Scottish Independence

[peterms]

 Has anybody seen the comments of Salmond comparing this election to the post-apartheid elections in South Africa?

 

What an utter moron.

 

Didn't see Salmond's remarks, but I've heard others saying that the sight of people queuing up at stalls in the street to register to vote is reminiscent of SA.  My partner saw such a queue in Glasgow.

 

For anyone concerned about the way mainstream politics has alienated so many people over the last few decades, this level of engagement is a good thing, whichever side you support.

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They're expecting an 84% turn-out apparently.

[chrisp65]

 Has anybody seen the comments of Salmond comparing this election to the post-apartheid elections in South Africa?

 

What an utter moron.

 

Do you have the actual words and context available?

 

Or is it like the claim this morning that food in Scotland will become more expensive because parts of Scotland are remote?

[Nabby]

Has anybody seen the comments of Salmond comparing this election to the post-apartheid elections in South Africa?

 

What an utter moron.

 

Do you have the actual words and context available?

 

Or is it like the claim this morning that food in Scotland will become more expensive because parts of Scotland are remote?

 

http://www.telegraph.co.uk/news/uknews/scottish-independence/11086121/Independent-Scotland-wont-pay-back-debt-Alex-Salmond-says.html

In remarks at a rally of foreign supporters of the Yes campaign outside St Giles Cathedral on Edinburgh’s Royal Mile, he said that the referendum campaign felt to him like the first elections in South Africa after the end of apartheid.

Those elections in 1994 resulted in the election of Nelson Mandela as president of South Africa, bringing down a curtain of 300 years of white rule.

Mr Salmond said: “Last Monday I saw something which I did not ever think I would see in my political life. In Dundee, I saw people queuing up – and it was not a short queue, it was a long queue – to register to vote.

“Almost reminiscent of the scenes in South Africa that some of us of a certain age remember from 20 years ago or so when people queued up to vote in the first free elections. I saw people queuing up to put in their registration forms to vote.

“People who frankly couldn’t give a stuff about political parties or any politician are now engaged joyfully in this electoral process, and, just for the absence of any doubt, they weren’t queuing up to vote No, they were queuing up to vote Yes.”

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It was in a speech from the weekend so I will have to search for it. Essentially about how the engagement in this election (well it is pretty important!) is like SA 1994 and the conflating idea that its because people are throwing off the shackles of English oppression.

 

The bit from John Lewis is seperate from this.

[lapal_fan]

We need a secret weapon..

 

Send in Boris.

[Eames]

We need a secret weapon..

 

Send in Boris.

The SNP would be holding street parties if Better Together deploy the most English man ever to convince the SCots to stay.

[LondonLax]

Norway can't support their social programmes with oil money alone and so it seems unlikely that Scotland will either, and so it seems likely that they will have to raise their taxes from the present level (36.7% of gdp) to the same as or greater than Norway (42.2%).

Sorry to pull you post up on one small point but I have to say the Norwegians very much can support their social benifits purely on oil revenue if they chose to.

They deliberately only spend 4% of their oil revenue a year in order to not completely distort the market in Norway and cause rampant inflation.

The other 96% of the revenue gets pooled in a sovereign wealth fund and invested outside the country (like buying up real estate in London and New York or investing in global stock markets).

The Norwegians are set up with wealth for generations and I bet the Scots are wishing they'd been able to do the same.

As an Australian I can only wish our government had had that kind of foresight with out mineral wealth boom.

[CarewsEyebrowDesigner]

lol governments having foresight.

[peterms]

Wren-Lewis on the economic position after independence.

 

Scotland and the SNP: Fooling yourselves and deceiving others

 

There are many laudable reasons to campaign for Scottish independence. But how far should those who passionately want independence be prepared to go to achieve that goal? Should they, for example, deceive the Scottish people about the basic economics involved? That seems to be what is happening right now. The more I look at the numbers, the clearer it becomes that over the next five or ten years there would more, not less, fiscal austerity under independence.

 

The Institute for Fiscal Studies is widely respected as an independent and impartial source of expertise on everything to do with government spending, borrowing and taxation in the UK. It has produced a detailed analysis (recently updated) of the fiscal (tax and spending) outlook for an independent Scotland, compared to what would happen if Scotland stayed in the UK. It has no axe to grind on this issue, and a considerable reputation to maintain.

 

Their analysis is unequivocal. Scotland’s fiscal position would be worse as a result of leaving the UK for two main reasons. First, demographic trends are less favourable. Second, revenues from the North Sea are expected to decline. This tells us that under current policies Scotland would be getting an increasingly good deal out of being part of the UK. To put it another way, the rest of the UK would be transferring resources to Scotland at an increasing rate, giving Scotland time to adjust to these trends and cushioning their impact. Paying back, if you like, for all the earlier years when North Sea oil production was at its peak.

 

The SNP do not agree with this analysis. The main reason in the near term is that they have more optimistic projections for North Sea Oil. The IFS analysis uses OBR projections which have in the recent past not been biased in any one direction. So how do the Scottish government get more optimistic numbers? John McDermott examines the detail here, but perhaps I can paraphrase his findings: whenever there is room for doubt, assume whatever gives you a higher number. In my youth I did a lot of forecasting, and I learnt how to be very suspicious of a series of individual judgements all of which tended to move something important in the same direction. It is basically fiddling the analysis to get the answer you want. Either wishful thinking or deception.

