Not too wee and not too poor
Posted on
March 17, 2019 by
Rev. Stuart Campbell
Dr Craig Dalzell of the Common Weal is a very sharp guy we’ve run several pieces by on Wings, and he’s currently appearing all over the place with a highly accessible and concise explanation of how an independent Scotland could sensibly run its economy.
If you haven’t been able to make it out to see him, a quiet Sunday might be an ideal time to catch up with it.
We need to start NOW pushing the arguement against needing Westminster to “look after us”
We all know it is nonsense but the too wee, too poor and too stupid position has had 300 years to undermine the confidence of Scots.
The main case being that we are not going to be a mini UK. This podcast is a great example. You do not have to agree with every alternative put forward by the various groups just to recognise that WE can make a different future.
Another excellent piece of work by Dr Craig!
Cheers to Lindsay Bruce for the quality footage 🙂
It needs a wider audience. Well done.
Public finance should be shaped by culture, not the other way around. Public finance is undermined by normalising the ‘nationalisation of private risk’ (see austerity).
link to uni-erfurt.de
CLASSICS IN THE THEORY OF PUBLIC FINANCE
desmarais-tremblay.com/Resources/Musgrave%20Peacock%201958%20Classics%20in%20the%20Theory%20of%20Public%20Finance.pdf
Public Finance and Development
link to eml.berkeley.edu
Fiscal Sovereignty:
Reconfigurations of Value and Citizenship in Post-Financial Crisis Argentina
link to academiccommons.columbia.edu
Rev.,
Was there a Q&A afterwards? Do you have a link to it, if there was?
This takes me back.
link to link.springer.com
Economic sociology as public sociology
Public sociology and economic sociology: introductory remarks
burawoy.berkeley.edu/PS/Socio-Economic%20Review/Swedberg.pdf
Society, State, and Public Finance: Setting the Analytical Stage
citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.563.315&rep=rep1&type=pdf
Towards a Critical Sociology of Democracy: The Potential of the Capability Approach
link to journals.sagepub.com
Well set out presentation. These facts have bedn know for years. SNP policy and facts and discovery. Including many others.
Greens (Common Weal) could much up Independence. Reneging on green policies. The talk the talk but do not walk the walk. Constant criticism of the SNP etc especially petty, often irrationally.ie campaigning against essential products or services for years. Wasting monies revenues, time and putting up costs.
The AWPR and the Forth crossing. They campaigned against for years and out up cost, wasting revenues that could be better spent. £Billion. These essentials roads are cutting journeys times etc 60%+ . Scotland has cut emissions 60%+. With these two constructions. Increasing conductivity and saving costs of fuel and energy and making journeys cheaper. Cutting the working day 2 hours for millions. Millions have benefitted and £Billions will be saved for £2.5Billion spent. The Greens/unionist (Common Wesl) were against it.
The greens/unionists renege on green policies and codt £Billions, The SNP has to pysh them through being criticised all the time. The roads were not fit for the 20C never mind the 21C. It hapoens all the time. The Trams mismanagement. Still no resolution or colluded Inquiry. Collurded with unionists. Wasting £Billions? Soon to be reapeated? OAP’s from other cities still not permitted to use their off peak travel passes in the Trams which would be cheaoervabd use up capacity.
The greens advocated Norway as an example of prosperity compared to Scotland. The Norwegian Oil and ‘Sovereign’ fund making money from other (poorer) counties. The green do not advocate Oil use or massive cut without adequate alternatives in place. Or making money out of other (poorer) countries. The greens are hypocrites, introducing policies a ‘car tax’ which will not made hardly any difference in the grand scheme of things. Giving May ammunition to lie about Scotland in the Commons. Not a good look and pointless.
The greens could muck up Independence with their unpopular policies often irrational or irresponsible. The most unpopular Party with the most unpopular policies. No wonder. An small interest pressure group. Tax on land etc. Local income tax instead of land tax. It would not collect enough revenues. Etc, etc. They do not think things through but from borrow and irrationally criticise others. They can be ideological blinkered, if people point that out. They will not listen. Just continue down a transigent path if irrationality.
They do not understand business in many cases. They can’t count or read a balance sheet. They go off on other tangents with unexpected consequences. Not intended. Annoying people. They should be more realistic of a mixed economy. Still saving emmissions and revenues. Stop criticising the SNP constantly colluding with misinformed unionists. That just harms Independence. Fairweather friends when it suits. They should come forward more realistically with a planned strategy. More diplomaticly.
Scotland is similar to Norway but there are differences. Weather, size density, production, balanced economy, land management, ‘right to roam’, social structure, access to the EU/Europe etc. Some people think Norway is boring.
