Unintentional Self-Parody: The Failed Banks Warn Scotland Against Independence

September 11th, 2014
in Op Ed

by William K. Black, New Economic Perspectives

I do not know whether the Scots should vote for independence. I assume that the odds are they will vote against it. I do know that the reasons advanced for voting against independence by business interest are false. Indeed, the opposite of what they claim is far more likely to be true. What I find a joy to behold, however, is the suggestion by the banksters that the Scots should get their economic advice about independence from a group of failed and often fraudulent parasites and that they should avoid any action that creates "uncertainty" or would cause them to act as a Nation rather than a U.K. province. There is a serious effort to make independence from the Brits sound like the path of economic madness.

Follow up:

Each of these asserted business bases for cowering from independence is an insult to the people of Scotland. In an irony that, if the polls are accurate, is increasingly sensed by Scots, the business arguments against independence, unintentionally, have made a compelling case for independence. The thrust of the Brit's strategy is to promise that they will try to cripple Scotland economically should it vote to restore its independence and sovereignty. Thus we see the English, and their EU allies, claiming that they would prevent Scotland from joining the EU or extort it to adopt the euro (a terrible idea) as a condition of entry into the EU, block its ability to continuing to use the pound as its currency, and even major businesses in Scotland threatening to flee the Nation should it vote in favor of independence. Labor leader Ed Miliband went so far as to threaten to place armed border guards on the border with Scotland should the Scots vote to restore their sovereignty.

What each of these threats has in common is a demonstration of England's ill will for the people of Scotland should they choose to be independent. That malice reveals their lack of respect for the people of Scotland, the continuing definition of them as "the other," and the willingness to threaten harm to Scotland even when doing so would harm the English. England's EU allies are threatening Scotland because they are opportunists trying to curry favor with UK opponents to remaining in the EU. The entire unsavory stew of threats and extortion reveal the hypocrisy of English pleas to the Scots to maintain their "union" with the U.K. The English have always believed they are "better together" with the colonials only if the English are sovereign and dominant in the "union."

As nasty and revealing as the English threats are, it is exceptionally unlikely that the English would make good on those threats were the people of Scotland to vote to restore their sovereignty. The harm that such English reprisals would inflict on the stagnant Eurozone economy would be severe. It would be a political disaster for the English parties if they maintained a campaign of hostility against an independent Scotland.

I discuss next the panic that large businesses are trying to induce to dissuade voters from choosing independence. I end with RBS' management having the nerve to lecture Scots on financial matters given that RBS continues to exist solely because of the massive governmental bailout of its often fraudulent operations.

Uncertainty

National independence is the norm, not a strange form of atavism. It is the norm when it comes to nations choosing to be independent of England. Consider first the economic results of the major "Western" nations that have chosen independence from England: the U.S., Canada, Australia, New Zealand, and Ireland. Each of those nations must be considered among the world's greatest success stories on economic, political, and social grounds. Uncertainty is a powerful catalyst for productive change. Staying the same does not prevent uncertainty, for nothing in the world is static. Continuing the same policy can produce catastrophic harm because other circumstances changed.

Peoples with well-developed economies that yearn for independence, and the accountability inherent in independence, have proven economically successful throughout modern history. Part of the reason for this success is that such peoples embrace change and uncertainty to forge their own futures. National independence of advanced nations from English rule has been the key to attaining prosperity. Canada, Australia, and New Zealand, of course, attained de facto independence prior to de jure independence. In each case the achievement of de facto independence was a powerful impetus to full development of the nation.

Ireland and the U.S. had to fight for their independence from the English. Both peoples chose to be Nations and faced vastly greater uncertainty than the Scots face now should they vote to reclaim their sovereignty. The cry of the "Loyalist" opponents to American independence in 1776 was "uncertainty." The Loyalists warned of English hostility and retaliation should we choose independence. The direst warnings came from many (but far from all) in the business classes against the folly of independence. Today, there is no one in the U.S. and virtually no one in Eire that regrets the choice of independence and sovereignty.

The risks that the Scots take in voting for independence does not even begin to compare with the risks taken by their Americans and Irish counterparts who cast their votes for independence by taking up arms to bring about the birth and rebirth of their Nations. The only constant is how many businessmen bleat in fear of independence because of the threatened wrath of the English. The traditional English response to any movement for independence is to threaten reprisals.

RBS: Our Ratings Could Fall

RBS had entered the independence controversy by claiming that it might fail if Scotland were to vote to restore its independence. In Scottish Gaelic the term for RBS' claims is chutzpah. RBS is the former control fraud that caused such catastrophic losses that it led to a massive public bailout. The U.K. owns 80% of RBS, which is by far the largest bank based in Scotland. The world would be better off were RBS to be split up into smaller banks that would be more efficient, no longer "too big to fail," and no longer create crony capitalism.









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