Category Archives: Politics

Talking ‘Bout A Referendum…

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A couple of weeks ago, a friend said that they hadn’t heard any good reasons to vote “No” in this week’s referendum. Sensing a challenge, I started to write a post, outlining the reasons why I’m going to vote “No”. But it didn’t get very far, in large part because my feeling was that the two sides are so fed up that they have long given up listening to each other, instead spouting repetitive tracts to their own supporters and completely missing the undecideds who may well determine what looks like being a very close result. The gulf between the two sides seems larger than ever, despite my belief that actually not much separates us, and that both sides truly want the best for Scotland.

It also seemed hard to believe that there were any undecideds left after what feels like years of fact-throwing.

I have certainly stopped listening, even to my own side, whose negative tactics have lived up the “No” on their posters. So when I was asked to come up with an introductory question to kick off the seasonal dialogue – which is all about listening – that was the topic I chose. I remembered the last of the James plays which I saw during the festival, full of nationalist fervour but also using the mirror tool to reflect the of the nation. I thought about using Burns’ ” To A Louse” as an opening text – “to see oursels as ithers see us!” – but instead, being me, I opted for music: Arvo Pärt’s quietly reflective “Spiegel im Spiegel” (“The Mirror in the Mirror”) to get us listening to each other.

The purpose of the evening wasn’t to discuss the referendum per se, but talk (and listen) about how we can heal the split between two camps after the vote: what would it take for us to listen to others’ views?

But the conversation inevitably strayed into the referendum itself. It was very civil and non-partisan (despite one member of the group apologising for being too stridently partisan – I didn’t think he been!) but understandably emotional. People have strong feelings about this, including me.

There were a great many different views: since we could all see good and bad things about both sides the debate, there were more views than participants. We talked for a couple of hours, and I can’t remember all that was said – we followed lots of tangents.

But here are some of my impressions – what I remember of what I heard (which may not be what was said…).

  • even after two years of campaigning, we were still very engaged in the process (even if we were looking forward to it being over)
  • there were several people who were undecided. My guess is that the group split three ways – “yes”, “no” and “don’t know” about a third each
  • we all wanted to create something better – a better country, a better society, a better community – even if the route (and perhaps the goal) may be different.

The number of undecideds surprised me. I have been pretty sure how I would vote for many months, having listened to early arguments and found them generally unconvincing. Everyone in the discussion last week was intelligent, aware and actively participating in the debate – but hadn’t been convinced either. One person felt they had had an epiphany that very morning and had decided how they would vote whilst sitting in the sunshine in their garden; but they have subsequently changed their mind. (I included them in my unscientific poll as “don’t know”!)

None of the undecided were quite sure what it would take for them to make a choice

Someone else, an expat from a European state, didn’t feel comfortable having a say in determining another nation’s future (despite believing they would never live anywhere else). I have heard that a lot from English-born voters, too. But the rules say you have a vote – so I reckon you should use it.

In many ways, this felt like many conversations I have had over the last year or so. Perhaps a bit more intense – more listening and more concentrating – but in essence, the same kind of discussion I’ve had over pints in pubs or over coffee in a cafe.

Within 48 hours, we’ll know the outcome – the result is expected around 7am on Friday. And then we can get down to rebuilding relationships and – perhaps – building a new country. Either way, I think we’ll have to learn to listen to each other again.

What unites us is a lot more than what divides us.

[Nb I have revised the last paragraph of this post since it was brought to my attention that I had said precisely the opposite of what I intended. This is what I wanted to say. One word wrong completely changed the meaning. And that is why one should respect sub-editors!]

Why Do The Campaigns In The Scottish Referendum Concentrate On Economics?

I was at (another) debate on the economics of Scottish independence on Monday. One of the panel members, Christine O’Neill, the chairman of a firm, expressed her surprise and dismay that both campaigns – for and against independence – had focused almost exclusively on economic issues, rather than, for instance, what it means for our culture and values, and what kind of society we would like to create in Scotland.

I’m with her – particularly when the economics is so up in the air, with both sides throwing around contradictory “facts” which are frankly nothing of the sort. O’Neill likened it to the campaigns trying to buy votes – with Better Together offering us £4bn (about £1000 each) and the SNP offering £5bn. (Both these claims are based huge assumptions which make them impossible to compare.)

Her question, though has a simple answer, as sephologist and pollster John Curtice described at a talk back in April. (See, I’m a glutton for punishment.) Then, in discussion with Stephen Reicher and Jan Eichhoin – it was like a public version of Newsnight Scotland (before it got axed) – Curtice explained that the prime determinant of voting intentions in the referendum was voters’ view on the economy, ahead of cultural identity and values. It apparently explains many anomalies, such the long standing gap between male and female voting intentions – women are more pessimistic about the economy, and more risk averse.

Both sides know this and are tailoring their campaigns accordingly.

Indeed, Curtice admitted he was also responsible for the campaigns focussing on £500 – all it would take to swing their votes: it was his research that identified this low price-point. How cheaply our votes can be bought.

