Is Scotland going for the worst possible solution?
For instance, Iain Macwhirter wrote the following in The Sunday Herald today:
I don’t think we’ll see another Scottish referendum until well into the 2020s because the implications of Brexit will take many years to sort out. Article 50 hasn’t been declared yet and isn’t going to be for some time. It will take more than two years to disentangle Britain from the EU, and the years immediately after formal departure will be as chaotic, if not more chaotic, than now.
Robin McAlpine has expressed similar thoughts in the past, for instance at the recent Independence Rally on Glasgow Green.
I’m afraid I totally disagree with such ideas. Getting dragged out of the EU and then rejoining a couple of years later is insane, as anybody who knows the complexity of the modern EU will tell you. It means going through enormous amounts of change and then reverting everything immediately afterwards.
Of course it depends what kind of Brexit we’re getting.
If the Tories opt for a soft Brexit (essentially a Norwegian solution, which means that the free movement of goods, capital, services and people will be maintained), I agree it makes sense to take a deep breath and think hard about the timing of the next independence referendum. The main downside to delaying is perhaps that all of us EU citizens will have lost our right to vote in it, but it shouldn’t affect other people or businesses drastically. I still think there would be many advantages to Scotland remaining within the EU when the rUK leaves, but we can sit down and have a civilised discussion about the pros and cons.
On the other hand, if the Westminster government goes for a hard Brexit, taking us out of the Internal Market and all the other parts of the EU in order to restrict migration, we need to get out in time. Sadly, all the smoke signals emerging from Westminster seem to be pointing towards this being the preferred solution.
A hard Brexit will be a like a wrecking ball taken to the Scottish economy, and saying that we might leave five years later if we don’t like it will only make things worse. This is because a hard Brexit will be both a disaster and a business opportunity. Lots of companies are going to relocate to the rEU, shedding a lot of jobs here in the process. However, once that is done, there will presumably be opportunities to create products and services to replace those that suddenly cannot be sourced from the rEU profitably. For instance, if it becomes clear that the UK will slap a 20% import tax on Manchego cheese from Spain, it might become a business opportunity to create a clone here for the British consumer. My gut feeling is that there won’t be enough of these new jobs to replace the ones lost to the rEU in the medium term, but at least there will be a few of them. However, if you’re a business person thinking about setting up a company making a British Manchego clone, will you place it in Scotland if there is a possibility that Scotland will five years later leave the rUK and rejoin the EU? No, of course not. You’ll place the company south of the border. If it’s clear that Scotland will remain in the EU if the rUK goes for a hard Brexit, many of the EU-oriented businesses will potentially relocate to Scotland, but if it isn’t clear what Scotland is going for, we won’t get any of them – they’ll go to Ireland, Germany or some other rEU country instead. We need to make it clear whether we’re going to stay within the Internal Market or remaining within the UK no matter what, or we’ll end up in the worst of all possible worlds, getting neither relocating EU businesses nor new post-Brexit companies. It would be a disaster of Darien Scheme proportions.
I’m not saying we need to call the referendum just yet. But Nicola Sturgeon needs to go out and say that Scotland will remain within the Internal Market, and if Westminster are going for a hard Brexit, Scotland will hold a new independence referendum in time for Scotland to leave the UK before Brexit happens. This would also provide the kind of message control that Robin McAlpine has correctly called for.
The morning after Brexit, when Nicola took charge and promised EU citizens and their families in Scotland that we’d be OK, we were all ready to kiss her. The impression I and others got was that she would explore the options for keeping Scotland within the Internal Market (e.g., whether a Reverse Greenland would be possible), but that she would definitely call a new independence referendum if that was the only way to achieve that. You can always discuss the finer legal and linguistic aspects of her statement, but that was definitely the impression I was left with. Because of this, if she follows the advice offered by Messrs. Macwhirter and McAlpine and allows Scotland to be taken out of the Internal Market just because the opinion polls aren’t favourable enough (and let’s face it, they’re much better now than when Indyref1 was called), she will have broken the promise she made to us that morning, and I will be tearing my SNP membership card apart.
Hopefully I’m just worrying needlessly, and all that is happening just now is that the SNP leadership are trying to ascertain whether the Brexit will be soft or hard before fixing a date for the next independence referendum. Salmond’s prediction that it’ll be held in two years time sounds OK to me, although I don’t like the fact that Boris Johnson has started saying that the negotiations might be concluded in less than two years, in which case we might have less time than we think.
The reason for the lack of movement in the opinion polls, as well as for the laid-back attitude with regard to Brexit exhibited by the Indyref2-after-2020 crowd, is perhaps the general feeling in the UK media that Brexit isn’t going to be that bad after all, based on the fact the economy is still ticking along nicely. However, Brexit hasn’t happened yet, and many businesses will be waiting to find out whether it’s going to be soft or hard before relocating, so we ain’t seen nothing yet. This is likely to change soon, however. I’ve started hearing about the first redundancies due to Brexit amongst my acquaintances this week, and if that continues, the general mood might change abruptly. We need to be ready to seize the moment when that happens.
No one can say that the UK economy is in good shape, even if it is ‘ticking along’ at the moment. Financial services make up 20% of the UK economy; manufacturing about 10%. Only Scotland is self-sufficient in food and energy. The trade balance is as high as it has ever been.
UK is a consumptive economy that relies on borrowing and its fiat currency to keep going. We need to get out asap.
If Brexit will be a wrecking ball because of its impact on trade with the EU, wouldn’t Brexit+”Independence in Europe” be an even bigger wrecking ball, given the trade hit would then be applied to a much larger proportion of trade (with rUK)? It’s a paradox of the situation in which we find ourselves – any economical arguments that talk up how Brexit will be armageddon can be easily flipped around to point out that independence with the same trade barriers at Berwick would be more apocalyptic.
If Scotland manages to retain membership of the Single Market, we would hit the sweet spot in terms of trade, retaining our markets in Europe, attracting Ireland-style financial sector jobs from a London losing its passporting rights.
As to Scotland/England trade I just throw back the argument Brexiters use about German car manufacturers. England sells more to us than we do to them so they would be the losers if they wanted a hard border with tariffs.