Scotland: ‘Pound is as much ours as it is yours’

[Locutus]

If UK ministers continue their “bullying” tactics to stifle the Scottish independent movement and block Scotland from adopting the UK pound as its currency, Edinburgh won’t take on its share of UK debt, warns Scotland’s First Minister Alex Salmond.

The First Minister said that shutting off Scotland from sterling “would seriously damage the economy of the rest of the UK, as it would cost their businesses hundreds of millions of pounds a year, blow a massive hole in the balance of payments, and it would leave them having to pick up the entirety of UK debt,” Salmond said in response to George Osborne’s announcement, which was seen as a big blow to the ‘Yes’ movement to gain independence this autumn.

“This is a concerted bid by a Tory-led Westminster establishment to bully and intimidate – but their efforts to claim ownership of sterling will backfire spectacularly in terms of reaction from the people around Scotland, who know the pound is as much theirs as it is George Osborne's,” said Salmond, the leader of the Scottish National Party (SNP).



more


Scotland bites back: ?Pound is as much ours as it is yours? ? RT Business

 

[Blackleaf]

I'm afraid Salmond and the SNP are wrong here, and the British Government is only doing the sensible thing by informing the Scots that they cannot continue to be a part of the UK currency if they decide to secede from the UK.

The thing with the SNP is that, rather than wanting full autonomy for Scotland, they instead wish to pick and choose which areas they want to become independent in and which areas they don't, areas to suit themselves. They seem to want independence from the UK yet still want to retain the UK currency and have the BoE set their interest rates etc. What kind of independence is that? Why can't they just opt for full independence instead of just picking and choosing certain bits?

And it wasn't that long ago that the SNP were saying that they wanted an independent Scotland to join the euro. But now they have changed their minds (probably as a result of the polls which show most Scots are against joining the euro) and now wish to keep the UK currency even if Scotland secedes from the UK.

The Scottish Nationalists are not putting across any cogent argument here.

Many Scots can see through the half-truths and downright lies they are peddling.

The SNP (the ruling party in the devolved Scottish parliament) keep telling us, for example that, in the unlikely event of Scotland becoming an independent nation state, that they will become a new EU member state.

Yet on Sunday morning Jose Manuel Barroso, the President of the EU Commission, was on the BBC's The Andrew Marr Show and he said, quite clearly, that it would be "extremely difficult, if not impossible" for an independent Scotland to join the European Union.

Mr Barroso made his comments during an interview with Andrew Marr

He said an independent Scotland would have to apply for membership and get the approval of all current member states.

In his interview with Andrew Marr, Mr Barroso said: "In case there is a new country, a new state, coming out of a current member state it will have to apply."

He said it was important that "accession to the European Union will have to be approved by all other member states of the European Union."

He went on: "Of course it will be extremely difficult to get the approval of all the other member states to have a new member coming from one member state."

Mr Barroso cited the example of the Spanish not recognising Kosovo.

He said: "We have seen Spain has been opposing even the recognition of Kosovo, for instance. So it is to some extent a similar case because it's a new country and so I believe it's going to be extremely difficult, if not impossible, a new member state coming out of our countries getting the agreement of the others."

Barroso's statement echoes earlier statements from EU officials in which they have said that a new Scottish nation state would find it extremely difficult to join the EU. Yet the SNP, apparently, know better than EU officials.

In response to Barroso's comments, Scotland's Finance Minister John Swinney said: "I think President Barroso's remarks are pretty preposterous."

So there you have it. Apparently the SNP know better the workings of the EU than the President of the European Commission does. So the SNP STILL tell the Scottish people that there will be no difficulty in an independent Scotland joining the EU, despite the EU itself saying otherwise. The SNP are lying to the Scottish people.

Another thing the Scottish nationalists have to address is that any new country joining the EU has to join the euro at some point (only the UK and Denmark do not have to join the euro at any time in the future), and the majority of Scots are against joining the euro. Yet an independent Scotland somehow joining the EU as a new nation state will have to join the euro. The euro is not something the Scottish people want and this will surely work against the nationalists come the referendum.

BBC News - Scottish independence: Barroso says joining EU would be 'difficult'


So everyone is rounding on the Scots Nats at the moment. The British Government is telling them that they cannot keep the UK pound if they secede from the UK and the EU is telling them that it will be very difficult for Scotland to join the EU.

Salmond could plunge UK into euro-style crisis: Bank chief's blow to Scottish independence plans


Carney holds talks with First Minister Alex Salmond in Edinburgh

Pro-independence campaigners used to say they would join the euro

Now they want to continue using the pound in a currency union



By Hugo Duncan
30 January 2014
Daily Mail

Scotland could never be fully independent if it keeps the pound, the Governor of the Bank of England warned yesterday.

Mark Carney said that Scotland would have to share sovereignty with the rest of the UK to avoid creating economic havoc.

