There’s an atrocious piece of journalism in this morning’s Guardian, and on this particular occasion we’re referring to its technical standards rather than any bias or spin. Here are the opening paragraphs:
In a calculated effort to undermine the release on Tuesday of the landmark white paper outlining the case for Scottish independence, the Treasury said those increases would hit 2.4m people now paying the basic rate of income tax.
It said the alternative, according to the most optimistic scenario for Scotland’s economy and debt levels sketched out last week by the Institute for Fiscal Studies, would be to cut public spending by £3bn more than the UK government plans by 2021.”
We’re confused already.
Because despite the article having taken two people to write (Severin Carrell and Nicholas Watt), the provenance of the £1000 figure never gets any clearer than that. Is this supposed £1000 bill an annual one? Does it kick in in 2021? Does it reach £1000 in 2021, having grown over the intervening eight years? We’ve read the piece from top to bottom and there isn’t a single clue.
We’re interested because the apparent source of the claim is Danny Alexander, and it’s not too long – the start of this year, in fact – since the Chief Secretary to the Treasury told us that the cost of independence was just £1 a year, to much amused hooting from Yes supporters keen to know where they could send the cheque.
This seeming 99,900% increase in 10 months in the bill Scots will be asked to pay for self-determination and democracy, though, merely serves as another reminder, were one needed, of the mad folly of prediction where economies are concerned. And looking back at that January post reminded us of some striking evidence to that effect.
What that graph so starkly shows us is that eight years ago, in 2005, the UK government’s highest estimate for the price of oil in 2013 was around $42 a barrel. Yet today the actual price of Brent crude is $107, well over twice that figure. But today we’re being asked to accept a UK government claim that it can meaningfully forecast the price of oil (and therefore the health of an independent Scottish econony) exactly the same amount of time into the future.
If we go back just five more years, the sums get even more comical. The most optimistic price the UK government could foresee for North Sea oil in 2013 was around $20 a barrel – less than a FIFTH of the reality. (Its pessimistic guess was about $10.)
Yet last week we were asked to accept that the Institute for Fiscal Studies could accurately identify oil revenues not five or 13 years into the future, but FIFTY.
We suppose we ought to forgive the Guardian’s abysmally sloppy reporting. Because whether Danny Alexander was asserting that the £1000 bill would land on Scots the day after independence or almost a decade into the future, or whether it was annual or cumulative, it’s based on complete fantasy either way. So asking them to actually explain what he was claiming is a bit like arguing over the colour of Nessie’s knickers.