Theres a glaring hole in Paul Krugmans analysis, and its the UKs trade deficit. He, incredibly, doesnt mention it once. The trade deficit precisely what did for Spain as a euro member, but it wont be a problem for a newly-independent Scotland: itll run an enormous surplus - its all that oil, to be crude (pun intended). Scottish independence isnt a problem for *Scotlands* economic stability. Its a problem for the UKs, with its hopeless economic imbalances. And that means, however much Cameron et al dislike it, well get a currency union. If theyre genuinely concerned about the future, and want to stop a further pre-emptive slide the pounds value, our state managers should stop pretending otherwise, and start laying out how, post-independence, they might make it work. They wont do this, of course, because theyd rather bet the farm on trying to preserve the union.
Posted on: Mon, 08 Sep 2014 11:09:23 +0000
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