Head, Heart and Gut: Where I stand on the Scottish Independence Referendum.

I spent last Christmas in England. And with just about everyone I met, at one point or another, the conversation turned to the Scottish independence referendum, and how I felt about it.

Now, the debate has been hotting up; the politicians full of bluff and bluster. And it seems a good point to see where I’ve got to.

During one of the tv debates, I was exchanging views on Twitter (where the discussion has been lively, radical, and, despite some claims to the contrary, largely good natured – people on all sides of the debate have been open and engaging, and there are many people with whom I disagree that I like a lot); I reckoned that the decision came down to head v heart; someone shot back saying that guts must a say too.

Here’s what they’re saying…

Head

The rationalist in me is still “no”. I haven’t heard anything to counter my original feelings.

The campaigns have a lot of views and counter-views that they reckon are facts. Salmond made a speech in London where he said

After Scottish independence, the growth of a strong economic power in the north of these islands would benefit everyone – our closest neighbours in the north of England more than anyone…

He states this as a fact, but it is conjecture: Salmond may hope that he puts in place the policies that lead to economic growth, but you know what? He may not even be first minister after (and of course if) Scotland becomes independent: the next election for the Scottish Parliament is due in May 2015, before the politically-driven date of independence of 16 March 2016.

Facts are, of course, hard to come by. I have been in public meetings where each side has presented its facts, and countered the other side’s facts. Both sets of facts may be right – the world is ambiguous, and it is possible to select timescales to bring out the best in one’s data. Without knowing precisely the source and counter-source, it isn’t possible judge whose views are more valid.

So my head is sticking with “no”.

Heart

The thing is, I don’t believe this is about the head, anyway. It isn’t about facts. It is about heart – belief and faith.

And here I have to admit I am wavering.

Who doesn’t think that self determination is a good thing? In most other places in the world, I would support a separatist freedom movement. I believe in devolving power to the place where it can best be wielded (neither Westminster nor Holyrood, both of which seem to believe in centralising rather than sharing out power).

If Scotland were not part of the UK, I wouldn’t vote join it.

So my heart is probably saying “yes”.

Guts

This is the interesting one, really. My guts are a firm “no”.

In part it is because I think there are a lot of benefits if being part of a greater whole. I am not an isolationist. I think Scotland is richer culturally as being part of the UK, just as I think the UK is hugely richer by being part of the EU.

I have no problem in Scotland being part of the UK – it doesn’t stop being Scotland because it is part of something bigger. (I can’t help but see a contradiction in the SNP’s belief that, outside the UK, Scotland must be part of the EU. I don’t disagree, but when they are trying so hard to leave the UK, it seems strange for their plans to rely on being part of something larger.)

I might feel differently if I thought that, as a result of being part of the UK, Scotland was being oppressed. But I don’t. (Before anyone else points it out, of course I would say that – I’m one of the oppressors…) Scotland is, and has been historically, overrepresented in Parliament. It has over 9% of MPs but only 8% of the population. (Boundary changes in 2015 will remove this anomaly.)

For decades, Scotland’s politicians have wielded power and influence in Westminster. Tony Blair’s cabinet relied on Scottish politicians: Gordon Brown, Alistair Darling, Derry Irvine, Robin Cook, George Robertson, Donald Dewar, Gavin Strang – all Scottish. And that’s just his first cabinet. Even Margaret Thatcher had Willie Whitelaw, Malcolm Rifkind, Alastair Forsyth, and George Younger

The strong, visceral dislike of Tories in general (and Thatcher in particular) in Scotland – which I share – is largely responsible for the rise in nationalism in Scotland. The view that Scotland has had a government for which it didn’t vote – and hence should be independent – is rife. The first bit is true. Scotland voted Labour throughout the Conservative government between 1979 and1997. But it seems like a logical fallacy to say that requires independence. The two things aren’t connected. You don’t chuck out the system just because you don’t like the answer you get. Scotland didn’t complain (much) when it helped elect a Labour government in 1997.

So: head, heart and guts. One “yes”, two “no”. I have heard the journalist Lesley Riddoch described as “a reluctant yes” (a phrase I think she used in an article, but I can’t find it online!) Me, I’m a reluctant “no”.

Where the Debate on Independence for Scotland Has Got To…

In the first two months of the year, the campaigns for the referendum on Scottish independence seem to have really heated up. North and south of the border, the media seem like they’re taking it very seriously. BBC Scotland are running a series of debates and documentaries related to the referendum; STV’s Scotland Tonight is also having several debates.

I haven’t seen all these, but I saw the first BBC debate and a few minutes of the STV debate between the SNP.’s Nicola Sturgeon and Labour’s Johann Lamont.

The BBC use a similar format to Question Time, with a panel featuring politicians and others – one “Yes”politician, one “No” politician and two pundits meant to represent “don’t knows”. STV had only two politicians slugging it out.

So far, politicians on either side of the televised debates have done themselves no favours. On the Beeb, whilst the politicians were trying to score points off each other without giving any ground, the two “don’t knows” were asking reasonable questions, expressing uncertainty and generally saying what needed to said.

