The referendum debate is increasingly split along class lines. Photo: Getty
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Why the Yes campaign isn't winning the economic argument in "middle" Scotland

The Yes campaign is losing the economic argument – this could be more to do with establishment unionism than seeing through the SNP's "bluff".

The economic case for Scottish independence practically makes itself. Britain is in headlong decline. During the 1970s average economic growth in the UK was just shy of 2.5 per cent. Over the course of the last 14 years it has been closer to 1.5 per cent. In the early 1980s the UK had a trade surplus (due, in part, to the boost provided by North Sea oil). These days, its trade deficit stands at more than £20bn. Owing to the erosion of trade union power under successive Conservative and Labour governments, Britain now has the second highest rate of low pay in the OECD. Six years after the crash, average UK earnings are still some-way below inflation and won’t return to their pre-recession peak until 2020.

And it gets worse. For the last three decades, Scottish growth rates have lagged behind growth rates in the rest of the UK, as well as in other comparably-sized European states. According to one recent study, as much as 70 per cent of the Scottish economy is foreign-owned. Because of the high concentration of manufacturing jobs north of the border, Scotland has been particularly badly hit by successive rounds of (Westminster-imposed) deindustrialisation, while the increasing focus on London-based finance as the motor of UK growth has locked Scotland into a monetary policy regime which actively undermines its manufacturing exports. So anyone who seriously believes Scotland benefits from the UK needs to explain why, when it comes to Scotland’s economy (particularly its industrial economy), the UK has such an abysmal record.

Yet, despite all this, large numbers of Scottish voters remain unconvinced by the economics of independence. Earlier this month, a YouGov poll showed that just 27 per cent of Scots believe Scotland would be better off outside the UK, while 49 per cent think it would be worse off. Put simply, the Yes campaign is losing the economic argument – an argument it has to win if it is to stand any chance of securing a majority for independence in September. Unionists are acutely aware of this, which is why, on Tuesday, George Osborne challenged the SNP to lay out what independence would mean for Scotland’s deficit, for its oil and for its currency. “These are the questions that shape all our lives”, Osborne said. “They dictate our mortgage and tax bills; the quality of our schools and hospitals; the safety of our jobs and opportunities of our children. Our economic security hangs on [the] answers.”

Although the SNP insists it has answered these questions, it’s clear that the broader nationalist message – which stresses the strength and untapped potential of Scotland’s economy – just isn’t getting through. But why? Better Together’s theory is that ordinary Scots see through the SNP’s “bluff”; that, as the “risks” of independence become clearer, more and more people are retreating back into the “safety and security” of the Union. There’s probably some truth to this. Many ordinary Scottish voters are still uncertain about what independence will actually entail and (ironically) seem hesitant about “gambling” on Scotland’s future while the effects of the financial crash still linger.

But there’s another theory. As most people now accept, the referendum debate is increasingly split along class lines, with poorer Scots disproportionately supportive of independence and wealthier Scots disproportionately opposed. For obvious reasons, voters who don’t own their own homes, run their own businesses or work well-paid jobs are keen on the idea of change, while those with relatively secure lives have a much greater stake in the status-quo. Better Together speaks directly to the self-interest of this latter group. Take Alastair Darling’s interview in the Daily Mail last week, in which the former Chancellor fretted about the effect independence might have on Scottish financial institutions, dismissed Nordic social democracy (“[it means] higher income tax and VAT up to 25 per cent”) and accused the SNP of “bullying” the CBI. This is establishment unionism in its purest form, completely detached from the sort of “progressive”, centre-left unionism the Labour Party claims to represent.

So far, the No campaign hasn’t had to work very hard to keep its affluent base on side. “Middle” Scotland hasn’t felt the rough edge of Britain’s post-war decline in the same way or to the same extent as “lower” Scotland has. In fact, even as the collapse of manufacturing devastated communities in Scotland’s (now Yes voting) former industrial heartlands, the financialisation of the Scottish economy created a whole new sector for Scottish professionals to thrive in. Can the Yes campaign convince middle-class Scots, in what little time is left before September, to change their minds? Or will Scotland’s doctor, lawyers and bankers prove themselves every bit as petulant and conservative as their counterparts in other parts of the UK?

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Who is the EU's chief Brexit negotiator Michel Barnier?

The former French foreign minister has shown signs that he will play hardball in negotiations.

The European Commission’s chief Brexit negotiator today set an October 2018 deadline for the terms of Britain’s divorce from the European Union to be agreed. Michel Barnier gave his first press conference since being appointed to head up what will be tough talks between the EU and UK.