His assessment of a ‘Yes’ vote on September 18 suggested that Scotland would need to surrender control of interest rates and agree to strict rules controlling tax and spending.

Talks: Bank of England governor Mark Carney meets First Minister Alex Salmond to discuss Scottish independence

Otherwise it would risk a eurozone-style disaster, where stronger nations, including the UK and Germany, have been forced to prop up heavily indebted smaller ones, such as Greece.

Mr Carney insisted in a speech in Edinburgh that he was not passing judgment on whether Scotland should be independent or on what currency arrangements an independent Scotland could make.

And he refused to be drawn over whether Scotland would be better or worse off as an independent nation.

But his intervention carried the clear implication that Scotland can either be fully independent or stay with sterling – but not both.

The governor’s speech is likely to be a pivotal moment in the referendum battle, with just 230 days left until the vote.



Read more: Bank governor Mark Carney warns of risks of letting independent Scotland keep pound | Mail Online
Follow us: @MailOnline on Twitter | DailyMail on Facebook

Now Scots know: an independent Scotland won’t be Salmond’s ‘same-but-slightly-different’ vision

Hamish Macdonell (A proud Scot and a proud Brit)
16 February 2014
The Spectator

The Scots Nats have a Munro to climb

Personally, I’m now waiting for the Queen to get involved.

After all, there’s not much left of Alex Salmond’s independence-but-not-independence blueprint that is left intact. First it was his ‘we’re going to share the pound in a Sterling zone’ claim. That was ruled out by Chancellor George Osborne (and Ed Balls and Danny Alexander) last week.

Then it was his ‘independence in Europe’ claim, and that was dismantled by European Commission President Jose Manuel Barroso today. The only pillar of Salmond’s grand ‘everything’s-going-to-remain-the-same-only-different’ scheme which remains in place is a shared monarchy.

So it can’t be long before Her Majesty also intervenes and says: ‘Do you know what? I don’t much like the idea of being monarch of an independent Scotland, I think I’ll opt out of that too.’

For months, the referendum debate has been chugging along, the same old arguments have been explored without much to get anybody really interested. Then, kaboom, in just a few days, everything has changed. Ever since the campaign started two years ago, thousands of Scots have demanded clarity and certainty. What is going to happen to the pounds in our pockets? They have cried. What’s going to happen to our place in Europe? They have asked.

Well, now they know and this is really what has changed in the last few days: Scots have been told that an independent Scotland will actually have to be independent. It will not be the ‘same-but-slightly-different’ vision that Salmond has painted for so long.

An independent Scotland will be independent. It will have to have its own currency – whether or not that can be pegged to the UK pound – and Scotland will be stranded outside the EU, probably for years and possibly even for decades.

The Nationalists could – and did – dismiss this warning when it came from the Chancellor over the currency last week. But now that we have had a cold, hard dose of reality from the President of the European Commission, the truth of the situation is really starting to sink in.

There has undoubtedly been a feeling in Scotland that voting Yes didn’t carry much of a risk. We would still be attached to the UK, at least in part. We would have the same currency, we would be able to rely on the Bank of England to bail us out if we got into trouble and we would still be in the EU so could trade as normal with everyone.

But now, all that has changed. The independence debate has shifted. It has moved on, substantially so. Everything has become starker and it now should be clear to everyone in Scotland just how high the stakes are.

Mr Barroso’s intervention this morning on the Andrew Marr Show would have been significant at any time but coming, as it did, just after the Chancellor’s dismissal of a shared currency after independence, it had real weight.

Just for the record, let’s have a look at what he actually said: “In case there is a new country, a new state, coming out of a current member state, it will have to apply and – this is very important – the application and the accession to the European Union, will have to be approved by all the other member states of the European Union.”

And he added: “I don’t want to interfere on your referendum here and your democratic discussion here but of course, it will be extremely difficult to get the approval of all the other member states to have a new member coming from another member state.

“We have seen, for instance, Spain is opposing even the recognition of Kosovo so it’s, to some extent, a similar case, because it’s a new country and so I believe it’s going to be extremely difficult, if not impossible, a new member state coming out of one of our member countries, getting agreement of the others.”

Now, there will be many people out there willing to criticise Mr Barroso. After all, he is not a much-loved figure in the UK – being Europe’s top bureaucrat and all.

But if there is someone who knows how Europe works, it is him.

He knows that every country in Europe has its own agenda and, if it suits that country to use its veto on Scottish membership as a bargaining chip for something else, then that is what is going to happen.

This time last week, Scottish independence looked, to many north of the border, like the best of both worlds. Scotland could keep the best things of being British, including the pound and the monarchy, and take on the best things about being independent – making Scottish decisions at a Scottish level.

But now it looks very different. Independence suddenly looks as if it would actually mean what it says on the tin. It would mean estrangement, separation, divorce and, following Mr Barroso’s intervention, isolation as well.

