Is Mark Carney trying to out-Swinney John Swinney? He was preternaturally cautious and sober, the poker player from Hell as he delivered his SCDI speech today (See below). It was a technician’s rundown of the potential upside and the obstacles of monetary union and what is needed to make it work. From an amateur’s point of view I thought his opening remarks on this issue, which he ran through at indecent pace, summed up why it’s probably the best option for the Scots.
It reduces costs between markets and there is no currency conversion implications; it reduces uncertainty and evens out borrowing costs and encourages investment; it represents and encourages integration and it aids mobility of people and money.
Sacrifices will be required and that means convergence of debt and borrowing criteria, something already spelled out in the White Paper and, far from being a brake on independence I regard it as imposing discipline on spending ambitions – remember Scotland won’t always have Swinney in the Chancellor’s chair. It is also what countries around the world are used to and without it you end up like the Eurozone with countries lying to each other about their debt and revenue and breaking the rules such as they are.
It would immediately calm those headless chickens in the money markets if they could see a new country tied into a fiscal and monetary regime of another with a track record of paying up and not defaulting. It was interesting to hear Iain Gray on Radio Four this morning – doing a pretty good job, I have to admit – moving as quickly as he could away from the issue at hand which is our preference for monetary union on to the propaganda campaign ground of asking: What’s your alternative plan? This is the game laid out by Better Together – pretend we will not agree to union and force them on to the back foot by demanding they answer our question which is in reality irrelevant. Deflect and distract.
But do you know what the real gain was from today? It wasn’t the detail and technicalities of monetary union and shared currency or even if it is the best option for Scotland. It was seeing the Governor of the Bank of England standing up in Edinburgh and telling us how a currency might/might not work in an independent Scotland. This is the stuff of nationalist dreams…like the British Prime Minister coming to Edinburgh to sign an agreement to recognise our independence in the event on one single Scot more than the No side voting Yes. These are momentous and historic times. What these events do is normalise the concept in the public imagination of our country becoming independent. It is no longer a pipe dream…no longer an idea to be scoffed at and dismissed. It is mainstream. It is bringing London’s big guns to Scotland to meet the elected Nationalist leader of our country and treating him as an equal.
The next step is to realise they do this because they have to face up to the real possibility that the Union is about to end and provisional plans must be put in place. They are bowing to the will of the Scottish people. They won’t concede anything until they absolutely have to but ask yourself a question: Is this how an aloof and disinterested state behaves when it is convinced it has nothing to fear or nothing to plan for because it has the result in the bag? Or are these the practical and on-going steps of a government and its institutions preparing for ground-breaking change, no matter how hard they try to resist it?