Scotland Debate

[Deleted member 18588]

Sounds like there would be a joint committee. After all were Scotland to leave the union the business and economic ties between Scotland and the rUK are such that it would be in the interests of the rUK to work closely with Scotland on economic matters such as interest rates. The last think the rUK would want, given that the economies would be so closely integrated in many ways, would be for the Scottish economy to collapse as that would have a very significant impact of rUK. For pragmatic economic reasons it would seem to me that the rUK would want to work closely with Scotland to ensure the best for both economies.

And that is not to say that rUK would be supporting Scotland - but that they would work together. After all the economies must be reasonably well aligned at the moment so it shouldn't be that difficult to keep them reasonably well aligned. There would have to be flexibility on the part of the rUK - and some BoE decisions might not fully suit the rUK in the short term and that would no doubt cause some disquiet if not resentment. But were the rUK to ignore Scotland's needs and Scotland goes down the dunny - then there is a risk that that would drag rUK down as well.

A country with a population of 50 million + and a far larger economy is in any currency union going to dictate to its much smaller partner. Just look at the Eurozone, do not Germany and France dominate the decision making? Of course they do and so it would be with sterling.

 

[Doon frae Troon]

OK I shall keep this simple.
'Westminster' [aka BoE] says no to the £.
Scotland converts all of it's Scottish pounds into euros.

Euro booms £ busts.
PS Anyone checked £/Euro rates lately.

 

[Deleted member 18588]

OK I shall keep this simple.
'Westminster' [aka BoE] says no to the £.
Scotland converts all of it's Scottish pounds into euros.

Euro booms £ busts.
PS Anyone checked £/Euro rates lately.

Short term exchange rate movements are relatively unimportant compared with economic performance. The UK's economy in 2013 grew much more than that of any in the Eurozone and this forecast to again be the case in 2014.

This would have been very unlikely if our economy and monetary policy had been subject to ECB controls.

 

[SocketRocket]

OK I shall keep this simple.
'Westminster' [aka BoE] says no to the £.
Scotland converts all of it's Scottish pounds into euros.

Euro booms £ busts.
PS Anyone checked £/Euro rates lately.

The rates look very stable to me.

Another simple analogy:

Scotland converts all of it's Pounds to Euros.
Euro goes bust (High possibility) . Pounds soars (Quite likely)

 

[Old Skier]

Things hotting up.

 

[Doon frae Troon]

View attachment 8954

Things hotting up.

...and I always thought North Devon was quiet a genteel place.

 

[SwingsitlikeHogan]

Ultimately answerable to UK Government.

I really do wonder if you have actually studied Mr Carney's remarks regarding the costs to any country in a currency union of having to forsake its monetary policies and control of interest rates.

Would that not also be the case for one of the main alternatives - joining the euro. And at the moment Scotland has not a great deal of say in monetary policy anyway - and with a NO will that change? Haven't heard anything from BT or westminster suggesting it would.

 

[SwingsitlikeHogan]

A country with a population of 50 million + and a far larger economy is in any currency union going to dictate to its much smaller partner.

So pretty much as happens today?

 

[SwingsitlikeHogan]

The rates look very stable to me.

Another simple analogy:

Scotland converts all of it's Pounds to Euros.
Euro goes bust (High possibility) . Pounds soars (Quite likely)

Which assumes that following a YES vote and Scotland leaving the union, the rUK and BoE together decide against any form of monetary union with Scotland and Scotland then join the euro. And they make that decision knowing - 'as you do' - that there is a high possibility of the euro going bust - potentially sending Scotland to the knackers yard with the serious impact that that event would have on the rUK economy. So given these potential serious consequences on the rUK economy would rUK take the risk - or would they take the pragmatic route and tie Scotland and rUK together under the one same currency - with BoE policy considering the economies of both Scotland and the rUK when setting interest rates etc.

So there is a question that has to be answered by Westminster about what would be preferred following a YES vote. Lots of noise from some parts of Westminster about there being little or no chance of Scotland 'being allowed' to adopt the ££ (though it's Scotland's ££ as well let's not forget - it's not owned by rUK). Fine to say 'no chance' in lead up to the vote - but I'm not so sure that that would be the thinking in Westminster and BoE post a YES vote.

