Salmond and Sturgeon Want the English Fish for More Fat Subsidies

CLAPTON

zagubov wrote: »

Blimey, one of those sentences was true. :shocked:

I knew if I read this thread often enough it was bound to happen.

Need to sit down now.

I guess I'm still ahead of you then

Shakethedisease

Chadsman wrote: »

I can see there would be some benefits to iScotland by a currency union but these would be outweighed by having no say in practice on its own monetary and fiscal policies. The benefits to rUK of a currency union would be at best slim if that meant its own monetary and fiscal policies had to accommodate the needs of a foreign nation.

Yes that was the argument against. However, for there were arguments for, which were just as valid. Remember that the currency union was only one of 4 or 5 'possibles' in the White Paper.. ( 2 economics nobel laureates wrote the part on that ).

iScotland asking rUK for a currency union is like a big debtor to a bank asking the bank to wipe an unauthorized overdraft cos that would reduce its unauthorized lending.

At least with sterlingisation iScotland could control its own fiscal policy.
IMHO iScotland having its own currency would make far more sense.

Well I agree with the last part. Like I said there were 4 or 5 'options' presented in the White Paper. The Fiscal Commission suggested a currency union was in the interests of both iScotland and rUK.. short to medium term.

As for iScotland walking away debt free- if its first act was to unilaterally renounce its debts that would make raising any future capital on markets very difficult.
But it would be UK that got to decide what assets iScotland could have and the rUK portion of UK could easily out vote the Scottish portion.
...not to mention making life awkward over EU membership.

Yes, I remember a lot of this sort of waggy finger stuff at the time. However, the fact is that a debt free new 'state' is actually quite an attractive prospect. Especially small one's with resources such as Scotland has ( not just oil by the way ). I can assure you that had there been a Yes vote, and there had been no currency union.. Scotland would've walked away debt free. Swinney wasn't a good leader of the SNP. But he rarely says anything lightly or that he doesn't mean. He meant it when he said, no currency, no debt, end of. While you're right that borrowing rates might be higher... that may have been more than offset by the fact there was no debt. The UK in fact, had to pledge to take on the entirety of UK debt regardless, some months before the referendum. Regardless of the outcome. A Yes vote meant Scotland 'agreeing' to take the debt. Not the other way round. rUK was taking the hit whatever happened.

The Treasury has pledged to honour all UK debts up to the date of Scotland's independence in an effort to reassure investors and stop interest rates rising.

Please read up on 'continuing states' and 'successor states'. rUk was of the opinion that iScotland would weirdly be a 'continuing state' ( take the debt ) AND a 'successor state' ( have to start from scratch when it came to treaties/EU/etc). When it couldn't be both.

The law professors think that if Scotland votes for independence, it will become an entirely new country in international law (a “successor state”), while the rest of the UK will continue to be the UK in the eyes of the world (a “continuator state”).

http://blogs.channel4.com/factcheck/factcheck-can-scotland-avoid-paying-uk-debt/13362

I can't be bothered going through all this stuff again. We've already done it here already. Suffice to say that in most cases, successor states.. usually don't take any debt with them when they leave. Brand new starting from scratch, kicked out of the EU and re-negotiating 1000's of international treaties as a new nation, independent countries by their very definition can't have any debt... Since they didn't exist prior to independence.

iScotland didn't want to be one of those though. However, like I say all hypothetical now. And if there's another referendum, I doubt a currency union will be put forward. * in the definitely 'one to avoid' next time folder*

Shakethedisease

kabayiri wrote: »

I think it's reasonable to flesh out all possible scenarios. Walking away from circa 8.5% of the national debt is certainly one such scenario. What's that ? £100bn+

What would happen to any future state pension commitments for Scottish pensioners? Would that debt from rUK to Scottish pensioners be expected to be honoured?

To avoid any tit for tat actions, it is better if they work these things out beforehand.

If you emigrate to Spain after paying into a UK pension.. you still get it even if you've been in Spain for the last 25 years. I don't think there's a problem there. Would only apply to those becoming pensioners after independence. And even then.. the 'pot' would have to be split somehow to take into account payments in up until then.

Generali

Yet further examples of the incompetence of the SNP in power, this time from the FT:

http://www.ft.com/intl/cms/s/0/32c37d04-4caf-11e5-9b5d-89a026fda5c9.html??ftcamp=crm/email/_DATEYEARFULLNUM___DATEMONTHNUM___DATEDAYNUM__/nbe/UKPolitics/product#axzz3kMjnAAIX

It's a pretty damning report. They note Scotland is spending less on health and schools more on culture, transport, economic development and free personal care for the elderly in relative terms as a result of the SNP's decisions over the past 4 years.