The fight on STV showed politicians in an even worse light; boxers would have been better behaved. They talked across each other, didn’t listen, and frankly proved to me that this is too important an issue to be left to politicians.

I recently went to a face-to-face debate at Edinburgh University between the two non-figurehead leaders of the campaigns. (Politicians Alistair Darling and Dennis Canavan ostensibly head up the “No” and “Yes” campaigns respecitively, although Alec Salmond and the SNP are driving the political discussion for the “Yes” campaign.) Covering the economic issues, Blair MacDougall manages “Better Together” and Blair Jenkins “Yes Scotland”. [Mr MacDougall seems to have neither a wikipedia entry nor a public bio on available. At least, I couldn’t find it.] You can see from the start that they have much in common, and indeed despite their closeness to the campaigns this felt much less partisan than I had expected. But, being economics, there weren’t really any facts – just interpretations. They threw numbers at each, in apparent contradiction, though one would actually need to see the sources, context and appropriateness before making any decisions based on the figures provided.

This does matter. Apparently, if people believe they will be £500 better off either way, it will influence the choice people make. (How cheaply we’re bought and sold. As Robert Burns wrote, “We’re bought and sold for English gold Such a parcel of rogues in a nation!“.) The main economic issue seems to be what currency Scotland would able to use, followed by how the assets and liabilities are divided, and the ability to sustain pensions and the welfare state.

The “Yes” supporters in the audience were much more vocal than the “No”s, and frankly less reasonable. I don’t find this surprising: they are driven by strong feelings. I don’t believe the views of anyone in the audience – whether “Yes”, “No” or “Don’t Know” – would have been effected by what they heard: we already know that we can’t get the answers we need, probably until many years after the referendum.

The UK government had said that it would not negotiate its position in the advent of a “Yes” vote ahead of the referendum which, whilst an understandable philosophical position, means that no one actually knows the answers to any of these economic questions (nor any others) before we are called on to make a decision.

Except that the UK government has recently been showing its hand, sometimes reasonably, sometimes not. In February, chancellor George Osborne, his shadow Ed Balls and deputy Danny Alexander all said an independent Scotland would not be allowed into a formal currency union with the rest of the UK.

(Scotland would still be able to use the pound informally, though this would probably be looked on poorly by financial markets, adding to Scotland’s funding costs, due to its instability. On the other hand, a formal currency union would completely tie the hands of any post independence Scottish government to develop its own fiscal policy.)

Then UK culture Secretary Maria Miller stated outright that an independent Scotland would not able to use the BBC.

The first of these interventions, by Osborne and co, seems to me to be valid. The currency an independent Scotland would use is clearly important to many people: the economy is the most important issue for many people and also of great consequence to the other inhabitants of the UK – and if it is really non-negotiable, far better to get it out now. (The SNP don’t accept that it is not negotiable: they reckon Osborne is bluffing. They have ruled out revealing plan B.)

Ms Miller’s intervention, however, just seems bonkers and unnecessary. What part of the British Broadcasting Corporation does she not understand? My guess is that the BBC might feel rather differently: they have a large presence in Scotland. The BBC is available throughout Europe; citizens of Eire, for instance, can access BBC broadcasts. When I lived in Brussels for a year, I watched BBC tv and listened to Radio 4 (albeit on long wave!). Perhaps Miller is unaware that much of the BBC’s output is available over the internet? Even if the BBC is divided into Scottish and rUK components, the infant SBC might want to provide programming from its former partner – a commercial decision, not one for interference from ministers. And subject to negotiation, of course. Perhaps Ms Miller is unaware that culture is one of the many devolved powers, too?

And then there was David Cameron’s charm offensive, turning the referendum into a games show with his suggestion that people in England might like to phone a friend. “Who Wants To Be Independent”, perhaps. My phone has been running off the hook.

Whatever their purpose, I think these interventions have been misguided. They play into many nationalists hands by reminding those north of the border that the UK is governed by parties for which Scotland didn’t vote. A dislike of the Tories, going back generations, is one of the key motivations for independence. It allows the “Yes” campaign to portray Westminster’s politicians as English bullies.

The argument that since Scotland hasn’t voted for a Tory government and yet they get elected seems to be a very poor reason for independence, frankly. It turns politics into an infants’ playground: if we don’t get the answer we want, we’re not going to play. It applies not just to Scotland, but much of the UK. The north east of England voted against increasing devolution. It is only the chance combination of a nationalist government in Scotland and a Tory-lead coalition in the UK which has brought us to this point, and the SNP took full advantage of their majority in Holyrood. But as grounds for independence, I funny think so.

There have also been several companies announcing that they are either against independence – like Shell and BP, the two British oil giants (which clearly have an instant in North Sea production) – or that they are parroting to protect their (clients’) interests by relocating at least some of their assets to England – like Alliance Trust and Standard Life.

