Alex Salmond delivers his speech to delegates at the SNP's spring conference on April 12, 2014 in Aberdeen. Photograph: Getty Images.
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On the economy, the SNP is starting to sound Osborne-esque

Like the Chancellor, the party has a vested interest in convincing voters that the crisis is over. But it isn't.

The SNP has made a concerted effort recently to emphasise the “strength” of Scotland’s economy and the apparent resilience of its post-crash recovery. In the last few weeks alone, I’ve received a series of press releases highlighting how employment in Scotland has reached “record” levels, how Scottish output will soon “surpass its pre-recession peak” and how “business optimism” is steadily returning.

At first, this struck me as an odd strategy for the nationalists to pursue so close to the referendum. Why should Scots vote for independence if even the Yes campaign (or a large part of it, at any rate) thinks Scotland is thriving within the UK?

But it’s actually consistent with the psychology of the party. It’s no coincidence that support for the SNP boomed in the 1970s following the discovery of oil and gas in the North Sea then crashed in the 1980s as the UK entered a severe downturn. There is a relationship (albeit an inexact one) between how confident Scots feel, economically, and their enthusiasm for constitutional change. SNP leaders understand this, which explains why they are so keen to persuade voters that Scotland’s economy is in such good health.

The problem, however, is that Scotland’s economy is not in such good health. It is, in fact, in a pretty bad state.

Take the report published in the Guardian last week suggesting that just 30 per cent of the Scottish economy is domestically owned. If true, this means Scotland is essentially being asset-stripped by foreign capital, as a significant proportion of the wealth generated by Scotland’s key industries - from North Sea oil to whisky and finance - is channelled down south or overseas.

Equally troubling is the STUC’s estimate that as many as 120,000 Scots are currently employed on zero-hours contracts. This reflects the growth of insecure work in Scotland over recent years and confirms Scotland’s status as one of the lowest pay economies in the OECD.

Then there’s the complicated issue of Scotland’s public finances. Scottish spending is not subsidised by English taxes, nor are oil revenues declining as rapidly as some claim, but Scotland’s overall fiscal position is still relatively weak. Even with a geographical share of North Sea oil, Scotland’s 2012/13 net fiscal deficit was a massive 8.3 per cent of GDP, while its national debt remains upward of 60 per cent of GDP, which is substantially higher than that of many other small northern European countries, including Denmark and Norway, the poster-boys of Nordic social democracy. 

This is not an attempt to “talk Scotland down”. Scotland’s unemployment rate is lower, by about 0.4 per cent, than the rest of the UK’s, until recently its economy was growing slightly faster and its trade balance is considerably stronger. (As Craig Berry, a research fellow at the Sheffield Political Economy Research Institute, told me in January: “Primary responsibility for the UK’s £30bn balance of payments deficit lies with southern England, whose main contribution to Britain’s export base - financial services trade - is far too dependent on the crisis-hit Eurozone”.)

But the SNP’s insistence that Scotland’s economic prospects are brighter than the evidence suggests is beginning to look Osborne-esque. Like the Chancellor, the SNP has a vested interest in convincing voters that the crisis is over, even if the challenges they face on a day-to-day basis, from finding permanent work and to paying household bills, tell them it definitely isn’t.

The Yes campaign’s narrative is not, of course, exclusively economic. A couple of weeks ago, Yes Scotland rolled out a new poster campaign highlighting levels of child poverty in Scotland, and the SNP itself regularly criticises the coalition’s “heartless” spending cuts and welfare reforms. But these attacks don’t sit easily with the Scottish government’s panglossian account of Scotland‘s economy: either Scotland is being devastated by Tory austerity or it’s heading for another boom - I’m not sure it can be doing both at the same time.

Last year, Alex Salmond told the Observer that independence would be won on the back of a “rising tide of expectations”. The question nationalists have to ask themselves now, with less than four months to go until the vote, is this: how far are people’s expectations likely to rise when their lives are being ruined by a failing and dysfunctional economy?

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

Photo: Getty
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Ken Livingstone says publicly what many are saying privately: tomorrow belongs to John McDonnell

The Shadow Chancellor has emerged as a frontrunner should another Labour leadership election happen. 

“It would be John.” Ken Livingstone, one of Jeremy Corbyn’s most vocal allies in the media, has said publicly what many are saying privately: if something does happen to Corbyn, or should he choose to step down, place your bets on John McDonnell. Livingstone, speaking to Russia Today, said that if Corbyn were "pushed under a bus", John McDonnell, the shadow chancellor, would be the preferred candidate to replace him.

Even among the Labour leader’s allies, speculation is rife as to if the Islington North MP will lead the party into the 2020 election. Corbyn would be 71 in 2020 – the oldest candidate for Prime Minister since Clement Attlee lost the 1955 election aged 72.

