A Bitter Divorce? Scotland’s Independence Referendum

J.K. Rowling recently donated £1m donation to Better Together, an organization campaigning for a No vote in the upcoming Scottish independence referendum. In the wake of that donation, Rowling released a statement explaining the reasoning behind the donation, noting the “fringe of nationalists who like to demonise anyone who is not blindly and unquestionably pro-independence.” Rowling may have had reason to preemptively issue such a cautious statement given the wave of online backlash that followed its release. Scottish charity The Dignity Project tweeted that Rowling was a “bitch.” Other Internet trolls have chosen more creative and nasty epithets by calling her a “Union cowbag” and a “disgrace.”

Yesterday, Hillary Clinton even joined the debate to caution Scots against turning their backs on the Union.

Why such rancor? For those across the Atlantic who have not been steadily following the heated debate between Yes Scotland and its Better Together, here’s what you need to know:

While the United Kingdom is frequently heralded as one of the world’s most successful (and longest-running) multinational states, it is clear that the strength of the nation is under threat. In 1707, the Act of Union joined the kingdoms of England, Wales and Scotland. For 307 years, this Union has remained in tact under minimal threat of dissolution. At least, that was the case until May 2011, when the Scottish National Party took the country by surprise by winning the majority of seats in the Scottish Parliament. The growing support for the SNP likely stems from increasing differences between conservative Westminster and more liberal Holyrood.

Yes Scotland, the major group supporting the upcoming referendum, believes that Scotland’s decisions should purely be made by Scots. At the other end of the spectrum, Better Together advocates for a distinctive Scottish Parliament while remaining a part of the United Kingdom. On September 18, 2014, the two sides will come to a head as Scotland votes on the referendum. According to recent polls, 44% of Scots say “no” to independence while 39% of Scots say “yes”. The remaining crucial 17% are undecided.

Given Scotland’s unique cultural history, a greater desire for autonomy makes sense. So why might this be a bad idea? As CNN puts it, Scotland’s independence movement is “rich on idealism and light on practicalities.

  1. Under Salmond (the First Minister of Scotland)’s proposals, a newly independent Scotland would continue using the pound. However, critics have pointed out that such a move might undermine Scotland’s legitimacy as the new nation would have no control over interest rates, and thus, its own monetary policy. The Bank of England’s chancellor has already ruled out the possibility of a shared monetary union, meaning that Scotland’s monetary policy would be fundamentally affected and determined by UK interests.
  2. Even if Scotland chose to forego adopting the pound in favor of the euro (another proposal), it would face significant roadblocks. European Commission President Jose Manuel Barrorso has stated that an independent Scotland would have to go through the traditional EU accession process - no fast-tracking. Such a process is likely to end unsuccessfully due to possible opposition from the UK as well as countries like Spain, which has been grappling with its own separatist movements and may fear setting a dangerous precedent.
  3. A major motivation behind Yes Scotland has been the push for greater control of North Sea oil and gas fields, but relying on finite resources comes with obvious risks.
  4. SNP's white paper on an independent Scotland calls for an annual military budget of around £2.3 billion. Considering that independence would force Scotland to take on its share of the UK’s debt - a figure that could be in the tens of billions, the new nation might struggle to budget such costs. With a newly independent Scotland facing a budget deficit of 5.5% of GDP – £8.6bn – an independent Scotland would be off to a rocky start.
  5. According to the Treasury Department, Scotland would need almost 500,000 immigrants in order to maintain the same balance of pensioners and working age adults as the UK. This point is particularly concerning given that Scotland is projected to age more rapidly than the UK. If Scotland is unable to rapidly attract more immigrants, it would face a poor dependency ratio (the number of people receiving pensions in relation to working age adults) that could further undermine its fiscal stability.

If Scotland were to exit the United Kingdom, the dissolution is unlikely to resemble the smooth, seamless nature of Czechoslovakia’s “Velvet Divorce” as recent months have shown the referendum to be a source of bitterness and intense debate. In light of that concern as well as reasons outlined above, Better Together’s focus on greater dissolution as a way to address Scottish concerns about autonomy may be a better proposal for Scotland’s economy and future. Westminster has already shown a willingness to make concessions as evidenced by Cameron's recent support for proposals to give Scottish Parliament the power to set its own income tax rates.

However, even if the referendum fails, the United Kingdom faces a difficult path in repairing the relationship between Scotland and the rest of the nation. One can only hope that Scotland avoids the fate of Quebec, where a local sovereignty movement has entrenched divisions between the Quebecois and their fellow countrymen.

Akinyi OchiengComment