Again, this really shouldn’t surprise anyone. These large corporations are all about making profits – for themselves and their customers, and they will base their assets and activities wherever they think they can make most money and minimise business risk. My guess it’s that they have subsidiaries in many different parts of the world already, and if they decided it would be better business to move elsewhere, they would. Either way, they’d be remiss not to plan for contingencies, since no one knows what will happen in September, nor, under either outcome, the implications of the result. Whatever happens, change is coming.

More thoughts on the Scottish Independence Debate…

I recently heard Michael Marra from Five Million Questions talk on the issues surrounding Scottish independence and next year’s referendum. (“Five million” refers to the approximate population of Scotland; to be honest, there are probably a lot more questions…!) Like Jeremy Peat, it is Marra’s aim to bring a more nuanced approach to the independence debate, but looking at how the issues affect people rather than pure economics.

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Clearly, many of the issues central to the debate – the currency, spilt of national debt, allocation of oil reserves, the size of the public sector, the division of pensions and associated liabilities – are economic, and as Marra pointed out, only knowable after the referendum, since the UK government has decided only to negotiate after the result is known. Similarly, the three unionist parties have all said they would support more devolution in the event of a “no” vote – be it “devo-plus” or “devo-max”, but no one is saying what they would actually do. So whether we vote yes or no, we won’t know what we’re voting for – hardly a victory for democracy, but that’s what we’ve got. (I haven’t been able to find anything on the Conservative, Labour, LibDem or Better Together websites confirming that they categorically support further devolution, but I have read it in the press and Marra referred to it; maybe I was simply not looking hard enough.)

Marra described the debate as highly complex and highly political – hardly surprising given that it is politicians leading both sides of the debate. But the result of this is that the debate is highly polarised. Better Together concentrate on the (mainly financial) risks and great uncertainty (or, less generously, fear tactics: the latest – today – being the threats to the Royal Mail and rural Post Offices); Yes Scotland are trying to minimise the perception of those risks. Each seems to benefit from a low level of debate; it is easier for them than to raise their game.

To this end, the SNP government (represented in but somewhat different from Yes Scotland) have outlined their proposition. They will be publishing details in a white paper (or perhaps two, just to maintain that uncertainty) in December (or maybe November). Marra summarised their current position (which differs from their previous positions in some key areas – after all, they weren’t in power then, so they could say anything…) as

  • a shared currency with the rest of the UK (“rUK”)
  • freedom of movement between Scotland and rUK
  • retaining the monarchy
  • competitive tax rates
  • NATO membership
  • EU membership

Of these six points, five are outside the Scottish government’s gift: they can only be decided in collaboration with other bodies: the Westminster government, the EU and NATO; and I guess the Queen might have a say. Only one represents a change from the current situation – the ability to set competitive tax rates.

Marra described this as “Indy lite”, and you can see why. According to the SNP, nothing much would change; it is just business as usual. Indeed, during the morning, Marra was told that the SNP proposed retaining the welfare system (at least for a while).

So if nothing is going to change, why on earth would we want to vote for independence? The SNP wants us to vote “yes”… to keep everything the same!

For me, this lack of vision on both sides is crippling the debate. Purely on economic grounds, I am a strong “no”. But if either side could set out a platform for change – a vision for a more just, equitable Scotland, a positive, radical alternative to the status quo that they currently seem to be proposing (in order not to scare the horses. Or the voters), they might be able to shake up the campaign and actually change some minds.

For instance, a complete reform of taxation might free up entrepreneurs and businesses and stimulate the economy, something Peat suggested. (I’m not a tax expert, so I can’t even imagine what this might look like – but I can’t believe that a system designed to provide funds to fight a war more than two hundred years ago is really fit for the 21st century.) It can’t be beyond the wit of man to design a welfare system that supports rather than stigmatises those unable to support themselves. (The Scottish health, education and legal systems are already separate from the rest of the UK.)

A new social model might be worth voting for; but of the options on the table, with minimal change – well, is that really the best we can do? The rare opportunity to really explore what Scotland means and what we want our country to be like is being lost.

The Scottish Economy and Independence.

Talking at Edinburgh University Business School earlier this month, Jeremy Peat from the David Hume Institute (and formerly head economist at RBS) reckons that the debate on independence for Scotland needs the injection of some rational thinking, so that voters can make an informed decision in the referendum next year.

His beef is that there are a lot of questions, and each side is picking its answers politically, rather than factually: for example, his institute produced a paper on the possible range of oil income; one newspaper printed only the lower limit, and the campaign for the opposing argument used only the upper limit. Neither is wrong, but both warp the discussion – and confuse people by promoting the figure which supports their argument as “fact”.

Peat set out to clarify what the questions are, and what the options might be. He doesn’t have a fixed viewpoint, and wouldn’t say whether he was pro- or anti-independence. Indeed, he believed remaining objective was key, giving access to all parties and bringing informed debate to their arguments.

He covered both macro and micro economic issues.

The main macro concern is the currency, where he saw four options:

  • keep formal currency union with the UK
  • use sterling as a parallel currency (just as some countries use the US dollar) without formal currency union
  • join the euro
  • establish a new, Scottish currency

No surprise there, then. For me, this is the crucial matter. But Peat went on to identify several issues around the currency.