“Not too wee and not too poor”, but judging by recent opinion polls, I’m unsure as to the third element in that catchy Yoon mantra concerning intelligence. Just saying…
loved this
My wife who is English and not a nationalist says’thats really interesting, can you send me the link so I can listen to it in my own time’
I feel a conversion coming
Was listening to Freddy PLAYing it on the PR VCR there.
Made me think of this like:
link to youtube.com
That is a very helpful video. I hope it gets wide distribution. And, yes, it does encourage further fact finding and debate.
The section on trade, public finance, business and household could be expanded into another video explaining the relationships more fully.
This stuff is dealt with in a very narrow fashion by the likes of the BBC. It is a public duty to maintain economic pluralism, otherwise you end up in a progressive decline of democracy (see austerity and Brexit). Brexit will only intensify the economic rot at the heart of Britain’s neo-liberal society, no small thanks to the BBC.
Oops.
BUSM076 Public Financial Management and Accounting
link to qmul.ac.uk
So does Scotland really fancy limiting it’s social potential in order to appease contemporary English nationalism (including white British nationalism)?
speri.dept.shef.ac.uk/wp-content/uploads/2018/11/Global-Brief-7-EU-Business-Views-on-Brexit.pdf
Sociological Questions Through the Spectre of Brexit
link to thesociologicalreview.com
Understanding the economic impact of Brexit
link to instituteforgovernment.org.uk
The Uneven Path Ahead: The Effect of Brexit on Different Sectors in the UK Economy
link to blogs.imf.org
Some great information here, especially the part about inequality at around the 20 minute mark, that clearly differentiates Scotland from England (or rUK if you want to be pc, or SE England if you want to be more accurate). It strikes me that while Scotland as a generalisation is forward looking in the truest sense, England (especially SE England) largely sees the future only as a mirror image of the past.
So whether you consider the hard data on inequality or the subjective attitudes about accepting and maintaining it, it’s another example that the differences within the UK’s two largest nations are fundamentally different and therefore totally incompatible.
Well THAT was very helpful !
robin @ 11.16 am Your wife is in for a rare treat and hopefully Dr Dalzell’s explanation will bring her to Yes =)
I’ll need to listen to it again to get a better grip on it all. I have to be ready to answer questions with confidence.
I expect some of this will find its way into Rev Stu’s new Wee Mysterycolour Book 🙂
Oooh! The line I really liked was that Scotland would not be entitled to Cornwall’s tin =)
Now that I can remember when it comes to discussing Scotland’s oil.
There are a few folk on the other thread who are going to enjoy being educated in Independent Scotland’s fiscal future =)
I knew our future would be good but this talk has given me even more reason to be even more optimistic 🙂
Thank you Dr Craig Dalzell.
And thank you YES Hub Edinburgh and John and team =)
Craig came to speak at our local SNP branch. An entertaining and informative talk. Hats off to the man he puts in a serious amount of effort to this and is well worth listening to.
In terms of simplifying the tax code, I’ve been inside that. In the ’80s New Zealand did this. A massive simplification. Everybody does a tax return in NZ, not just if you’re self employed. The tax return went from a book at least 25 pages long, with possible inserts for job specific forms to a folded A3 page, the last page of which was the declaration. We put a single A4 page in as we were in receipt of child tax credits. Imagine that, a single page for child tax credits.
Gone went a tradie claiming for his or her tools, but also taxes went down and the exercise was revenue neutral. Government saved a bundle in admin and compliance costs and the opportunities for tax avoidance and evasion were very, very much smaller. Listening to those in business or the trades talk about how they were saving on the tax before the change gave you a measure of the scale of it.
At the same time a plethora of sales taxes were simplified into one, GST the VAT equivalent. Being informed was important. People were panic buying ice cream despite it’s taxes going DOWN in the change so it became cheaper. The new system was also cheaper to run and run compliance on. Business costs decreased as well due to the simpler systems.
Nobody died. There were no bodies. Life and the economy went on.
I absolutely and utterly recommend a periodic simplification of tax systems and codes. Over time lobbying and govt desire to support this, inhibit that via the tax system complicate it. Meaning every few decades it needs simplifying. The UK should have taken note in the ’80s. We are LOOONG overdue for one.
Perhaps it will a gift from Scotland to rUK, a demonstration close to hand of the benefits of a simplified tax system. Don’t hold your breath though.
Oh yes and as for the South of Scotland being poor, the Borders have the highest level of millionaires and aristocrats per head than anywhere other than London. The Duke of Buccleuch, one of the biggest landowners in the UK is based there.
