The Union: a gamble worth taking?

Darling is right to highlight the risks of Scottish independence, but there are risks to staying in

In an interview published in the Observer last week, former Chancellor Alistair Darling warned of the "profound risks (and) immense downsides" of Scottish secession. Not only would Scotland's separation from the rest of the United Kingdom involve considerable "trauma and expense", he said, it would also generate "uncertainties (not) worth gambling on". The "uncertainties" to which Darling referred were principally economic. If an independent Scotland chose to remain within the British sterling zone, how would it cope with the Bank of England -- an institution over which it had no control -- setting its interest rates? If it opted for the euro, would it submit to a new Franco-German regime of tight fiscal discipline? As a small country, could it withstand the financial turbulence of another global banking crisis?

These questions are hugely important and the SNP cannot afford to ignore them if it is serious about convincing a majority of Scottish voters to back its plans for independence at the ballot box in 2014. But it would be naïve to think Darling raised them simply as an intellectual challenge to the nationalists. He didn't. Rather, by employing the language of "risk" and "uncertainty", he was trying to promote the idea that independence represents a dangerous leap into the unknown, while the Union, by contrast, offers only security, continuity and comfort. The problem, though, is that this is clearly not the case. For Scotland, remaining within the UK is at least as much of a gamble as going it alone.

Take the issue of Trident, Britain's fleet of nuclear armed submarines and the largest concentration of nuclear weapons anywhere in Europe. For the last 30 years its missile carrying component has been stationed at the Faslane base on the Firth of Clyde, barely an hour north of Glasgow. Had a nuclear confrontation between the USSR and the West been sparked during the Cold War, Scotland's largest city would have been in the firing line during Moscow's first attacks. Fortunately, no such confrontation occurred. But the threat from the Faslane and Coulport installations persists. The environmental devastation wrought by, say, a spillage of nuclear waste or a collision of vessels would be enormous, as would be the effect on the large human population centres near by. Yet, an independent Scotland could force the removal of Trident from Scottish waters and rid itself of that potential source of catastrophe.
A sovereign Scotland would also have the option not to participate in the kind of British military adventurism which, in recent years, has stoked resentment in the Middle East and helped make UK citizens the targets of Islamist terrorism. Reflecting its new status as a small, northern European nation-state, it could conduct its foreign affairs in the spirit of peaceful diplomatic cooperation, discarding the more belligerent approach to international relations it was forced to adopt as part of a major, if declining, world power. It could even radically reduce its defence expenditure from the £3.1bn per year it currently contributes to the UK's annual defence budget to £1.8bn in line with the Nordic average.
Another enormous gamble Scots could avoid by extracting themselves from the British political structure is that contained within the coalition government's strategy for economic recovery. As dole queues lengthen and growth flat-lines, it is becoming increasingly obvious that George Osborne's programme of radical austerity is not going to work. Neither does it appear to be reducing the UK government's massive debt burden, which is fast heading toward £1tr. This means the longer Scotland stays part of the Union, the larger the debt pile it will inherit if it ever leaves. So separation sooner rather than later could rescue Scots from an extended period of economic hardship in the future, as well as ensure that it, rather than the UK Exchequer, takes a majority share of revenues generated by North Sea oil production in the years to come.
Alistair Darling is entitled to issue stark, headline-grabbing warnings about the risks of Scottish independence and the instability the break-up of Britain might cause. Clearly, rhetoric of this sort is going to be central to the "Save the Union" campaign. But then he and his Unionist colleagues have no right to complain if their nationalist opponents decide to focus on the hidden and not so hidden risks embedded in the constitutional status-quo.

James Maxwell is a Scottish political journalist. He is based between Scotland and London.

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Why relations between Theresa May and Philip Hammond became tense so quickly

The political imperative of controlling immigration is clashing with the economic imperative of maintaining growth. 

There is no relationship in government more important than that between the prime minister and the chancellor. When Theresa May entered No.10, she chose Philip Hammond, a dependable technocrat and long-standing ally who she had known since Oxford University. 

But relations between the pair have proved far tenser than anticipated. On Wednesday, Hammond suggested that students could be excluded from the net migration target. "We are having conversations within government about the most appropriate way to record and address net migration," he told the Treasury select committee. The Chancellor, in common with many others, has long regarded the inclusion of students as an obstacle to growth. 

The following day Hammond was publicly rebuked by No.10. "Our position on who is included in the figures has not changed, and we are categorically not reviewing whether or not students are included," a spokesman said (as I reported in advance, May believes that the public would see this move as "a fix"). 

This is not the only clash in May's first 100 days. Hammond was aggrieved by the Prime Minister's criticisms of loose monetary policy (which forced No.10 to state that it "respects the independence of the Bank of England") and is resisting tougher controls on foreign takeovers. The Chancellor has also struck a more sceptical tone on the UK's economic prospects. "It is clear to me that the British people did not vote on June 23 to become poorer," he declared in his conference speech, a signal that national prosperity must come before control of immigration. 

May and Hammond's relationship was never going to match the remarkable bond between David Cameron and George Osborne. But should relations worsen it risks becoming closer to that beween Gordon Brown and Alistair Darling. Like Hammond, Darling entered the Treasury as a calm technocrat and an ally of the PM. But the extraordinary circumstances of the financial crisis transformed him into a far more assertive figure.

In times of turmoil, there is an inevitable clash between political and economic priorities. As prime minister, Brown resisted talk of cuts for fear of the electoral consequences. But as chancellor, Darling was more concerned with the bottom line (backing a rise in VAT). By analogy, May is focused on the political imperative of controlling immigration, while Hammond is focused on the economic imperative of maintaining growth. If their relationship is to endure far tougher times they will soon need to find a middle way. 

George Eaton is political editor of the New Statesman.