Scottish Independence must be about breaking from flawed economics
The lack of opposition to Conservative Mark Garnier’s suggestion that Scotland should become a “financial services hub” has highlighted just how effective Tory propaganda continues to be about the causes of the last crash and, therefore, the role of the banks in our economy.
From Tony Blair to Naomi Klein’s Shock Doctrine, it has been widely recognised that crises provide excellent opportunities for the ruling elite to restructure society and the economy in a way they would never be able to achieve otherwise. Post 2008, even when any rational observer would expect the crash to weaken the power of finance capital, the opposite has been the case. The enduring power of neoliberal ideology and the finance capital behemoth continues to cast a long shadow over all those in the UK unfortunate enough to barely live under it.
But let’s rewind for a minute.
In the wake of the 2008 crisis and the corresponding bank bailouts, there was a period of absolute disgust at the contradiction between having a never-ending supply of money for banks that wrecked the economy and nothing for more trivial matters like, say, tackling global poverty. This period of flux, where there was widespread revulsion at the banks and a ruling elite that has long supported them, was pivotal. Unfortunately, the Tories managed to reframe the problem as one of public spending, despite the fact that Debt/GDP only exploded after 2008.
The weak response to this was perhaps best encapsulated by Ed Milliband’s sudden decision at Question Time, just weeks before the General Election, to question that narrative after years of leaving it unchallenged, much to the surprise of the audience (and probably his PR team).
The story ran that there was a need to “balance the books” and that we needed to get the deficit down as quickly as possible. On this basis, for years the British public have been told that the economy is “like a credit card”. At the time, then-Prime Minister David Cameron said: “If you have maxed out your credit card, if you put off dealing with the problem, the problem gets worse.”
The implication that the UK can no longer borrow, or to compare the low rate of borrowing they would enjoy to a credit card, is obviously ridiculous. Economists invariably throw a tantrum whenever this is mentioned but, often, to no avail. To work with a similar analogy, and, at the risk of prodding already angry economists, what if we thought of the British economy as being more like a mortgage?
Few would voluntarily increase their mortgage payments and sacrifice things like heating their home or feeding their children just to get the debt down faster. Unfortunately, this is exactly what the Conservative obsession with reducing the deficit amounts to – sacrificing the basic needs of human beings on the altar of an artificial timetable based on the unquestionable power of the banks.
Austerity is an extreme and counterproductive move, and one that is designed to shore up the financial system for the next crash the Tories are helping to make all but inevitable through relying solely on finance capital for future growth. The case for austerity is so compelling because of the longstanding weakness in the British economy. As a result, the next crash is taken as a given.
There are, however, alternatives. One of these would be to invest strategically in key areas of the economy, as James Meadway’s excellent article on ‘Corbynomics’ shows. Meadway suggests a focus on domestic production and the substitution of imports; a shift to domestic energy sources through renewables; the relocalisation of supply chains in food production; and to drive up the UK’s very low rates of R&D expenditure. Of course, the specific needs of Scotland’s economy would need to be taken into account, but it nevertheless shows that different options are available.
These are crucial lessons to be learnt for Scottish independence too.
Firstly, independence has to be a lever for creating a better society. Should it instead become a means for turning Edinburgh into a mini-me London, it starts to defeat the purpose. Independence is a unique opportunity to break with failed economic strategies. Moreover, presenting a realistic vision of a different type of society that works for the majority of the Scottish population is the key to winning a second independence referendum.
We also need to clearly set out a strong economic alternative in driving forward a prosperous, independent Scotland, and to address this to the middle class as well as working class people. As Bernie Sanders’ campaign in the US showed, the reservations of those in the increasingly “squeezed middle” must be addressed, and a robust economic model needs to be presented to them if we are to gain their support.
Furthermore, rather than waiting for the dust to settle, we need to recognise that the discussion about the type of Scotland we want to see has already begun. Delaying these discussions and campaigns can only serve to benefit the establishment and the right.
Finally, we need to be much more effective in putting across a strong message for independence to those who, as yet, remain cautious over the idea of an independent Scotland. The aim here should be to discuss the case for independence with voters, learn from their concerns, and convince them that independence can be the catalyst for much-needed social and economic change in Scotland.
To successfully present the case for Scotland’s independence, the process needs to begin by making a genuine effort to understand voters’ actual lived experiences. Although important, facts on their own do not win the day. The message that independence can work for the real interests of the people of Scotland has to be one that resonates on an emotional and personal level with those who have real concerns and reservations about our country’s future. We omit such a vital element at our peril.
With Westminster in disarray, there is no time to lose in building a solid and substantial case for IndyRef2. Let’s not get entangled in complacency – we don’t have all the time in the world. The time to make the argument is now, and it’s an argument we must drive home if we truly desire to be in control of shaping Scotland’s future.