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Osborne nixes currency union; Salmond hops around claiming it’s only a flesh wound

13 February 2014

3:08 PM

13 February 2014

3:08 PM

An interesting day, then. As I suggested yesterday, George Osborne has ventured across the border on a punitive raid. Nothing like a spot of rough wooing to get you through the winter.

The reaction from Scottish nationalists has been interesting, to say the least. Some seem most affronted. Who the hell does George Osborne think he is, anyway? He’ll no be telling us what currency we may use. Perhaps not but he – or Ed Balls – is certainly entitled to set out his view of what may be in the best interests of the rest of the United Kingdom. And if that view differs from the Scottish view then tough.

Be that as it may, it never ceases to amaze me that nationalists, having declared war upon the British state, are so shocked or appalled when the British state fights back. They’re like boxers complaining it’s unfair that the other guy has biffed them on the nose.

On the other hand, there are some nationalists who still seem to be in denial. Among them, Alex Salmond himself. The First Minister tweeted (or, rather, had one of his staff tweet):

Currency stance of UK government will be very different the day after a Yes got to the campaign rhetoric we are hearing today.

Well that’s OK then! Of course the UK government might change its view on the desirability of a currency union. But, hey, it might not and the prudent investor might take the claims made by the Treasury and all three main Westminster parties seriously. The SNP prefer to assume that this is just bluff and bluster, campaign froth not to be given too much credence.

Is this a bet Alex Salmond really wants to call? For that matter, does he have enough chips to cover the bet without going all in himself? The answer to both questions is No.

In fact the First Minister and his acolytes resemble no-one so much as the Black Knight from Monty Python and the Holy Grail. Their desire for a currency union has – at least for now – been lopped off and yet still they hop around insisting this grievous loss is nothing more serious than a flesh wound.

If that were the case the nationalists wouldn’t have pursued a currency union in the first place. This was always a risky strategy since said union is not in their gift. But it was a matter of politics, not economics.

For more than twenty years the SNP’s approach to independence has been built on gradualism. The party leadership recognised long ago – twenty years ago in fact – that there’s no such thing as independent independence in the modern world. The party has opted for a gradualist approach, sometimes an approach so nuanced it’s not always been clear what independence would actually amount to. Most of the true believers have held their tongues, accepting that some loaf is better than no loaf.

It has been, you might say, Project Reassurance.

That reassurance has been necessary because a) most Scots do not think Britain irretrievably broken or illegitimate and b) the SNP recognises that Scotland is a conservative country. If that were not the case the SNP manifesto might be more radical than it is.

This, naturally and understandably, irritates genuine radicals but, facts are facts and these ones will not ding either. Salmond is a very modest revolutionary even if, in the grander historical context, his plans are still very revolutionary. The break-up of Britain is no small thing, however quietly you wish to do it.

So, keep the pound. Not because that’s necessarily the best option (though from a Scottish perspective it might be!) but because it’s the approach that will frighten the fewest ponies. A form of Continuity Nationalism, if you like.

The euro once seemed to offer a safe harbour but when that ceased to be the case, a sterling zone was the best thing available. Not, again, for economic reasons so much as for political ones. A separate Scottish currency, complete with central bank, would be risky – or easily caricatured as risky – and an approach liable to upset business.

And since much of the case for independence rests on the economic arguments (thin and bloodless as these may be) keeping business sweet has been a central part of the SNP mission these past 15 years. For things to change, many things will have to remain the same.

So what next? There is, of course, the Panama option. Or the Montenegro gambit. But this seems unattractive and not the sort of thing liable to persuade Scots to vote for independence. If it were, this might have been SNP policy all along. That policy, remember, has been crafted to secure as many Yes votes as possible. It follows, then, that the Panama option is, by the SNP’s own analysis, sub-optimal and liable to frighten more voters than it persuades. A vote loser, in other words.

Hence today’s denial. George and Ed and even wee Danny don’t really believe what they are saying. They will change their mind once the need to do so is forced upon them. Move along, now, nothing to see here.

It’s a point of view, I guess.

The other impact of today’s developments, however, is to harden the strength of feeling on both sides of the argument. Despite the witless bampottery of a relative handful of zealots (on all sides) this campaign has hitherto been conducted with a notable lack of rancour. That may not last.

Scots already persuaded to vote Yes will complain Scotland is being bullied by England. Their resolve will be hardened. In some cases, their distaste for anyone who simply disagrees with them will increase. There will be more and more frequent accusations of Uncle Tamism or accusations that so and so is a self-loathing Scot.

On the other side, committed Unionists will be convinced Salmond and Co are nothing more than a bunch of wreckers and lunatics.

So we can expect the electorate to become increasingly polarised. The number of genuinely undecided voters is smaller than the opinion polls suggest (since many of them already lean one way or the other).

The nationalist ploy, it seems to me now, is to present Osborne’s speech as an attack on Scotland itself. This is not, the nationalists will say, a question of the detailed prospectus for  independence per se but rather on whether Scotland can be free to pursue her own destiny. Are you with us or are you against us? Osborne is against us having that right. Do you agree with him? Do you really want to take his side or do you choose Scotland’s?

It is an audacious gamble even, perhaps, a bluff and one that many will reject as a false choice but it might also be the best bet available to the nationalists after what has been, by any objective standard, a bad, black day for the Scottish independence movement.


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