33 ms·
With hard headed view, I struggle to see that an independent Scotland will be economically able to deal with large cuts to public sector spending that would alm
by physicsguy 4y ago
With hard headed view, I struggle to see that an independent Scotland will be economically able to deal with large cuts to public sector spending that would almost certainly be required. Per capita spending is already higher in Scotland than in the rest of the UK. Scottish companies have debts denominated in pounds. There would almost certainly be capital flight to rUK. Large businesses may relocate. There is no plan for a new currency, which would leave Scotland either with a weaker currency than sterling, or with a currency it has no influence over.
The UK is obviously suffering economically because of Brexit - an economic relationship that was built up over 40 years or so. Scotland, England and Wales have been a country since 1707. Just imagine the complication of breaking that. It makes Brexit look like a tiny job. Scotland would need to set up mirrors of institutions completely administered by Westminster at great cost, with a shrinking and aging population which is poorer, less educated and less healthy than the rest of the UK, even despite much of the things influencing that (healthcare, education) being devolved to the Scottish government since 1997.
I certainly don’t think it’s impossible. But I think it’s like Irish independence - it took the best part of 70 years for Ireland to economically recover. Over that time there was vast emigration to the UK and the US. Part of that was my own family who moved to the UK in the 1950s because of terrible job prospects in the Republic.
- nickd2001 4y agoWriting as an English person who'd be sorry to see the Scots go, feels like losing a sibling, but trying to be objective, I'd challenge your assertion it'd be long period of pain like Irish independence. When Ireland went independent, they didn't have the EU single market on their doorstep. There were global economic problems during those 70 yrs e:g world wars. Whereas by rejoining the EU, Scotland can improve its economy much more quickly. Ireland is nowadays a very economically successful country. why shouldn't Scotland be too? Wind powered electricity could be a big export to replace oil and gas. Also Scots tend to favour paying slightly higher taxes for public infrastructure projects, which then give economic gain. An independent Scotland could invest in railways, education , all the other things that a sensible European country does which benefit everyone and lead to economic growth, but England doesn't do properly because keeping taxes down even if the resulting lack of infrastructure and opportunity impoverishes everyone , is the English Tories policy. If I were Scottish, I'd vote for independence in a heartbeat, but the whole thing is very sad as it seems like a family breakup, also can't see how we avoid a hard(ish) border between England and Scotland
- manmal 4y agoWould it not be appealing for the English financial sector to move to Scotland if it’s part of the EU?
- aembleton 4y agoHaven't they already moved to Dublin?
- carnitine 4y agoNo, not even remotely. London is second only to New York for finance.
- aembleton 4y agoSo, why would they move to Scotland? If it becomes appealing for the financial sector to move to Scotland if they are inside the EU, then why not move now to Ireland which is already in the EU. Any businesses that needed to move to the EU will have already done so.
- physicsguy 4y agoScotland likely won't be part of the EU on an exit from the UK. If a country wanted to move to the EU, why move to a country that's just undergone an economic shock, and with new political divisions forming as competing visions of the future and huge uncertainty, rather than move to Ireland which is relatively stable politically and also has English as the working language, and a much larger existing financial sector?
- randomsearch 4y ago"Scotland won't be part of the EU" Oh yes, and voting for Remain is the only way to stay in the EU. I think that argument has long since sailed. The EU will undoubtedly fasttrack Scotland straight back into the EU and single market before independence arrives. As a major English-speaking country in the EU, with ports at the periphery of Europe, strong exports, and a finance capital, Scotland will be in a great position. Brexit has given them a huge opportunity. They should capitalise on England's foolishness.
- sideshowb 4y agoDoesn't the fact that Scotland owns the oil fields answer the economic problem, at least while everyone still wants oil? (not rhetorical, I haven't seen the numbers & I presume that's what TFA and its sequels aim to address, among other things).
- iso1631 4y agoSince the 2014 referendum upto 2021, total oil revenue has been about £5b, that's £700m a year Pre-covid, Scottish public spending was about £15b a year more than tax revenue. I believe the SNP position is that historical revenues should be taken into account for historic debt, but Scotland still has to convince the world to lend it a hell of a lot of money every year to pay for those services, even if they took all the North Sea old revenue (which seems an odd thing for a government with Green backing to be relying on)
- mschuster91 4y ago> but Scotland still has to convince the world to lend it a hell of a lot of money every year to pay for those services, even if they took all the North Sea old revenue (which seems an odd thing for a government with Green backing to be relying on) The revenues from oil are going to be somewhat predictably stable for the next ten to fifteen years, there is simply too much infrastructure in Europe that relies on burning or otherwise using fossil-origin oil and gas. Banks and other investors can make an investment backed by this expected income.
- Gordonjcp 4y ago> large cuts to public sector spending that would almost certainly be required Why do you think that? We already raise more in taxes than we spend, and right now Scotland is heavily subsidising England.
- Emma_Goldman 4y agoScotland's implied deficit in 2020-21 was £36.3bn, or 22.4% of GDP. [1] When the SNP set up the Sustainable Growth Commission before the last independence vote it advised that public sector cuts would be necessary to reduce the country's deficit to sustainable levels. [2] You can't just make things up because you wish it was so. It is not sensible. [1] https://www.theguardian.com/uk-news/2021/aug/18/scotland-soaring-deficit-is-no-barrier-to-independence-says-minister https://www.theguardian.com/uk-news/2021/aug/18/scotland-soa... [2] https://ifs.org.uk/publications/13072 https://ifs.org.uk/publications/13072
- randomsearch 4y ago> Scotland's implied deficit in 2020-21 was £36.3bn, or 22.4% of GDP. [1] How has the price of oil changed since then? Cherry picking much?
- Emma_Goldman 4y agoScotland's deficit is persistent. Between 2014-15 and 2019-20 it averaged 9.2%, compared to 3.2% for the UK as a whole. [1] Infamously, the SNP's envisioned post-independence budget was based on their forecast for annual oil and gas revenues: £10bn. In reality they have averaged an order of magnitude less: £1bn. Oil and gas are volatile commodities so there will be year-to-year fluctuations but the secular trend is clearly downwards. The best wells have run dry, and the UK is committed to net zero by 2050 and Scotland to net zero by 2045. [1] https://www.economicsobservatory.com/what-might-the-public-finances-of-an-independent-scotland-look-like https://www.economicsobservatory.com/what-might-the-public-f...
- 4y ago
- dubeye 4y agoI very much doubt many scottish voters will pay too much attention to the economics. Are constitutional referendums ever really about economics? Brexit certainly wasn't
- swarnie 4y agoSome really basic questions will need to be answered. 1) What currecny are you using? 2) Where is your central bank? 3) What debt will you be departing with? 4) What cuts will be required when you can no longer take 32bn a year via the Barnett formula? Just simple, fundamental things really.
- dubeye 4y agoThey need to be answered at some point, but not necessarily before the referendum. Not saying it's a best way to do it, but it's the most likely way. Brexit for example, was a referendum on a very broad question, the specifics were worked out afterwards. But most likely there will be a transition period, where monetary sovereignty is sacrificed in the short term, to allow central bank to be set up and votes held on various questions including some you list.
- swarnie 4y ago> Vote for this! > What is it? > We dont know yet! Doesn't seem like a brilliant idea from where i'm sat. I think the comparison to Brexit will come up a lot, arguing for a similar process with six years of hindsight is... questionable....