Wednesday, February 12, 2014

Hindsight is 20-20 : A Scot speaks from 2020

An OpEd piece from The Scotsman that came through a time warp from February 2020.

Looking back on the first three years of an independent Scotland, there is little, from the perspective of 2020, that we can say we did not know before the referendum of 2014. So how is it that we face such difficulties? How did Scotland fall into every trap? More to the point, how do we now address the deep crisis that we now face?

On sober reflection it is clear that the 18 month timetable from the September 18th referendum to the establishment of a separate state was extremely short. Too short to complete the transitional arrangements to allow Scotland to obtain full membership of the European Union. The unhappy compromise of a duel-headed UK/Scottish delegation at EU ministerial meetings lasted a bare three months, as it became clear that the Scottish government was less interested in the drudgery of technical meetings and more interested in making gestures over negotiations with the rest of the UK. Now we remain in limbo, with Spain, Belgium and the New UK - likely to be renamed the Anglo-Welsh confederation after the new constitution comes into force there next spring- reluctant to complete the agreements without further Scottish concessions. We function as part of the EU, but as yet we still have no participation in the policy process. The irony is the new popularity of the EU in the New UK has cemented London as a key decision maker, while it is the formerly pro-EU- now much less so- Edinburgh, that is the unpopular kid in the playground.

Of course even the easiest issue, the sea border, is still not agreed, and the arbitration process may yet go on for another five years. The revenues from the oil fields- sadly far lower now after the effective withdrawal for the US from the global energy market as the result of their huge leadership in renewable energy research- are collected and held in trust, but the great hope for Scottish wealth has disappointed. It may be "Scotland's Oil", but the new Republic of Arabia that has arisen from the Saudi revolution needs to address huge social problems after the civil war, so will keep pumping, and the high costs of the North Sea are likely to render the bulk of production uneconomic. The depressed state of oil-bust Aberdeen speaks volumes.

Even more serious for the Scottish government is the mess in the financial markets. Shortly after Nicola Sturgeon took the First Minister's job after Alex Salmond's tragic heart attack, she attempted- in line with the previous SNP position- to repudiate the Scottish share of the UK debt. This desperately ill-judged decision has had echoes throughout the three years of independence that we have endured. Although she quickly back-pedalled, the damage was done. After having been told that such a repudiation would close the global debt market completely to Scottish government borrowing, her frantic attempts to find sovereign lenders in the Gulf and Russia was greeted with uproar across the EU. In the end the UK-IMF-ECB funded rescue package co-ordinated, ironically, from London, has stabilized the Scottish Pound- albeit 30% below Sterling, but imposed eye-wateringly tight spending restrictions- in line with the same restrictions imposed on Hungary and Serbia after they joined the Euro- still a distant prospect for Scotland, alas- last year. We can only hope that the bitter medicine of devaluation, root and branch government cuts and radical economic reform can deliver the more sustainable economy we can now only pray for.

Meanwhile the transfer of RBS- now the NatWest group- to London has removed a major headache from Bute House, but left all of Scotland's banking system in foreign hands- and after the emergency introduction of the Scottish Pound, banks are still slow to increase lending to Scottish entrepreneurs. The bursting of the Scottish reputation for financial probity has seen the loss of almost all the once flourishing financial services business- mostly gone to Dublin or Geneva- and the money men of Charlotte Square, in decline for so long, are now distant ghosts.

If the economic scene is a "more stable crisis" and relations with Europe, while difficult, now set to be solved within a couple of years, the relationship with the United States remains very brittle. The peremptory closure of Holy Loch to nuclear submarines, which forced the UK to transfer their Trident base to Savannah, Georgia, while new facilities are built in Plymouth- was political point scoring which cost badly needed jobs. While the Russian Ambassador was clearly delighted, the American Ambassador called it "the effective end of US engagement in Europe". After the short Sino-Japanese war of May 2018 with the abortive nuclear strike by Japan, the US has enough on its plate in Asia, without having to worry about uppity Europeans. Although the assassination of Vladimir Putin in 2016 brought hope for a more liberal Russia, the fact remains that the EU is dealing with a hostile and deeply authoritarian enemy in the Kremlin. The Belarusian rebellion has left Russia brooding and resentful, and the weakening of NATO could hardly have come at a worse time for the EU.

