Wednesday, March 14, 2007

How Scottish independence benefits the working class

In the detail of reports about the Trident debate is the interesting fact that a majority of Scottish MPs are opposed to government policy, yet the missiles will be based in Faslane in Scotland. This is just one example of the potential constitutional crisis inherent in Scotland’s role in the UK.

As Kevin Williamson reports, some 44% of Scots support independence, with only 42% opposed. There is also the intriguing possibility that the Scottish National Party will emerge as the largest party in Hollyrood in May, but with neither the unionist parties nor the pro-independence parties being able to construct a viable coalition government. It is regrettable that the London based media will probably hardly notice this likely constitutional crisis for the United Kingdom, during the faux excitement of Gordon Brown’s procession to Number Ten. (Even though as the MP for a scottish seat, Brown would be unable to continue as PM if Scotland did become independent, and unless the Labour Party radically changes, it could never win another general election)

Discussion of the case for Scottish independence among the Brit-left tends to be preoccupied with the idea that independence somehow undermines class loyalty between English and Scottish workers. This being a good example of the left orienting on what workers ought to be thinking about, rather than what they are actually thinking about; but in any event being part of the United Kingdom did not stop that likeable old bugger Mick McGahey preventing Scottish steel mills being closed during the 1984-1985 miners strike, even though this would have helped the miners win, as he used the argument that he had to think of Scotland’s steel industry.

Outside the hot house of the hard left the argument tends to concentrate on whether or not Scotland receives a tax subsidy from England, and about the ownership of oil.

But these all miss the point, which is that Scotland’s economy is subordinated to the UK economy. In turn the UK economy is geared to maintaining London as a major financial centre, even though, according to a recent report by Goldman Sachs, this has led to the pound being overvalued by 12% in recent years – a consequence of which is 100000 manufacturing jobs have been lost in Scotland since 1999. (This has also affected the English regions, Wales and Northern Ireland). 91000 Scots live in desperate poverty.

Cambridge university economist, Gordon Adamson, explains in the latest issue of Scottish left Review how relative economic underdevelopment in Scotland is because England’s economy crowds out Scotland’s. More specifically, the policies of New Labour have been to overheat the economy in the South East, based upon house price inflation. The consequent equity withdrawal and private debt has driven the economy, rather than strategic investment in infrastructure and manufacturing capability. Today, one third of the EU’s entire consumer debt in the UK: nearly all of it in England. This has further policy implication as New Labour’s failure to provide adequate social housing is designed to prop up these exaggerated house prices.

Decoupling Scotland’s economy from London, and decoupling Scotland’s political decision making from Westminster would inevitably break Scotland from the overvalued pound, and the debt driven model of Gordon Brown’s economy. Currently Scotland’s manufacturing sector has been decimated by the high pound, which has wiped out its export industries - so that now 63% of Scotland’s exports are to England, only 17% to the EU, and 6.5% to the USA. In contrast, Ireland now exports 46% to the EU, and only 17% to the UK, and between 1997 and 2005 Ireland has created 435000 new jobs.

The political implication of Scotland voting for independence would be a real debate about what sort of society Scotland should be. But it would also require a Scottish economy outwith the Sterling currency area to develop a high wage manufacturing economy, based on real jobs, and developing advanced skills by education and training. It is interesting that the economic logic of independence would probably force any Scottish government towards economic policies that would bring tangible benefits to working people, whatever the ideological persuasion of that government.

This advantage would be enhanced still further if Scotland cut its military spending to levels similar to Ireland, for example withdrawing Scottish regiments from Iraq, and once separated from UK interest rates, Scotland’s housing policy could be geared towards social provision not feeding the debt driven economy.

The left needs to concentrate on what would be the best outcome of the May elections to Hollyrood. What result would give the best context for developing working class politics in Scotland and the rest of the UK? I have no doubt that the biggest possible vote for the independence parties is the best outcome.

Given the peculiar electoral system in Scotland the best option in the first past the post section is to vote Scottish National Party SNP (you may need to hold your nose to do it), and in the top up list vote Scottish Socialist Party (SSP).

Indeed, to a large degree the election result may depend upon how much the message about tactical voting gets across. The d'Hondt system rewards voters who express different preferences in the first past the post and top up votes. Pro-independence SNP voters should consider voting for one of the other independence parties (SSP or Green - or Solidarity in constituencies where their list is headed by a candidate unambiguoulsy supporting independence) in the top up vote, as this may deny a unionist Labour MSP being elected. Green and SSP voters may also choose to vote SNP in the first past the post contest.

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