Unfortunately by Wednesday the No campaign had descended into a “declaration of economic war”, as Iain Macwhirter put it on Radio Scotland. This strange case of Dave as Dr. Jekyll and the hideous Gideon as Mr. Hyde with a reckless use of mad potions of economic chemistry threatens to plunge the referendum campaign into a different unrecognisable form.
It’s as if Cameron has unleashed his inner Osborne. In a few days the No message has transformed into something more menacing and primitive looking. Unlike Cameron, the Osborne variant has no conscience, no restrictions, no boundaries; he is free to do what he pleases.
Gideon and UDI
Gideon and Ham’s botched threatening posture risks the campaign descending into a more extreme phase, as panicked Unionists descend into naked threat-mode. One response, not so far considered, is that such an abandonment hastens a declaration of UDI after the vote.
Without the Edinburgh Agreement functioning as a behavioral restraint mechanism and the softening orthodoxy of conventional negotiations, relations could sour to the point of departure.
What does that look like? Nobody really knows, but if people get their knickers in a twist about a few brickbats on Twitter I don’t think they’re going to like whatever’s next.
As Stewart Hosie told us today Westminster Hall: Currency in Scotland £60 billion trade sold from the rest of the UK into Scotland is more than South Africa, Russia, China, and Brazil combined. If British Ministers really want to de-couple debt from assets it does set an entirely different precedent. As Nicola Sturgeon has said:
“It would cost their own businesses hundreds of millions of pounds, it would blow a massive hole in their balance of payments and it would leave them having to pick up the entirety of UK debt.”
Whether the UK is genuinely risking the loss of North Sea Oil revenues or not is a good question. As are those raised by Ronald MacDonald, saying, in essence, if we do not accept responsibility of our fair share of rUK liabilities and particularly our fair share of UK public debt, then: ” Presumably in that case it would not be given the share of assets relating to the sterling monetary union, such as, crucially, its share of the foreign exchange reserves held at the Bank of England. How then would they be able to operate a sensible foreign exchange rate policy absent foreign exchange reserves? Where would these come from?”
One neat answer is: £1.5 trillion of oil assets.
A less negative view comes from the Adam Smith Institute who see it as some sort of liberatory moment.
Certainly if the British Chancellor has decoupled debts and assets he could be making a transformative mistake, releasing us from an obligation to take some responsibility for up to £150b of British debt.
The Consequences of Threatening iScotland
Whatever the technical merits realities and claims of the economists, it remains an extraordinary moment in British politics, where the true nature of the relationship between Westminster and the Scottish society is starkly revealed. Anybody witnessing the debate in Westminster Hall called by Ian Murray (Labour, Edinburgh South) on Scottish Currency would see little more than a mob in suits.
There wasn’t much decorum, and there wasn’t much debate. But it’s wider than that.
As Derek Bateman, the Beeb’s newly feral journalist puts it (‘We Love you You Bastards’):
It is a statement – by all the main Unionists – that Scotland has no stake in the UK. We have, according to them, contributed nothing to the pound, made no impact on the UK’s finances, the reserves and fiscal policy and as a result deserve nothing out of it. Is it £300 or £400 billions in oil revenues and they count for nothing. How much in corporation tax from Royal Bank alone over the years? We have been taken for a ride, if they are right. What they are saying is that Britain belongs to them, lock, stock and barrel and more fool the Scots for thinking they were really partners.
It is difficult to see how they can pretend now to love Scotland with more melancholic sub-Wordsworth fancies when they unite behind vindictive John Bull obduracy. Even at risk to their own interests they will resist the economic logic.
This is Better Together gone all Miley Cyrus. A potential wrecking ball to the economies north and south of the border, and several consequences become clear:
1. The ‘there will be no ‘pre-negotiations’ line, now looks to have been abandoned.
2. The co-ordination and unity between the three parties is now explicit and undeniable as moves become more and more desperate. The idea of ‘two campaigns’ is left looking increasingly stupid. It’s really just the Better Together campaign and Gordon Brown’s side-project.
3. As a moment to decide to ramp-up the debate it’s badly chosen. In a few weeks both Cameron and Salmond will be a few miles away near Aberdeen. The pressure to meet and debate will become irresistible.
4. It will require some quite nifty footwork from Alistair’s Carmichael and Darling to explain away their on the record statements on the currency. They are both bound as one and separated by what they have said.
There is a possibility that this all stems for last months announcement from the Treasury that all the debt belongs legally to the rUK Treasury. Perhaps they realised too late that we can’t default on debt that’s not legally ours. Maybe that was just a terrible tactical mistake they re now rushing to patch-up?
This is being spun as a terrible blow to the Yes campaign and the indy movement and I have seen sombre and dread uttered by several indy commentators. That’s not how I see it at all. We should be asking ourselves instead: what on earth do people in Scotland make of these politicians threatening the Scots by denying them access to their own currency? At some point there will have to be a reckoning for the lies, distortions, culture of threats and intimidation carried out by these people.
If we are being told that Scotland has no stake in the UK that’s a powerful and clear message. If we have to think more deeply about how we run our economy and our currency systems, given the chaos of neo liberal deregulated Britain, that can only be a good thing.