 

[Deleted member 18588]

So pretty much as happens today?

Utterly wrong.

What happens today is that the minority very often dictates. Remember only once since WW II has there been a Labour government elected without relying upon Scottish votes. That plus the disproportionate amount of State funding that is spent north of the border means you could not be wider of the mark.

 

[SocketRocket]

Which assumes that following a YES vote and Scotland leaving the union, the rUK and BoE together decide against any form of monetary union with Scotland and Scotland then join the euro. And they make that decision knowing - 'as you do' - that there is a high possibility of the euro going bust - potentially sending Scotland to the knackers yard with the serious impact that that event would have on the rUK economy. So given these potential serious consequences on the rUK economy would rUK take the risk - or would they take the pragmatic route and tie Scotland and rUK together under the one same currency - with BoE policy considering the economies of both Scotland and the rUK when setting interest rates etc.

So there is a question that has to be answered by Westminster about what would be preferred following a YES vote. Lots of noise from some parts of Westminster about there being little or no chance of Scotland 'being allowed' to adopt the ££ (though it's Scotland's ££ as well let's not forget - it's not owned by rUK). Fine to say 'no chance' in lead up to the vote - but I'm not so sure that that would be the thinking in Westminster and BoE post a YES vote.

Scotland only has part ownership of the £ until they walk away from it.

 

[NWJocko]

Which assumes that following a YES vote and Scotland leaving the union, the rUK and BoE together decide against any form of monetary union with Scotland and Scotland then join the euro. And they make that decision knowing - 'as you do' - that there is a high possibility of the euro going bust - potentially sending Scotland to the knackers yard with the serious impact that that event would have on the rUK economy. So given these potential serious consequences on the rUK economy would rUK take the risk - or would they take the pragmatic route and tie Scotland and rUK together under the one same currency - with BoE policy considering the economies of both Scotland and the rUK when setting interest rates etc.

So there is a question that has to be answered by Westminster about what would be preferred following a YES vote. Lots of noise from some parts of Westminster about there being little or no chance of Scotland 'being allowed' to adopt the ££ (though it's Scotland's ££ as well let's not forget - it's not owned by rUK). Fine to say 'no chance' in lead up to the vote - but I'm not so sure that that would be the thinking in Westminster and BoE post a YES vote.

It appears Mark Carney disagrees wit you on pretty much all aspects this (similarity of economy, Scotland using £ etc), perhaps we should get him a username here so you can keep him right!!

As for the BoE being independent of Westminster, utter nonsense. Carney was hand picked by the Govt for the role and there are numerous areas where they are either answerable (inflation etc) or influenced heavily (financial regulation) by the Gov't.

 

[Doon frae Troon]

A country with a population of 50 million + and a far larger economy is in any financial and political union going to dictate to its much smaller partner.

A wee fix, just to keep you straight

 

[Old Skier]

...and I always thought North Devon was quiet a genteel place.

Up North - we stick to VW campers down here

 

[SwingsitlikeHogan]

Utterly wrong.

What happens today is that the minority very often dictates. Remember only once since WW II has there been a Labour government elected without relying upon Scottish votes. That plus the disproportionate amount of State funding that is spent north of the border means you could not be wider of the mark.

...and that situation will continue following a NO vote. That's not great news for English voters.

 

[Adi2Dassler]

A country with a population of 50 million + and a far larger economy is in any currency union going to dictate to its much smaller partner. Just look at the Eurozone, do not Germany and France dominate the decision making? Of course they do and so it would be with sterling.

I agree with this, and any YES campaigner who doesn't is wasting time-leave that to the politicians.

any indy Scotland wanting to use the £ will have to accept a smaller role in the partnership of any currency union, but the word partnership can't be ignored.The noises coming out of the treasury yesterday claimed any currency union is 'unlikely' but that's politiking.As confirmed last week by the treasury, all of Scotlands proportion of debt will be guaranteed by the treasury in any event, meaning if there's no currency union and Scotland has to walk away from the currency, we also walk away from 10% liability of total debt of UK-about £110 Billion.And the value of the £ is also reduced by a %, meaning the devaluing of the £, something no govt will want on their watch.

so the simple answer but taking a long way round is there will be a currency union when Scotland votes yes, The central bank will have over all rule over interest rates etc, but Scotland will have a veto within parameters agreed...nothing radical, both sides will want it to work so there will be no nastiness onc things settle down.

