Scottish Independence – What If..

I was listening to some Scottish people debate whether Scotland should become an independent nation. It struck me that the politicians in the debate mostly tried to reduce the argument into one of whether Scotland would be economically better off or worse off as an independent nation. The people who are not politicians were not buying into what the politicians were selling. Good for them.

 

I cannot see that the present proposals for an independent Scotland would make Scotland genuinely independent. I do not think a nation can be truly independent unless it controls its whole economic policy. The proposals for independence would enable Scotland to control most of its economic policy, but would tie Scotland to the most important and effective economic policy of the rest of the United Kingdom because Scotland would still use as its sole currency the pounds sterling.

 

For decades now monetary policy by control of interest rates has been the most effective lever of economic policy of governments everywhere. We have seen that the key problem with the euro is that different nations cannot set interest rates at levels that suit them; what suits Germany does not usually suit Greece. With interest rates in Scotland being set in London, as opposed to being set in Edinburgh, an independent Scotland would be dependent upon the rest of the United Kingdom for this major way in which governments can control, or attempts to control, the economy.

As a truly independent nation Scotland should issue its own currency. The Scottish Nationalists do not want to do this because they fear that such a currency might not be accepted on international markets in the same way that the pound sterling is accepted, and this might bring economic difficulty Scotland. If the independence debate was held 10 years ago then I expect the Nationalists would be answering this point by saying that Scotland would join the euro, but the euro is a discredited currency to a large extent, particularly in small nations who are feeling the effect of economic problems because in effect they have to adopt the policies of large nations, such as Germany. Greece and Cyprus have found this to their cost.

Small nations have found that the large nations will not use their resources to help out small nations that have found themselves in difficulties because of the use of the euro.

The debate about Scottish independence is still in its early stages. No one, as far as I can see, has looked back to see what would’ve happened if Scotland had become independent ten years ago; I believe it would have joined the euro and that would have caused great damage to Scotland. No one seems to have thought what would have happened if Scotland had become independent 10 years ago and then adopted its own currency.

I think that might have been good for England Wales and Northern Ireland but very bad for Scotland. The Scottish banks were culpable in the financial crisis that started in 2008 and were responsible for raping and pillaging their customers with their sales of personal protection insurance and swaps for small businesses. I think collapse of the Scottish banks in 2008 would not have been supported by the rest of United Kingdom in Scotland would have found itself in the same economic position of Iceland is today.

Every person has the right to control his or her own destiny and make decisions about how he or she wants to live. Every nation has a collective right to control its own destiny or to combine with other nations in the hope that the combination will provide strength and protection. Economically although small is beautiful there is safety and protection in union, but I accept that some people prefer the risks of being independent and if the people have courage to undertake those risks are common sense to manage the risks carefully and the ability to avoid being bamboozled by multinationals and bullied by large nations then independence makes a great deal of sense. However, there are a lot of “ifs”.

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