The Dambusters strategy

[skirtingtoday]

That's what it is being called by Westminster - on the mindset there to "frighten" Scotland into staying with the UK and not vote for independence.

It seems that the wealth from Scotland (even without the oil revenues) will be quite enough to get a AAA financial rating and a "highly successful and diverse economy"

As it says in the article (copied below), the writer is not an SNP member but he has looked into the truth behind last week's events. The article by a well known Scotrs writer from the Herald newspaper (this was a sunday editorial comment) btw is available to view on line at
http://www.heraldscotland.com/comment/c ... -.23565915
but in case the link gets broken or doesn't work, here it is in full:-

It wasn't so much the dam busters as the blitz.

A co-ordinated assault, led by the Prime Minister, backed by the City of London financial establishment, and endorsed by Scotland's Labour leader, Johann Lamont, echoing the Proclaimers at FMQs: "Standard Life no more; RBS no more; ship-building no more …" Quote us no more, replied Craig and Charlie Reid, who were furious at being enlisted into Project Fear.

This is beginning to sound like the economic equivalent of war. The "dam busters strategy" - as the Coalition is reportedly describing it - is a telling insight into the mind of the UK establishment as it seeks to demolish nationalism. The idea was that, after the UK Chancellor ruled out sharing the pound, a flood of companies would rush out of Scotland. The strategy relied on a supportive Scottish media to spin the bouncing bombs and it didn't disappoint. Newspaper readers could be forgiven for thinking last week that Scotland is heading for economic disaster if it votes Yes, with banks taking their money and running from an independent Scottish banana republic.

So it may come as a surprise to learn there was confirmation last week that an independent Scotland would not only be economically viable, but could have a highly successful and diverse economy with a healthier credit rating than the UK. I know this makes me sound like an SNP press release, but I am not a member of the SNP and never have been. However, I simply can't help seeing last week's events in a rather different light than most of the Scottish media.

On Tuesday, we learned that, far from the oil running out, Scotland is on the cusp of another oil boom, according to a report from Sir Ian Wood, commissioned and endorsed by the UK Government. It said there are still up to 24 billion barrels of recoverable oil, worth about £200 billion in additional revenue, and £1 trillion-£2trn in reserves. Environmentalists rightly raise questions as to whether it is right to suck these hydrocarbons out in the shortest time possible. Yet this was reported in one newspaper as the "North Sea's greatest crisis in 50 years", based on the observation that production has been declining. Most of the "easy" oil has been extracted and the revenue wasted, but there is still almost as much oil left in the North Sea as has been taken out over the last 40 years. There can no longer be any debate about the existence of this very substantial asset.

We also learned last week that, according to one of the world's biggest rating agencies, an independent Scotland might have a AAA credit rating even without taking the oil into account. Standard & Poor's reported on Thursday that an independent Scotland would "qualify for our highest economic assessment". Its analysts looked at Scottish economic fundamentals like on-shore GDP and concluded that an independent Scotland would be up there with triple A-rated countries such as Germany.

Standard & Poor's recognised that there was a risk associated with monetary disunion and the possible departure of banks, but it didn't take them very seriously. Indeed, it said that losing some of the big banks might be a benefit to an independent Scotland as a top-heavy banking sector could cause trouble if one institution went bust.

Now, credit rating agencies don't always get it right, but they are important because their assessment of the soundness of a nation's finances is what international investors use to set the interest rate on government loans. We should know this because the UK's credit rating was downgraded last year. Countries including Italy and Spain faced sovereign debt crises after poor credit ratings led to an increase in their cost of borrowing - a bit like when there is an increase in a mortgage rate. Greece had such a poor rating that interest payments crushed the economy.

Unionist groups try to equate Scotland with Greece or Argentina, and when I suggested recently that a better comparison might be with Switzerland, there was raucous laughter in the Twittersphere. But I stand by that assessment, and so does Standard & Poor's. The truth is that Scotland has the potential to be a world-leading economy with better economic security than Denmark.

David Cameron's claim last week that Scotland would be too small to develop the North Sea's potential and that it would have to "stand on the UK's broad shoulders" was not only patronising, it is manifestly untrue. Norway is a small country with far fewer natural advantages than Scotland. It has a sovereign wealth fund worth £500bn.