Both a formal currency union and adoption of the euro would introduce strict fiscal and monetary constraints. Monetary policy would be set by either the BoE or the ECB, and Scotland would have limited influence over either.

Adopting the euro would take time to negotiate following independence (including membership of the EU and the need to meet the euro stability requirements, which could take years), and there would need to be an interim solution; similarly, the UK government has said that an independent Scotland would need to negotiate currency union. The impact on borrowing and trade under any option need to be assessed. (Peat recommended a paper by Brian Quinn, a Scot and former deputy governor of the Bank of England, on the impact of currency on an independent Scotland [PDF].)

Under any currency solution, who would be the lender of last resort? What about bank regulation? These are things that can only be decided once the result of the referendum is known, but the make a rational decision, the options and likely outcomes need to be considered.

Peat did say that Scotland wouldn’t be wholly independent inked it controlled its own monetary and fiscal policies – that is, its own currency. This may be why some of the Yes campaign have come out in favor of an independent currency, despite the SNP favouring sterling. (I couldn’t find a statement on the Yes campaign website – they do not have a search function on their website [at least not one I could find] – and the SNP doesn’t mention “sterling”, “pound” or “currency” in its vision.) There would however be significant costs transitioning from sterling, and small countries with a stable currency tend to have very rigid monetary and fiscal policies to protect the value of their currency. Any benefits of independent mindset and fiscal policies could therefore be lost.

The other major macro issue concerns the public finances. The global economic situation means that an independent Scotland would be starting from a very weak position. Public spending in Scotland is higher than the non-North Sea tax take from Scotland; the difference is generally made up by the income from oil and gas. The value of the income from the North Sea is therefore crucial, and depends on the price of hydrocarbons, the volume of production – and the basis of taxation. These are unknowable, though it is possible to estimate likely ranges. (These are the figures which Peat was irritated had been taken out of context, each side quoting the figure which supported their argument rather than the range in context.)

Much would depend on the share of government debt taken on by Scotland. There’s a lot of uncertainty about this. For instance, what comprises government debt? There’s government borrowing; a share of the RBS and HBoS bailouts; public pension liabilities. What about the decommissioning liability for nuclear power stations? The cost of decommissioning North Sea installations? Rail infrastructure? And so on. Much of this is unknowable – but of course it is possible to estimate these debts, and to model what it might mean for the economy.

The micro issues Peat discussed mostly involved the opportunities that existed for policy which an independent government would need to decide and enact. These were legion. What would competition policy look like? Financial regulation? Transport (though already a devolved power)? Energy policy? All these need regulation, as well – the competition for economists might mean a boom in wages… There would need to be the creation (or duplication!) of all sorts of institutions, including an equivalent to the Office of Budget Responsibility to keep government accountable. (Peat suggested the “Scottish Office of Budgetary Accountability” – or SoBA…)

The policy involving the non-Scottish bits of UK-wide firms represents lots of issues. How about cross-border mergers and transactions (and that is after the currency has been decided…). The interactions with the rest of the UK over all sorts of matters could become key – and might involve all sorts of transaction costs.

Once policies have been decided – government’s role – implementation and regulation would down to other bodies, operated at arm’s-length from government to reduce political interference. What others might call quangos. The establishment of these might cause a surge in the demand for skilled economists, administrators – and change managers (like me! I definitely see a way of hedging my bets here…). The SNP has set out a timetable to independence following a “yes” vote of about 18 months. Not long to get all the institutional infrastructure set up. Where will these skills come from? And what will this mean for business competing for the same talent?

One of the key benefits of independence identified by Peat would be freedom over taxation. Under devolution, the Scotland Act 2012 allows the Scottish government to set income tax and land transactions tax (currently stamp duty). An independent Scotland could completely revamp the tax system – simplifying it (and therefore saving individuals and businesses large costs in fulfilling their obligations), and designing it to meet specific policy objectives. This could be quite powerful in driving policy outcomes and the economy. (ICAS have an extensive report on the practicalities of tax devolution [PDF].)

It is hard to know how an independent Scotland would perform. David Skilling reckons that that small countries outperform larger ones, though Peat thought the jury was still out on that one. The psychological outcome of independence might be positive – the “Braveheart” factor – which could spur innovation, but of course (as so much else) this is unknowable before independence. (It would be interesting to see if there were any such boost to the economy following the start of devolution in the early 2000s.)

Peat concluded that independence was feasible, but that there were so many unanswered – and even unasked – questions that we cannot say if it would be beneficial. (Indeed, we’d have to define what “beneficial” means – there is more to this world than economics!) To get answers, we need to have a more subtle, nuanced debate, rather than the rather shabby level we’ve currently got.

We also need to think about the alternatives. A “no” vote wouldn’t mean “keep Britain and carry on”. All three unionist parties are contemplating further devolution following a “no” vote, be it “devo plus” or “devo max” (neither of which is defined). To decide if “yes” or “no” is the right choice, we need to understand the different options.

