Implications of Scottish Independence

[Francesca R]

And so we do well to look at comparable counties to appreciate the likely position. If we do that we see a bunch of places at or near the top of most of the global indices of prosperity, happiness and so on. And that is countries blessed with fewer natural resources than Scotland.

Erm, yeah. Or rather no. The level of analysis is somewhat higher than "Ah, right, probably be another Norway/Sweden, so fine" which is good since that could also be "Oops, gonna be another Iceland/Latvia".

Also it is not "contrived economic assessments that declare Scotland would be such-and-such in debt if after independence she went on making exactly the same spending decisions as Westminster makes now" either,as I said before here:

[ . . . ] churning out papers to prove that we'd be bankrupt if we went on doing exactly what Westminster is doing is pretty pointless.

Which is not what citi were doing. Strange as it may seem, sovereign nations do not have magic wands nor the power to make numbers add and subtract to the totals they desire.

The cold hard numbers look extremely favourable

This is to be rejected isn't it? It has no business being part of your case. Just a hopeful handwave.

Waving away economic analysis that doesn't just shine a green light isn't something I would have thought helped the "Yes" if most voters will ultimately make their choice dependent on what they think it means for their financial future (which is what I understand to be the typical case)

 

[Francesca R]

We'd all get along better without them and all this stupid 'we' and 'they' crap.

Kumbayah!

 

[Francesca R]

I genuinely don't know. It's clear some people are indeed responding in the desired way. The high incidence of door-to-door canvass returns indicating a voter who would like to see Scotland independent but is intending to vote no because "we couldn't go it alone" is alarming.

I am sorrier to hear that than you will believe.

Although that bias is strong in many referenda about this, irrespective of campaigning.

 

[Rolfe]

This is just one ignorant person, but it's emblematic of a lot of the rhetoric flying around.

https://twitter.com/wilma_mcewan/status/464470351913975809/photo/1

Knowing the real state of affairs, which is that Scotland year on year contributes more to the UK treasury than it gets back, and has in fact run a surplus in every one of the past 30 years, makes reading that kind of thing pretty galling.

If Scotland is indeed "poorer and dirtier than parts of Africa" as that person states, it got that way under the union, and while in possession of assets and revenue streams that would make many countries green with envy. We should stay, for more of the same?

The trouble is, if things like this are said often enough, and become common currency, people believe them even though the whole thing is nonsense. Then if you try to explain that whole "net contributor" thing, and the 30 years of surplus, people don't believe you. Why isn't it in the papers? Why hasn't the BBC told us that?

Well if you read the papers and listen to the BBC you kind of find they have. Or at least they have quoted people in the Yes campaign who have imparted the information, who have not been gainsayed, because it's true. They even quote David Cameron the time he said that of course Scotland could be a successful independent country. Or they did when he said it, I don't know about later.

But it's never discussed by the pundits. There's no programme explaining the financial situation with snazzy graphics. The whole tone of the commentary is too-wee-too-poor-too-stupid. When you try to explain that's not how it is at all, but the BBC and the newspapers have no interest in imparting that information, you're dismissed as a conspiracy theorist.

Note to self. Must read this Chomsky guy some time.

Rolfe.

 

[Darat]

This is just one ignorant person, but it's emblematic of a lot of the rhetoric flying around.

https://twitter.com/wilma_mcewan/status/464470351913975809/photo/1

Knowing the real state of affairs, which is that Scotland year on year contributes more to the UK treasury than it gets back, and has in fact run a surplus in every one of the past 30 years, makes reading that kind of thing pretty galling.

If Scotland is indeed "poorer and dirtier than parts of Africa" as that person states, it got that way under the union, and while in possession of assets and revenue streams that would make many countries green with envy. We should stay, for more of the same?

The trouble is, if things like this are said often enough, and become common currency, people believe them even though the whole thing is nonsense. Then if you try to explain that whole "net contributor" thing, and the 30 years of surplus, people don't believe you. Why isn't it in the papers? Why hasn't the BBC told us that?
...snip...

The results of the first 3 searches on my google search for "bbc news scotland 'net contributor'" (After the first three it starts to pull up non BBC site responses).

BBC News - Breakaway Scotland could forge new EU ...
www.bbc.co.uk › BBC Home › BBC News › Europe

14 Jan 2012 - How would Scotland fare as a separate state in the EU? ... Scotland would probably be a net contributor to the EU budget - like the UK, ...
Plea to sort out issue of EU entry for go-alone Scots - BBC
www.bbc.co.uk/news/uk-scotland-scotland-politics-15652822

9 Nov 2011 - Scottish Secretary Michael Moore says the issues surrounding what ... "The fact that a separate Scotland would be a significant net contributor to EU coffers and the Euro bailout fund is extremely significant. ... About BBC News.
BBC News - Plastic money and how far will resources stretch?
www.bbc.co.uk/news/uk-scotland-25438315


18 Dec 2013 - Today's controversy in Scotland centres upon the elasticity of our ... that Scotland (with oil) has been a net contributor to the UK for decades ...