The Nationalists expect a substantial number of Scots to take such umbrage with this supposed ‘bullying’ from the EC and the UK Government that they will join the Yes campaign.

That may be right but there will also be a lot of voters who will go the other way, frightened by the reality of what independence will actually mean.

So, while no-one quite knows how all this is going to pan out in percentage terms for each side, what is certain is that the debate is now definitely more polarised than it has been up until now. It is harsher, it has more edge but it is, at last, rooted in reality.

And that, in the end, is probably no bad thing.

The anti-independence Better Together campaign is on the front foot

http://blogs.spectator.co.uk/hamish-macdonell/2014/02/now-scots-know-an-independent-scotland-wont-be-salmonds-same-but-slightly-different-vision/

 

[Cannuck]

Why would the queen not be the queen of an Independant Scotland? She's the queen of an Independant Canada. Are you suggesting she's just a petty bitch

 

[captain morgan]

I suspect that in a year or so, Scotland will be a thriving, independent nation that is on the rise. After all, they have been supporting the UK for many, many years.

Very bad news for the UK, but extremely positive for an independent Scotland

Why would the queen not be the queen of an Independant Scotland? She's the queen of an Independant Canada. Are you suggesting she's just a petty bitch

I recently read that she is broke... I'm guessing that has made the royals pretty cranky

 

[Blackleaf]

I suspect that in a year or so, Scotland will be a thriving, independent nation that is on the rise.

The polls don't agree with you. So you have likely set yourself up for an embarrassing situation come 19th September.

And even if it did become independent, I'd like to see how it would survive without English money - and the fact that economists are predicting that an independent Scotland would instantly have to make deep and savage cuts, to save its economy.

One brilliant example of how Scotland needs the UK was the recent bail out of the failed Scottish banks RBS and HBOS (a large part of Britain's recent financial crisis started in Edinburgh, not London).

The cost of the bailout exceeded the entire Scottish GDP, so had those banks failed in an independent Scotland there's no way it could have afforded to bail the banks out.

The only way those banks were able to be bailed out was thanks to Scotland being part of the UK and therefore having millions of English, Welsh and Northern Irish taxpayers also at hand to bail out its banks.

After all, they have been supporting the UK for many, many years.

It's the UK, mainly England, which has been supporting Scotland for many years.

In fact, the whole system is skewed heavily in favour towards the panpered Scots, leading to criticisms from the English.

Scotland receives a handout, worth many billions every year, paid for by the generous English taxpayer.

Through the Barnett Formula, Scotland (and also Northern Ireland and Wales) receives more public spending per head of population than the English do. Even wealthier Scottish areas receive more public spending per head than poorer English areas. Even the Joel Barnett, who created the Barnett Formula in the late 1970s, has said that it should have repealed years ago due to the unfairness of it.

In The Scotsman in January 2004 he wrote, "It was never meant to last this long, but it has gone on and on and it has become increasingly unfair to the regions of England. I didn't create this formula to give Scotland an advantage over the rest of the country when it comes to public funding."

Not to mention all the lovely freebies which the Scots receive, such as free prescriptions and free university tuition, all things which are paid for by the English taxpayer yet which are themselves denied to the English who, unlike the Scots, have to pay their own way in the world.

In view of all this, it isn't surprising that polls have shown that MORE English are in favour of Scottish independence than the Scots are. Whereas polls consistently show, as they have done for years, that the majority of Scots are against independence, polls in recent years have shown that the majority of English are in FAVOUR of Scottish independence.

I recently read that she is broke... I'm guessing that has made the royals pretty cranky

Broke? She's worth around £25 million.

 

[Nuggler]

Why would the queen not be the queen of an Independant Scotland? She's the queen of an Independant Canada. Are you suggesting she's just a petty bitch

Petty fat bitch with saggy tits

 

[Blackleaf]

Here are some more blows to the possibibility of an independent Scotland:

Scottish independence: 'Fiscal gap would lead to spending cuts', says IFS

BBC News
18 November 2013

An independent Scotland would need to cut spending or raise taxes, said the IFS


An independent Scotland would need to cut spending or increase taxes for its finances to be sustainable in the long term, a think tank has warned.

The Institute for Fiscal Studies (IFS) said an independent Scotland would face a "fiscal gap" of 1.9% of national income, compared to 0.8% for the UK.

This would require significant spending cuts or tax rises, the report said.

Scottish Finance Secretary John Swinney said the analysis "underlines the case for an independent Scotland".

But former Chancellor Alistair Darling, leader of the pro-Union Better Together campaign, said the report left the SNP's economic case for independence "in tatters".

The report, entitled Financial Sustainability of an Independent Scotland, says the exact size of the challenge would depend on factors such as how much debt Scotland inherited from the UK, the interest it paid on the debt, the age of the population and potential changes in oil revenues and immigration rates.

The predictions were based on research funded by the Economic and Social Research Council.

