Monday, 8 April 2019

Could Scotland Push For A 2nd Referendum?

In 1707 Scotland and the Scots we're bought and sold for English Gold or so say the words of Robert Burns. When, in reality the union had formed 54 years earlier with the formation of the Commonwealth between the two countries with the United Kingdom coming into force 1 May 1707.

A Remarkable alliance by all accounts, on one side the English were concerned that the Scots would form or rekindle an old alliance with the French, turning against the English. England had become reliant on many Scots regiments to fight within the army of the then Commonwealth, the fear that these troops would change sides was a real and present danger. On the Scottish side they were heavily in debt following an investment intended to create a great trading route between the Atlantic and stretching across the Pacific. With every Scot, or those that could invest £5 invested in a new pioneering venture based in Panama. This failed impoverishing Scottish folk, hence the term coined by Robert Burns. Whilst the term had negative tones the intent was honourable,  and of mutual benefit.

Today we have a real and present danger that the Union will be shattered after a no deal Brexit. This has reduced somewhat due to the SNP losing seats at the last election but it hasn't disappeared. With Parliament behaving the way it has, this could be the catalyst that forces the disintegration of the union, not Brexit.

In many ways this should give time for reflection by those ardent Brexiteers. On one hand the European Union is not flavour of the age, but the historic union between the two great Kingdoms is, and a delicate path forward has to be found. The fragility of the UK is further at risk due to the parliamentary shenanigans. Brexit has been mishandled.

The UK is worthy of saving, and the EU is worthy of leaving. We have a long and powerful history together, fought in wars together. We have a shared language, a shared monarchy, and we have both benefited economically and will continue to do so once we are through this, what is a silly season in British Politics.

Scottish secession will be won or lost based on ideology, emotion and a misguided dislike of all things English. This would be a travesty as undoubtedly we have prospered together. The EU presents a real and present danger to Scotland should they get their hands on this culturally rich kingdom. However, Scotland could well be a bystander in the success of Great Britain and those that remain in the United Kingdom. 

In the Union's favour is of course the economic circumstances. Scotland's economy is reliant on oil, during the last referendum for Scottish Independence the oil price hovered around $120 per barrel, looking poised to accelerate northward, today we have $60 approx. The economic situation is a far cry from 2014. Even 2014 the economic well-being of Scotland was far from assured. Today it would make no sense at all, particularly when you look to the Eurozone and their lacklustre growth. For sure Scotland would need to participate in the Euro and the eurozone has been a straight jacket to many EU economies.

Let's be clear for Scotland to be a success austerity would need to bite more severely than it has. Taxes would have to rise and public spending would need to be cut. The Remaining UK tax payers subsidise Scotland to the tune of £1000 per head per year. 

The EU have made clear Scotland will leave the EU when the UK leaves the EU. Scotland would have to join the EU by taking its place in the queue. Membership is not at all assured. Spain will most certainly veto membership fearing a backlash from Catalonia.  Although, in 2017 Spain have said they would not veto Scotland joining it is generally felt that that was an enforced political posturing. 

To detract from the emotional passion to pull away from England, there are several factors to consider:

  1. The Scottish English border would be a headache for the EU. 
  2. Scotland’s exports to England and Wales are today four times larger than they export to the EU.
  3. Scottish businessmen and women will most certainly migrate south causing a significant exodus of wealth and jobs from an already beleaguered nation.
  4. The subsidy argument should not be dismissed, the EU would need to take up the slack at a time when they are reeling from the loss from what is the equivalent of 20 EU states.

The upshot is that the economic losses for Scotland from leaving the UK are probably greater with the UK out of the EU. Meanwhile, as the EU’s problems mount, and indeed the chances of an EU break-up rise, the wider case for Scotland to leave the UK looks weaker still. Suppose Scotland left the UK, believing that the EU would give it shelter, only to find that the EU had broken up. What a fate that would be. So, in contrast to the prevailing conventional wisdom, I believe that a Scottish secession from the UK is now much less likely than it was a few years ago. Click here

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