All these people want it to stay rural and bucolic populated by forelock tugging characterful peasants who know their place and how they are dependent on the rich, aristocratic people.
How they must have hated the reintroduction of the rail line, bringing oiks and the ‘wrong’ sort of tourist.
To improve things in the South of Scotland we will have to break the grip of the powerful and the landed. it is to be hoped that the powerful will be less so in iScotland, no HoL, fewer private clubs to hobnob with ministers in. Scottish minsters tend to have grown up in Council Houses anyway and to not know their place. Oh dear, what a pity, never mind.
We NEED a Land Value Tax, said Duke will HATE it which is VERY good reason in and of itself to do it.
All over Scotland where the big landholders hold sway economic progress gets stymied. Want to start a business? Please sir may I build a shop/factory/workshop? A house for my grown children? Oh, sorry to bother you. This will be familiar to folk in the Highlands and Islands as well.
The changes to inheritance law were good but they will work too slowly. A Land Value Tax pitched right will make the holding of large amounts of relatively unproductive land expensive. Or it damn well should do.
Very interesting. Thanks
Hi Muscleguy at 8:39 pm.
You typed,
“The tax return went from a book at least 25 pages long, with possible inserts for job specific forms to a folded A3 page, the last page of which was the declaration. We put a single A4 page in as we were in receipt of child tax credits. Imagine that, a single page for child tax credits.”
and
“I absolutely and utterly recommend a periodic simplification of tax systems and codes.”
“Yes Minister” or “Yes Prime Minister” did an explanation of this but after spending 20 odd minutes on YouTube, I can’t find the relevant clip.
The crux of it was, as explained by Sir Humphrey, that departments, like HMRC for example, create “work” for their department, because more work means more staff required and more staff means a bigger budget is required. A bigger budget means more power compared to departments/ministries with lesser budgets.
That’s the problem with the civil service system that is still operating.
Dr Dalzell’s decoding of GERS is inspired work. Thanks to him and all involved in creating this great presentation video. Loved it.
The truth will out …
just how fast can we make it happen?
These comments occurred to me as I watched the tape. I concede that sometimes something is said later which addresses wholly or in part the issue I raise.
1) The fact that Lang supposedly said that GERS was useful in undermining the demand for devolution doesn’t mean that GERS is false. Cancer warnings undermine the case for smoking. This doesn’t mean that smoking doesn’t cause cancer. The presenter elides over the distinction between “designed” and “intended”. If GERS was “designed” – if it was a seriously flawed construction from the outset – then doubtless we’d have never stop hearing about these supposed flaws. Detailed criticism was rare.
2) He distinguishes between spending supposedly for Scotland on reserved issues, and spending in Scotland (such as welfare) which is not chosen in its specifics by the Scottish government. The problem is that the former is tiny, and the Yes movement rarely argue that anyone in receipt of spending right now should not receive it. So if we halved Scotland’s share of reserved functions (defence, foreign affairs) it wouldn’t be meaningful. If we want to say that Scotland would make “different choices” – always the slogan – who, right now, would not get what they currently get?
3) We’re told that there were methodological issues around GERS “at that time”? In 2007 the SNP took on Cuthbert’s recommendations. In 2015 that presumably fine methodology told us we had a £15,000,000,000 fiscal deficit. GERS now, the presenter tells us, is “a fair analysis of Scotland’s finances..”. This is qualified. The figures are reasonable given this is a “region of the UK with some devolved powers”. The trouble is that 12 years of SNP control of key drivers of economic growth, such as education and transport infrastructure, have produced hee haw in the way of improvement. Indeed, Scotland has been shielded from the massive cuts to local authority spending which have taken place in England. This “region” has been feather-bedded. And yet England powers ahead. The gap’s widened. Why? What is it in us which allows us to remain as we are when our sister nation is deprived of the largesse we’re afforded? It’s a reasonable test, isn’t it? Where is the cause of our woes? Is it in us, or in the UK? Well, let’s slash spending in England and give Scotland relatively much more, plus new “levers” (which are always demanded; 2012, 2016). What do we get? No improvement. The relative positions remain the same, or moves against Scotland. That’s quite a fact, isn’t it?
4) We’re told that independence doesn’t just change things because policy can change. We’re told that the fact of independence changes things in terms of how finances are raised. Pause and think about that. Sturgeon subscribes to the Laffer curve. She resisted higher taxes on the high earners because she felt lower tax receipts would result. We’ve total control of income on earnings (save the personal allowance). So what extra does independence allow? 1) Taxes on businesses. 2) Taxes on other sources of income. 3) Borrowing. We can rule out “1” for Laffer curve-type reasons. An independent Scotland that tried to tax non-earnings income might also see such individuals move. I would. So it’s a great big “3”. But with Scotland’s fiscal deficit Sterling borrowing would be ruinously expensive. It couldn’t be secured on assets (to lower borrowing costs) because nobody would believe that we’d allow the extraction of rent from those assets if we did default.
