Wealth Creation - the elephant in the Scottish Room??

This is probably the only blog written by a Scot which is still neutral about the issue of independence – the subject of a referendum  on 18 September. It’s neutral for three basic reasons –
·       I’ve been out of the country (Scotland and the UK) for 24 years – almost as long as I was politically active within Scotland and don't therefore find myself thinking about Scotland's future very often 
·       I come late to the discussion   
·       I am a natural sceptic – particularly of prevailing consensus (and most Scottish scribblers seem to be separatists)

So far this series of blogposts has made the following points –

·       A significant amount of power was transferred to the Scottish Parliament and Government in 1999

·       More will transfer when the 2012 Scotland Act is implemented

·       The Scottish government has still to use its existing tax-raising powers – let alone the additional ones contained in the 2012 Act

·       The Scottish Parliament and its people can be proud of the way the new policy-making capacity has been handled. Distinctive policies have been developed – and the respect of its citizens earned.

·       It has still to build on some of that innovative work – eg in the fields of community ownership of rural land; and of renewable energy

·       The post -2007 “Nationalist” government is hardly nationalist – it stresses the importance of remaining within five of the six Unions with which it has suggested Scotland is currently associated.

·       and, ideologically, it seems more social democratic than anything (although its absence of a tax base means that it has not really been tested on this count)

·       the uncertainties and risks associated with negotiations with the UK, the EU and other bodies are generally ridiculed by the yes campaign.

·       The Scottish and UK media do not support the idea of independence but journalists generally have given an increasingly sympathetic treatment to the yes campaign and have ridiculed the No campaign

·       It is indeed now difficult for anyone with a different view to be taken seriously

·       The betting is now that the vote will be for separation

As someone who has been a social democrat all my life and not well disposed to the business class, the following piece in today’s inimitable Scottish Review about wealth creation seems a really important contribution to the debate -

As a Scot with almost no sense of being 'British', the Yes campaigners should have little problem convincing me to side with them. In fact, over the past year, I have become even less enthusiastic about the idea of an independent Scotland – as it is being proposed........If we want to a glimpse into the future, we need to look not just at what is set out in the white paper but at what the SNP has done as the Scottish Government in the past seven years.Two specific objections have become clear in the past year's campaigning; first, the enormity of unravelling a 300-year-long administrative union. Second, the uncertainty over which currency an independent Scotland would use. Greece has shown how the wrong currency can destroy an economy and then a society.

More generally, Alex Salmond has championed independence to create a fairer, social democratic Scotland. This tells us little. Who promises a less fair Scotland? Social democratic has become shorthand for the society that politicians and commentators – the distinction between the two has almost evaporated – would like to create. Sometimes 'progressive' is used in the same way.

Significantly, there has never been a social democratic party in Scotland. Across Western Europe such parties are common. There, it is understood to involve a productive economy underpinning a welfare state. The first part has rarely concerned Scottish politicians. In fact, too many Scots have an instinctive aversion to wealth creation, even as they enjoy its fruits and promise the rest of us we too will share them.The SNP would deny it, but its track record on wealth creating is on a mediocre par with the Labour Party.

There is no firmly rooted understanding that a successful capitalist economy is necessary for the future prosperity of Scotland. In social democratic Sweden or in Germany it is taken for granted. 

Lacking a coherent view of wealth creation the SNP – like Labour – fell into enthusiastic support for prosperity based on financial services. There was no ideological basis for this. It was merely that, for a number of years, roughly 1992-2008, this sector seemed capable of producing the profits – and tax revenue – needed for higher public spending. It also created a large number of clean, comfortable jobs for people sitting at computers at a time when the alternative was low-paid work in in cleaning, catering and caring. While it pays lip service to the idea of a high skill-high wage economy, the reality has been a continuation of hand to mouth policies that date back to the 1950s.Tax-dodging Amazon is lured here because it can provide jobs. That these are low-skill jobs, even in comparison with those provided by multinationals in the post-war era, is secondary. Where previously, NCR and Caterpillar brought skilled manufacturing jobs, now Murdoch's Sky brings call centre employment. 

The promise of low corporation tax is clear evidence that this policy is intended to be a core feature of the economy of an independent Scotland. (The irony is that Ireland has already cornered this niche market as a small, English speaking outpost of the European continent. Hi-tech companies choose Ireland. Amazon chooses Scotland for its giant warehouse.) When it comes to fostering an equal society, the record of the SNP is similarly poor, even as Alex Salmond laments the fact that Scotland is the fourth most unequal country in the world.

In the early 2000s, there was such a huge increase in public spending that Steven Purcell, when running Glasgow Council, could talk of councils 'awash with money'.This spending made little impact of the endemic social problems of urban Scotland. New entitlements were added to old ones. In almost every case, the already prosperous gained most. 'Free' university tuition gives more to prosperous East Dumbartonshire than to Glasgow where a far small percentage of pupils achieves university entrance qualification – although pupils in both areas attend comprehensive schools. (In fact, schools in deprived areas are encouraged to adopt a non-academic curriculum; de facto junior secondaries.) The area where the disparity between Scotland as 'progressive beacon' and the less attractive reality stands out most clearly is in tax revenue raised from oil and gas. This money, £10 billion in 2011-12, is at present shared between some 60 million Britons. Post-independence, it would be shared between 5.3 million Scots. This is not my idea of social democracy; it is closer to its antithesis. Professor Paul Collier raised this point in the Herald and, sadly but predictably, he was denounced online.

The painting is one of the Stanley Spencer series of Port Glasgow shipbuilding during the war years.