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White Paper (THE #indyref thread)
(2915 posts)- Started 11 years ago by Morningsider
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Posted 10 years ago #
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@insto
I moved from being pro helmet to being anti compulsion through debate on this forum
But I cannot see you, calmac, IWRATS and crowriver seeing the error of your ways? :-)
Radical booksellers weekend in the smoke, morning star has Oscar Guardiola-Rivera as showing Early Promise. He does look gorgeous. I forgot about Owen jones.
Posted 10 years ago # -
"
Scottish independence: How many unicorns do you earn?"
http://www.bbc.co.uk/news/uk-scotland-scotland-politics-27294419
Posted 10 years ago # -
"@calmac, just to try to be clear, I am saying that the Objections to the politicians visits have an element of coming up here for a visit, think you can lord it over us? But it is ok for snow to visit (he did stay a week) because he is agreeing with the ayes."
I think it's wrong to compare a journalist who's making observations and not giving any advice on how to vote to politicians telling us exactly how to vote.
"Similarly Bowie view bad, Bragg view good?"
I don't know anybody who thinks either had more of a right to voice their opinions than the other. Is that what you're suggesting? Or are you mixing up criticising their views with criticising their right to have a view?
And on Moody's - all they've said is what Scotland's initial credit rating would, in their opinion, be. The only reason why it would not be higher is because we would have no record of debt repayment.
But let's deal in fact and not conjecture - here's the 10-year bond rates, which is the key indicator on how much it costs governments to borrow, right now:
http://markets.ft.com/RESEARCH/Markets/Government-Bond-Spreads
Austria 1.68%
Belgium 2.04%
Canada 2.36%
Denmark 1.52%
Finland 1.74%
France 1.92%
Germany 1.45%
Ireland 2.73%
Italy 2.99%
Japan 0.60%
Netherlands 1.78%
Spain 2.93%
Sweden 1.93%
Switzerland 0.85%And finally...
UK 2.65%
So, right now, our rate is very substantially higher than that of Austria, Denmark, Sweden and Finland, and a good chunk higher than a lot of other comparable economies too. (Norway doesn't work for this measure, because they are the only country in Europe for whom borrowing is a bit of fun).
Not only that, but we're paying just a little less than Ireland, Spain and Italy!
So to those who say us nats don't like facts - care to explain away these facts?
And while you're at it, fancy explaining why these facts never appear in any news report on Scotland's likely credit rating after independence?
Posted 10 years ago # -
What's to be explained away? What's the signficance of those figures to Scotland's credit rating post-independence? Are we to assume that Scotland's rate would be comparable to Austria, Denmark, Sweden and Finland?
If Moody's is saying Scotland's rating would be two notches lower than the UK, and if the NIESR's assessment that one notch equates to a 0.5 to 0.75% premium on rates (something like that - I'm recalling) then what we can estimate is that Scotland's rate might be 1% - 1.5% higher than the UK's current rate. It doesn't really matter all that much what the actual rates are.
Posted 10 years ago # -
calmac - these are indisputable facts. However, I can't see the link between what long established countries pay for borrowing today and what a newly independent Scotland might pay in a couple of years time.
I can't help but notice that the FT list you quote from above includes 20 countries, while your list includes 15. The five countries you choose to exclude were:
Australia: 3.84%
Greece: 6.17%
New Zealand: 4.34%
Portugal: 3.56%
USA: 2.58%While you might expect Greece and Portugal to pay more to borrow, the UK rate doesn't look quite as bad when you include the others - including the world's largest economy.
Posted 10 years ago # -
"Are we to assume that Scotland's rate would be comparable to Austria, Denmark, Sweden and Finland?"
Can you think of any better evidence for what Scotland's borrowing rate would be than the borrowing rates of similar economies?
"If Moody's is saying Scotland's rating would be two notches lower than the UK, and if the NIESR's assessment that one notch equates to a 0.5 to 0.75% premium on rates (something like that - I'm recalling) then what we can estimate is that Scotland's rate might be 1% - 1.5% higher than the UK's current rate."