But why wait for independence? There is much that the government could do under the current conditional set up. Blaming Westminster for a lack of progress seems rather childlike – always blaming the big boys, and never taking responsibility for our own actions. The SNP have been in power for six years; what have they really achieved? (I think I’ll have to go and find out. I may be sometime.)

[The David Hume Institute has several papers relevant to the debate on its research page.]

Hans Rosling on “The Big Picture”

My first event in this year’s Edinburgh International Science Festival was to hear Hans Rosling give a statistics lecture.

This wasn’t the typical kind of statistics lecture; I reckon I have had at least four stats courses over the years, and whilst I know enough to know what to do (or where to find out what to do), I think it is fair to say that I don’t really get statistics. I can do it, but it never really makes sense. And all those stats lectures were dull, dull, dull, and dry.

This one was different. Not talking so much about stats as our ignorance of stats, and largely based on data rather significance tests, Rosling was as much entertainer as statitician. (I think on of his slides described him as “edutainer”.)

He was talking about how numbers can be used to describe the world – not to the exclusion of other inputs, but to produce a rounded picture.

The bulk of his talk was about population growth and world poverty, and the causes of change in these global phenomena – largely economics. In between, he told stories of his life amongst the numbers, when to trust them and when not. (“Not” seemed to be mostly when you don’t actually have the data – he highlighted how wrong our assumptions about the world can be.)

Rather than try to reproduce what he said (without the laughs), here are some of his TEDtalks covering similar issues…

…on stats

…on poverty

…on population growth

All the data and the manipulations he used can be viewed on Gapminder, where one can play around with the data and visualisation. A great way to while away the Easter break…

“DemoMax”: looking at Scottish democracy.

The Electoral Reform Society Scotland has been running “an inquiry” (I’d call it a series of meetings!) into looking for a better model for politics, or what politics should look like – what it calls “Democracy Max” – or DemoMax. (A nod to the third, unexplored (and unanswerable) question in 2014’s Scottish referendum on independence, “DevoMax“.)

I came late to the DemoMax party, attending a public meeting last week. It felt like I was coming in half way through a conversation.

There were three speakers, who varied in their passion and direction, discussing three themes (already set by “the people’s gathering” and some roundtable discussions): participation in politics; sovereignty of the people; and the mechanism of engagement. After each speaker, there was a bit of open discussion and then a show of hands vote on a specific question set. These were different, but related, to the three questions set out on the ERSS website, namely

  1. Sovereignty of the people – How do we return more power to the people?
  2. Defending our democracy – How do we stop vested interests having too much influence?
  3. How do we write the rules – How do we get the checks and balances our democracy needs?

(I didn’t write down the questions we were asked to vote on, and I can’t find them on the website.)

A bit about the process. Despite the efforts of facilitators, I didn’t feel it worked very well. The setting – a university lecture theatre – didn’t really engender debate. We were constrained to speaking to our neighbours, followed by a “feedback” session after each speaker. The votes seemed a particular waste of time, since we didn’t know the detail of what might be proposed: I abstained in them all, being assured that would be taken as a need for more information. (Though the lead facilitator’s omission to count abstentions to the first question didn’t bode well – he had to be prompted by a member of the audience to do so.)

The evening was held under the Chatham House rule. I’m not sure if that extends to the three main speakers or not, but in case it does, I’ll respect it and not say who said what.

The evening opened by postulating that there was something wrong with the state of political parties in the UK. The Hansard Society Audit of Political Engagement [pdf] shows decreasing levels of engagement with the political process (p18), which the speaker blamed on parties: he reckoned people were disillusioned and detached, that parties were suffering a crisis of their elites, and that they were hierarchical, bureaucratic, tribal and adversarial. I agree. But he also though parties were essential – indeed, he believed that if political parties didn’t exist, we’d have to invent them.

On that, I really don’t agree. The subtitle to “Democracy Max” is “Politics is too important to be left to politicians.” Politicians are what you get with political parties. They want power. (I hope they want to change things for the better too, but power is their tool.) The speaker didn’t believe non-hierarchical systems could work, but there was no (public) discussion of the role social media might play, nor on the distributed power demonstrated by the Occupy movement (despite ERSS listing OccupyEdinburgh as one of the bodies involved in the process). The National Council for Voluntary Organisations reckons

…[p]eople are now increasingly drawn towards single issue campaigns and organisations providing opportunities for involvement that cut across traditional lines of division between political parties. This allows people to engage in a less structured and less formal way [pdf] (p2)

I don’t think we need hierarchical, bureaucratic, adversarial political parties. But then I’m a strange beast who believes that coalition is a viable way to run a country…

The second section of the evening looked at the democratic deficit. Interestingly, despite the previous discussion, the proposed solution was to have more politicians: or at least, more elected officials. Whilst France has 125 local councillors (or equivalent) to every member of the population, Spain about 700 and Norway 800 (figures quoted during the evening – I haven’t tried to verify them), in Scotland that ratio is 1:4,270. European countries generally have many more councillors than the UK, and it was suggested that by devolving power as low as possible locally people would have more direct interest in political decision making. I was sitting next to a Spanish (Catalonian) national who disputed this – he reckoned that whilst political issues are gripping Spain and more than a million march in favour of Catalan independence (against the meagre 5,000 who turned out in favour of Scottish independence two weeks later), people were no more engaged in Spain than Scotland. This is only anecdotal, but salutary.