So, rUK has the £ zone as their trump card and Scotland will have to suck on it a wee bit.Scotland has coulport as their trump card and England will have to suck on that a wee bit.Give and take chaps, give and take.

fwiw, I'd want Scotland out of the £, out of EU,out of NATO and a clean slate, but thats a wee bit too radical.

 

[SwingsitlikeHogan]

so the simple answer but taking a long way round is there will be a currency union when Scotland votes yes, The central bank will have over all rule over interest rates etc, but Scotland will have a veto within parameters agreed...nothing radical, both sides will want it to work so there will be no nastiness onc things settle down.

I absolutely agree that following a YES vote that this would seem to be what the rUK would do - why wouldn't they - it is the sensible pragmatic thing to do. What we hear from the NO campaign and Westminster over this issue is IMO all a smokescreen to raise uncertainty in those considering a YES vote. A smokescreen covering a pragmatic reality.

Ask Westminster what it would do following a YES on this matter? At the moment the answer is either that a YES won't happen (which avoids the question completely) or a load of disingenuous avoidance of the probable truth - a truth that Westminster dare not speak.

If voters know up front of the vote of the likely currency arrangements, and the impact Scotland ceding some fiscal powers to Westminster would have - they can decide whether that is acceptable - or whether it undermines the whole notion of independence for them.

 

[Adi2Dassler]

I absolutely agree that following a YES vote that this would seem to be what the rUK would do - why wouldn't they - it is the sensible pragmatic thing to do. What we hear from the NO campaign and Westminster over this issue is IMO all a smokescreen to raise uncertainty in those considering a YES vote. A smokescreen covering a pragmatic reality.

Ask Westminster what it would do following a YES on this matter? At the moment the answer is either that a YES won't happen (which avoids the question completely) or a load of disingenuous avoidance of the probable truth - a truth that Westminster dare not speak.

If voters know up front of the vote of the likely currency arrangements, and the impact Scotland ceding some fiscal powers to Westminster would have - they can decide whether that is acceptable - or whether it undermines the whole notion of independence for them.

Never going to happen.Once you accept that yes is possible and you plan accordingly, the public perception changes and even more momentum gathers behind YES.All of which I accept as part of the game.The public game.But lets not kid ourselves...initial discussions and parameters have been laid down in the event of the inevitable yes victory.

 

[Adi2Dassler]

Here's a quick thought on the +'s for England in the event of YES winning.

A renewed and + projection of English nationalism...just now it can come across incorrectly as right wing and introverted.This presents the opportunity of redressing that falsehood

Increase exports for balance of payments on import/export.

No more block grant

no more west lothian question, which is absurd

 

[NWJocko]

I absolutely agree that following a YES vote that this would seem to be what the rUK would do - why wouldn't they - it is the sensible pragmatic thing to do. What we hear from the NO campaign and Westminster over this issue is IMO all a smokescreen to raise uncertainty in those considering a YES vote. A smokescreen covering a pragmatic reality.

Ask Westminster what it would do following a YES on this matter? At the moment the answer is either that a YES won't happen (which avoids the question completely) or a load of disingenuous avoidance of the probable truth - a truth that Westminster dare not speak.

If voters know up front of the vote of the likely currency arrangements, and the impact Scotland ceding some fiscal powers to Westminster would have - they can decide whether that is acceptable - or whether it undermines the whole notion of independence for them.

Have you read Mark Carney's comments from yesterday?

That is not from Westminster (albeit always an influence as I've said) but more from an economy management perspective.

Playing Devils advocate for a minute.......

If those voting Yes are happy to have their interest rates and therefore, to a degree, economy, managed by BoE are you not concerned that their primary concern is going to be how macro-economic policy and interest affects the remaining UK and the policy of the governing party therein rather than Scotland?

If Scotland is in a position through either rapid growth or a downturn would you be comfortable that one of the main tools of managing the economy is unavailable to you?