From the highlighted result:

...snip...

To which, Ms Sturgeon replies that the Treasury have landed Scotland in the glaur in the first place by misusing oil revenues, that Scotland (with oil) has been a net contributor to the UK for decades - and that Scotland would thrive, with growth funding policies.


...snip...

One suspects that agin your assertions are backed with very few actual facts if any at all.

 

[Rolfe]

And if you read the bit of my post you snipped, you will find that I went on to touch on exactly that point. I'm actually surprised you found so little. (That "net contributor" stuff was actually spun to imply that poor helpless wee Scotland would be further impoverished by the EU contributions it would suddenly have to make as a member in its own right, without the legendary "rebate" negotiated by the all-powerful UK - the rebate that actually disadvantages Scotland's interests!)

Rolfe.

 

[Tsukasa Buddha]

Hello everyone. I am in the don't care camp, not having a vote nor minding which entity my entity is part of nor whether my entity should be an entity at all. But … why shouldn't the highlands be independent of the lowlands? Or the islands. At what level does nationhood begin and end? Personally, I think folks should not get in a lather about nations. We'd all get along better without them and all this stupid 'we' and 'they' crap.

Hasn't this been addressed, let's see, how many pages are we on now? I'm going to guess 300 times. I can see three ways to address it.

1. The slope is not so slippery because the historical, cultural, and legal situations are not similar.

2. Technically one could accept the extreme base of self-determination for any geographic region (as I do), but just as Norway wasn't endlessly divided there is no apparent will in Scotland either. And whether Scotland chooses to go independent does not make this "threat" more or less likely, as Scotland is not setting some novel claim wrt independence.

3. This is some weird objection to independence qua independence, which I don't think is a well thought out position.

Personally, I think folks should not get in a lather about nations. We'd all get along better without them and all this stupid 'we' and 'they' crap.

An independent Scotland with closer ties to Europe would be the better path for this ideal, IMO. But it is still not an ideal I would particularly make decisions on.

 

[Craig B]

Hello everyone. I am in the don't care camp, not having a vote nor minding which entity my entity is part of nor whether my entity should be an entity at all. But … why shouldn't the highlands be independent of the lowlands? Or the islands. At what level does nationhood begin and end? Personally, I think folks should not get in a lather about nations. We'd all get along better without them and all this stupid 'we' and 'they' crap.

Are you kicking out Her Maj Rolfe? I would vote for independence if that was on offer.

If you want to be more certain of keeping the Monarchy it would make more sense to vote No, and vice versa. I'm pretty sure of that.

I sympathise with your desire to live in harmony with all peoples, but the question you pose: where does nationhood begin and end? is easy to answer. In the context of this discussion, and of the independence referendum, it begins and ends with the country of Scotland. That is the entity that was joined to England by the Union, and it is the entity that will become independent in the event of a Yes vote. There are other issues of nationality, but they are not at stake in this particular process, although no doubt they will have to be attended to whether Scotland votes for or against independence. If they are not urgent in the second case, they can't be urgent in the first case either.

 

[Francesca R]

Knowing the real state of affairs, which is that Scotland year on year contributes more to the UK treasury than it gets back, and has in fact run a surplus in every one of the past 30 years [ . . . ]

That includes oil (geographically allocated), and it was not the case in 2013 even with oil (source).

Moreover most sensible assessments of fiscal sustainability exclude oil due to (i) its volatility/uncertainty and (ii) its projected decline looking forward (Chart 4.1 page 106). The Scottish Government is a lot more optimistic with its oil revenue forecast than the OBR (Chart 4 page 5)--perhaps we should split the difference.

In any case the Scottish Government's own independence white paper states the intention to divert oil/gas revenue into a sovereign wealth fund (like Norway, Sweden), although it states that this could not be afforded until 2017-18 (page 305). Including oil revenue forecasts in the total and simultaneously promising to ring-fence them is having one's cake and eating it to an extent.

Anyway without oil, the gap between revenue and spending in Scotland is larger than the UK, and always has been (source) (Both regions have a negative gap). It is all very well to say "Well we won't have to tax/spend the way 'Westminster' did in the future" but this begs the question of exactly how Scotland will tax more or spend less--and that is the direction in which things are likely to have to move. "We'll decide by ourselves" might not be a sufficiently comforting manifesto.

