Wee Herald letter: “Andrew Who?”

YOUR correspondent Alan M Morris (Letters, August 29) is to be thanked for reminding us about the existence of Andrew Wilson and the prospect of his answering vital questions about how Scotland will thrive economically when the £13 billion UK subsidy is removed. His report is taking so long to produce, like most people I had quite forgotten him.

I wonder if it will be worth the wait: his last pronouncement was that it would take at least a decade of ultra-austerity to even get back to parity with the status quo of the UK.

Peter A Russell

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Herald Letter: “Nationalists need to spell out how they would make the economy work.”

CONTRARY to the assertions of some of your correspondents (Letters, August 25), few of us pretend that the SNP Scottish Government’s GERS figures show how an independent would fare economically. It is clear that the figures it contains refer to the current reality whereby, as part of the UK, Scotland is able to spend more than £13 billion more on public expenditure than it collects in tax.

The question that is posed is how would an independent Scotland differ? The only thing that is clear is that it would lose this massive slice of revenue, which would need to be replaced. Nationalists need to answer specifically what their policies would be to do so. Whenever this question is put, they reply that they need “levers”. What is never clear is what levers, how they would be pulled, what the effect would be and how effective this would be in creating growth and increasing revenues.

As their project also includes membership of the EU, they could not increase borrowing (or even maintain it at anything like current levels) under the Stability and Growth Pact. So the only options would be much higher taxation or massive public expenditure cuts. Scottish Nationalists from the First Minister down need to be honest with the public, and tell us who would pay for their obsession, and how much it would cost us. Even before then, they might give us at least a hint of what currency we would use, how it would be supported and what the cost of a central bank and currency reserves might be?

Alternatively, they could make the Scottish economy work within the UK so that revenues exceed expenditure – or forget the whole damned business as the 2014 referendum suggested they should.

Peter A Russell

“Shameful” – Redistribution and GERS.

NOTE: Written before publication of new GERS figures  – but they change nothing here…

The late great Christopher Hitchens (how he would have despised the cliché) once said of his troubled relationship with his brother Peter “…families are wonderful things. You get to mix with people who you would otherwise not even get to meet.” Or maybe Peter said it – in this case , it self-evidently does not matter.

Social media are much the same: you can get to have some sort of discussion with all sorts of brilliant and not so brilliant people, and you can make a wide range of friends and enemies, and even better, have your own ideas put to the test both by friendly commentary and hostile fire. And you can learn about others and their strengths and weaknesses.

As a self-confessed obsessive about the question of Scottish independence, I still find myself drawn into disputation with those who oppose my own view, even though the prospect of another referendum on the issue is now further away than any point since 2014. It is of course not the case that Nicola Sturgeon has suddenly decided to honour her pledge of “once in a generation” or indeed to respect the votes of 2 million of her fellow Scots in rejecting independence, but rather that she knows that a referendum now or in the foreseeable future would again result in defeat for her project.

What fascinates me about the remaining Yes supporters is the perversity of the persistence of their belief in the myths of their failed campaign, and two real crackers came up on twitter this week.

The first when I pointed out that Scotland’s public expenditure  is greater than its public revenues. The first predictable response of some Nationalists is to call this statement into doubt, to which the standard response is to draw their attention to the excellent work of Kevin Hague, Fraser Whyte and Neil Lovatt.

Next up, one of two things happens: either the Nationalist blocks, or, as on this occasion, they question the very concept of Scotland receiving a subsidy from the rest of the UK: the interlocutor of the moment demands “if your only reason for supporting the union is the subsidy we get from others, you should be ashamed.

In other words, to be in receipt of redistributed revenues is a demeaning and shameful position: Scotland is dependent on hand-outs and weakened by not standing on our own two feet.

This kind of thinking is of course not new. We saw it in the 1970s and 1980s under Margaret Thatcher, when it took two forms.

The most immediate was the virtual elimination of regional policy including large cuts to Regional Selective Aid (RSA) which were based on the idea that regional economies including Scotland in the then pre-devolution UK should  find their own ways to be competitive and successful. The persistence to this day of long-term unemployment in former heavy industrial areas throughout the UK demonstrates the failure of this policy. Indeed, the successes of employment growth in pockets and sectors in these areas have in many cases been due to the historical intervention of the European Structural Funds: these were created by Labour’s European Commissioner Bruce Millan and Strathclyde Region’s Charlie Gray specifically to provide assistance to areas neglected by the Thatcher and Major governments.

The second manifestation of the “you should be ashamed” attitude of Scottish Nationalists is the implication that there is something demeaning about receiving assistance. There are two possible sources for this thought. One is a puritan work ethic – again it has much in common with the fundamentalist Methodist upbringing of Margaret Hilda Roberts – and the other is the crude machismo of “I don’t need anyone’s help.” Both are deeply conservative and short-sighted, and relate most closely to Hayek and his view of social democratic redistribution as “The Road To Serfdom.”

There is however, always another way of looking at the philosophy of mutual support. This is to examine how the human race has survived and thrived through co-operation and sharing, to the extent that we have a biological imperative built into us which manifests itself in religion, politics and philosophy over and over from “love thy neighbour as thyself” to “for the many not the few.”

Our experience as a species and in our own lives as family, social and working creatures is that we achieve more together than alone, and our efforts when applied collectively total more than the sum of their parts. This is true in personal relationships, in families, in workplaces, in communities, between regions and nations, and internationally. The only conditions are that the unions in question must be voluntary, and that they should have mature and effective ways of managing disputes and disagreements.

The union between Scotland and the rest of the UK is no exception: the referendum outcome in 2014 meets the first condition, and the combination of UK-wide and devolved institutions meets the second.  The position of Scotland as a net beneficiary of UK taxpayers money is indeed a mark of the success of the relationship – of mutual support for the Common Good – rather than a symptom of failure and dependency.

The other question I came across this week was the old chestnut that Scottish Nationalists pose when confronted with the fact of our public expenditure deficit: “do you think Scotland is too wee and too poor to succeed? If so how do other small nations do so well?”

The answer is that Scotland is not Denmark or Norway: neither of these have a history of having been part of the largest worldwide Empire the world has even seen. Therefore they do not have the enormous legacy of a now largely lost heavy industrial sector based on the supply of producer goods to closed markets and of now obsolete commodities such as coal.

These other small countries also started off from another point in a further way: Scotland’s economy throughout the history of capitalism has shared all four of its classical components with the rest of UK: the Four Ms of Money (capital), Markets (worth four times that in EU), Materials and Manpower. Therefore the better comparator is specifically the Republic of Ireland, a country which every year loses over 35,000 of its population, many of whom emigrate to the UK. (This, incidentally, is a truly debilitating and shameful position for a country to be in: 100 citizens leaving every single day of the year.)

The point is not that Scotland could not exist without the support of the rest of the UK. It is rather that Scotland would be worse off in that position. This remains the case even if Scotland could re-join the EU after Brexit – indeed, in that case, we would be worse off again, not only losing the £13.3 (edited) billion in Barnett consequentials and other UK support, but also our share of UK Rebate and such sweeteners as VAT exemptions on items such as children’s clothes and shoes.

When you add in that adherence of the European Stability Pact is a condition of EU membership, the effect on public services and taxation would be little short of catastrophic. And to go down that route on the grounds of misplaced pride or Thatcherite ideology really would be something to be ashamed of.