Excuse me emptying my brain on Scottish Independence but Ive quite enjoyed having a good think about it today. If you were just on facebook for the pictures of kittens, Id scroll past this! Without commenting on whether Id vote Yes or No, if I could, I thought Id jot down a few thoughts on what might actually happen in the event of independence, and what the biggest challenges the first Scottish Sovereign government might face. Happy to accept all debate on the matter. 1) Currency. Not anything like as big an issue as it has been made out, at least not yet. Differences in the economies of rump UK and Scotland will evolve over time, so the need for differing monetary policy will also grow slowly over time. At separation, it wont matter much if the Scots dont have much say. This means that a workable solution can be brought in as appropriate. If the Scots gradually find they need their own currency or wish to join the Euro, that will become apparent over time. Until that point, an ugly compromise will likely evolve, with nominated Scots being able to sit in and advise on interest rates, without being in proper control. 2) Europe. Whilst EU membership is not automatic, Scotland would no doubt qualify for some sort of fast track, even if in European terms, that might mean 5 years. Until then, the likelihood is surely a bilateral agreement on goods, services, and law, that keeps Europe open to Scotland and obliges Scotland to follow EU laws. (much like Norway) The only difference would be that Scotland wouldnt have a vote in Europe until it became a member. In practical terms, things wouldnt change much. Its not like Scotland has much individual influence now anyway. The point being that these two issues dont actually need to be resolved now, as the right solutions will become obvious as Scotland evolved. The real challenges faced by the first Scottish government are very interesting. To make a success of this, the process of creating a Scottish political identity through policy needs to be smooth. Thats not to say that change cant happen, but that it should be evolutionary rather than radical. Writing a constitution - logic would say that Scotland would have some sort of constitution. This would probably be voted on by referendum. Its incredibly important that it reflects all Scots, not just the ones who voted SNP or Yes. Look at Egypt for an example of where the winners get to write the constitution. To my mind, the SNP look very much like New Labour of 1997. They believe in spending on social issues, fairly high taxes, but are fundamentally pro business too. They need to avoid the two really big cockups that New Labour committed. 1) New Labour initially believed that simply throwing money at public services would make them better. Whilst it did a bit, much of it created a huge tier of managers that added no value. The SNP would need to show that a lot of thought had gone in to the structures that will spend their public money, and demonstrate that they know how to spend public money effectively. For the first 5 years, Scotland might be advised to set % limits of how much it would vary from the rump UK in tax and spend each year to avoid spooking the market. This isnt to say that Scotland shouldnt go where it wants, ultimately, in terms of tax/spending/socialism etc, just that it should go there in small steps over time, as the world gains confidence in the solidity of the policies. 2) New Labour turned a blind eye to regulating business, particularly finance, in return for tax revenues. In effect they sold themselves out. The SNP hasnt had chance to do this, as much of this happens in areas not devolved to Scotland. They have a clean slate and must not squander it. They must tread a fine line between being pro business and not letting business take the piss. This will become much harder once they assume control of the whole economy. Too much cosying up to business and people will wonder what they were actually voting for. Too much nationalisation too soon, and too much regulation, and business will move south of the border. In summary, what I think Im trying to say is that asking whether its a good idea for Scotland to become a Sovereign nation is not answerable until youve seen how it will be run. The ingredients are there for a successful country, but it really depends on the inclusivity of the subsequent debate, and the sensitivity with which the economy is handled. The two biggest risks to an independent Scotland would be the winning faction trying to change too much too soon, and the losing faction not being allowed or not wanting to join in the next debate about where Scotland goes next. Radical, rash decisions and tribal politics will lead to a weak, stagnant Scotland, and evolutionary policy and inclusivity will lead to a successful Scotland. Any thoughts?
Posted on: Tue, 09 Sep 2014 13:37:46 +0000
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