Morning Call: pick of the papers

The ten must-read pieces from this morning's papers.

1. Who pays the Tesco CEO's wages of £6.9m a year? We do (Guardian)

When low supermarket wages are supplemented by state benefits, it allows obscene profits to be made at taxpayers' expense, writes Zoe Williams.

2. Labour deserves oblivion if it listens to the unions on pay (Independent)

Some unions are threatening to break ties, writes Steve Richards. Miliband should be relaxed about this.

3. There's nothing noble in this Wiki blackout (Times) (£)

Cutting off millions of users is self-serving and arbitrary, says David Aaronovitch. And it shows that the online world isn't serious.

4. In France, genocide has become a political brickbat (Guardian)

Next week's bill on denial of Ottoman atrocities against Armenians is an attack on free speech, one of many around the world, says Timothy Garton Ash.

5. Long march ahead to a truly capitalist China (Financial Times)

An economy now dominated by the government needs to be market led, says Qin Xiao.

6. What David Hockney's return tells us about the new mood in Britain (Daily Telegraph)

The country is once more ready to make confident judgments about truth and beauty, writes Peter Oborne.

7. Our toxic blend of capitalism and short-termism (Financial Times)

The rules that govern capitalism need to change, writes Ed Miliband.

8. Sarkozy could be toppled by the downgrade (Independent)

The credit downgrade is widely seen as an adverse judgement on Sarkozy's record in office, writes Andreas Whittam Smith.

9. Moldovan squatters and a week that showed how good citizens suffer while parasites flourish (Daily Mail)

The law is so heavily tilted in favour of a plaintiff, however undeserving and especially foreign, that the poor old British people have scant chance against them, says Max Hastings.

10. An idea that must finally take flight (Daily Telegraph)

If Britain is to build trade links with emerging economic powers, it must stop dithering and commit to airport expansion, argues a Daily Telegraph leader.

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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.