Oil revenues

At present North Sea oil revenues more than make up for higher public spending per head of population in Scotland compared to the rest of the UK, the IFS says.

The think tank analysis said "even under the most optimistic scenario" bringing national debt down would require something like a 6% reduction in total public spending, a rise of 9% on the basic rate of income tax or a VAT rate of 28%.

Such measures would have to be taken over and above the tightening of public spending already planned by the UK government.

However, independence could also give Scotland an opportunity to create an "optimal tax system" which could lead to some taxes being lower than the UK as a whole, the IFS said.

The analysis also noted that under devolution Scotland already had different spending priorities than the UK as a whole, and said this would continue post-independence, meaning budgets could be more focused on local needs.

The independence referendum takes place on 18 September 2014, with voters in Scotland being asked the yes/no question: "Should Scotland be an independent country?"

Gemma Tetlow, one of the authors of the report, said an independent Scotland would face "even tougher choices" than the UK as a whole over the long term.

"Revenues from the North Sea will probably decline and official population projections suggest that the average age of the Scottish population will increase more rapidly than for the UK as a whole, putting greater upward pressure on many areas of public spending," she said.

"As a result, to ensure long-run fiscal sustainability, an independent Scotland would need to cut public spending and/or increase other tax revenues more than would be required across the UK as a whole."

BBC News - Scottish independence: 'Fiscal gap would lead to spending cuts', says IFS
************************

A growing number of major companies are warning Scotland of economic disaster should it become independent. Here's one of the most recent...

North Sea investment bank attacks Scottish independence

Colin Welsh, the chief executive of Simmons & Company, tells an industry conference he "wholeheartedly" endorses the criticisms aired by Bob Dudley, the head of BP.

The chief executive of a major North Sea investment bank has become part of a growing number of companies to attack Scottish independence Photo: ALAMY



By Simon Johnson, Scottish Political Editor
05 Feb 2014

The oil industry’s backlash against Scottish independence has intensified after a leading North Sea investment bank warned separation was a “threat” to Scottish prosperity.


Colin Welsh, the chief executive of Simmons & Company, said he “wholeheartedly” endorsed an outspoken attack on separation delivered the previous day by Bob Dudley, the head of BP.


Mr Welsh, who is described as one of the North Sea’s most influential dealmakers, told a conference in Aberdeen that the Nationalists’ economic case for independence was based on “flawed logic”.


He urged businesses to make public their views on separation “before it is too late” and said the industry cannot afford the risk of “stepping into the unknown”.


His intervention was significant as the investment bank has completed more than 200 deals in the North Sea since 1999 worth more than £9 billion. However, the Scottish government last night said his views were “mistaken”.


Mr Welsh made clear his concerns only 24 hours after Mr Dudley became the most eminent business leader yet to attack separation, concluding that “Great Britain is great and it ought to stay together”.


Their hostility is a serious setback for Alex Salmond and his fellow separatists as their economic case for separation relies heavily on North Sea tax revenues.

Alistair Carmichael, the Scottish Secretary, told the Commons that Mr Dudley was part of a “growing chorus” of companies starting to go public with their opposition to separation.

Speaking on the first day of the Subsea Expo conference in Aberdeen, Mr Welsh said the North Sea needs “stability and certainty” to maximise the remaining oil reserves.

“I wholeheartedly endorse what Bob Dudley said yesterday regarding the uncertainty that the question of independence brings to our industry and the threat that this poses to our economic future,” he said.

“This is an issue that is too important for the business community to stay silent on and the oil and gas industry needs to stand up and say what it thinks before it is too late.”

Mr Salmond has repeatedly claimed there is up to £1.5 trillion of oil and gas left in the North Sea but Mr Welsh said the SNP’s plans to base a separate Scotland’s economy on the “twin planks” of oil and gas were flawed.

“There is no getting away from the fact that production from the North Sea is declining fast,” he said.

“Moreover, with crude prices range bound and costs spiralling upwards the North Sea is a relatively unattractive place to invest compared with other offshore regions or fracking.”

He concluded: “We cannot afford the risk of stepping into the unknown in today’s economic climate and competitive environment.”

A spokesman for the pro-UK Better Together campaign said: “These comments are absolutely devastating for the nationalists and their plan to break up the UK.

“Alex Salmond cannot dismiss this as a personal opinion. The industry are speaking and he cannot put his fingers in his ears and pretend that he cannot hear them.”

telegraph.co.uk

 

[petros]

Will they kick BP out and nationalize the oil and tell the Brits to go pound sand?

 

[barra]

I would love to see an independent Scotland if that is what the Scottish people want. And yes, Canada survives independently, why not Scotland. And all the hassles England has meted out to Scotland for centuries, they are justified to separate.

While we are at it, lets get Quebec on their high road to independence too. The sooner the better with their whining about seceding and all that for a couple hundred years or so ~ do it already!