The UK has long had centralisation, both in Westminster and Holyrood. It makes sense to me that decisions are made as close to the issue as possible – as the speaker pointed out, the frequency of rubbish collection shouldn’t really be the concern of Westminster politicians. But how local is local? My street, my neighbourhood, my town? Who knows. And I am not certain that increased localisation will increase respect for politicians and the political process.

I did however like the idea that rather than central Government(s) pushing power down to local institutions, it should work the other way: a kind of zero-based political process, the default should be local decision making, and power only then passed to larger, more central organisations. Someone also talked about the myth of economies of scale – whilst economically big may be better, that isn’t the only answer: there are other issues to be taken into account.

The last speaker looked at how we might hold politicians to account. It was a fiery, heart-felt speech, proposing a “people’s chamber” for Holyrood to balance the power of MSPs – a “citizen’s assembly”. (Albeit that without a formal constitution, Britons are subjects, not citizens…!) This assembly would need to be representative of the population (neither Westminster nor Holyrood is, in terms of gender or race; or probably, age and wealth…), perhaps chosen by lot rather than elected (to remove the need for parties?).

Part of me thinks this is a great idea; part of me thinks it would be a disaster and unworkable. In a country as sparsely populated as Scotland, representatives would need to be based where the assembly was – even if it moved between cities and towns, that would mean the central belt most of the time (where 70% of the population is based) and those far away islands would feel as isolated as ever.

Would business people want to spend their time on the assembly rather than running their businesses (or making money, or paying taxes…)? Would there be opt outs?

Lots of questions, as the proponent of this idea pointed out, but no answers.

The idea of representativeness was interesting. Because the meeting to discuss DemoMax was anything but representative. It was pretty well balanced in terms of gender, but it was 100% white and, I would guess, uniformly middle class. I would also guess that there were few there who represented the political right. And everyone there was engaged politically. It felt ironic that the politically engaged should be spending their time discussing how to involve the politically unengaged – because of course, they weren’t there to talk for themselves. (I do expect and hope that ERSS will have other ways to reach out to those not happy spending an evening in a university lecture theatre.)

But I guess that is politics.

Entrepreneurs and Scottish Independence: a debate.

The Entrepreneurs Club at the business school held a debate (jointly with MBM Commercial, a legal practice) about independence and businesses.

There were five speakers (plus Bill Jamieson in the chair, who recommended this report by ICAS on taxation and independence): J.P. Anderson; Gavin Gammell; Jim Mather; Ian Ritchie; and Ian Stevens. Of these, one was vehemently pro-independence, one vehemently pro-Union and three uncommitted but, I felt, leaning pretty much towards the Union’s camp. This surprised me somewhat – it made the panel feel pretty much unbalanced (albeit in a way that I strongly agree with). Could they really only find one business person who favours a “Yes” vote? (Also, why no women and no minorities?)

The two who felt very strongly both appealed to largely emotional arguments, in ways that, judging by the questions following the speeches, didn’t go down particularly well with the audience. The pro-Union speaker talked about the shared history of the Union, our strength as part of a large nation, and the fear of economic collapse under independence. The pro-independence speaker talked of England (and, specifically, London) creaming off capital and talent, how it was time for Scotland to stand on its own two feet, and how Scotland had to find its own destiny. His speech was painfully low on detail, and frankly jumped all over the place – though I will admit that I was never likely to be convinced by his emotional appeals.

The key issues for the three uncommitted-but-leaning-Union seemed to be

  • the damage caused by long periods of uncertainty (for a minimum of two years until the referendum, and in the case of a “Yes” result, perhaps another five whilst all the details are decided and the Union is unravelled), particularly regarding
    • relationships with EU and NATO
    • the currency
    • taxation
  • access to capital and markets
  • risks to funding research and education (specifically, Scottish institutions receive more from funding bodies on the basis of their research projects than a per capita share; and Scottish universities currently charge fees of English students which they would be unlikely to be able to do under independence, since they can’t charge students of other EU nations)
  • regulation, particularly of financial institutions (an independent Scotland could not afford to be the lender of last resort for either RBS or the HBoS arm of Lloyds, both of which might therefore need to be headquartered in England)
  • the role and size of the public sector in Scotland

Neither those for nor against independence were able to come up with a “business plan” for their outcome – indeed, one of the weaknesses of the Unionist argument seems to be the inability to produce a positive message for the Union: I agree we’re “Better Together“, but where are the positives of the Union (as opposed to scare stories)?