Speaking in Brussels, he warned that UK-EU relations had entered “uncharted waters”. He used the conference to effectively shorten the time period for negotiations under Article 50 of the Lisbon Treaty, the legal process to take Britain out of the EU. The article sets out a two year period for a country to leave the bloc.

But Barnier, 65, warned that the period of actual negotiations would be shorter than two years and there would be less than 18 months to agree Brexit.  If the terms were set in October 2018, there would be five months for the European Parliament, European Council and UK Parliament to approve the deal before a March 2019 Brexit.

But who is the urbane Frenchman who was handpicked by Commission President Jean-Claude Juncker to steer the talks?

A centre-right career politician, Barnier is a member of the pan-EU European People’s Party, like Juncker and German Chancellor Angela Merkel.

A committed European and architect of closer eurozone banking integration, Barnier rose to prominence after being elected aged just 27 to the French National Assembly.  He is notorious in Brussels for his repeated references to the 1992 Winter Olympics he organised in Albertville with triple Olympic ski champion Jean-Claude Killy.

He first joined the French cabinet in 1993 as minister of the environment. In 1995, Jacques Chirac made him Secretary of State for European Affairs, teeing up a long and close relationship with Brussels.

Barnier has twice served as France’s European Commissioner, under the administrations of Romano Prodi and José Manuel BarrosoMost recently he was serving as an unpaid special advisor on European Defence Policy to Juncker until the former prime minister of Luxembourg made him Brexit boss.“I wanted an experienced politician for this difficult job,” Juncker said at the time of Barnier, who has supported moves towards an EU army.

 

Barnier and the Brits

Barnier’s appointment was controversial. Under Barroso, he was Internal Market commissioner. Responsible for financial services legislation at the height of the crisis, he clashed with the City of London.

During this period he was memorably described as a man who, in a hall of mirrors, would stop and check his reflection in every one.

Although his battles with London’s bankers were often exaggerated, the choice of Barnier was described as an “act of war” by some British journalists and was greeted with undisguised glee by Brussels europhiles.

Barnier moved to calm those fears today. At the press conference, he said, “I was 20 years old, a very long time ago, when I voted for the first time and it was in the French referendum on the accession of the UK to the EU.

“That time I campaigned for a yes vote. And I still think today that I made right choice.”

But Barnier, seen by some as aloof and arrogant, also showed a mischievous side.  It was reported during Theresa May’s first visit to Brussels as prime minister that he was demanding that all the Brexit talks be conducted in French.

While Barnier does speak English, he is far more comfortable talking in his native French. But the story, since denied, was seen as a snub to the notoriously monolingual Brits.

The long lens photo of a British Brexit strategy note that warned the EU team was “very French” may also have been on his mind as he took the podium in Brussels today.

Barnier asked, “In French or in English?” to laughter from the press.

He switched between English and French in his opening remarks but only answered questions in French, using translation to ensure he understood the questions.

Since his appointment Barnier has posted a series of tweets which could be seen as poking fun at Brexit. On a tour of Croatia to discuss the negotiations, he posed outside Zagreb’s Museum of Broken Relationships asking, “Guess where we are today?”

 

 

He also tweeted a picture of himself drinking prosecco after Boris Johnson sparked ridicule by telling an Italian economics minister his country would have to offer the UK tariff-free trade to sell the drink in Britain.

But Barnier can also be tough. He forced through laws to regulate every financial sector, 40 pieces of legislation in four years, when he was internal market commissioner, in the face of sustained opposition from industry and some governments.

He warned today, "Being a member of the EU comes with rights and benefits. Third countries [the UK] can never have the same rights and benefits since they are not subject to same obligations.”

On the possibility of Britain curbing free movement of EU citizens and keeping access to the single market, he was unequivocal.

“The single market and four freedoms are indivisible. Cherry-picking is not an option,” he said.

He stressed that his priority in the Brexit negotiations would be the interests of the remaining 27 member states of the European Union, not Britain.

“Unity is the strength of the EU and President Juncker and I are determined to preserve the unity and interest of the EU-27 in the Brexit negotiations.”

In a thinly veiled swipe at the British, again greeted with laughter in the press room, he told reporters, “It is much better to show solidarity than stand alone. I repeat, it is much better to show solidarity than stand alone”.

Referring to the iconic British poster that urged Brits to "Keep Calm and Carry On” during World War Two, he today told reporters, “We are ready. Keep calm and negotiate.”

But Barnier’s calm in the face of the unprecedented challenge to the EU posed by Brexit masks a cold determination to defend the European project at any cost.

James Crisp is the news editor at EurActiv, an online EU news service.