On health, waiting times for outpatients have shot up in the past two years. The number waiting more than 12 weeks to be seen has more than doubled. The share of accident and emergency patients treated within four hours has trended downwards since 2011. This worsening of health outcomes coincides with a total rejection by the SNP of all choice and competition by NHS providers.

In education, Scotland is seeing a real terms cut in spending on schools that is worrying. The most recent numeracy and literacy statistics show that a declining share of Scottish pupils was assessed as performing “well” or “very well”. The SNP’s totemic policy of abolishing university tuition fees, levied at up to £9,000 south of the border, is also flawed. The policy ends up supporting all students, including the affluent. Yet the cost is being met, in part, by cutting maintenance support for students who are less well off. As a result, access to universities has barely increased for poorer Scots since fees were scrapped.

The SNP’s tendency for statism is alarming. A bill going through Holyrood would reduce the autonomy of Scotland’s university leaders. Of particular concern, however, is the centralisation of the eight regional police forces to form Police Scotland. This has imposed Glasgow-style policing across the country with high rates of street searches and the use of armed police to respond to routine incidents. Growing public disquiet on this led to the resignation last week of Police Scotland’s chief constable.

And of course the Scottish police have to pay VAT because the SNP didn't want the overseeing body to be a Local Government Joint Board as this would reduce their power and influence over the force.

The Scottish people will presumably realise all of this at some point unless the long term plan is to kill off the old people (that don't vote for independence) and make the young so dumb that they fall for all that propaganda put out by the Yes campaign.

CLAPTON

Shakethedisease wrote: »

If you emigrate to Spain after paying into a UK pension.. you still get it even if you've been in Spain for the last 25 years. I don't think there's a problem there. Would only apply to those becoming pensioners after independence. And even then.. the 'pot' would have to be split somehow to take into account payments in up until then.

private pensions will be unaffected as they aren't funded by the state either UK or Scotland

the liability for paying state pensions will be divided between the two states with scotland paying their 'fair ' share
The is NO state POT to pay state pensions they are paid out of current income

kabayiri

CLAPTON wrote: »

private pensions will be unaffected as they aren't funded by the state either UK or Scotland

the liability for paying state pensions will be divided between the two states with scotland paying their 'fair ' share
The is NO state POT to pay state pensions they are paid out of current income

Indeed, so called unfunded liabilities.

There would need to be agreement between the 2 states post separation on anything which assumed some level of continued funding.

Agreement would come from negotiations. When one party is content to abandon any plans to take up a share of the national debt, I can't see that being a positive in the negotiations.

The "we can walk away from our debts" is nonsense.

Generali

kabayiri wrote: »

Indeed, so called unfunded liabilities.

There would need to be agreement between the 2 states post separation on anything which assumed some level of continued funding.

Agreement would come from negotiations. When one party is content to abandon any plans to take up a share of the national debt, I can't see that being a positive in the negotiations.

The "we can walk away from our debts" is nonsense.

Especially if you're planning to start life as an independent country running a deficit well north of 10% of GDP while saving up a SWF:rotfl:

Moby

It seems to me from talking to Scottish colleagues economic arguments mean nothing to them. They want independence no matter what; I find this view especially common amongst younger Scottish colleagues working in London. It's an emotional thing based on their view of culture, history etc. The political/economic arguments often only come into play to the extent that they act as a confirmation bias for a view already held. I find they have a completely different view of what the FT describes disparagingly as 'statism'. They seem to see it more as social responsibility.

Generali

Moby wrote: »

It seems to me from talking to Scottish colleagues economic arguments mean nothing to them. They want independence no matter what; I find this view especially common amongst younger Scottish colleagues working in London. It's an emotional thing based on their view of culture, history etc. The political/economic arguments often only come into play to the extent that they act as a confirmation bias for a view already held. I find they have a completely different view of what the FT describes disparagingly as 'statism'. They seem to see it more as social responsibility.

Only a strong economy can pay for large and generous welfare state.

If the Scots go for independence it will mean having to forego a lot of the welfare state.

Chadsman

Shakethedisease wrote: »

Yes that was the argument against. However, for there were arguments for, which were just as valid. Remember that the currency union was only one of 4 or 5 'possibles' in the White Paper.. ( 2 economics nobel laureates wrote the part on that ).

Do you have a preferred option for the currency? IMHO Sterlingisation would be a far better bet for both iScotland and rUK. If a currency union were to be agreed iScotland's voice would be very easily drowned out. At least with the Euro iScotland would have potential allies to support their point of view. The fiscal commission wrote what they thought their paymasters wanted to hear.

Robert Peston's BBC documentary on the financial implications of independence said if all other things remain equal iScotland would have about the same level of wealth as it does now.
This supposes monetary and fiscal policies are decided according to iScotlnad's best interests. In reality they would not be in a currency union.

I will say independence could have certain benefits but there would also be significant costs. You obviously believe those costs are a price worth paying.