What I am about to write will seem heretical to many traditionalist conservatives. After reading it, I’d be very interested in your opinion. So here goes.
If I were a Scotsman voting in the independence referendum I’d be voting YES!
I haven’t come to this conclusion lightly and have exactly zero skin in the game so the outcome makes very little, if any difference to me. I even expect this initial push for Scottish independence to fail but ultimately I think we will see an independent Scotland in the coming decade or so.
The greatest argument against a yes vote is that Scotland is unable to sustain itself economically. In other words, Scotland will fall flat on its face without the support of the UK treasury.
The NO advocates state that the Government Expenditure and Review Scotland (GERS) figures show UK treasury spending £54bn on Scotland but only receiving £43.5bn back in revenue – a deficit of £10.5bn.
However, these figures conveniently ignore the fact that around 91 per cent of North Sea oil and gas are derived from within Scottish territorial waters. The annual value of these fuels is around £12bn. Crediting Scotland with this revenue would leave it as one of the few nations worldwide with an actual operating surplus.
Coupled with the fact that an independent Scotland would be debt free (any debts would reside with the UK) it starts with a rather compelling balance sheet from which to work on.
The real opportunity for an independent Scotland is to work within the EU nation states but unencumbered by the massive and destructive bureaucracy that is stifling economic growth there. As the home of Adam Smith and his ‘invisible hand’ Scotland could proudly reject the Marxist welfare state that has effectively bankrupted the global system and become the financial centre of the 21st century.
Scotland could position itself as the new Switzerland of Europe – a nation committed to forging a path free from the financial and cultural mistakes of other nations and having a trusted role as a financial centre.
The formula for such an outcome is actually rather simple. Firstly, Scotland must become a staunch defender of freedom and personal financial privacy. It should commit to abandoning state borrowing for any reason which would help it avoid the coming sovereign debt crisis. It should consider radical taxation reform built around a consumption tax with extremely low or zero personal income tax rates. Company taxes should also be kept as low as possible. Sound banking and a stable currency would deliver certainty in an uncertain world. Finally, an independent Scotland should remain neutral in world affairs thus becoming a haven of financial tranquillity.
By providing this economic environment, the already substantial business base in Scotland would attract new enterprises and wealth-creating businesses. For a nation of only 5.2 million people it already punches above its weight in many areas.
Financial services in Scotland employ around 100,000 people and generate revenues of around £9bn. One third of the UK insurance business is operated out of Scotland already. There are hundreds of fund management firms that utilise Scotland as a base and the Scottish banking industry comprises 13 per cent of all banking employment in the UK.
Scotland also has a fine reputation as an educational centre, a growing tourism industry and the most famous whisky business in the world. Now if there was only something they could do about the weather…
Cory Bernardi is the author of seven books and has been a member of the Australian rowing team, a publican, an investment portfolio manager and spent nearly 14 years as an Australian Senator.
