Comment | Scottish Independence: Westminster’s unholy alliance short-changes Scots over the Pound
New in Ceasefire, Politics - Posted on Friday, February 14, 2014 19:54 - 9 Comments
I’m not a big fan of Star Trek but the recent antics in the Westminster village reminded me of a closing scene in one movie when Captain James T. Kirk proclaims he will join forces with one of his enemies to fight another enemy. Kirk justifies his unholy alliance with the axiom that “the enemy of my enemy is my friend” while the wise Vulcan, Spock, reminds Kirk the proverb was coined by an ill-fated Arab prince, who ended up being decapitated by his “friend.”
Now I’m not sure who is going to attack who in the unholy alliance formed between Tory Chancellor George Osborne, Lib Dem Danny Alexander or Labour’s Ed Balls and, quite frankly, I really don’t care. However, the three have come together to try and scupper Scotland’s First Minister Alex Salmond’s plan to keep the pound in an independent Scotland.
It was a highly-unusual move since the three main parties in Westminster have already started knocking seven bells out of each other in preparation for the next General Election. But it seems they have called a temporary ceasefire to agree that whoever is in power after the election will block a formal currency union with the rest of the UK. (Incidentally, this also supports the theory put forward by some that UK voters have no real democratic choice these days as there’s little to differentiate the three main parties).
Osborne justified the alliance by saying the pound was not like a CD collection to be divided in a ‘a messy divorce’, while Lib Dem Danny Alexander refused to allow the UK to be ‘exposed’ to Scotland’s risks. For his part, Labour’s Ed Balls accused nationalists of “not living in the real world”. Now while number crunching might be their area of expertise, quite clearly history is not. Every schoolboy and girl north of the Border knows that the Bank of England was founded by William Paterson, a Scotsman. The successful merchant, trading with the West Indies, proposed the creation of the Bank of England in 1691 and when it was founded three years later he became a director.
The canny Scot recognised that Orange King William III and his Government needed lots of cash to pay for wars and a Government loan of £1.2m. at an impressive 8pc interest rate. was issued. The national debt became the stock of the Bank of England and it became the Government’s banker. Another piece of history of which the three politicians also seem to be unaware is that the Bank of England became a shared asset with Northern Ireland, England, Scotland & Wales when it was nationalised in 1946.
Ed Balls’ political amnesia could be blamed on his New Labour credentials, but just to remind him the Bank of England was the first institution to be nationalised by Clement Attlee’s Labour Government followed closely by the coal, steel, power and rail industries. Attlee’s logic was that nationalisation benefited everyone, as they were publicly owned, and not just the wealthy few who owned shares in those industries. Nationalisation was a long-held belief of the old, traditional Labour Party, which put people before profit … who in the Labour Party remembers those days?
And so the Bank of England, owned by private individuals since 1694, became the property of the British people. The reality is if Scotland is forced by Westminster to drop the pound then the British Government will, by law, have to give a proportionate share of the Bank of England’s assets to an independent Scotland. But let’s face it – that isn’t going to happen because all of the businesses on either side of the Border who do billions of pounds worth of trade with each other will not want the added complication and costs of trading in other currencies.
So what’s this all about then?
The truth is, Westminster village is in a panic at the prospect of an independent Scotland which, according to polls, is becoming more of a reality as the referendum day in September approaches. The Tories are panicking because an independent Scotland is committed to getting rid of the nuclear facility in Faslane in its first term of government. This would jeopardize the UK’s nuclear power status and therefore its standing on the UN Security Council and possibly a seat at the G7/8.
Labour is panicking because it knows the chances of ever regaining power in a country without Scottish voters is highly unlikely, so their power and influence would also diminish rapidly. And it’s quite clear from the antics of the Liberal Democrats that what hurts Labour and the Tories will hurt them as they’re obviously not fussy who they jump into bed with as long as they can sit on a few seats in the government’s front benches.
As Spock would say: “It’s politics, Jim, but not as we know it.”
Yvonne Ridley will join a panel including Anas Sarwar MP and Humza Yousaf MSP for a referendum debate organized by FOSIS (Federation of Student Islamic Societies) for Muslim students at Strathclyde University on Sunday 9th March, 6pm-9pm