While Corbyn is said to be enjoying the role at present, he still resents the intrusion of much of the press and dislikes many of the duties of the party leader. McDonnell, however, has impressed even some critics with his increasingly polished TV performances and has wowed a few sceptical donors. One big donor, who was thinking of pulling their money, confided that a one-on-one chat with the shadow chancellor had left them feeling much happier than a similar chat with Ed Miliband.

The issue of the succession is widely discussed on the left. For many, having waited decades to achieve a position of power, pinning their hopes on the health of one man would be unforgivably foolish. One historically-minded trade union official points out that Hugh Gaitskell, at 56, and John Smith, at 55, were 10 and 11 years younger than Corbyn when they died. In 1994, the right was ready and had two natural successors in the shape of Tony Blair and Gordon Brown in place. In 1963, the right was unprepared and lost the leadership to Harold Wilson, from the party's centre. "If something happens, or he just decides to call it a day, [we have to make sure] it will be '94 not '63," they observed.

While McDonnell is just two years younger than Corbyn, his closest ally in politics and a close personal friend, he is seen by some as considerably more vigorous. His increasingly frequent outings on television have seen him emerge as one of the most adept media performers from the Labour left, and he has won internal plaudits for his recent tussles with George Osborne over the tax bill.

The left’s hopes of securing a non-Corbyn candidate on the ballot have been boosted in recent weeks. The parliamentary Labour party’s successful attempt to boot Steve Rotheram off the party’s ruling NEC, while superficially a victory for the party’s Corbynsceptics, revealed that the numbers are still there for a candidate of the left to make the ballot. 30 MPs voted to keep Rotheram in place, with many MPs from the left of the party, including McDonnell, Corbyn, Diane Abbott and John Trickett, abstaining.

The ballot threshold has risen due to a little-noticed rule change, agreed over the summer, to give members of the European Parliament equal rights with members of the Westminster Parliament. However, Labour’s MEPs are more leftwing, on the whole, than the party in Westminster . In addition, party members vote on the order that Labour MEPs appear on the party list, increasing (or decreasing) their chances of being re-elected, making them more likely to be susceptible to an organised campaign to secure a place for a leftwinger on the ballot.

That makes it – in the views of many key players – incredibly likely that the necessary 51 nominations to secure a place on the ballot are well within reach for the left, particularly if by-election selections in Ogmore, where the sitting MP, is standing down to run for the Welsh Assembly, and Sheffield Brightside, where Harry Harpham has died, return candidates from the party’s left.

McDonnell’s rivals on the left of the party are believed to have fallen short for one reason or another. Clive Lewis, who many party activists believe could provide Corbynism without the historical baggage of the man himself, is unlikely to be able to secure the nominations necessary to make the ballot.

Any left candidate’s route to the ballot paper runs through the 2015 intake, who are on the whole more leftwing than their predecessors. But Lewis has alienated many of his potential allies, with his antics in the 2015 intake’s WhatsApp group a sore point for many. “He has brought too much politics into it,” complained one MP who is also on the left of the party. (The group is usually used for blowing off steam and arranging social events.)

Lisa Nandy, who is from the soft left rather than the left of the party, is widely believed to be in the running also, despite her ruling out any leadership ambitions in a recent interview with the New Statesman.However, she would represent a break from the Corbynite approach, albeit a more leftwing one than Dan Jarvis or Hilary Benn.

Local party chairs in no doubt that the shadow chancellor is profiling should another leadership election arise. One constituency chair noted to the New Statesman that: “you could tell who was going for it [last time], because they were desperate to speak [at events]”. Tom Watson, Caroline Flint, Chuka Umunna, Yvette Cooper, Andy Burnham and Liz Kendall all visited local parties across the country in preparation for their election bids in 2015.

Now, speaking to local party activists, four names are mentioned more than any other: Dan Jarvis, currently on the backbenches, but in whom the hopes – and the donations – of many who are disillusioned by the current leadership are invested, Gloria De Piero, who is touring the country as part of the party’s voter registration drive, her close ally Jon Ashworth, and John McDonnell.

Another close ally of Corbyn and McDonnell, who worked closely on the leadership election, is in no doubt that the shadow chancellor is gearing up for a run should the need arise.  “You remember when that nice Mr Watson went touring the country? Well, pay attention to John’s movements.”

As for his chances of success, McDonnell may well be even more popular among members than Corbyn himself. He is regularly at or near the top of LabourList's shadow cabinet rankings, and is frequently praised by members. Should he be able to secure the nominations to get on the ballot, an even bigger victory than that secured by Corbyn in September is not out of the question.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog. He usually writes about politics.