You're making a cause-and-effect error.
The higher rates and lower ratings for countries like Greece are caused by the same thing - the market's perception of the level of risk. Ratings and rates influence each other, but they are driven by the same thing.
We don't know what the market's perception of risk will be for Scotland. Right now the market likes the UK - it pays a high rate but is pretty much guaranteed to keep doing so. And the markets hate unpredictability and price it accordingly.
But given that Ireland's most recent 5-year bond issue went at below the UK's equivalent rate, isn't it just about possible that Scottish bonds would not be priced meaningfully higher than the UK's, when it comes to it? Isn't it possible that your own view is coloured by your perception that England's economy is stronger than Scotland's?
"It doesn't really matter all that much what the actual rates are."
Ok. So you're saying that one ratings agency's opinion of what Scotland's borrowing rate could be in two years' time is important, but what the actual rate that is paid by countries like us in the market doesn't matter.
Riiiiight......
Posted 10 years ago # -
@Morningsider - the USA rate is high because of the loonies in Congress, who could trigger a default.
Not sure why Aus has a hiigh-ish rate, I'd need more info. For sure, their economy is booming, but in an unhealthy and probably unsustainable way. Dunno about NZ either. But neither are like Scotland either.
Portugal and Greece - they're not comparable with Scotland. They are significantly poorer countries. Our per capita GDP is at least a third larger than theirs and assuming a proportionate share of the UK debt for Scotland, our debt is much lower.
And if I'd been trying to spin, I wouldn't have helpfully included the link!
Posted 10 years ago # -
calmac - I never accused you of spin. I simply pointed out that you had chosen to omit several figures from the list. I agree that the countries you didn't include are not really equivalent to Scotland. However, nor are the ones you included - Japan, Canada, Germany, Sweden - the whole lot really. That isn't surprising, most national economies are quite different due to quirks of history, politics, geography and so on.
An independent Scotland will be a new entity and its borrowing rate would be set based on what political and economic agreements are made following independence negotiations. I have no idea what that might look like, nor does anyone else.
Posted 10 years ago # -
I'm saying, "so what?" to your table of bond rates. They are facts, of a sort, but in itself it doesn't tell us anything.
I wasn't making a cause and effect error. Moody's gave it's current assessment - two notches lower. NIESR has given us an indication of what that means in terms of rates. +1-1.5%. The market gives us the current rate paid by UK. If we're two points lower, we could expect to be paying 1-1.5% above that. Where am I mistaking cause and effect?
OK, I accept that that's not definitive. We don't know, for example, what the assessment will be of rUK. We don't know that current UK rates don't already take some account of the uncertainty of a possible post-independence settlement. You'd think ten year bonds might consider that. It's certainly possible that 'when it comes to it' that Scotland's rates would not be much higher than rUK's but what basis do we have for thinking that that's likely? We don't about currency union and we don't know about the apportionment of debt. We don't know how much Scotland would need to borrow and we don't know oil revenues. There's much we don't and can't yet know about interest rates.
So there are uncertainties and unknowns in all of that. But for all it's limitations it seems like a bit better base for judging than just assuming that we'd suddenly be rated not much more highly than the UK because of the current rates of countries (who're actually not very much) like us.
Posted 10 years ago # -
@Morningsider - of course, we can't know what the borrowing rate would be. So we have to go on what we have.
We also have to remember to look at two sets of evidence, not just one - what will the UK eocnomy look like in 2, 10, 20 years time?
Personally, I think the most instructive evidence on financial matters is to look at where the money actually goes, and the decision people in the markets make.
So I'm looking at comparable countries (and yes, I'd definitely include Sweden in that), and on that I see that small Northern/ Western European countries like us are paying less than the UK, and that the UK is paying one of the highest rates in Europe. That's the rate Scotland is paying right now.
I'm looking at recent and current decisions to invest in Scotland, which show we're attracting more inward investment than anywhere else in the UK outside the south-east, and that has actually grown since the prospect of independence increased.
Against that we have the opinions of organisations like Moody's. These organisations have a poor record of analysing the strength of economies, and a very poor record of predictions. All the money men said that Iceland would be punished and shunned for its default. And was it? No, international money is flodding back in, because the market doesn't hold a grudge - money goes where the people in charge think it will generate more.
If I were a betting man, I'd bet Scotland would have a lower borrowing rate than the UK within a year of independence. If Ireland are only paying 0.08% more than the UK, then I think anyone who thinks we'd be paying 1% to 1.5% more is deluding themself. There is just no evidence to support it. Moody's are dealing in hypotheticals right now, for something the markets don't want to happen. That'll change.
There's a world of economic data out there that we can argue over. But I'm always going to take facts over opinions.
Posted 10 years ago # -
As discussed elsewhere.
The whole unitary authority structure we have now was a Thatcherite exercise in prising (mostly Labour at the time) power away from the old regional authorities; centralising power at national level; gerrymandering; and "efficiency savings", ie, cuts.
Most countries have a layered structure:
- local (equivalent of our community councils but with budgets and real powers.
- regional/city (like the old Lothian region or a city/metropolitan authority eg. CEC)
- national (eg. Scottish government/Westminster)Some countries have federal structures where regions have substantial tax, borrowing powers and large budgets separate from the national government.
All or some of these could be possible in an independent Scotland, to create better accountability, and check the imbalances of power resting mainly with central government.
Posted 10 years ago # -
"I think anyone who thinks we'd be paying 1% to 1.5% more is deluding themself"
It's certainly possible that Angus Armstrong and his colleagues are deluded idiots but if it's OK with you, I'll take my chances with them over your reliance on inward investment and "countries like us" as the key indicators of future economic performance and borrowing rates.
See here: http://niesr.ac.uk/sites/default/files/publications/SP_fiscal_NIESR.pdf
Page 4, second last paragraph. Follow the links for the full analyses.
Posted 10 years ago # -
crowriver - yes, the regions were abolished to get rid of Strathclyde - which was Europe's largest local authority and a real thorn in the side of the Thatcher Government. However, centralisation has continued apace under subsequent administrations. The current Scottish Government has nationalised both police and fire services, which were previously under local authority control. As far as I am aware, only the Greens have any plans to reorganise local government in any meaningful way.
calmac - I have previously posted on the issue of facts vs opinions, the issue of a Scottish borrowing rate cannot be a fact. You can analyse current "facts", but the results of that analysis will always be an opinion. Some opinions are clearly better founded than others, but that still doesn't make them facts.
Posted 10 years ago # -
I find it rather odd that the SNP are so against centralised government in London but so pro it in Edinburgh.
Posted 10 years ago # -
@Morningsider "As far as I am aware, only the Greens have any plans to reorganise local government in any meaningful way."
Indeed. Well somebody's got to get the ball rolling. Recent (Feb 2014) report by Andy Wightman (him again) for Scottish Greens on this very topic,
Key ideas include:
- Current councils broken down into municipalities serving around 20,000 people each. European municipalities average 5600 people.
- A set of larger regions to coordinate issues such as health, economic development, colleges and transport
- A flexible ‘Lego brick’ model for coordinating other services between smaller units.
- Municipalities should raise at least 50% of their own revenue, up from 20% today.
- Local government should get a statutory share of national income tax
- The status of local government should be enshrined in a written constitution for the first time.Labour in Scotland are making some noises too, but very little in the way of detail (yet).
Posted 10 years ago # -
J D McKie (historian dude) reckoned that Strathclyde made an independent Scotland impossible because it was so large.
Labour want to reorganise local gov and give them more power.
Posted 10 years ago # -
Here's a summary of Labour's current plans as outlined by its Devolution commission.
On local government:
4. Internal devolution
Along with local authorities getting some welfare powers, there should be more powers for the islands.The Labour commission says Holyrood should be able to work with the islands councils to "support the development of renewable energy resources"
The document also says: "Responsibility for delivery of the DWP Work Programme should be devolved to local authorities to better reflect local labour market conditions, with the Scottish Parliament playing a partnership role and providing strategic oversight."
Er, that's it. (At the moment anyway).
Posted 10 years ago # -
@ instography - I didn't call anyone an idiot - don't put words in my mouth.
Angus Armstrong says that "the most important factor driving this spread is the liquidity of the market which reflects how easily investors can buy and sell without impacting market prices. This reflects that an independent Scotland would be a much smaller bond market that the UK gilts market."
Well, then could someone explain why there is no correlation between bond rates and economy size?
Because the actual bond rates being paid in real markets do not reflect his opinion.
@morningside - no, the current and past bond rates for other countries are facts, not opinions. Where opinion comes in is in suggesting that Scotland would be on rates similar to Denmark, Finland or Austria rather than Portugal or Spain.
I would argue that the facts show that those countries on lower rates are more similar to Scotland than those on higher rates, and I would suggest that all the facts about the Scottish economy as it is at present would support that.
It is a fact that Scotland pays into the UK a higher proportion that it receives back. It is a fact that Scotland per capita GDP is 10% higher than the UK's.
It is a fact that, by any measure anyone would want to use, the small northern European countries are among the most successful in the world, and on almost any indicator you care to use they are ahead of the UK. Salaries, working hours, productivity, housing costs, energy prices, child development, childcare costs, education, life expectancy, healthcare standards, healthcare spending, care for the elderly, pensions, gender pay gap, inequality, spending on R&D...
Opinions come into whether those things would be improved or worsened by becoming independent.
But what no-one should be saying is that the UK is a successful country when it is lagging so pitifully behind its neighbours. Nor should anyone be saying there's an advantage in being in a big country, because that's manifestly disproven.
Posted 10 years ago # -
I was mildly cut up by black limo today. Nothing major. Mildly ludicrous accelaration to pass me towards the entrance to grassmarket from west vehicle then had to brake suddenly for bin lorry in front which I had already clocked, so I just kept my distance. Overtook it again at lights at end of cowgate. Number plate G2 SNP.
Posted 10 years ago # -
"Well, then could someone explain why there is no correlation between bond rates and economy size?"
Perhaps you could email him and ask. He's published a big long paper with his analysis and just going by the equation on p39, it's definitely more complicated than a straightforward correlation.
It's also worth having a look at an article on the NIESR website dealing with criticism from one of the members of the SG's Fiscal Commission. The thing that struck me most about it is that Prof Hughes-Hallet doesn't seem to have fundamentally questioned the analysis (the method) or it's conclusions (that Scotland's rates would be higher, just that the effect is exaggerated) but he makes a couple of interesting points, which Prof Armstrong answers.
Of course, in all of this Prof Armstrong may well be wrong or mistaken but he doesn't seem to be deluded. He has, at least, shown his working, which is more than can be said for the conjecture of the White Paper.
It's also definitely worth reading the Spice briefing here to get a summary of the various analyses.
Posted 10 years ago # -
"But what no-one should be saying is that the UK is a successful country when it is lagging so pitifully behind its neighbours. Nor should anyone be saying there's an advantage in being in a big country, because that's manifestly disproven."
Did anyone do that?
Posted 10 years ago # -
"
The Future Is Not What It Used to Be"
Was on Radio 4 yesterday.
http://www.bbc.co.uk/programmes/b042jfvz
A lot about the future not being an extrapolation of the present.
Much mention of productivity and how it was defined in relation to GDP.
GDP figures are of course selective, not including subsistence farming or unpaid domestic or caring work.
The programme pointed out that is was difficult/impossible to account for the amount/effect of 'free' - Google, Facebook etc. and apps which have clearly changed the way people work and therefore 'productivity'.
Some people will be voting Yes in the hope (however naive - consciously or otherwise) that things might be done differently.
'Facts'/projections/opinions/unknown unknowns may count for less than 'both' sides hope/imagine.
Posted 10 years ago # -
calmac - obviously past and current bond rates are facts, I covered that pretty clearly by stating "these are indisputable facts" a few posts ago. I was trying to highlight that quoting bond rates, being paid at least two years before Scotland could become independent, by other countries offers no real guide to what a newly independent Scotland may pay.
While Scotland is a small northern European country, it shares little else with Sweden (or other Nordic countries). These countries have massive personal and company tax rates, which I just cannot imagine Scots wanting to pay. State intervention is far more obvious than in the UK (e.g. state owned off-licences) and the societies are far more homogenous.
Like it, or not - we are really far more like England than the Nordic countries due to shared laws, culture, language, currency, institutions and so on.
I think we have already covered the fact that Scottish GDP figures and UK/Scottish public finances are as much a work of interpretation as solid fact.
Would it really hurt to accept this uncertainty?
Posted 10 years ago # -
Morningsider if this uncertainty is accepted that will be the first example in my limited experience of a Yes side debater accepting any argument that is possibly linked to any weakness in pro independence arguments. I think this might be a tactic as it seems like it is 100% for independence or nothing? I know devoMax option on voting paper would have complicated things but this is more of what the landscape is like, not black and white but grey?
Apologies if I have exaggerated this phenomenon and I am not meaning to be pejorative. however, I do think there is no room for uncertainty in the Yes side? Or for admitting uncertainty. Though some yes voters will accept uncertainty and say they are voting yes anyway?
Posted 10 years ago # -
And who ruled out the devo max option?
Mr Salmond is most certainly not infallible. He thinks that Star Trek Voyager is the best version of the show.
Deep Space Nine is best.
Posted 10 years ago # -
Well no one is perfect.
What was SNPs first draft question?
Posted 10 years ago # -
Some aspects of uncertainty are OK. That idea that goes something about the first day of a better nation is uncertain in that it suggests starting from scratch. The discussion of how things might be under independence embraces uncertainty because within uncertainty there is possibility. But the range of uncertainty is limited to positive, hopeful areas. How things might be better. Which, is OK as far as it goes. At best it's starry-eyed optimism and at worst it risks losing people's confidence when everything looks too good to be true. Not exposing people to the risks of independence is infantilising and disabling - treating people like children who can't make complex decisions and real-world choices.
The trouble is that the entire No campaign has been about using uncertainty as an argument against independence, which is at best a deeply cautious view of the world and at worst dishonest about the possibility that there are positive aspects of Scotland being independent. It's an infantalising and disabling way of encouraging people to think - treating them like children who can't make complex decisions and real-world choices.
Posted 10 years ago # -
we are really far more like England than the Nordic countries due to shared laws, culture, language, currency, institutions and so on.
Closest parallel is probably Ireland, though Ireland also very different to Scotland in many ways. Different histories. England also very different in ways not obvious immediately to someone from outwith these isles. Look a bit closer, and the differences are significant.
However the further north you go in Scotland, the closer the culture is to Nordic. The further west, it gets more Celtic/Irish. Inevitable really. Here in Lothian we are seen as very Anglicised by many other Scots, especially those hailing from the west (though I think they just say that because they don't like folk from Reekie).
Though some yes voters will accept uncertainty and say they are voting yes anyway?
Like me for instance.
Life itself is full of uncertainty. If we do gain independence, it's going to interesting: in some good ways, and maybe some not so good. It's the sense of possibility that I find appealing.
Posted 10 years ago # -
Insto - exactly, my post of three months (and 27 pages!) ago:
"Personally, I think everyone in Scotland is being done a grave disservice by both the yes and no campaigns. The yes campaign is making claims of certainty when the results are unclear, usually because the results will only be clear after negotiations. The no campaign are claiming uncertainty on issues where the way forward is pretty clear (although there may be a modicum of uncertainty)."
Posted 10 years ago #
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