 

[Blackleaf]

Will they kick BP out and nationalize the oil and tell the Brits to go pound sand?

That's the way to go. Kick major companies and all those jobs out of your country, especially when those companies are oil companies and your only hope of surviving as an independent nation is through revenues from your dwindling North Sea oil.

I would love to see an independent Scotland if that is what the Scottish people want.

In 42 polls conducted since January 2012, all of them, except one, have shown a majority of Scots wanting to stay in the Union.

Only one - and that one was conducted by the SNP themselves in August 2013 - showed a majority in favour of independence.

The only time in the last two years that support for Scottish independence exceeded 40% in Scotland was August 2013, the only poll in which the Scots appeared to favour independence. But that was a poll conducted by the SNP themselves and was very close (44% supporting independence and 43% against).

In order for the Scottish nationalists to win the referendum, there would have to be a sudden and unexpected swing the other way, denying not just opinion polls from the last two years but from opinion polls from the last thirty years, which have rarely shown Scottish support for independence exceeding 40%.

The nationalists have a mountain to climb.

UK Polling Report

And all the hassles England has meted out to Scotland for centuries, they are justified to separate.

And what about all the "hassles" that the troublesome Scots have meted out to England for centuries?

The fact remains that Scotland has done very well in what is the most successful political union in history, anywhere in the world.

Scotland unified with England because it was skint - and so got access to English cash - and wanted an empire.

Its failed attempts to start a Scottish Empire in Panama during the disastrous Darien Scheme made it envy England's fledging empire, and so wanted to unify with England to get access to that empire.

Come polling day on September 18th the Scots won't forget how much the Union with England made their nation rich, prosperous, and successful, and that breaking from the UK will skint their economy again, and so vote accordingly.

Scottish independence is economic nonsense

Crucially, Scotland’s still extremely precarious financial services industry is viewed as UK-backed — and that means the Bank of England. The Scottish commercial banks, with their vast liabilities, and still unresolved off-balance-sheet losses, will always physically reside in Britain

'The reality is that if an independent Scotland’s banks imploded, London would not be able to stand idly by' Photo: AP



By Liam Halligan
15 Feb 2014
The Telegraph

London’s games are Great Britain’s games.” So said the iconic BBC commentator Barry Davies, at the start of the opening ceremony of the 2012 Summer Olympics. A four-hour extravaganza, it was a show that stunned and delighted the world.

The start of the 30th Olympiad showcased the UK’s creative and organisational genius. It was a stylish reminder of the huge impact our small North Atlantic nation has had on broader humanity. And what did this high-octane celebration of Britain’s shared history and culture kick-off with? Successive choruses sang with reverence and respect by sweet-voiced schools kids from the UK’s four corners.

We had the English hymn Jerusalem, Danny Boy for Northern Ireland and the Welsh tearjerker Bread of Heaven. And, at the heart of the mix, from a place integral to our ongoing island story, we heard Flower of Scotland.

While the UK is four distinct countries, each with its own identity, we’re one coherent nation. Cobbled together, in a form that somehow works, our joint history of achievement and success is as rich as any on earth. That’s how we presented ourselves during that masterful Olympic opening ceremony in July 2012 — and the world roared back its approval.

Last week, mainstream politicians finally tackled the fiendishly difficult economic and technical issues raised by Scottish independence. In just seven months, Scotland votes on whether to leave the UK. The outcome will swing partly on nationalist fervour, the battle within millions of hearts between British and Scottish identity. But votes cast on September 18 will also revolve around money and financial security — issues that have just moved centre-stage.

I’m against Scottish independence because I’m horrified at the prospect of our country being dismantled. I’d also argue that an independent Scotland is an economic nonsense. I’m not saying a country of 5m people, with a wealth of know-how, couldn’t survive.

The problem is that the cultural, historic and commercial ties that bind us are too tight to safely be cut.

They can be symbolically severed, yes, with the creation of yet another expensive layer of Scottish government, with all the special advisers, civil servants and juicy public sector per diems that would bring to Edinburgh’s already cosseted political elite. But as far as the rest of the world is concerned, we’re one entity — a reality that’s prevailed for centuries, long before the 2012 Olympics.

Crucially, Scotland’s still extremely precarious financial services industry is viewed as UK-backed — and that means the Bank of England. The Scottish commercial banks, with their vast liabilities, and still unresolved off-balance-sheet losses, will always physically reside in Britain.

As such, global investors will keep assuming that, in the event of a crisis, the UK government will be in charge. That will apply however many drivers Scottish National Party leader Alex Salmond has at his disposal and under whatever flag any “independent” Scottish government sits.

Last Tuesday we saw a rare outbreak of agreement between the Conservatives, Labour and the Liberal Democrats. The UK’s three main parties are now united in their determination to refuse an independent Scotland a currency union with the rest of the UK. “People need to know that’s not going to happen,” said Chancellor George Osborne last week in Edinburgh, during a rare north-of-the-border foray for a senior Tory.

