I could entirely devote this, my last Sunday Telegraph column before Scottish voters make their historic choice on Thursday, to yet more economic analysis. Having railed against independence over recent weeks and months, arguing it would be to the detriment of both Scotland and the broader UK, I easily develop and amplify the pecuniary narrative.
The Scottish National Party, to be sure, is being economically dishonest, promising far more nice public spending goodies than contentious answers on where the revenue-raising pain will fall. It’s all very well offering free tuition fees, free child care and all the rest of it, while slamming “Tory austerity”. But how will the bills be paid?
A newly-independent Scotland, after all, would issue debt at higher yields than the rest of the UK, given the country’s larger fiscal deficit, far heavier exposure to volatile oil and gas prices and considerably weaker demographics. That means dearer borrowing costs for mortgage-holders and businesses north of the border, particularly if SNP Leader Alex Salmond further spooks capital markets by walking away from Scotland’s share of the UK’s national debt.
Keeping the pound, meanwhile, with no currency union and Bank of England backing, is a reckless proposal for an advanced economy – particularly one with a banking sector that’s extremely top-heavy and will remain so even after the post-independence exodus that the Royal Bank of Scotland and others warned of last week.
And attempting to force the rest of the UK to underwrite Scotland’s future debts by threatening not to honour existing debts is beyond the pale. It’s a gun-to-the-head negotiating tactic befitting of a tin-pot dictator, rather than the First Minister of a country with a widely admired and imitated legal system and a strong claim to have invented liberal Western capitalism. Yet that’s Salmond’s stance. Adam Smith, David Hume and the other giants of the Scottish Enlightenment must be rolling in their graves.
With the vote on a knife-edge, this entire column could indeed amount to another economics missive, adding to the welter of hard-headed financial analysis urging Scotland to stay. With sterling having lost 6pc since July and 3pc last week, as support for Yes has surged, the International Monetary Fund has just warned of “negative market reactions” in the event of a pro-independence vote.
The scrupulously fair Institute for Fiscal Studies concluded it would be harder to protect the Scottish NHS after a Yes vote. And BP and Shell then backed predictions, against their commercial interests, that North Sea oil – the keystone of the nationalist’s economic case – will have all but expired by 2050.
It’s become fashionable lately to claim that while the Yes campaign has cleverly appealed to emotion, and the romance of emerging statehood, the No side has focused too much on economics. Droning on about currencies is dry and uninspiring, the argument goes. This is self-indulgent tosh.
Some voters, both nationalists and unionists, will obviously vote strictly on gut instinct. For them, it’s all about Braveheart or the Union Jack, depending on tribal loyalty. For many others, though, including most of the vital 10pc or so who remain undecided, those who’ll determine the outcome of this referendum, economic self-interest and fears of financial insecurity are key. The No camp, then, should keep stressing that Scottish independence is an extremely risky leap into the economic dark – as shown by increased market volatility since the polls became close.
Having said all that, with readers in no doubt where I stand on the economics, I should say I also have a very strong emotional and cultural desire to keep the UK intact. The strength of this feeling, provoked by the threat of a split with Scotland, has surprised me.
In general, I like to thumb my nose at the status quo. I instinctively back the underdog. More importantly, as someone with of celtic origins, who wields both an Irish and British passport, I should perhaps take pleasure that the Anglo-Scottish axis, the spine of the Union, could be broken by this time next week.
But I don’t – not for one moment. The story of Irish independence and purported Scottish independence could hardly be more different. Those who struggled to free Ireland, not least the rebels of 1916, were fighting a brutal colonial master, reacting to centuries of plunder and pillage.
The British empire, for all its pomp and circumstance, when challenged, was capable of tyrannical deeds. After generations of Irish resistance, and murderous actions on both sides, the Irish Free State was eventually formed in 1922, born of blood and rebellion, so paving the way for the Republic of Ireland in the late 1940s.
So how can an Irish citizen like me, who is grateful for the struggles of my forefathers, seek to deny Scotland its “chance” for independence? Well, the economy of the Irish Free State was a disaster. So too, for several decades, was that of the Irish Republic. Far from thriving, the young Irish nation turned in on itself, disappearing into a cul-de-sac of statism, small-mindedness and corruption – a ghastly cocktail.
Today, of course, with its strong exports, inward investment and thriving tech-sector, Ireland’s economy has much to be proud of. But it took years of struggle to get there – struggle, though, that the vast majority of Irish people feel is justified, given the importance of ending the horror of colonial rule.
The starting point of an independent Scotland isn’t the same. Far from being colonised, the Scots were among the most eager of the British Empire’s colonisers. Salmond, for all his soaring rhetoric, and demonisation of “Westminster Tories”, isn’t leading voters away from oppression. He’s leading Scotland, instead, away from a union that for generations has provided a fantastic deal – not least more public spending per head than the rest of Britain and massive influence at Westminster (no less than seven British Prime Ministers have been Scots, including two of the last three).
Scotland and England have shared a monarch since 1603. They’ve been fused together in political and economic union since 1707. The Scottish-English relationship is a genuine partnership, which the rest of the world deeply admires and has been at the heart of the most successful union of states in the history of man. Being in the UK has allowed Scotland, with its industrious and talented population, to enjoy both a small-country sense of belonging and benefit from big-country economic and political influence on the international stage.
The history of Ireland’s relationship with the union is almost the polar opposite. Yet even the UK and Ireland, for all the bad blood, the mutual suspicion and loathing, have managed, in recent years, to reach out, normalise relations and cement the economic, cultural and political bonds between us which our shared blood, culture and geographic proximity must surely require.
For Anglo-Irish people like me, and many living in Ireland itself, this growing closeness, the end of military and political conflict between the UK and Ireland, is a deep source of comfort and pride. The Republic will never be part of the Union, and rightly so, but it is benefiting more and more from its political and economic proximity to one of the most important economies on earth.
Scotland, meanwhile, enjoys all the economic and cultural benefits of being in the UK, while having endured none of the colonial pain. Yet, fed on a diet of whipped-up resentment and forced hatred, this wonderful country could be about to stymie possibly the most successful economic, cultural and political collaboration on earth. And for what?