So where is the UK in this list? It’s sitting at a nothing-to-write-home-about number 22 (wait a second, isn’t that Iceland at number 20? Ireland at 12? So much for Jim Murphy’s “Arc of Insolvency”.) This perhaps explains why unionists are so keen to focus on the overall size of the economy, rather than this more important measurement, as it is somewhat at odds with the idea that the UK is an extraordinary nation that Scotland is fortunate to be a part of. John Swinney has already said that an independent Scotland would be the 6th richest of the OECD countries, with the UK at 16, so it’s safe to assume that an independent Scotland would be higher than 22nd on the IMF GDP per Capita figures. That, to me, sounds like as good an argument as any for voting for independence.
Scotch Myths No. 2 of an occasional series…by Doug Daniel. MYTH #2: Scotland needs to be part of the massive UK economy.
My next myth is about the economy, or more correctly, the size of the economy. Unionists often like to point out that the UK is the 6th biggest economy in the world, telling us that an independent Scotland wouldn’t come anywhere close. The implied point here is that Scotland will be a poorer nation as a result. Well, I’ll be honest, there’s no disupting the fact that the UK is the 6th biggest economy in the world, and that Scotland wouldn’t come close to that. They’ve got us bang to rights. Except that this little myth is based on an entirely false premise because, as Italians will tell you, size doesn’t matter. (Please note: the following uses the IMF’s figures for GDP in 2010.)
It’s true that the UK is the 6th biggest economy in the world. However, it’s also true that China is the 2nd biggest, Brazil the 7th, and India the 9th. I mention these three countries because despite having huge economies, they all have massive levels of poverty. A quick look at the top 15 economies in the world and one thing should stick out like a sore thumb: they’re all massive countries. Perhaps not in terms of landmass in some cases, but all have massive populations.
Look further down the list – Sweden at 22, Norway at 25, Denmark at 31, even Luxembourg at 69. Taking the unionist argument at face value, one could only assume that these countries have vastly inferior living standards to the vastly richer UK. But no one in their right mind would argue such a thing. So what’s wrong with this picture?
The answer, of course, is that the size of a country’s economy tells you almost nothing about that country’s real wealth. Instead, we need to focus on the GDP per Capita – how much a country produces per head. Looking at this table tells a very different story, one which makes far more sense. Look at where those three countries I mentioned stand – Brazil at 56, China at 91, India at a pitiful 133. These nations may have massive economies, but they also have massive populations to spread that wealth around, something which they fail to do adequately. Conversely, we have Luxembourg, Norway, Denmark and Sweden at 1, 2, 6 and 8 respectively. That’s more like it – everyone knows these countries have superior living standards. Of course, these countries have small populations, meaning they can’t possibly generate as much total GDP as the big countries – but it doesn’t matter, because proportionately they’re more wealthy per person.
So the next time a unionist tells you that the UK is the 6th biggest economy in the world and that Scotland couldn’t compete with that, try asking them how they compare to other nations in terms of GDP per capita. Alternatively, you could just point out that the next biggest economy after the UK is Italy. You’ll have fun seeing them trying to wriggle out of that one.