There might be questions asked even on the board of Standard Life, if it were to leave an independent Scotland with such a sound economy. As the front pages screamed last week, the insurance giant told shareholders it was making "contingency plans" to relocate south of the Border because of "uncertainty" over monetary arrangements and regulation. This uncertainty is an entirely self-fulfilling prophecy since it is a result of George Osborne's unilateral declaration of monetary disunion two weeks ago.

The UK Government has been manufacturing as much uncertainty as possible. It has been urging companies in Scotland to reflect this uncertainty in their annual reports to shareholders, so expect a succession of similar warnings in coming weeks. Standard Life has responded eagerly to the Chancellor's dog whistle by apparently briefing the press that it might take 5000 jobs out of Scotland. Some internal sources suggest that the number being talked of is only 50. But who's counting? This is politics not economics.

Standard Life made similar noises in the early 1990s over the prospect of Scottish devolution. You might have thought that would make it wary of crying wolf again - especially as its pre-tax profits fell last year by 13%. It still has a significant number of investors in Scotland, many of whom will be reviewing their portfolios. It is generally unwise for private firms to take sides in constitutional disputes, if only because they might have to deal with the other side if it wins.

Barclays chief executive Antony Jenkins said last month that he "can make it work either way" on independence, which is surely the sensible position to adopt. British Airways has also distanced itself from the debate, saying it might even benefit from an independent Scotland.

But good old Royal Bank of Scotland announced last week that it too was preparing to leave, because of the "political risks" of independence. Some might think this no great loss, given that the bank had just reported losses of £8bn, while shamefully paying its bosses £500 million in bonuses. Let the rest of the UK take on the toxic balance sheet of the bank that almost single-handedly destroyed the UK economy and has lost more than £40bn in the last few years.

But this became yet another "warning" against what headline-writers are now calling "iScotland". Mind you, RBS seems to be both an asset and a liability. Better Together's Alistair Darling is always saying an independent Scotland could be brought down by its banks. So why would it want to keep it?

It's heads they win, tails we lose. It takes a huge effort to read past the alarmist headlines about monetary chaos, European Union rejection, job losses, madness and early death. But those who do could see a very different picture: whatever else it would be, an independent Scotland would not be short of a bob or two.

For me, the article seems to prove that the rUK (rest of the UK) are running scared about losing the wealth from Scotland and wish to keep the fires burning especially in London and environs.

(To the MOD's - I hope this is not treated as political - subject banned here - and treat it as more of an essay on "dis-information" and painting the picture as black as possible)

[Sinned]

I'm actually on the fence on this issue. If Scotland does devolve then there will be consequences, costs and effects. Who does what, when and why will be determined over the next few months. I doubt that Scotland would be bankrupt but there would be a lot of difficulties to face, probably not all of them unsurmountable and an awful lot of horse-trading done if the result is yes. Again I hope that there is restraint shown and that this thread doesn't get closed down because it really does come into the politics area ( at least for those of us in the UK ). But it isn't anything that I would get het up and insulting about. What happens, happens and we will deal with the results as and when they happen.

[Grok]

There seems to be two opposite trends globally: 1. Devolution 2. Conglomeration There is a tendency for regions within countries to seek autonomy. On the other hand, there is a tendency for like minded countries to form blocs.

Conceivably, both one and two might be combined if there is peaceful devolution. This would likely depend on cultural commonality. The end result might be a loose conglomeration, reformatting the political structure of a civilization.

On the other hand, the European Union has been compared to the Holy Roman Empire-but influenced by French political culture (which values a highly centralized state, and is not especially democratic).

[Grok]

I recall a book written by Canadians called Plan B, which speculated about the results of Quebec secession. A question was whether "the doughnut" would stay together,or be divided by further secessions-different scenarios were considered. One idea mentioned was that Ottawa would be reimagined as a sort of public service organization-rather than the capital of a nation state-for a loosely bound grouping.



The "doughnut" refers to a map of Canada minus Quebec.

[Grok]

I was looking at the web site for a Campaign for an English Parliament. If the vote for Scottish independence results in an answer of no, the UK may still be at a fork in the road. Devolution for England would move the UK towards a federal system.

