reality-check-banking-bailout
#51 by Richard on September 27, 2011 - 8:38 am
All of these arguments that Scotland could or couldn’t have bailed out the banks are resting on one specious assumption – namely that had Scotland been independent, we would have had exactly the same “light touch regulation” as England over the preceding 30 years.
Given the national trait of financial canniness for which we are famed (with the obvious exception of Broon/Darling, thirsty for WM power), I find this hard to stomach.
#52 by Iain Menzies on September 27, 2011 - 12:10 pm
with out getting into if Scotland as an indy nation could have bailed out Scottish banks, or even how much of that bailout Scotland would have been liable, that issue is so far from relevant its a total waste of everyones pixels.
Some people will say Scotland coulnt on its own do that, I happen to be one of those people.
Others will say that Scotland wouldnt have had to pay the full whack, possible, even if that would probably have left the banks to collapse. But that doesnt matter either.
The point is that WE DO NOT KNOW.
Scotland, as we are all aware and happy/unhappy about was not independent in 2008. You and I have no idea what a banking regulatory system would have been like if Scotland was independent in 2008.
What happened in the context of Scottish independence doesn’t matter, what does matter is the consequences.
An independent Scotland would start off with a debt liability of more that £100Bn. That gets us on for a debt to GDP ratio of 100%. Thats nasty as all get out.
The problem i have with the ‘debate’ over scottish independence, and i have had it with many people SNP and not, is that , especially, when talking to Nats, there is a constant refrain of ” it wouldnt be like this is scotland was independent”. But it IS like this. And the SNP is NOT showing how independence would improve matters.
Case in point the question of currency. As best i can understand it the SNP policy is to stick with the Pound until such a time as another referendum is held in an indy scotland to change.
This is nonsense, i have heard the SNP moan (and oh how they moan) about interest rates set for the south east and not Scotland. But an independant Scotland would have no right to input, or even consideration as to the effect of interest rate changes by the Bank of England. Now we can argue if scotland is taken into account just now or not. But it doesn’t matter, the MPC has a duty to the BRITISH economy, even if that is an economy that is dominated by the south east.
One final point on the lines of the unionist just dont know the arguments or they would fall in love with independence meme.
About a year ago i had a chat with a friend (SNP member) and sometime poster here. It was at the freshers fayre at dundee and he was manning the SNP stall. And i told him i was considering joining the snp….but that i was waiting to see what happened with the SDSR. Now as it happened i didnt. but the reason i was thinking was because one of, if not the greatest reasons I believe in the Union is that i believe not only in what we can do for ourselves, but what we can do together as a United Kingdom. Plenty of the lefty nats can bang on about imperialism (even if we havent added one single colony to the ever expanding British empire) but I believe that Britain is a force for good in the world. In Britain we can DO good. Liam Fox is a Scot and was central to the effort in Libya. I cannot, on grounds of common sense, believe that Scotland would be able to contribute in the way the UK does.
PS, i almost retyped that last sentence but haven’t. Because its wrong. Right now Scotland doesnt contribute. and an indy Scotland would be able to. that much i give to the nats. but Scots, can just now in a way that they wouldnt in an independent Scotland.
#53 by Richard Thomson on September 27, 2011 - 1:28 pm
“This is nonsense, i have heard the SNP moan (and oh how they moan) about interest rates set for the south east and not Scotland. But an independant Scotland would have no right to input, or even consideration as to the effect of interest rate changes by the Bank of England.”
That position may be many things, Iain, but nonsense isn’t one of them. Have you given consideration to the fact that upon independence, a pro-rata share of the BoE assets and MPC governance may well be one of the outcomes of any settlement?
Retaining Sterling until and unless the voters decide in a future referendum to adopt the Euro is, unless I’m mistaken, the policy of both Labour and the Lib Dems, as well as the preferred position of Conservatives who support eventual Euro membership, even though they be ever so few in number. What exactly about that position makes it coherent from a British unionist perspective, but ‘nonsensical’ if it’s held by a Scottish nationalist?
Trying to be as objective as I can here, saying that Scotland shouldn’t be independent because UK banking regulation failed and Scotland would have to cop a proportionate share of the resulting national debt, isn’t the most convincing argument I’ve ever heard for maintaining the British state in its current form.
#54 by Iain Menzies on September 27, 2011 - 3:48 pm
The question of assets and governance are distinct i think. ON the assets from, well that may well amount to not much more than a huge pile of debt. On the issue of governance, well i tend to take the view that if your gonna call a country independent it needs its own central bank. It is not at all a given that scotland would have any imput on the MPC. it is after all the bank of england….and that england part may come to mean one helluva lot more if we saunter off. Indeed you concede that point yourself as you say these things may come to scotland.
