Scottish voters go to the polls today to decide whether Scotland should become an independent nation. Here are a few relevant links on the debate over the pros and cons of Scottish secession from the UK.
In this post, I tried to assess the case for and against Scottish secession. It turns out to be a close call. But it is possible that an independent Scotland could turn out to be like independent Slovakia – a nation that seceded from a larger entity in part to pursue more interventionist economic policies, but ended up having to pursue more free market-oriented ones in order to deal with the loss of subsidies and remain competitive.
In a follow-up, I described predictions about the impact of Scottish independence offered by others. Much depends on whether the new Scottish government will be able to get control of all or most of the North Sea oil, and whether there is enough oil revenue there to finance the expansion of the welfare state that most Scottish independence advocates want, without raising taxes or otherwise making the new nation uncompetitive. I have also analyzed the Scottish government’s proposed interim constitution for the would-be new nation. It’s an interesting document, but raises almost as many questions as answers.
In this recent post, economist Daniel Mitchell reviews libertarian reactions to the prospects of Scottish secession. Interestingly, most libertarian commentators (including Mitchell himself) seem to be sympathetic to the idea, in large part because they think that something like the Slovakia scenario is likely to be the result. David Boaz of the Cato Institute summarizes the most common libertarian perspective:
Alex Salmond, the leader of the Scottish National Party and the likely first prime minister of an independent Scotland, may be a socialist, but he’s not an idiot. He knows that a tax hike in Scotland wouldn’t work. Asked in a televised debate, he responded, “We don’t have proposals for changing taxation. We certainly are not going to put ourselves at a tax disadvantage with the rest of the UK.”
As Alex Massie put it in the Spectator, “It’s not quite read my lips, no new taxes but it’s not far from it….When it comes to tax no other British politician in recent years has cited Arthur Laffer more frequently than Alex Salmond.” With a top British tax rate of 45 percent, and 41 percent in Ireland, Salmond doesn’t want to raise the Scottish rate to 50 percent and push out top earners.
3) Critics of independence often say that Scotland is subsidized by wealthier England. The analysis is controversial, but it does appear that the United Kingdom spends about £1,500 ($2,500) more per person in Scotland than it does nationally. If it is true, as many British conservatives say, that Scots are whiny subsidy-suckers, then take them off the dole. It’s easy for a country with 52 members in the British parliament to demand more money from the British central government. An independent Scotland would have to create its own prosperity, and surely the people who produced the Enlightenment are smart enough to discover the failures of socialism pretty quickly if they become free, independent, and responsible for their own future.
An additional potential bonus for libertarians is that Scottish secession might make the remaining UK more free market-oriented by removing 41 Labor Party members of parliament and only one Conservative. British Conservatives are far from being libertarian; but they are more so on economic issues than the Labor Party is. By contrast, if Scotland stays in the UK, overall government spending could rise even beyond today’s relatively high levels, because the UK government might increase subsidies to Scotland in order forestall future outbreaks of Scottish secessionism (much as the Canadian government has provided generous subsidies to Quebec in order to stymie Quebec secessionism).
The results that libertarians hope for are precisely what English and Scottish left-wing opponents of independence fear. On the other hand, most Scottish independence advocates are also social democrats. They hope and expect that independence will result in a bigger welfare state and greater government intervention in the economy.
I think that the Slovakia scenario is more plausible than the Scottish National Party’s vision of an independent Scotland that can raise government spending and welfare benefits, despite losing UK subsidies and the prospect of tax competition from Britain, Ireland, and elsewhere. But I readily admit that other scenarios are also possible, and that much depends on how the UK and the European Union react to Scottish independence. I am therefore less certain of the potential benefits of Scottish independence than some other libertarians are. The one thing we can say for sure is that there is enormous variation between the different projections of the likely policies of an independent Scotland. If the expectations of many libertarians and anti-independence left-wingers are correct, than those of left-wing Scottish nationalists are badly wrong – and vice versa.
Economic issues are not the only ones at stake in the vote. Supporters and opponents of independence have also cited potential cultural effects. Famed Scottish actor and former James Bond star Sean Connery argues that independence would promote the flourishing of Scottish culture:
More than anything else, culture defines a country. It provides international visibility and stimulates global interest more than a nation’s politics, business or economy ever can….
So, with our colourful history, strong identity, deep-rooted traditions, a commitment to artistic innovation and diverse and beautiful landscapes, Scotland is truly blessed….
I believe Scotland can and will go further. A Yes vote in September will capture the attention of the world. That inevitably means there will be a renewed focus on our culture as well as our new politics, presenting us with an unparalleled opportunity to promote our heritage and creative excellence.
The powers of independence will allow Scotland to develop and enrich its culture as well as marketing it more effectively.
By contrast, Scottish-born Harvard historian Niall Ferguson argues that the nation’s culture could be badly damaged by independence if it loses some of the cosmopolitanism that made it great; he fears it might even “revert to its pre-1707 bad habits” and become a “a divided and rancorous society with a vindictive style of politics.”
I suspect that both sides’ cultural arguments are overblown. Scottish culture has long flourished under the UK, and it is difficult to imagine that independence would make it much better. On the other hand, an independent Scotland wouldn’t necessarily lose its cosmopolitanism. It would still have plenty of cultural and intellectual interaction with the rest of the English-speaking world, including the remaining UK.
UPDATE: Andrew Sullivan has a collection of links to various recent commentaries on the referendum, most of them opposed to independence.