“We can’t be prevented from using the pound,” replied Scottish National Party deputy leader Nicola Sturgeon. “It’s a fully tradable currency and Osborne is bluffing.” In some senses, she’s right. Will Westminster really pass and enforce draconian legislation fining British firms who use sterling when trading with Scots? I think not.

The more menacing, and largely unspoken, threat is to deny an independent Scotland banking union with the rest of Britain. This is Westminster’s big stick. The combined balance sheets of the UK’s banks amount to a massive five times annual GDP.

We have the most bloated banking sector of any major economy, making our public finances extremely vulnerable in the event of another ruinously expensive bank bail-out.

An independent Scotland, though, would be even more financially top-heavy, to a quite astonishing degree — with bank balance sheets totalling over 12 times its national income. When Iceland’s banks crippled the entire country the equivalent figure was seven times.

Would London really stand idly by if Scotland’s banks imploded, given the complex web of cultural and financial links between the two countries, combined with international perception that we are, to all intents and purposes, one nation? Of course not. The risk to the rest of the UK’s financial markets and credit-rating would be simply too great.

The SNP’s “Yes” campaign is still behind in the opinion polls. But Mr Salmond has a track record of surging late to victory — as he did in the Scottish parliamentary elections of 2007 and 2011.

The “No” campaign, meanwhile, is languishing and complacent. The Conservatives can’t run it, because they’re largely hated in Scotland. And while the Tories say they want the SNP to lose, the party knows Scottish independence would give it a far better chance, for years to come, of commanding majorities across the rest of the UK.

Over the coming months, the SNP will use all kinds of economic snake oil to swing the vote its way. Mr Salmond is promising Scottish voters a callous £600 “indy bonus” — without saying where the money will come from. The biggest con, though, is that while Westminster can threaten to stop both currency and banking union, in practice it won’t work — as the SNP well knows.

An independent Scotland will keep using sterling and its banks will continue to rely on a London-launched bail-out — so setting up the mother of all moral hazards. That’s the main reason why September’s vote shouldn’t only be limited to Scots. The entire UK should have a vote because the entire UK will have to rescue Scotland if its banking sector goes bust.

Britain’s gilts market is propped up by printed money. Our national debt, for all the “austerity talk”, has doubled since 2007 and is set to rise another 50pc by 2016. The SNP, as a political gambit, is now threatening to walk away from “Scotland’s share” of the UK’s national debt. Could there possibly be a worse moment to mess with our international creditors?

Then there’s the jaw-dropping political and diplomatic incoherence of the SNP’s stance. An independent Scotland would have to leave the European Union — an outcome many Scottish firms fear. It could only re-enter if all EU members agree — which Mr Salmond says they will. Would Spain? If a newly-independent Scotland waltzed back into the EU and the single market, that would fan the flames of Basque and Catalan separatism. I don’t think Madrid would allow it.

Think also of the impact of Scottish independence on Northern Ireland. The Good Friday agreement, secured after years of bloodshed, was, at best, an agreement to disagree, while pursuing differing aims by political and not military means. This is yet another reason why this upcoming referendum should extend beyond Scotland, because a Scottish Yes would reopen the constitutional question in Northern Ireland at a delicate time.

Flower of Scotland refers to the victory of Robert the Bruce over England’s Edward II at the Battle of Bannockburn in 1314. Some 600 years later, English and Scottish regiments (together with Welsh and Irish) were fighting alongside one another in the First World War. Which anniversary is more recent? Which has more relevance to our contemporary life? My cultural heart deeply opposes a UK split, my financial and political head even more so

Scottish independence is economic nonsense - Telegraph

 

[taxslave]

The Scot separatists sound much like Quebec seperatists.

 

[Cannuck]

Petty fat bitch with saggy tits

If, in fact, she has said she would not be the queen, that would be reason enough for me to seek independence. Criminy, they're a loony lot

 

[Machjo]

So Blackleaf, are you saying the pound belongs to England and not the UK? If so, why is Skotland using it then?

 

[Blackleaf]

So Blackleaf, are you saying the pound belongs to England and not the UK? If so, why is Skotland using it then?

If the pound belongs to the UK, then Scotland has no right to use it if it leaves the UK.

Why become independent but then opt to use the same currency as the country which you seceded from and still have your economy run by the central bank of the country which you seceded from? Either the Scots become independent or they don't. They can't pick and choose certain areas to become independent in and other areas not to become independent in to suit themselves. Either complete independence or none at all.

The Scots Nats only want to carry on using the pound so the Bank of England can bail them out should they get into economic troubles again. Basically, they want to sever ties with the UK and become an "independent" nation and yet want the UK to still be on hand to bail them out in the hard times. And I don't think the English, Welsh and Northern Irish taxpayers would be too happy with that. We already pay for the pampered Scots' freebies within the UK. I don't see why we should have to bail them out as an independent nation when they get into trouble. If the Scots aren't prepared to stand on their own two feet as an independent nation then they shouldn't become independent.