Turning to the Scottish domestic scene. It was, I suppose, inevitable that independence would lead to a fracturing of Scottish politics. What few might have seen was the radicalization that the wrenching changes have brought about. The huge job losses in Edinburgh, Aberdeen and on the Clyde drove Scottish unemployment up to over 30%, and the Scottish state sector obviously could not stand the strain- the tight spending curbs have meant that many Scots can not survive on benefits- and many skilled workers have fled for better economic climbs. The Scottish "handyman" has of course become a figure of fun in prosperous Estonia, but the emigration is a tragedy of missed opportunities, even if it has help reduce unemployment to just below the still terrifying 25% mark. 

Of course the recovery of the Liberals under their irrepressible leader, Willie Rennie- especially in their new electoral fortress of the North East- has squeezed the SNP even in their former heartland, However it is the emergence of the radical Saor Alba coalition to challenge the SNP from the left that is giving our embattled first minister so little room for manoeuvre. Glasgow left wing populism has a long history, and the SNP never really gained more than a shallow loyalty there- now it is gone. The bitter remnants of the once mighty Scottish Labour Party have been infected with a radical anti-globalist agenda, and Saor Alba combines a deeply left wing anti-capitalism with the kind of nationalist agenda that is no longer fashionable even in France since Marine LePen narrowly lost the 2017 election there. Although the electoral maths are against Saor Alba, they are eating the SNP's political lunch and it is no wonder that Nicola Sturgeon has so embarrassingly wailed in public about her "impossible job".

In the end, in the face of the huge problems our new state faces, it is hard not to wonder what might have been if the result had been 51.3-48.7 against instead of in favour of separation. As Willie Rennie said on the floor of the New Parliament House (yet another fiasco) only last week, "The SNP promised us roses all the way, but we got thistles. No jobs, few opportunities, difficult relations with London, Washington and Brussels, and at least another ten years before we can get back to the economic level we had in those distant sunny uplands of 2014- hardly a record that the first minister and her rag-bag party can be proud of". As she faces her second election without the sympathy vote of the first one, the uncertainties are gathering round. Maybe the new "Party for Britain" might just make an electoral breakthrough next year too. An irony, most certainly, but no longer beyond the bounds of probability. Yet, after the unfortunate booing of King Charles at the opening of the New Parliament House last year, and the growing and overt Republicanism of Saor Alba, it is clear that few expect the increasingly unpopular current settlement to last, so political uncertainty will remain the order of the day for the foreseeable future.

As the latest poll shows, most Scots would vote overwhelmingly to rejoin the Union, but that is the one thing off the political agenda. The anti-Scottish backlash which has given support to the firm line taken by the Conservative government in London has definitively taken the British identity away from English and Welsh as much as from Scottish people. Deeply though we may regret it now, the fact is that there really is no going back. Britishness: the currency, the passport, the flag, the military, the soft power and all, is gone. Now we have to endure at least a decade of economic upheaval to get our house in order- and even then Scotland will be a poorer, narrower, harder country than it was only six years ago. No wonder the new Canadian high commission received over 40,000 applicants on day one of their new working visa regime. 

Though so many are voting with their feet, those of us who stay must surely agree with the new Estonian Ambassador in Edinburgh who said, on her appointment "In Estonia we had to make freedom work, and for us freedom and independence were the same thing. In Scotland, you already had freedom, and you did not understand the sacrifice you needed to make to be independent. Now you do understand this, you are lost in uncertainty and you must still make still further sacrifices. You must now start a very difficult road- one which took us thirty years to complete, and may take you even longer. We are richer than you now because we work harder- so you must not expect to get a free ride from anyone, not even your EU friends". 

Bitter words for us to stomach perhaps, but as we all now know, how true. 

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