Thursday, 30 January 2014

A Kingdom For A Groat

The events yesterday were too predictable. The Governor of the Bank of England, an establishment founded by a Scot to bail out a Stuart Monarch, gave a lecture in basic monetary economics in Edinburgh.  Mark Carney, a Canadian, a nation with a great deal of Scottish heritage stated the obvious in formal terms.

This was dismissed by the SNP as being "technocratic", implying that it would be the political wrangling and horse trading that would matter.  The Russians may have given up on Marx and Lenin, but the SNP hasn't.  Down in Westminster a UK government hampered by the need to continue propping up bust Scottish banks continued to blunder around with other matters.

Is it that if the "Yes" side win, the SNP hopes to be dealing with a Labour UK government in 2015?  This might assume that even with independence in train there will be Scottish members at Westminster as part of the Labour majority or influential with a Lib Dem coalition.  Or is there a deeper strategy to somehow wreck Scottish Labour which along with Lib Dem losses give the SNP permanent rule?

One thesis is that an independent Scotland would be one of the richest nations on earth in terms of GDP per head allowing for this or that.  As I recall, so was Argentina in the late 1940's.  Historically, there has been many a rich nation who blew it in the past.  Sadly, it takes discipline, foresight and the careful management of assets to maintain it.

For those who view financial crashes and disasters through a technocratic lens, especially the heretic fringe that like to think in terms of chaos, uncertainty, collapse dynamics and such the SNP is embarked on high risk and dangerous tactics.  This is in the absence of a definable strategy.

Making it up as you go along in order to corral the short term votes is one thing in certain policy areas but when embarking on a global and changing future the currency is another matter.  The choice to be adopted is a major long term and critical element in how the nation will function and work. 

When the Euro seemed a nice idea and according to the Brussels neo-mafia, discussion and political deals would sort out the difficulties as and when they arose the SNP was all for the Euro.  At present the dollar might be an option, but the role of a secondary Panama does not appeal and there are questions about the dollar.

So in order to assure the voters that the pounds in their pockets will not be affected, and that the SNP will force Westminster to its knees in the event of disagreements, it is the UK pound that is offered.  Currently the pound looks healthy because so many others are in trouble.

But what is going on in London, no longer an English city by any standard other than an accident of geography, cannot be relied on for either stability or long term prosperity for most of its population.  The English are in hock to the global corporations and all the foreign heavy money parked in the London offshore network and property.

The pound is a bad bet in the longer term and could be a major gamble.  The Irish punt was tied to the pound between 1928 and 1978 and it put a straitjacket on the Republic's economy and political life.  That kind of "independence" came at a heavy personal cost to the ordinary Irish people.

There is one reason for the SNP's inexplicable stance.  That is for many of its elite and key financial supporters, their money is in the London offshore network of tax havens.  That is their personal assets and fortunes are so much tied to the pound now that there is no way out for those individuals at the present time.

A Scotland with a real Scottish vision for the future would buckle down and manage with care the introduction of its own currency and accept the challenges entailed.  If the assets are there it can be done and should be done.

Bring back the King Robert III Groat; it's market value adjusted for inflation and contingencies.

1 comment:

  1. "A Scotland with a real Scottish vision for the future would buckle down and manage with care the introduction of its own currency and accept the challenges entailed."

    I agree - it's their only real option if independence is what they really want.