This week saw the publication of Alex Salmond’s White Paper on Scotland’s Future. The Scottish people will vote on 18 September next year to decide whether Scotland will remain a part of the United Kingdom.
The First Minister suggests to Scots that the aspects of the Union they like – The Queen, for instance – will be retained, while others can easily be jettisoned.
But the Union doesn’t offer the ‘a la carte’ menu that Salmon wants, giving members free choice over the best parts while someone else pays the bill.
He says Scotland could join the EU but not the euro. Actually, new entrants are required to sign up to the single currency.
Instead, he claims that an independent Scotland would keep the pound, airily asserting that this ‘will not only be in Scotland’s interests... this will also benefit the rest of the UK’.
In fact, it would be in the interests of neither country, which is why the UK could not allow it.
Salmond proposes a currency union with the remainder of the UK, creating a ‘sterling-zone’ along similar lines to the Eurozone. Scotland would keep the Bank of England, setting interest rates for another country. Now there’s an irony.
Has he not noticed the problems in the Eurozone? The experience of currency unions without political and fiscal integration is hardly encouraging.
Either Salmond would refuse such integration, which would create huge instability, or he agrees, in which case what happened to the idea of independence?
He counters, with typical bravado, that if Scotland agrees to some of the Union’s debt, it is entitled to a share of the benefits - that is, some kind of ‘share’ of the pound.
Setting aside the notion that Scotland, with its historically higher rates of public spending, could escape its share of the responsibility for the UK’s levels of debt, the idea that this is just some deal to be done, that the pound can be ‘shared’ without consequences, is economic illiteracy.
Twenty years ago, in the so-called ‘Velvet Divorce’, Czechoslovakia divided to create the Czech Republic and Slovakia.
The countries agreed to share the Czech Koruna. The different pace of economic development in the two new republics made it impossible. The currency union lasted for 33 days.
And here’s a something which Mr Salmond and the Scottish people might like to consider. Slovakia now has the euro.
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