Sound as a Pound

[steepholm]

I'm no economist, and I'm agnostic in general on the question of Scottish independence. I don't know whether Scotland, the UK, both or neither would be better off in the event of a currency union - though for what it's worth my instinct is strongly against it, since such arrangements tend to be inherently unstable (vide. the Euro) unless accompanied by just the kind of unification of fiscal and other policies that it's point of independence to do away with. When it comes to good fences making good neighbours, I'm with Hadrian.

But I'm surprised that no one (as far as I know) in the grand coalition of Westminster parties now forming against currency union has raised the possibility of a UK referendum on the issue. I thought it was now the consensus that measures such as unifying our currency with that of a foreign power (which Scotland would then be) were exactly the kind of constitutional change that would need to be put directly to the people. If that applies to a union with the Eurozone, why not with Poundland?

Comments

[fjm.livejournal.com]

Indeed. I think the point Salmond is missing is that if the UK had wanted its currency to be at the mercy of the spending policies of another nation, it would have joined the Euro.

And also, as you note, if Scotland wanted to be at the mercy of someone else's central bank, why leave the UK in the first place.

[nwhyte]

One parallel people are missing here is the Irish precedent - the Irish pound remained linked to sterling, up until 1979, simply pegged one-for-one with no need to ask the British. It wasn;t even legally a separate currency until 1928, shortly after independence. Basically if the Scots want to unilaterally use sterling, or the euro, or the dollar come to that, they don't have to ask anyone; London / Frankfurt / Washington cannot prevent them.

[steepholm.livejournal.com]

Oh yes, Scotland could certainly peg their currency to sterling, and even call it the pound - much as the Republic of Ireland did. However, as I understand it this discussion is about full currency union.

[fjm.livejournal.com]

They can indeed. But it makes a mockery of half the things Salmond has argued.

[cmcmck.livejournal.com]

Foot in both camps time!


Wee Eck deliberately avoids two points even leaving aside that Ireland retained the pound and pound parity for decades, but that was then and this is now.

1. If Scotland wishes to remain in the EU it has to agree to become part of the Eurozone.

2. If Scotland wishes to remain in the EU is has to become part of Schengen and that will mean there have to be border controls as England wouldn't be.

But then Wee Eck is avoiding discussion on a great many germane issues.

A referendum more or less is a complete red herring.

[nwhyte]

1. If Scotland wishes to remain in the EU it has to agree to become part of the Eurozone.

Well, no; and certainly not as an immediate commitment. Sweden has not joined the Eurozone, despite lacking the explicit treaty opt-outs that the UK and Denmark have.

2. If Scotland wishes to remain in the EU is has to become part of Schengen and that will mean there have to be border controls as England wouldn't be.

Well, no; Cyprus is not in Schengen either, basically because the people in charge of those negotiations are capable of looking at a map.

[cmcmck.livejournal.com]

I'm going by what the Scottish devolved authority has already been told would be the case.

It seems that some of the newer member states, who had to go through economic hell to get in, are likely to raise all hell if Scotland were to be given an easier ride than they got.

Salmond constantly compares Scotland to Norway- which is not a member of the EU............

[veronica-milvus.livejournal.com]

I very much like "Poundland".

[adaese.livejournal.com]

Personally I would have a great deal more respect for the Scottish Nationalists if they had the courage to make the case for independence being a good in its own right worth paying extra for, rather than that an independent Scotland would be better off financially.