5) Defence will be a major change. The speaker elides over “defence spending” and “defence sector”. He says, “We’re not going to have nukes”. But of course Trident is included in the defence budget, we’re committed to NATO membership, the UK’s Trident programme is consistent with the bare 2% of spending NATO demands, Trump’s an unreliable boyfriend when it comes to countries that won’t pay their way and Sweden spends way over 2%. The Swedes are peace-loving social democrats. They’ve got massive airspace and coastal defence issues. So would Scotland. What we’d save on defence is zero. We’d probably have to spend much more than the UK does right now. So waffle about aircraft carriers and bad behaviour in the Chagos Islands is mince, and obviously so.
6) We’re told that half of the £3bn of defence spend allocated to Scotland is spent in Scotland. But this is an ignoratio elenchi: an error of irrelevance. If, as is likely, this has always been the case – the Parachute Regiment has always “sponsored” Aldershot’s publicans – then it matters not a jot. Are we actually saying that a large slice of Scotland’s workers and entrepreneurs, from time immemorial, have been unable to do anything but make weapons? If this were true would an independent Scotland be required to manufacture weapons for foreign despots? After all, it’s a tough trade. You can’t be fussy about customers’ intentions. If Scotland “imports” paratrooper services are we actually saying that we’re incapable – given an infinity of time – of finding something else to do to pay for this? Havers.
7) We’re told that spending £1.5bn extra on defence in Scotland wouldn’t decrease expenditure, but it would increase “income by a few hundred million pounds a year”. An independent Scotland would have stopped buying “paratrooper services” from the lowest cost supplier, and would be looking to produce them locally. That’s a nuisance for the taxpayer to exactly the same degree that all distress spending is. Providing the same lethality with local resources isn’t magically £1.5bn in your hand. We buy rice from Thailand. We wouldn’t gain from establishing paddies in Coatbridge. The SNP didn’t want the administration of some welfare spending precisely because they knew it would be more expensive for them to do it than it was for the DWP and Benefits Agency to do it. How silly of them, eh?! Allowing the GERS figures to be moved in the wrong direction by having something done in England with Scotland being allocated part of the cost!! No; it makes perfect sense. If the private sector produces whisky and jam, and the public sector paratroopers and nurses, you don’t make yourself wealthier by contriving a situation where you have to hand over more whisky and jam to get your paras and nurses.
8) “Scotland the peacemaker. Take the approach that Ireland has”. Let’s be clear. Ireland’s approach is to say, “Nothing could be done to us that wouldn’t be a threat to the UK. We’ll take the free positive externality of UK defence spending”. That was there position on the Holocaust, I seem to remember. They weren’t for it, or against it. They abstained. Many good Irishmen took a different view, and they were punished by their government for it.
9) The UK should keep the entirety of the debt because that allows the UK to claim to be the continuing successor state. Mmm? Find me someone in the global community who thinks that the UK would be materially diminished by the loss of Scotland such as to bring into question (for example) the permanent seat on the Security Council? The “UK”, “England” and “Britain” are used interchangeably.
10) If Scotland did anything other than take a proportional share of both assets and debt the infinity of ways that rUK could make our lives difficult would be explored. They’d be right. We’d be seen to be acting wholly unreasonably. Could we pass a lie detector test if we were wired up and asked whether such behaviour on our part was reasonable? Would any arbiter regard this behaviour as reasonable? If rUK refused to sign a free trade agreement with the EU until Scotland behaved responsibly how many milliseconds do you think it would be before we were told by Brussels to comply?
