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Scotland: Now comes the reckoning

The 55%-45% divide was larger than any of the polls had predicted and may reflect the last-minute fear factor strongly projected by the inglorious and verging-on-hysterical Westminster establishment. But it will come as an immense relief both to Cameron, who would almost certainly have been unceremoniously ejected if the Yes vote had won, and to Ed Miliband who will now hang on to those key 41 Labour Scottish seats, though the noise about the West Lothian Question will grow markedly louder.

For the LibDems it makes little odds since they’re already toast. But the real question is just how the far-reaching commitments made at the desperate end of the campaign will be implemented, how fully and over what timescale. What will be the effects on Scotland and equally importantly on the rest of the country?

The awkward problems over a customs union if the Yes vote had prevailed have been avoided, but there are still flashing warnings ahead. The liabilities of the Scottish banks are 12 times larger than the annual output of the Scottish economy – even more than in the case of Ireland and Iceland when their banks nose-dived at a ratio 8 times greater than their economies’ annual output. Then there is the problem of the s0-called ‘twin deficit’ reflecting the fact that even with the oil revenues, Scotland will have a balance of payments deficit of 2%-5% of GDP and a budget deficit of 5% of GDP.

The level of the oil reserves is another crucial question, about which there is substantial disagreement. One estimate puts it at 24bn barrels of crude reserves, whilst another estimates only 15bn barrels. Above all, Westminster-based austerity was perhaps the most powerful toxic element fuelling the No vote, yet Scotland still now needs to finance its share of the national debt, which amounts to about £120bn.

Beyond Scotland the issue is how matching or at least similar powers will be granted to Wales and N. Ireland since their demands are now bound to rise sharply. A more unknown factor is how far English nationalism will begin to assert itself. Certainly the case for a major devolution to the big metropolitan English city regions is now manifest, though there is room for considerable debate about exactly what form or forms it might take.

At long last the overwhelmingly dominant influence of London is being challenged, and in particular its most powerful element – the banking behemoth in the City. This insurgency has been building for a long time, and lighting this fuse may well turn out to be the most dramatic consequence of the Scottish referendum.

5 Comments

  1. James Martin says:

    “A more unknown factor is how far English nationalism will begin to assert itself”

    Indeed it is unknown, but already there are some worrying signs that reactionary strains of English nationalism that up to now have been the preserve of the far-right and fascists (English Democrats and other assorted loons), is now gaining traction. And this in turn is the echo against the stoking of Scottish nationalism that some of us have been warning about for a while, a stoking happily helped by numerous left sects who found it oh so easy to make the opportunist leap into the nationalist camp.

    No doubt those same sects will now balk and whine if similar nationalist sentiments start to come to the fore again amongst workers in England, but once the nationalist genie is out of the bottle, and workers become defined first by their nation or region rather than by their relationship to capital (happily so it seems by many on the left) then the disaster of all this will just grow and grow…

  2. Rod says:

    James: “the opportunist leap into the nationalist camp”

    According to countless reports and interviews support for independence was significantly motivated by a desire for social justice.

    Opportunity for the Left would have knocked if Yes had won. And, if already established momentum was developed, there could have been a major Left presence in a Scottish, independent parliament.

    To present the Yes campaign only as a vehicle for Salmond/SNP is to succumb to the blind smugness of those who insist there is no alternative to voting for the austerity-promising, military intervention-planning, public ownership-refusing Labour Party.

    1. James Martin says:

      Rod, just out of interest, but given every post of yours starts and ends with your hatred of the Labour Party, why do you cause yourself so much obvious pain by constantly involving yourself in a site for Labour Party socialists?

      1. Rod says:

        My benevolence is such that I feel obliged to offer guidance where it is most needed.

  3. David Pavett says:

    Is it right to dismiss the West Lothian question as merely noise? That is clearly the approach of the Labour front bench. It seems that it is Michael Meacher’s approach too. Labour want to bat it away by talking of devolving powers within England. That is simply to side-step the issue. Clearly Labour has concerns about a reduction of its voting power that would be likely if English matters could only be decided by English MPs but is that party political concern an valid consideration when trying to work out a new constitutional arrangement?

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