So, no, an independent Scotland will not be having the pound. I'm laughing at the way poor old Salmond and the nats are desperately trying to find new currency arrangements right now.

 

[Cannuck]

If the pound belongs to the UK, then Scotland has no right to use it if it leaves the UK.

You are wrong as usual. You must be getting used to that.

 

[L Gilbert]

By the looks of it to me, most Scots would rather have more control over their stuff than actual independence: More Scots would back greater devolution over independence - poll | Reuters

 

[Cannuck]

By the looks of it to me, most Scots would rather have more control over their stuff than actual independence: More Scots would back greater devolution over independence - poll | Reuters

Sounds just like Kweebeckers to me

 

[Blackleaf]

You are wrong as usual. You must be getting used to that.

The GBP is the currency of the UK, no other country.

Scotland cannot expect to keep using the GBP as an "independent" nation and expect English, Welsh and Northern Irish taxpayers to bail them out when the going gets tough again. Either they are fully independent or not independent at all. I don't like the way the Scots Nats are cherry picking certain areas that they DON'T want to become independent in in order to ensure that the citizens of the UK (England, Wales and NI) rather than just the Scots continue to pick up the tab when the Scottish economy goes belly up again. Why should English, Welsh and Northern Irish taxpayers continue to bail out Scottish banks in an independent Scotland? Surely the whole point of an independent Scotland is for the Scots to start standing on their own two feet and start paying their own way in this world. It just isn't fair for the Scots to carry on using the GBP as an independent nation just so the UK (England, Wales and NI) taxpayers can pick up the tab for the failings of an independent Scotland's economy and, thankfully, the British Government have told the Scots Nats they cannot use the GBP.

The pampered Scots have been getting their own way far too often.

Scottish independence: 'Yes' vote means leaving pound, says Osborne

In his speech in Edinburgh Chancellor George Osborne said: "The pound isn't an asset to be divided up between two countries after a break-up like a CD collection.

He went on: "There's no legal reason why the rest of the UK would need to share its currency with Scotland.

"So when the Nationalists say the pound is as much ours as the rest of the UK's, are they really saying that an independent Scotland could insist that taxpayers in a nation it had just voted to leave had to continue to back the currency of this new, foreign country?"

Mr Osborne added: "The UK is growing faster than any other advanced economy in Europe, and within the Union, Scotland is growing faster than the rest."

"Nothing could be more damaging to economic security here in Scotland than dividing our United Kingdom.




The chancellor's speech came as he published the Treasury's latest currency analysis paper, which said:

• The UK's successful union with its shared monetary policy and risk would be lost in an independent Scotland.
• Countries with more direct control over monetary policy can better cope with severe economic problems (an independent Scotland with the pound could experience the same problems as the eurozone countries)
• An independent Scotland would be more exposed to risks from the "volatile" energy and finance industries.
• The eurozone crisis had shown that agreed fiscal rules are not enough to ensure a stable currency union.
• There is no rule or principle in international law requiring the continuing UK to formally share its currency with an independent Scotland.

And in a highly unusual move, the chancellor also published civil service advice from Sir Nicholas, the Treasury's permanent secretary, who stated:

• "Currency unions between sovereign states are fraught with difficulty. They require extraordinary commitment, and a genuine desire to see closer union between the peoples involved."

• "What worries me about the Scottish government's putative currency union is that it would take place against the background of a weakening union between the two countries, running counter to the direction of travel in the eurozone."

• "The Scottish Government is still leaving the option open of moving to a different currency option in the longer term. Successful currency unions are based on the near universal belief that they are irreversible. Imagine what would have happened to Greece two years ago if they had said they were contemplating reverting to the Drachma."

• "Scotland's banking sector is far too big in relation to its national income, which means that there is a very real risk that the continuing UK would end up bearing most of the liquidity and solvency risk which it creates."

• "If you follow Treasury advice and this week rule out a currency union in the event of Scottish independence, you can expect the Scottish Government to threaten not to take on its share of the United Kingdom's debt. I do not believe this is a credible threat."

Has the Treasury killed Salmond’s sterling-zone?

By Robert Peston
BBC Business Editor

The instinct of the Scottish National Party may well be to dismiss the head of the Treasury's unambiguous advice to the Chancellor that he should not enter into currency union with an independent Scotland as the public-school and Oxford establishment closing ranks to save the union.

But the letter from Sir Nick Macpherson (Eton and Balliol) to George Osborne (St Paul's and Magdalen) is a significant constitutional event.

It is unusual for the permanent secretary to the Treasury to write a public letter on any issue at all, let alone one as momentous as whether institutional arrangements should be put in place so that an autonomous Scotland could have an influence on monetary and financial-regulation policy while continuing to use the pound.

