Scotland May Not Fare Better Outside United Kingdom

It is doubtful whether the Scottish economy would do better independently. Young Scotsmen seem to agree.

Eilean Donan Castle in Loch Duich in the western Highlands of Scotland, July 27, 2006
Eilean Donan Castle in Loch Duich in the western Highlands of Scotland, July 27, 2006 (Dave Conner)

In less than two years’ time, the people of Scotland will decide in a referendum whether to stay in the United Kingdom or not. Despite intense debate between opponents and proponents of secession, how the ordinary Scotsmen might fare under independence is less clear.

A recent University of Edinburgh study is fairly devastating for the ruling Scottish National Party which advocates secession. It polled a thousand teenagers who would be just old enough to vote in the 2014 referendum and found that 60 percent wanted to stay in the union. 21 percent backed independence. This is the very demographic the nationalists fought to extend the vote to.

The past year seems to have reinvigorated a sense of Britishness across the United Kingdom. For the Diamond Jubilee, the Union Jack was waved by old and young all over the Scotland as a symbol of celebration and unity while the London Olympics only made it better to be British.

What of the institutions that both countries in the union use, from the sterling to the armed forces? While the Scottish nationalists would like to keep the pound and be locked into a monetary and fiscal union with a rump Britain (not very independent really), all the signs point to the chancellor of the Exchequer not allowing this. Moreover, if an independent Scotland were to join the European Union, one of the entry requirements would be to commit to adopting the euro.

With regards to the military, a report (PDF) published by the Scotland Institute think tank found no reason to believe that slicing up a competent military force would benefit an independent Scotland or the rest of the country. Indeed, there are very real risks to the people of Scotland, be it from the loss of jobs and the local economic impact that the inevitable removal of the Faslane Naval Base would bring, the costs involved in building armed forces from the ground, the loss of access to sensitive intelligence and the inevitable dilution in the quality and number of the armed forces of the island. Atlantic Sentinel editor James R. Pritchett made the very point earlier this year.

The economy of Scotland would be interesting to see. In 2008, First Minister Alex Salmond said, “Scotland looks out to an arc of prosperity around her. Ireland, Iceland, Norway, Finland and Denmark, all are small independent nations. All are stable, secure and prosperous.” His arc looks far less prosperous today. The Celtic Tiger lies slain and Iceland had little choice but to embrace the European Union after a banking crisis nearly bankrupted the island. Salmond and his party hoped to copy the Irish economic miracle. Before the crash, the size of the Scottish financial industry was lauded. But an independent Scotland’s banking sector would be more than 1250 percent of its gross domestic product, potentially leaving the Scottish state unable to bail out the industry if things were to go wrong, like they did in 2008 and 2009.

Since the financial crisis, Alex Salmond has preferred to hail Norway as an example. It has offshore oil and gas sources like Scotland although it’s unclear how much of the revenue that is derived from drilling would be an independent Scotland’s and not the rest of Britain’s.

The newfound emphasis on a successful country also cannot hide the fact that the under nationalist rule, an independent Scotland would have followed Ireland’s example and possibly ended up facing near or total bankruptcy. While part of the United Kingdom, Scotland’s banking sector was bailed out by the very government in Westminster the nationalists despise.

If the outcome of the referendum is a “yes” vote after all, it would leave Scotland in limbo. For what would happen to all official documentation? Would they automatically secede to the European Union? Would they keep sterling? How would their economy fare? And from a military point of view, they want a nuclear free Scotland yet remain in NATO — are these aims compatible?

A “no” vote wouldn’t necessarily mean the end either. As Alistair Darling, the former Labour chancellor, said last month, “The nationalists only need to win once by one vote and there is no going back, so that is why we need to win this campaign and win it well.” To settle the independence question once and for all, the “no” vote has to be big, otherwise, within fifteen or twenty years, the United Kingdom might be facing the very same threat of disintegration it thought it had averted.

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