On the Euro/Unionist point…..personally i dont accept that you can be a brit nat as it were and support the euro as a replacement for the pound.
Anyway i wasnt making a case for staying in the union, though that is the position i take. Rather i was taking issue with the state of the ‘debate’ such as it is. Nats go it wouldnt have been like this is we were ‘FFRRREEEEEEEEEEEEE’ unionists tend to say oh you would be stuffed if it wasnt for the union.
As it happens i think an independent scotland would be fine…for a few years….then we would have SERIOUS issues. but would sort them out….much like sweden has over the past few years…well more than few but you get the point.
Can i make a case for the union that explains why i hold the views that i do? yes…..bu what i typed above was that.
I hope we can both agree than most of the so called debate on this issue is mince.
#55 by Richard Thomson on September 27, 2011 - 4:09 pm
“I hope we can both agree than most of the so called debate on this issue is mince.”
Yep. We probably can.
#56 by Hugh on September 28, 2011 - 12:21 am
But yet again, we have someone putting forward an independence case based on cloud cuckoo land economics. Did the SNP administration see the banking crisis coming? No. Did they ever complain about the lack of regulation of Scottish banks? No. Why? Because they used the fantastic success of the scottish financial sector as one of their main economic arguments for independence. I’m sorry, you can argue for as long as you like about how the UK government failed in its regulation of the banks, but you can’t claim that anyone else (except vince cable), least of all the SNP, saw it coming.
This is another example of how the SNP like to have it both ways. When the Scottish economy is doing well, Scotland should secede because its economy will boom even further when ‘free’ from the union; when the Scottish economy is doing badly, it is because ‘London’ is preventing it from fulfilling its true potential and therefore she should secede. You can’t have it both ways, nationalist sentiment prevents a coherent argument from being made and I’m afraid there isn’t one. I have still yet to hear a convincing economic argument at the very least for independence.
#57 by Richard Thomson on September 28, 2011 - 11:43 am
Yet similarly, when the Scottish economy does well, it’s a union dividend, but when things aren’t so rosy, it’s only the union which is preventing economic disaster. It’s not only nationalists who try to make the best case available to them…
I’m up for this debate on economics with you, Hugh, ‘cloud cukoo or otherwise’ – want to have a go at answering my question further up the page?
(Incidentally, my apologies if you’ve already responded but it hasn’t got through moderation yet!)
#58 by Hugh on September 28, 2011 - 6:55 pm
One small point, and that is I struggle to find an occasion in recent history (or perhaps even a long way back) when Scotland’s economy has been doing well but the rest of the UK’s hasn’t. By and large, when Scotland’s economy does well, so does the UK’s, and when it doesn’t do so well, the UK’s isn’t doing well either. The economies are so inexorably linked that Scotland’s economy by and large follows that of the UK’s – this is why the argument that independence from the economic agenda ‘set in London’ seems a little curious, Scotland’s economy isn’t that set apart from the rest of the UK’s.
By the way I meant no disrespect on the ‘cloud cuckoo’ comment!
#59 by Ron on September 27, 2011 - 12:40 pm
“British” pre-dates the formation of the UK. Was around when Scotland was independent. So that’s that one out of the window. You can be as British as you want. It can be defined and shaped into anything, which is what has happened.
#60 by EphemeralDeception on September 28, 2011 - 10:22 pm
The “I want the best for my country” quote says it all.
UK is your country.
You are proud be Scottish as a region only.
in a national sense.
You are not at all proud of being Scottish as a country, nation or anything like it because you pretend it does not even exist.
Be honest, stand and and say what you really mean.
You are proud to be Scottish in the way that people from Yorkshire are proud to be from yorkshire..
You are in fact in denial of the nation you belong too, in denial that the UK is a muli nation state and not a country and you have a completely different perspective to that of at least 80% of the people of our nation, Scotland, treaty member of UK state.
But despite all that, this is not something people will decide their future upon.
What people now see is see that Scotland is very poorly served within the UK state as it is now and want a full say on how Scotland is governed and the powers needed to do this. More and more people in Scotland want this whether they are Scottish, English, Polish, or even – heaven help them, Scottish and British.
#61 by Nik on September 29, 2011 - 10:28 am
Hugh, the Scottish economy was in recession in 2001, when the rest of the UK was growing. It’s also doing better than the UK economy is now, although if the UK economy gets worse, I imagine the Scottish economy will be dragged down with it.