One thing is for sure--Scotland seems to have wished to preserve a number of relatively regressive transfer systems that benefit the rich at the expense of the poor by more than would be the case if they were not in place (and they have been scaled back or removed in England)--such as universal subsidisation of higher education, of prescriptions, of elderly care, of sight tests. These are bizarre priorities for any left of centre government IMO.

 

[Craig B]

One thing is for sure--Scotland seems to have wished to preserve a number of relatively regressive transfer systems that benefit the rich at the expense of the poor by more than would be the case if they were not in place (and they have been scaled back or removed in England)--such as universal subsidisation of higher education, of prescriptions, of elderly care, of sight tests. These are bizarre priorities for any left of centre government IMO.

Could you please expand on these remarks? Before commenting on them I want to be sure that I understand them.

 

[Francesca R]

In the case of tertiary tuition fees, the private benefit accruing to the beneficiary is significant--and its expected value more than covers the cost of the beneficiary paying tuition fees (the net present value / internal rate of return is positive). Hence if it is publicly funded that creates a net transfer from non-graduates to wealthier graduates. (Note that there is substantial insurance underwriting built into the RUK student loan arrangements andf that nobody has to pay up front).

(The RUK arrangement is economically similar to a graduate-only tax and zero fees, which is obviously more progressive than no graduate tax and zero fees.)

In the case of the others, any universal benefit will result in relatively more transfers to the wealthy from the non-wealthy than will a benefit that tapers out with income/wealth.

 

[Information Analyst]

Could you please expand on these remarks? Before commenting on them I want to be sure that I understand them.

Isn't it generally that the well off/rich are getting a "free ride" on stuff they could easily afford to pay for themselves?

 

[Craig B]

In the case of the others, any universal benefit will result in relatively more transfers to the wealthy from the non-wealthy than will a benefit that tapers out with income/wealth.

You think then that all universal benefits are bizarre for a left of centre government to do? Thus, for example, it is bizarre for such a government to provide free health care at point of use? All social provision should be means-tested? That would be the left of centre way?

 

[Francesca R]

@ Craig B: I decline to answer. Do you challenge that the policies mentioned are relatively more regressive / less progressive than their counterparts?

The increases in tax on oil profits in recent years are also of interest here. If, say, taxes were raised on the profits of other firms/industries which had experienced unusually fast growth (say, Barclays Bank in 2007), left-of-centre folks would typically champion this, whereas the Daily Telegraph would grumble that it would damage the economy. Yet the oil tax is viscerally opposed by most pro-independence people in Scotland (I don't know how pro-independence non-Scottish feel about it), presumably because it is "them" taking "our" money.

 

[Francesca R]

Paddy-Power (internet bookie) has the yes vote at 43.5%, and the result at 1/3 No and 9/4 Yes. Back when InTrade was still up it would have been possible to get a history of those prices.

I don't know where polls are. In other threads about other subjects I've said I think traded prediction markets are better (though not infallible)

 

[Aber]

Paddy-Power (internet bookie) has the yes vote at 43.5%,

Ladbrokes has it 44%; from memory it started the year at 42%, dipped to 41% and then rose again, but has been stable for several weeks.

Strangely, the active market is for turnout, currently showing 76%.

 

[Francesca R]

Can't find a price at Ladbrokes--can you link it? (IIRC they made some weird splash about making a market in the conditional probability of FX union that was on the back of maybe a single bet)

Betfair is 30%:70%. If I am reading it right it says there is less than £0.5m in matched positions though, which does not strike me as anything but small

 

[Rolfe]

Ladbrokes has it 44%; from memory it started the year at 42%, dipped to 41% and then rose again, but has been stable for several weeks.

http://blog.whatscotlandthinks.org/2014/05/poll-of-polls-28-april/

It hasn't been stable for as long as "several weeks". The apparent stability in the final data point is due to the single most recent poll being less good than the ones just before it, although it was itself the highest Yes that polling company has ever recorded.

Rolfel

 

[Aber]

http://blog.whatscotlandthinks.org/2014/05/poll-of-polls-28-april/

It hasn't been stable for as long as "several weeks". The apparent stability in the final data point is due to the single most recent poll being less good than the ones just before it, although it was itself the highest Yes that polling company has ever recorded.

Rolfel

Ladbrokes of course is reporting the markets view of the final vote, as you can bet on whether the final Yes vote will be higher or lower than 44%. This course has no direct relation to current opinion polls.

 

[Aber]

Can't find a price at Ladbrokes--can you link it? (IIRC they made some weird splash about making a market in the conditional probability of FX union that was on the back of maybe a single bet)

Can't post a link from my current device but a search on Ladbrokes Scottish independence will find it - look for the all markets tab, as it may default to most popular.