Saturday, 23 August 2014

Scotland's Future.

In a matter of a few weeks Scotland will decide on its future. The Left seems to have lined up behind the Yes-side of the referendum on Scottish independence. We should be asking ourselves, what is the case for unionism here? Surely, there has to be a progressive case here. After all, the Union stood firm against the rising tide of Fascism in the early decades of the twentieth century.

First of all, it has to be affirmed that there is a fundamental principle – the right to self-determination – which is without question. If the Scottish people demand an independent sovereign Scotland then they are entitled to it. The English don’t have a right to impose a form of government not accepted by Scots over Scotland. This goes to the heart of democratic concerns.

What we might call ‘red patriotism’, or traditional revolutionary patriotism, as Hobsbawm called it, has its time and place. English nationalism was tapped into by both Winston Churchill and JB Priestley. The war against fascism coincided with forces vying for the future of the social order. The people who had seen the worst of the 1930s did not want to return to those days and wanted a better life. This is why in 1945 the national government under Churchill’s leadership helped to win the war, but the Labour Party won the election. It marked the beginning of three decades of social democracy.

It was in the Union that the Welsh and Scottish people found a voice in British political life, not through nationalist organisation, but through the opposition – the Liberals and Labour. It was only with the decline of the post-war establishment and rise of Thatcherism, coupled with the death of Empire, that the Labour Party pursued devolution. Then Scottish nationalism became a contender. This should not surprise us. So a vital part of the picture is the rise of neoliberalism.

The neoliberal context

The question of Scotland’s viability is not so uncertain. The country has a GDP per capita of over £24,000. No doubt Scotland would undergo economic reform in order to reorder the institutions which underlie its standing. The real issue is what exactly an independent Scotland will look like.

It seems plausible that an independent Scotland would be opened up to international forces and exposed to the full brunt of neoliberal reforms. This might even be the case if Scotland heads for greater integration into the European system. The power of monetary policy may still be held by Whitehall and this could constrain any government in its policies. Likewise it would be possible for corporations, and even small-scale businesses, to hold the state to ransom – threatening to disinvest the fledgling economy – to shift policy in their own favour. The English government could easily initiate a race to the bottom on fiscal policy with Scotland forcing down its rate of tax and expenditure.

The possibility of a flat-tax haven north of England shouldn’t be dismissed as we have seen the same thing happen in Ireland (where there always was a much stronger nationalist/republican case). Michael Portillo has described this as the Tory case for Scottish independence. He argues it would thrust Scotland into the cold winds of global competition and, by the looks of Brussels these days, we can see how independence may lead to greater neoliberal reform and not less.

This is a point that can’t be dismissed easily as the national takes shape within the international. Contrary to the claims of nationalists globalisation does not oppose nation-states, or even nationalism. Sovereignty of national bodies has long been embedded in a global economic context. Just as the freedom and sovereignty of the individual is not absolute, neither is that of the body national. Capital can easily exploit the proliferation of borders in a world already too bifurcated. This is the reason Scotland will remain within the EU and its currency will remain sterling after independence.

The prospects for distribution

We shouldn’t kid ourselves about the Barnett formula. It’s not the case that there is a ‘trickle-down’ of wealth from the financial colossus in the City of London; but there is a case for widespread redistribution within the Union. It may be said that the United Kingdom has a greater pool of tax revenues together and from the 1940s to the 70s there was a modicum of distributional change. This led to the workers’ share of GDP rising to a peak in the late 60s and early 70s. The battle to restore profitability to the system, firstly, by the Labour government of the late 70s and then by the Thatcher administration ultimately succeeded. Since then the workers’ share of GDP has stagnated while the bosses’ share has skyrocketed.

However, once independent, Scotland would not necessarily have access to capital if a programme of redistribution were secured. The Glasgow Media Group calculated that the top layer of income-earners in the UK – around 10% of the population – were sitting on around £4 trillion in wealth in 2010. The vast amounts of capital amassed over the generations and concentrated in southern English hands would largely remain in London. The potential for redistribution would be left stunted and Scotland would be on the receiving end of a self-imposed scarcity. Under such conditions it seems likely that the Scottish government would take the side of one class over another.

It can certainly be argued that the Union has done much to preserve inequality in Scotland, where the richest 10% now have 273 times as much wealth than the poorest 10%. The richest 100 men and women increased their wealth from £18 billion to £21 billion in 2012. Just in terms of land ownership there is immense inequality in Scotland. Out of the rural landscape, which makes up 94% of Scottish land, a little over 83% of it is privately owned. Out of a population of over 5.2 million people less than a 1,000 people control 60% of the country. It seems plausible that the social inequalities preserved in Scotland by the Union would remain and could potentially be deepened by independence. So the strongest case for Scottish independence has to be a socialist case and not a nationalist one.

Except the world situation seems to make a socialist Scotland unlikely. In the distributional struggle inside the EU the biggest sparks of resistance have been in Spain and Greece. The disenchantment elsewhere in Europe, including in the UK, has not translated into electoral change. This matters because Scottish independence could well open up a new distributional struggle in the country. In the absence of a mass movement capable of waging a fight for workers’ rights the conservative tendencies of the SNP may win in the end.

This article was originally written for The Third Estate on August 23 2014.

No comments: