Neither a good housekeeping budget, nor economic Armageddon
A question and answer interview with Grouse Beater
I’ll begin with the obvious. You’re a writer, a creator, not an economist. So why am I interviewing you about Scotland’s economy?
I judge what is right and fair and just for the general happiness of the majority. After that, everything falls into place.
But what about detail, the theories, the damage done by neo-liberal dogma?
I know the power elite corrupt Adam Smith’s theories, bent backwards to align with their repulsive doctrine ‘greed is good’. I know Keynesian economics lifted UK and USA economies out of near bankruptcy and into surplus. I’ve studied as much as I can, and am guided by contemporary economists. And I’ve waded through the Growth Report.
You talk of sharing wealth. You must be a communist?
Anything to the left of extreme capitalism is a communist. Karl Marx got lots of things right and all by sitting in London’s National Library reading old books. Capitalism has liberated many, enslaved others. It rid us of domestic drudgery – I have a washing machine and a dishwasher! We can travel anywhere by all sorts of transport. At the same time it has caused the most tragic economic horrors. Massive profiteering is built into its system. Capitalism shouts for regulation.
Surely the Growth Commission Report is capitalism neo-liberal style?
The Report is fine as far as it goes. For some it doesn’t go far enough, but I think that’s good politics. It wasn’t supposed to be a blueprint for an ideal future economy. Nor is it a manifesto we must salute and honour. It confirms what we’ve sensed for years, we are a viable nation state even without oil.
Was it wise to appoint financier/ex-SNP Andrew Wilson to chair the Report?
Wouldn’t have made any difference if Albert Einstein was the chairman, a Scotland confident is hated. Anyhow, the brief was to look at the worst possible scenario of an autonomous Scotland faced by the economic status quo, no oil revenues on which to rely.
Ironically one of the recommendations repeats the admirable White Paper under Salmond – stick with the pound during transition time. All-in-all the Report is reassuring, even if standard neo-liberal thinking. Summed in epitome its avers Scotland is better out of the UK than dragged under with it. No Unionist will admit that universal truth.
The left and right condemn it.
That’s not true. A few media pundits and one economist, Richard Murphy, jumped in too early with sharp criticism but have since modified their disappointment.
The Fraser of Allender Institute seem gleeful.
After a while the endless pettiness and carping repels. The Report’s authors based their figures on GERS, same as the Scottish Government, though the latter knows they’re highly unreliable. It’s a vicious circle. Try to calculate a way forward and you’re back to flaky GERS every time. Westminster, the enemy of democracy, keeps the real figures locked up. You only do that if what you’re hiding destroys your argument.
Unionists say it’s proof Scotland is a basket case.
Well, they would, wouldn’t they? Look, be realistic; the Report, any report, was destined to be flambéed by our opponents. Their entire being is to talk Scotland down, keep it submissive. They don’t want us to think, to function, to exist without British control. But take a reverse view. Their argument is based on fear of an insignificant England having no oil. England can’t function as a world power without Scotland’s oil.
Unionists say it’s about togetherness. You say oil.
Is there anything else? England doesn’t want Scotland for its kilt makers. When Churchill was First Lord of the Admiralty he wanted diesel not coal fuelling his Fleet, so he stole Persia’s oil, now Iran. Persians got little in return for the rights to drill. When Persians voted in a democratic government led by a reformer the Brits staged a coup financed by the CIA, jailed the prime minister, and installed their man who became The Shah of Persia. Much to England’s annoyance the USA took the lion’s share of oil wealth. Cheated, England stole Scotland’s oil. England still needs oil for its Fleet, its aircraft, its infrastructure and its balance of payments. Nothing has changed. The price of crude is rising once again, another incentive for the UK to keep a tight grip.
You say neo-liberal economics are anti-human – some countries do well.
When imposed on countries by dictators the results have been brutal, democracy always the casualty. Chile under the murderous General Pinochet is a good example. There are lots of others. Libertarians always point to neo-liberal experiments after the purges, mass poverty and privatisation have done their worst.
The Growth Report advocates a step at a time and then adopt our own currency. My most admired politician of the 20th century is Mikhail Gorbachev, the perfect example of how one person can make the difference. His Perestroika was inspirational in dragging the Soviet Union out of the pit it had fallen into, one step at a time.
Let’s not get side-tracked into East-West relations.
England without the EU means England thrown in to the arms of Trump, beholden to the USA. The first world leader Theresa May met as prime minister was Trump, and then ingratiated herself with DUP leader Arlene Foster. She keeps terrible company.
Do we want an immoral, unethical and cruel society? While meeting EU officials Sturgeon stated the obvious, the Growth Report recommends a way forward to debate. If we want a Scottish currency tied to a Scottish public bank sooner rather than later we can decide to do it. Quite a novelty having such power in our hands instead of Whitehall, isn’t it?
Some people argue for a radical economic policy.
Independence reinstated is as radical as any nation can get. That’s the prime goal. At the Edinburgh launch of the Report chairman Andrew Wilson said if you work together over a generation on a broadly agreed strategy – (a political five years) – you can get somewhere. Shout about detail now and you don’t”.
Professor Richard Murphy’s advice takes a different tack. He says, in essence the Report is about balancing the books, not about growth at all. Now, you’d think that alleged omission might assuage the anxiety of the far-Right but as we have seen they’re volubly dismissive of a healthy economy on any level. The Report does discuss growth.
What happened to the idea of having our own currency?
The Report suggests we create our own currency later, Murphy says Day One of independence. Put succinctly Murphy’s diagnosis is:
“What should also be clear is that a Scottish currency is also essential for the creation of an effective tax policy for an independent Scotland. This is because if a country has its own currency then there is technically no limit to what a government can achieve.”
But before we grab a pen to sign his prescription and take it to the chemist he adds:
“There are, however, two practical constraints. The first is that the government does not try to create more economic activity than the economy can deliver. The second is that they must tax sufficiently to cancel enough of the money that the government has created through its spending to ensure that its inflation targets are met.”
Okay, even Murphy has cautionary notes. Now what?
To my mind there are three ways to go:
The first is to stick with Tory austerity and a Brexit exit which is really a cloak to cover their manoeuvres to privatise everything, and reduce us to passive consumers with or without private health care insurance. The end result of that doctrine are pauper’s graves and most of our democratic rights removed, held tight by corporations.
The second is to follow the Growth Report religiously, take each day as it comes while balancing the books. That’s the steady as we go policy with lingering austerity measures that assume the electorate doesn’t return Corbyn’s militia to Holyrood or Tories ready to deliver us back into the hands of Westminster’s gross follies.
The third way is to throw caution to the wind, not to capitulate to received wisdom, be bold by announcing our own currency in an Act of Parliament, set up the infrastructure to back it, work to a deadline, and give the neo-liberal universe the finger.
What’s your choice, Mr Knowall?
My choice is the same as implied in the Report but an early date to introduce our own currency. I can say that because I’m cushioned against poverty as are the Murphy’s of this world. There are thousands out there for whom living their working lives is a state of perpetual anxiety a step away from the street. Many are the young. Only a heart of concrete, or Theresa May, would want them to suffer more than at present.
You like what the Report says, then?
You admire it. You don’t have to like it. I’m reassured in some ways. The Report is cautious. It doesn’t go to extremes. It makes no assumptions about higher growth out of our toils or innovation or oil, and has its goal set on economic fairness.
I like that it states no formal monetary union is need with the UK. Superb! I disagree about eradicating debt. No nation conducts their economy that way.
Of one thing I’m adamant: I don’t want to see the financiers of yesterday put in charge of a new economy. What a disastrous move to appoint the very same people who were responsible for the gambling casinos we called banks and watch them line their pockets. They would take control again.
I like this from the Report:
C5-49 BANK REGULATION: Banks regulated for their activities in Scotland by the SCB/SFA would be required to ring-fence their retain banking operations. [SCB – Scottish Central Bank. SFA – Scottish Financial Authority.]
So, who are our saviours?
We need the new, the young, the fresh. (I sound like the cadaver surgeon Dr Robert Knox.) I’d look to China for economic expertise, not their dictatorial communist party, but the way Chinese micro-manage. Their economy is a wonder of the 21st century.
Finally, what about the EU and Scotland’s Remain?
Our enemies deride the EU, pretending we will trade UK control for EU control – quite an admission when you think about it. Hate EU directives? Love the UK’s shackles.
EU is not the power elite. It’s nation states consisting of people with lives to lead in safety and reasonably comfort. We should remain a member of it. We’re already among the wealthiest countries in the world – per capita our economy is as strong as France, New Zealand and Japan. Ask yourself, if countries smaller than us, with few resources do well, why are we hesitant about nationhood?
The enemies of democracy, the same doing what they can to make Greece a laboratory of neo-liberalism, who champion racism, no state pensions or unions, and imperialist wars have to be purged from society. Why would you want to allow the callous sods the right to humble us with their preposterous ideology?
The Growth Report is not dogma to be imposed. Governments plan their economy five years ahead. We have time to debate the proposals, invite experts to give advice – we can start with Richard Murphy and add Yanis Varoufakis – and make our choices. That’s called free will. That’s called independence.
You didn’t introduce me to your readers. Why?
Because you’re me. Just the same, thank you for one of the best interviews I’ve had.