11) Again, the claim that Scottish Office civil servants in England are a Scottish expense but a source of income for England is predicated on the claim that they do what they do less efficiently than we would. If these arrangements have been stable for decades – which they have been – then (again) all were doing is buying an import. When we buy wine from France the producers pay their taxes to the French government. Think we should grow our own? Think that growing our own is cost-free? Civil servants produce public sector output (supposedly). The private sector pays for such output through taxation on pain of imprisonment. In any imaginable world curry is desirable. Politics is like sewers: it would be nice if we didn’t need it at all. The same holds true for infantry soldiers, and all else. So, again, doing this for ourselves would be an expense.The idea that such on-shoring of civil servants has all kinds of mystical Keynesian consequences is (again) predicated on our having this cohort of Rab Cs who’ve been inactive for decades, but could soon emerge from their chrysalis to become Sir Humphrey. We benefit from “bringing our government back” Our government has been in Westminster for 300 years. We’ve had time for our Sir Humphreys to become geophysicists and gin distillers. Is there really a group in every society – like the telephone sanitisers in Douglas Adams’ trilogy – who’re fit for nothing but casual assumptions of superiority in Pall Mall’s Athenaeum? If Denmark moved it’s government to London and then paid for it they might or might not suffer. It depends on how you conceive of government. The speaker seems to assume, i) that comparative advantage, economies of scale and the division of labour don’t exist, and ii) that government isn’t a pox on our private consumption. Government is what we buy with reluctance, it always costs, and – to reiterate – we’ve had a stable 300 years to deploy those who might otherwise have looked out a window in Holyrood on some other task. Indeed, we don’t seem to have benefited much from deploying precisely this class since 1999.
12) We spend £0.2bn on embassies and the like. We could save on that. Yeah. Penny wise and pound foolish. Save half that and it’s 0.7% of the deficit. Cancel your home insurance. It’ll probably be fine.
13) We could rely on the embassies of other EU nations. Well, see above on Ireland’s defence expenditure. Why not go the whole hog and just adopt the leech as our national symbol?
14) “The big ticket items; not paying for Trident, not paying for the House of Commons..”. The former is included in the defence budget (see above, so no saving), and the latter costs very little. For anyone who thinks that Scotland can’t waste money on politics I draw to your attention the Holyrood Hotel, and our 129 MSPs (cf and cp US Senate:100).
15) We’re told that Scotland is advantaged on infrastructure spending compared to most of England, save London and the South east. Yet England in its entirety – taking the whole curate’s egg – is fiscally fine.
16) The we’re told that these infrastructure issues are not “really going to have a huge effect on Scotland’s budget”. Indeed.
17) The tax gap. The rates are set, and accepted or not, with due cognisance of the “tax gap”. Companies reckon what they’ll have to pay with best planning. Governments reckon on rates given the assumption of best planning. If you think you can close the gap without being seen to have effectively massively increased taxation you’re kidding yourself. Tax planning is assumed on all sides. Remove all planning and it’s a higher tax. Have a really strong anti-avoidance statute and i) it’s a massive increase in tax, and ii) it’s the end of the rule of law. If government doesn’t have to carefully define something in law – it just says, “Give me lots and my dependent judges will support me” – then you precisely throw away one of the key advantages the UK has. So “capturing” Scotland’s share of the “gap” will almost certainly be “making Scotland way less attractive than the country to the south”. Think about it.
18) Independence is an “opportunity” to formulate a tax code with a blank sheet of paper. Mmm. That won’t cause much business uncertainty. Can’t imagine that Scotland’s civil servants will have any difficulty achieving this expeditiously. [NB sarcasm]
19) I love the idea that the very fact that England has done better since the SNP took charge in Scotland is taken as evidence in itself that the economic policy of the UK favours England. Yeah, well that’s one construction that can be put on the facts!
20) We’re told that “since austerity” the “economy of the UK has been benefiting London and the South East”. Think about that. It’s not that London and the South East are outperforming economically, it’s that there’s something else called “the economy of the UK” and it has been benefiting London and the South East.
21) The “London effect” is entirely an artefact of how you define a “region”. Define “region” as the City of London and it’ll look worse. Define region to include London and then down to Margate and Hastings and it looks quite different.
22) “Deficits take on a different meaning when you’re a country, especially a country which has its own currency”. Yeah. A country with its own currency never runs out of money. It runs out of something much more interesting: it runs out of people prepared to accept its currency. If you want a Scottish currency that’s trade-able, convertible and useful you’ll accept exactly the market strictures that prevent the McDonnell-isation of Scotland. If you don’t you’ll discover the hard way what bond markets can do.
23) If there’s a net private sector saving balance there has to be a public sector deficit. You now require £88 to buy what £1 bought you in 1914, and we’ve had positive (often punishing) interest rates and bond yields for long periods. How often have we had net private sector saving in Scotland? There’s an idea worth exploring. We’ve spent money like a sailor on shore leave.
24) The presenter talks about “trading with Mars”. He slides from what must be true in a country and what must be true in the world. Taking the world we can have net private sector saving so long as someone else has a deficit. As the presenter says, Germany does exactly this.
25) If health spending is being paid for out of tax receipts it doesn’t matter a damn whether government as conduit buys it (having taxed you), or whether it imposes a compliance cost on you.