Wings Over Scotland

This morning sees the release of another set of GERS (Government Expenditure and Revenue Scotland) figures accompanied, no doubt, by the usual strange hybrid of sneering and cringing from Unionist politicians braying proudly that we’re too small, too subsidised and too stupid to ever look after our own country.

So as the annual circus act gets under way again, for a little perspective we took a quick look at Scotland’s actual standing in the international community.

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Yesterday George Osborne treated us to an Autumn Statement in which he performed one of the most remarkable political U-turns in living memory.

The apparent need to cut £12bn from the welfare budget has long been sign-posted by the Tories as a requirement to getting us “back in the black” and on the road to a “higher wage, lower welfare, lower tax” society as part of their oft-cited “long-term economic plan”. (Or what academic economists prefer to call a “risky experiment with the economy in order to score political points“.)

Alert readers will recall David Cameron saying before the general election that child tax credits wouldn’t be cut in pursuit of that goal. But after the election, Osborne decided that they would. The Institute for Fiscal Studies determined that these cuts would have the worst effects on some of the poorest families in Britain.

Despite widespread opposition to the cuts, Labour infamously abstained on the critical vote in the Commons. Then, when the welfare bill reached the Lords, Labour once again abstained on a Lib Dem motion that would have completely killed the bill, in favour of a Labour one which phased in the cuts over three years, but meant Osborne would have to find another £4.5bn in his budget.

The passing of the Labour motion enraged Cameron so much that he went on an extraordinary rant about a “constitutional crisis” and announced a “rapid review”.

So we were somewhat surprised to hear Osborne say yesterday that the best thing to do was “not to phase these changes in, but to avoid them altogether”.

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Last Friday’s article on the limitations of GERS caused quite a stir among the stout defenders of the Union, as social-media users may have noticed over the weekend.

Amidst the wildly-flailing fury-storm of shouty, abusive responses which pathologically evaded addressing the article’s point, the one vaguely factual argument raised was the notion that an independent Scotland wouldn’t be able to make significant savings on its current (notional) £3bn defence budget because NATO supposedly requires all member states to spend 2% of their GDP on defence.

So we thought we’d see if it was true.

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Last week the BBC treated viewers to a Question Time hosted in Edinburgh, where a right-wing economics journalist from MoneyWeek magazine called Merryn Somerset Webb explained to a somewhat disgruntled Scottish audience why the government were right to bail out the bankers, but not steel workers.

It capped off an interesting week but to see why we’ll have to rewind a few days and revisit the work of an amateur Unionist blogger of our unwelcome acquaintance.

The amateur blogger in question has been garnering a fair amount of attention lately from straw-clutching Unionist hacks for his “analysis” of the Government Expenditure and Revenue Scotland (GERS) figures, in which he purports to show a sizeable deficit in the economy of an independent or “full fiscal autonomy” Scotland.

In essence, the analysis amounts to dumping all the GERS summary tables into a Microsoft Excel graph, adding the Office of Budget Responsibility (OBR) forecast for oil revenue, and pointing to a resulting £9.1bn gap between Scotland’s public spending and its total revenue.

This, he asserts, is in addition to Scotland’s share of the hefty deficit the UK currently runs. His conclusion, shouted loudly and often by every angry Unionist on Twitter, is that the government of an independent Scotland – which tellingly they always assume to be an SNP one – would either have to drastically cut public services or raise taxes to fill this “black hole”.

It’s an interesting piece of analysis. Or it would be, if it wasn’t total nonsense.

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