Here is the present state of the argument for independence:
Salmond: We are appealing to the greatest authority of all, the sovereign will of the people of Scotland. It’s Scotland’s pound and we’re keeping it.
(First Minister’s Questions, Thursday 7th August)
It has been a frustrating couple of weeks. Salmond has resurfaced, citing the ‘national will’ to defend his case on currency. For people worried about their mortgages and pensions, nationalist arguments on the pound make even less sense than economic ones. And where are all the socialists, to point out keeping the pound is not the best of various options in the long term?
To shift the focus back to our ground, Yes Scotland is describing a Yes vote as the one opportunity to ‘make Scotland’s wealth work better for all those who live here’. But is this credible enough? While chronic inequality of wealth and income is constantly emphasized, the SNP has no serious plans to make Scotland more equal. With monetary policy out of national control, economic power is limited. Money supply and interest rates are two crucial ways to control the money flow, wealth accumulation, and capital investment. To build the wealth of working families without monetary control is like building sandcastles below the high-tide line: they stand for a while, but when the tide comes in they crumble down.
To redistribute wealth in favour of the people you need monetary, wage, and fiscal powers. In effect, you need to destabilize and appropriate the private wealth and assets of the richest. But the SNP is busy pre-negotiating away authority over these areas, and insisting that the only threat to market stability is coming from the unionists (for we radicals have hardly caused a stir).
So the Scottish Government will not acknowledge that independence comes with any risk, and will propose no policies that may disturb the markets. The Radical Independence campaigners talk about a better future without any audit of the transition costs and without the slightest inclination to discuss who pays. Some radicals even despair that the currency issue has returned, as if the question of who controls our money is neither here nor there in the struggle for a more equal society! There is a better, honest case to be made, between the cautious commitments of the Scottish Government and the utopian claims of the left-wing independence groups, which will accord with what the public wants to hear.
It starts by admitting the SNP does not have what it takes to tackle inequality or end austerity in an independent Scotland – both No campaigners in Labour and socialists in the Yes campaign agree about that. Our alternative has to be clear: our party, in an independent Scotland, would support workers, put the burden onto the shoulders of the richest, and start to reduce inequality by force. It falls to a minority in the wider Yes movement to make the more challenging case for independence in spite of the SNP’s timidity, and also to be clear that a period of transformation, far from effortless, will depend on compromises and struggles.
We have to challenge the nationalist belief that life in an independent Scotland will improve at little or no cost to anyone. Advocates of the official, reassuring case fail to understand that claiming there is nothing to lose does not sound credible to many voters, especially Labour voters. Throughout this rest of the campaign the Yes case should be tempered by honest acceptance of challenges that will face a post-Yes Scotland. This will enable the campaign to both inspire the ambitions of the public, and address their doubts about what Yes could mean. How could we make Scotland’s economy work for the many within the first few years of independence? How can we be sure independence would not harm those with least to lose, like Scottish Labour has constantly asserted?
To be credible on inequality, parts of the Yes campaign must draw red lines: that currency powers and tax powers will have to be under our control; and that challenging privilege and wealth will cause necessary instability. So long as there are also guarantees – to protect the work, wages, pensions, savings and welfare of the many – then such an honest case will benefit the Yes campaign.
One solution is for the pro-Yes left to present a credible set of demands and goals: a programme of radical realism that looks to challenge the structural inequality of distribution, and to welcome the consequences. What would the starting principles be? We could argue that:
An independent currency is the eventual goal
To seriously tackle inequality in the long run, we need currency under the control of an independent Scotland. Even admitting this would have costs in the short-term. Although we would keep the pound for some time, this ambition may result in the leakage or flight of capital and investment, a higher rate of interest on the money that governments and individuals borrow, a smaller return on savings and investment like pensions. Building up reserves would require a bout of austerity. But this austerity, if it was fairly arranged, and if the burden was placed on capital not labour and if the wealth of the many was protected, would itself help to reduce inequality. The savings and investments that would suffer most would be those of the richest – the vast majority do not have substantial savings, and those savings and pensions we do have could be underwritten by a tax on those who can afford to pay. The prize is meaningful independence.
Taxing the rich is just
Taxation is for social good. There is a myth that placing higher taxes on the rich will be counterproductive because it will drive out rich people. If this happens, it will be a cost we have to pay, and one that will itself reduce inequality. But flight is unusual. They talk about an oil bonus, but the real short-term bonus for an independent Scotland is a tax on the wealth of the richest. Taxing the rich until the pips squeak may ruin the comforts of a few, but it will not ruin Scotland.
We need better wages
Wages have been frozen or falling for a long time. Capitalists passed the burden of austerity onto workers, and the UK government did nothing to strengthen wages or keep them higher. Intentions to raise the minimum wage are important but irrelevant to the majority of earners who still do not get a proper share in the wealth we all produce. People must have higher incomes, and wages are the starting point. Many companies can afford this, but it will put pressure on other companies, which will sometimes lead to job-losses in the short-term unless the wage rises are subsidized by the government. One short-term corrective is to create jobs where higher-wages are guaranteed; another, to support companies that invest in Scotland to use skills and pay a better wage. And for those parts of the economy where mandating higher wages would ruin the work and jobs, tax credits should be used to ensure the lowest paid have a decent income.
Arguments from these principles could capture and inspire the interest of voters who do not trust Alex Salmond or the SNP. But in the wake of spats and splits that have turned solidarity into disunity, the pro-independence left is looking deflated. Anything its individual members say will carry little weight.
We do need to recognize that in the minds of most people in Scotland there is only one credible party other than the SNP. That party is the Labour party. We need an independent Labour programme for an independent Scotland. There are areas on which Labour, in an independent Scotland, might credibly take a more socialist line than the SNP. Johann Lamont said at STUC Congress that an independent currency would be the only ‘logical’ option for an independent country. It is Scottish Labour policy to raise taxes on the richest. Scottish Labour has pushed hard to ensure that the living wage is paid as far as possible across the economy. Describing an Independent Labour programme for an independent Scotland is the strongest card we have to play.
The ideal scenario would be for the pro-independence left – all of it that believes in the importance of a party connected with the labour movement – to consider what a new Independent Labour party should do after the referendum. In private conversation, this suggestion is met with hoots of laughter or howls of anguish.
But offering a vision of an Independent Labour Scotland would capture the attention of the public – because the Labour case is still the missing link. Working out a plan for a socialist Labour party would not be an endorsement of the current Labour party – it would simply acknowledge the values that underpin the ambitions of the working people in Scotland who we need to persuade to vote Yes in September. Such unity, for the final weeks of this campaign, would make the kind of impact neither RIC nor Labour figures could alone – and it would lay the ground for the socialist revival the country needs to shake itself from nationalism and put socialism at the centre of our politics.