The relevant issue for Mr Salmond is only to a limited extent whether Macpherson and the Treasury are right or wrong that monetary union with an autonomous Scotland would be contrary to the interests of a still-united England, Wales and Northern Ireland.

To remind you what you already know, his strong conviction is that Macpherson and the Treasury are misguided.

But the problem he has is a different one: can he hope to persuade Scots that a Westminster government would ever negotiate currency union with him, now that the official and supposedly impartial civil service has made its view unambiguously clear that negotiating a formally agreed sterling-zone would be a serious error?

In other words, Macpherson has underwritten not only Osborne's opposition to currency union, but that of Labour's Ed Balls (Nottingham High and Keble) and the LibDem's Danny Alexander (Lochaber High - as it happens, a state school - and St Anne's).
Capital flight danger

Which implies not that a separate Scotland could not use the pound. But that it would have to do so in a wholly informal way, with no control over interest rates or regulation of banks or even the supply of adequate quantities of bank notes.

In those circumstances, it would have to grin and bear interest rates and an exchange rate that suited the rest of the UK, but might well be inappropriate to Scotland as a new independent oil-based economy.

So why is Macpherson and the Treasury - which has published a detailed analysis of the costs and benefits of monetary union - so clear that a monetary federation with Scotland would be bad?

Well they make three points.

First that the Scottish National Party has failed to make a forever commitment to keep the pound. It has kept open the option of at some point creating its own currency or joining the euro. But this magnifies the danger of capital flight from Scotland, of a life endangering sort for its banks, any time there were rumours of Scotland dumping sterling (as happened to Greece and Spain, for example, at the height of the eurozone's recent crisis).

That flows through to Macpherson's second point: the Scottish economy and the resources of Scottish taxpayers would be too small to be able to bail out Scotland's giant banks - RBS and Lloyds/HBOS - in a crisis, so the solvency risks attached to these banks would remain with the Westminster government.

Also Macpherson argues that in general, in a currency union, the rest of the UK would perpetually be on the hook to bail out Scotland, and that this would be an unreciprocated or asymmetrical risk - in that, in his view, it would be "inconceivable that a small economy [Scotland] could bail out an economy [England, Wales and Northern Ireland] nearly ten times its size".

'Hogwash?'

Finally he says that the tax and spending or fiscal policies of Scotland and the rest of the UK were likely to become "increasingly misaligned", unless Scotland were put in a fiscal straight jacket that caused growing demands in Scotland for withdrawal from the currency union - which in turn would risk the capital flight and run on the banks that could do such serious economic damage to both parts of the sterling zone.

Now Salmond will say this is all hogwash.

He will argue that the finances and economy of Scotland have a long history of being in step with that of the rest of the UK. And given the importance of Scottish trade to English companies, it would be bonkers to introduce friction and additional costs into the trading relationship by adopting two currencies.

Salmond may be right.

But it is perfectly clear that every important decision-maker in Westminster, political and non-political, disagrees with him. Which means this is less about the fundamental economics than about what an independent Scotland could ever expect to negotiate.

And Salmond's threat of retaliation - that Scotland won't assume any of the UK's public-sector debts if there is no monetary union - is also dismissed by Macpherson.

He makes the unoriginal point that a Scotland seen to be reneging on its fair share of the UK's debts would probably be punished by investors when it tried to borrow as a separate sovereign state, that they would extract a punitive interest rate from Edinburgh.
'Increased hardship'

For what it's worth, that is what investors tell me, though it is not provable beyond doubt.

But Macpherson also tries to get his revenge in early - namely that a Scotland that didn't take the debts could not count on UK support when negotiating with the "international community" (on issues like the terms of Scotland's membership of the EU, for example).

And even if a reborn independent Scotland were to walk away from all the UK's debts, Macpherson says that "it is more than likely that the increase in funding costs, which the continuing UK would face, would be smaller than that which would result from an ill thought out currency union with Scotland".

Or to put it another way, he argues that England, Wales and Northern Ireland would be rational to risk a degree of increased hardship - more expensive borrowing for the Westminster government - than take on what he sees as the potentially more costly risk of marrying currencies with a Scotland striving for cultural and economic self-determination.

BBC News - Has the Treasury killed Salmond?s sterling-zone?

 

[Cannuck]

The GBP is the currency of the UK, no other country.

....until another country decides to use it. You are confused. Not long ago, Iceland thought of adopting the Canadian dollar as it's currency. They were free to do so without Canadian approval. It just means they would lose control of policies affecting the currency. Not many countries would want to to that but they are free to do it if they so choose. It's much better to negotiate with the country whose currency you choose to adopt so that you have some input on economic policy. You are very welcome.

 

[Nuggler]

keep the bloody pound. I jist want me wee heeland croft returned. along with me sheep. specially Beatrice. although she's very likely quite long in the tooth by now.
bye now.