The Treasury is trying to frighten Scots out of voting “Yes”
in the 2014 referendum on independence over the question of what a currency
union based on the pound would mean. But George Osborne is hardly in any
position to lecture others.
Osborne and his crypto-Tory pal Danny Alexander, still
nominally a LibDem, are promoting the virtues of a report
written
by civil servants and academics. The report claims that the “current currency
and monetary policy arrangements within the UK
serve Scotland
well”.
In fact, it is described as “one of the most successful
monetary, fiscal and political unions in history”. Leaving aside this
sensational claim to a unique place in world history, the sting is in the tail.
The report claims the SNP's preferred option of continuing
to use the pound sterling might be rejected by the rest of the UK because it could expose the larger neighbour
to risk if Scotland
ran into fiscal and financial difficulties.
It concludes that even if a deal could be reached, it would
have to include arrangements for Scottish ministers to hand their annual
budgets over to Westminster for approval even before they had been voted on at
Holyrood.
And it admits that would run both ways, with Scotland
wanting some say over British fiscal policy. Bu Con/Dem chancellor Osborne is
having none of that. He told an audience of Scottish business people:
"The fundamental political question this analysis
provokes is this - why would 58 million citizens give away some of their
sovereignty over monetary and potentially other economic policy to five million
people in another state?
“Before the rest of the UK
could ever agree to enter a formal currency union, any future UK chancellor
of the exchequer tied to independence would have to provide the British people
with a clear and compelling answer to this question.”
Well maybe the compelling question he should actually answer
is, what control do the citizens of any country have over their currency? The
answer is, absolutely none. It is outrageous for Osborne of all people to
masquerade as the defender of the sovereignty of the citizens of the UK .
The financial sector he serves has created a level of debt
that is so uncontrollable that even the global corporations are terrified about
the future. The 50% collapse in Tesco pre-tax profits, and bankruptcies in
retail are the front end of a collapse in manufacturing that will bring even
more downward pressure on wages and working conditions.
And what do governments of nation states, like Britain , mired
in an eternal and deepening global crisis do to defend their citizens? Well we
know the answer to that. They have so little real control over the economy that
they are basically reduced to just two possible actions.
One is to slash public spending in order to try to reduce
the deficit. And the other is to print money, introducing liquidity into the
economy but at the same time undermining the long-term value of the currency
overall.
The real attack on the pound has come from
Treasury-authorised quantitative easing in a desperate attempt to shore up the
banks. The result is that the majority of us exist every day within a hostile
economic and fiscal environment that offers us no security and no control whatsoever.
The real sovereignty question is why do 90% of the people
hand control over currency, their public services and their social, political
and environmental future to governments who operate on behalf of the minority who
stand to gain from the current arrangements? What kind of independence and
self-determination do we really have, north or south of the border? To ask the
question is to answer it.
This whole independence debate is, not surprisingly,
bringing to the fore burning political and economic questions. Neither Osborne
nor Scotland ’s
first minister Alex Salmond have any answers outside of the failed policies
they are already pursuing.
Penny Cole
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