Another possibility is for the UK is to leave the EU and join a different grouping. One idea mentioned is an updated Commonwealth. Another mentioned is NAFTA membership for Britain.

[Sinned]

Now the UK leaving the EU is something that I would favour. I recall a quote from the film "Cromwell" in which he says "An immovable Parliament is more objectionable than an immovable King." Or words to that effect. I quote this in relation to rule being from a huge unelected EU Civil Service that seems to act completely independently of our elected EU MP's. Anyway the EU seems to bring in an awful lot of legislation that acts contrary to our British way of life - the removal of our traditional weights and measures system is an example but by no means the only one. Seems that every week something comes from the EU that we object to. Trouble is that we take such measures far too seriously - the French, Germans, Italians and Spanish simply ignore what they disagree with. It's only now that Parliament is getting serious about telling the EU where to go over issues such as the voting rights of prisoners.

[Grok]

I was looking at a euroskeptic article, phys.org/news/2013-07-euroskepticsm-english-british.html. How things will play out remains to be seen, but political change seems inevitable for the UK.

[Milfmog]

Ross,

The Scots will make their decision, the rest of the UK will live with it and many won't give a flying fudge. Sorry, but Scotland is not that high on most Englishmen's list of concerns. Don't believe me? Try listening to general conversations in public places and see how often Scotland is mentioned. (That in itself may be/seem sufficient reason to leave the union, of course). As for "running scared", please don't generalise the feelings and thoughts of politicians across the rest of the nation.

Have fun,


Ian.

[Sinned]

I agree with n here. The Scotland issue is interesting but in my top ten concerns it ranks about 50th. Of our topics of conversation the EU, immigration, banking crises, and lots of other topics get an airing but Scotland, no, not really. In some respects I hope that the Scots do vote for devolution. It would shake up the political scene here and more than a few MP's careers would go south. The horse trading that would go on would be interesting. Will my life be different, maybe? Would it drastically affect my way of life - probably not? Might even be better off, who knows?

[skirtingtoday]

Ian

Really? Then what about these articles in the Herald (Glasgow) and HuffPo on 14/02/13 that states that "Yes" does not necessarily mean we get independence! That the status quo is the Coilition's "default option"? In other words if negotiations are stalemated, then independence will not be allowed to happen?

http://www.heraldscotland.com/politics/ ... s.23438016
http://www.huffingtonpost.co.uk/2014/02 ... 95068.html

I hope from your and Dennis' comments that the vitriol I have seen penned on various other blogs (all from English people) - and happily no such comments appear here - isn't a true representation of English feeling but that as you say most don't really care that much. The comments on these other blogs are quite disgraceful and very demeaning, and little (if any) of that is moderated.

I believe that Westminster is probably mostly concerned about the general Election in 2015 and they don't want to be the party that presided over a split in the UK in the event of a "Yes" vote. And not wanting to get embroiled in independence negotiations whilst campaigning for that election. Sound like too much like hard work for the poor souls!

And Dennis, yes, a lot of MP's careers will "go south" or rather North and they will have to be enthusiastic about the new reality to try and get elected north of Hadrian's wall!

It would also resolve the "West Lothian Question" originally mooted in 1977 which is one comment from Grok's linked article (actual link here as Grok's didn't work for me:- http://phys.org/news/2013-07-euroscepti ... itish.html ) After all, why can Scots/Welsh/Irish MP's vote on purely English matters and not vice-versa. I know that many arbitrarily opt to abstain for those votes on English matters, as they do not concern them.

Ross

[Milfmog]

Ian

Really? Then what about these articles in the Herald (Glasgow) and HuffPo on 14/02/13 that states that "Yes" does not necessarily mean we get independence! That the status quo is the Coilition's "default option"? In other words if negotiations are stalemated, then independence will not be allowed to happen?

http://www.heraldscotland.com/politics/ ... s.23438016
http://www.huffingtonpost.co.uk/2014/02 ... 95068.html

Try not to believe everything you read in a paper. Yes, I know you are not daft or we'd never have been able to converse over a meal on those two occasions, but I note that Scottish independence did not come up in conversation then either...

Personally I'd be sad to see Scotland leave, but the right to self determination, in which I whole heartedly believe, means that it is Scotlands' choice, not mine. The alternative would be to allow foreign powers to decide the fate of countries; Spain owning Gibraltar or Argentina owning the Falklands, irrespective of the wishes of the residents, comes to mind.