The crux of the debate came down to the inability of the “Yes” campaign to provide answers to many questions, so that people don’t know (and won’t know by the time of the referendum in two years’ time) what they’ll actually be voting for. Not their fault, necessarily (though the SNP government has been woeful in its obfuscation), but clearly critical for the key “don’t knows”.

The results of the poll at the end of the debate were:

77% vote No

Pretty categorical: 77% of attendees voted “No”, out of 115 votes cast (which means about 35 people, or 23%, couldn’t be bother to vote Or, more positively, a 77% turnout!).

Where I Stand on Scottish Independence

Much of my last post on “A Just Scotland” concerned the constitutional settlement for Scotland, and in particular the outcome of the proposed referendum in 2014 on Scottish independence.

I rarely post here about overtly party political matters, though much that I write about is “political”; but the arguments for and against independence go beyond (or, at least, ought to go beyond) party politics, and I thought it only right that I should explain where I stand on Scottish independence.

I have already made up my mind how I’ll vote (though of course I have plenty of time to change it – and if I do, I’ll post about it!).

I am against independence.

My decision stems from three arguments, any one of which I think would stop me voting “yes” to independence.

The first is the outright uncertainty in what we are voting for. Fortunately, the recent “Edinburgh agreement” restricts the referendum to a single question on independence. (The precise wording is being overseen by the Electoral Commission – the wording of the question may make a big difference to the outcome.) But quite what a “yes” vote may mean is unknown: in the EU or not, in NATO or not, contributing to UK armed forces or not, in sterling or the euro (or neither) or not, the amount of debt UK national debt that will be allocated to Scotland… The list of unknowables is long. Some of these might be decided – or at least a policy decided – before the referendum, but much which be decided as part of negotiations should there be a “yes” vote. Which of course means that we won’t know what we’re actually voting for in 2014.

The second factor is the complexity. Scotland and the rest of the UK have been so closely linked since unification in 1707 that common institutions are intricately tangled, and untangling them will be difficult. Rebuilding these from scratch would be costly. One of the advantages of union is the economies of scale resulting from being part of a larger whole. At its most basic, having the infrastructure for tax collection in place is a huge boon. (Imagine the economic hiccup in switching from one tax collection system to another: just as when one changes jobs, the Scottish government would need to build up a reserve to tide the country over the gap.) It might be possible to outsource much of the bureaucratic infrastructure – I’ll bet the UK government would happily do the job (for a cost). Or maybe not: HMRC might just laugh at us, and not hand over their share. Scotland would have minimal leverage. And no representation. Even if the Scottish government were able outsource the bureaucracy for so much of our day to day lives back to London, what then would be the benefit of independence? Nothing would have changed.

The difficulty for business would be immense: the large number of cross-boarder businesses which would, one way or another, need to account for their Scottish and other UK operations separately would make this a vast, and expensive, task. (I recently had a conversation with a friend who had been working on the transfer of over 300 RBS branches to Santander – a deal that has subsequently fallen through. Both organisations had large teams working on this, and the complexity of the process was mind-boggling.) Separating two countries that have been so tightly linked would be several times more complicated – an enormous and costly task.

It is also possible that there could be a large number of talented people who migrate from Scotland to greener grass south of the boarder if Scotland gains independence, leaving the country financially and culturally poorer.

The last, and frankly killer, argument is economic. Scotland’s economy is inextricably tied up with England’s. Excluding oil and gas, Scotland exports goods and services (excluding oil) worth £45bn (2010) to the rest of the UK (ie England), more than twice the £22bn it exported overseas [pdf]. (Of the £22bn of international exports, £10bn went to the EU, £4bn to the USA and £2bn to Asia.) For business reasons, it would make sense to keep sterling: the costs of transacting in another currency could be very large.

There are at least two other options: Scotland could join the euro (though it is doubtful that could take immediate effect – the Maastricht criteria for joining the euro have a minimum of a two-year lag period, during which the nation’s currency must be in ERM II (which sterling would not be, of course); or Scotland could issue its own currency (like Irish punts before Ireland joined the euro). Given the current state of the euro and the stringent economic conditions being set by the European Central Bank, it is unlikely the Scottish government would chose that path. And the costs associated with establishing its own currency (which would have no value in the money markets and which would impose large transaction costs on business) would, I believe, make this a non-starter.

(The SNP states that “…on independence day … the pound will be our currency“, but there are many views which dispute the workability of this.)

Without an independent currency, in what way could an economy be independent? Any economic decisions made by an independent Scottish government would be subject to decisions on monetary policy decided in London or in Frankfurt – that is, fundamental decisions on interest rates and monetary supply. Fiscal policy – tax raising and spending powers – would be determined in Scotland, but it is fair to assume that the yield on Scottish government bonds (the rate of interest charged by the money markets) would be higher than that on UK government bonds, if only because the market would be so much smaller (and hence less liquid). It would therefore cost more for the Scottish government to borrow money to fund its activities.

Either way, the Scottish government would have its hands tied – by the Bank of England, the European Central Bank – or even by the financial markets. It would be independent in name only, and at great cost.

And that is why I am against independence.

Other sources I looked at when trying to set out my views include