 

I personally would criticise the IFS analysis in one respect. It assumes that Scotland would have to pay the same rate of interest on its debt as the rUK. This has to be wrong. Even under the most favourable assumption of a new Scottish currency, Scotland could easily have to pay around 1% more to borrow than rUK. In their original analysis the IFS look at the implications of that (p35), and the numbers are large.

 

So what would this mean? Could Scotland just borrow more? I am all for borrowing to cover temporary reductions in income, due to recessions for example, which is why I have been so critical of current austerity. However, as the IFS show, North Sea oil income is falling long term, so this is not a temporary problem. Now it could be that the gap will be covered in the longer term by the kind of increases in productivity and labour supply that the Scottish government assume. Governments that try to borrow today in the hope of a more optimistic future are not behaving very responsibly. However it seems unlikely that Scotland would be able to behave irresponsibly, whatever the currency regime. They would either be stopped by fiscal rules imposed by the remaining UK, or markets that did not share the SNP’s optimism about longer term growth. So this means, over the next five or ten years, either additional spending cuts (to those already planned by the UK government), or (I hope more realistically) tax increases.

 

Is this a knock down argument in favour of voting No. Of course not: there is nothing wrong in making a short term economic sacrifice for the hope of longer term benefits or for political goals. But that is not the SNP’s case, and it is not what they are telling the Scottish people. Is this deception deliberate? I suspect it is more the delusions of people who want something so much they cast aside all doubts and problems.

 

This is certainly the impression I get from reading a lot of literature as I researched this post. The arguments in the Wee Blue Book are exactly that: no sustained economic argument, but just a collection of random quotes and debating points to make a problem go away. When the future fiscal position is raised, we are so often told about the past. I too think past North Sea oil was squandered, but grievance does not put money into a future Scottish government’s coffers. I read that forecasting the future is too uncertain, from people who I am sure think about their future income when planning their personal spending. I read about how economists are always disagreeing, when in this case they are pretty united. (Of course you can always find a few who think otherwise, just as you can find one or two who think austerity is expansionary.)

 

When I was reading this literature, I kept thinking I had seen this kind of thing before: being in denial about macroeconomic fundamentals because they interfered with a major institutional change that was driven by politics. Then I realised what it was: the formation of the Euro in 2000. Once again economists were clear and pretty united about what the key macroeconomic problem was (‘asymmetric shocks’), and just like now this was met with wishful thinking that somehow it just wouldn’t happen. It did, and the Eurozone is still living with the consequences.

 

So maybe that also explains why I feel so strongly this time around. I have no political skin in this game: a certain affection for the concept of the union, but nothing strong enough to make me even tempted to distort my macroeconomics in its favour. If Scotland wants to make a short term economic sacrifice in the hope of longer term gains and political freedom that is their choice. But they should make that choice knowing what it is, and not be deceived into believing that these costs do not exist.

 

[Zhan_Zhuang]

The very word Nationalist sends historical alarm bells ringing as far as I am concerned.

[CarewsEyebrowDesigner]

Don't subscribe to any '-isms'. Ferris Bueller had it right.

[Rob182]

I would like to see a Scotch Army in battle.

Men in kilts tossing cabers while drinking irn bru and eating haggis, all ginger and covered in tartan, with a bagpipe-player spurring them on. Ptthhhhh. Ross Kemp and Vinnie Jones would take them all on!

[lapal_fan]

organisms?

 

You is one m8.

I would like to see a Scotch Army in battle.

Men in kilts tossing cabers while drinking irn bru and eating haggis, all ginger and covered in tartan, with a bagpipe-player spurring them on. Ptthhhhh. Ross Kemp and Vinnie Jones would take them all on!

 

Also, bagpipes can be converted to either flamethrowers or sleeping gas. I've seen it.

[dAVe80]

It may have already been said (I'm not reading through 38 pages to check) (sorry donnie), but if the Scotch do get FREEDOM!, then at least it may put to bed the ridiculous idea that Celtic and Rangers should join the Premier League.

[Rob182]

They might have a giant deep-fat fryer aswell, where they grab their victims in some sort of tartan-net, and deep fry them one by one.

Thinking about it, this Scotch Army sounds pretty scary.

I say we put up a big wall between England and Scotland and stop all contact and trading with them. They'll soon come back when they realise they have to send a boat to Sweghanistchland to get milk and bread!!!

(My Geography isn't great, that's the closest sand-and-mud country, right?)

[leviramsey]

We're in a world of peak oil, but it's not oil supply that's peaking, it's oil demand.

[TrentVilla]

Excellent article that Peterms, thanks.

[islingtonclaret]

I would like to see a Scotch Army in battle.

Men in kilts tossing cabers while drinking irn bru and eating haggis, all ginger and covered in tartan, with a bagpipe-player spurring them on. Ptthhhhh. Ross Kemp and Vinnie Jones would take them all on!

 

Or, to be a bit more boring, they could be some of the hardest contingent of modern warfare soldiers in the world.

The Black Watch and the Highlanders may have bagpipes, but history has shown they are very talented at wasting people.

[Jon]

 

I would like to see a Scotch Army in battle.

Men in kilts tossing cabers while drinking irn bru and eating haggis, all ginger and covered in tartan, with a bagpipe-player spurring them on. Ptthhhhh. Ross Kemp and Vinnie Jones would take them all on!

 

Or, to be a bit more boring, they could be some of the hardest contingent of modern warfare soldiers in the world.

The Black Watch and the Highlanders may have bagpipes, but history has shown they are very talented at wasting people.

 

The Scotch have always been very talented at wasting people, or rather, getting people wasted. World leaders in that ...

Edited September 11, 2014 by Jon