A stalemate in negotiations over independence, following a yes vote, would be a huge issue, but unlike the journalists, who are trying to write interesting copy, I suspect there is nothing that could not be resolved with a little good will and a lot of hard work. In fact the biggest obstacle in that scenario is probably Alex Salmond; the only politician I know of who can make Tony Blair seem sincere...

I believe that Westminster is probably mostly concerned about the general Election in 2015 and they don't want to be the party that presided over a split in the UK in the event of a "Yes" vote. And not wanting to get embroiled in independence negotiations whilst campaigning for that election. Sound like too much like hard work for the poor souls!

I'm not sure I agree with you. From a Conservative point of view, Scotland going it's own way would dramatically improve their probability of an outright win. In fact that may be David Cameron's only possibility of winning.

Have fun,


Ian.

PS Please note that none of the views expressed above offer any insight into my political views or allegiances: those do not need to be aired here and will not be.

[skirtingtoday]

We do at least agree on certain things, but not all:-

1 It is indeed Scotland’s choice and not anyone else’s.
2 The wishes of the people have to be listened to, especially following voting day.
3 Journalists do have to make good “copy”. And no I don’t believe everything I read in newspapers or on-line either for that matter. I personally do worry though about the negativity prevalent in most UK national newspapers these days on the independence debate.
4 A stalemate in negotiations would indeed be a huge issue but there we differ. I think the main stumbling block is more likely to be Westminster “stonewalling” every proposal and suggestion. Think of the recent, “Not going to use the pound” argument despite every financial institution saying that is the best solution for Scotland AND the UK. (read “Standard and Poor’s” recent statement for instance) Think of the, “Not going to be able to stay in the EU” argument when only one Euro MP wishes that to be the case (BTW it was Spain – can’t think why that might be… ) There are many more examples
5 And finally, I also think that Tony Blair was actually sincere… Just his sincerity was sadly misplaced in quite a few areas such as his absolute belief in WMD’s… nuff said.

Politics has become very different in recent years in the UK. The Westminster parliament has a “First past the post” system, geared and designed to eliminate the possibility of a “hung” parliament and that a single party could have full power. Except that we now have a Coalition government.

In Scotland, the MSP’s have to go through a PR system designed so that no single party can ever attain an overall majority. Except that the SNP did just that at the last Scottish elections.

Ross
Strange times… and interesting times to come.

[Grok]

I was having trouble trying to post that link-some sort of glitch with my computer. Thanks, skirting today, for posting that.

One thing to think about is the Law of Unintended Consequences. If Scotland becomes independent, how will that affect the rest of the UK? What would be the fate of England, Wales, and Northern Ireland? Will the UK dissolve? (The fate of Northern Ireland brings up another question-what will be the fate of Ireland?).

[Grok]

One argument I have seen for the UK staying in the EU is that departure would leave Britain out in the cold. This is one issue that could be influenced by other countries-if there were an alternative group for Britain to join. Therefore proposals for an updated Commonwealth, or NAFTA membership for Britain. It has also been suggested that the size of the UK economy...would provide enough clout for a trade agreement with the EU upon departure.

[skirtingtoday]

Grok,
I am uncertain about what will happen to England, Wales and N Ireland but here are some facts about the Scottish Economy.
Excluding oil and gas, the value of exports we make to the rUK (rest of the UK) is £45.5bn and additionally we also export £23.9bn to the rest of the world. (report here http://www.scotland.gov.uk/Resource/0041/00412570.pdf )

Using a Scottish population of 5.25million and an exchange rate of £1 to $1.58 we get the total per capita in exports from Scotland is $20,886 - compare this with the world's top exporters http://en.wikipedia.org/wiki/List_of_co ... per_capita and Scotland would lie tenth (IN THE WORLD!) and that is WITHOUT oil or gas exports! Note that the UK export per capita is $7582 and is ranked 32nd in the world. And that the Scottish export economy is also higher than France, Germany, Italy, Denmark, Sweden, Canada and the United states.

Now exports aren't everything but they do make interesting reading.

So perhaps here might be a reason for the No campaign is trying so vehemently to and keep Scotland within the UK.