Monday, 28 January 2019

Robert Burns: An Immortal Memory

It was my privilege to deliver the Immortal Memory at the Gifford Village Burns' supper on Saturday and some people enjoyed it enough (or were at least polite enough) to ask me to share a written version. So here goes.

The hugely talented Aileen Watson and her brother Neil provided musical contributions / interludes and - so as not to test the patience of the audience - I broke my contribution into three distinct sections with the aim of providing a narrative structure to the evening.

There is much fun that can be had with Burns' bawdier works - I chose not to given the rather genteel audience I was addressing.

A final note on delivery: personally I never read from a script - I prefer the natural and more engaging cadence that comes from speaking from the briefest of notes - so the prose that follows is a perhaps awkward hybrid of prose and script [complete with asides] and can only represent an approximation of what I might actually have said!


🎵 Song: 'Rantin, Rovin Robin (There Was a Lad)' 🎵
"He’ll be  a credit to us a'
W
e’ll a’ be proud o Robin!"
And proud of him we are!

My task tonight is to remind us why we're here to celebrate the life and works of this extraordinary man, why he was indeed a 'credit to us a'.

And to do that I think it's helpful to provde some context, to help understand why this meal itself is so significant and why the haggis we’re about to welcome deserves such an impressive ceremony.

So I want you to come with me on a journey - come back 260 years [and one day] to the night of the 25th January 1759. We’re by the banks of the river Doon in Alloway, and a wild storm is blowing. And there's a small, mud-walled, thatch-roofed cottage  - an ‘auld clay biggin’ - inside which a child is being born. That child is, of course, our hero: Robert Burns.

Legend has it that the wind was so fierce that night that the gable-end wall of the cottage started to collapse, and the baby Burns had to be carried though the tempest to somewhere more secure1.

So he was born in a storm - and born into a world very different to that we know today: the world of the agricultural poor in 18th century Scotland.

What did that mean in practice?

Well the home that Burns grew up in we today wouldn't consider to be fit for human habitation. That two room cottage would have had no proper flooring - certainly no floorboards or carpet - no running water, no sanitation, no bathroom – and the living area was probably shared with chickens.

When Burns studied at night - and he did study; encouraged by his father he studied English grammar, French, Latin and later mathematics and the classics - he would have been working by the dim flicker of tallow lamps.

Picture him: studying and later writing his poetry while his feet scuffed against an earthen floor, with hens maybe clucking around him, the light dim and the air thick with the smell of rendered animal fat burning in those lamps.

Not to put too fine a point on it: life for the agricultural poor back than was pretty miserable. Disease was rampant and infant mortality was shockingly high.

In fact, let me do a little test with you all here tonight [get all to put their hands up, then lower them if older than 50, 40, 35 - at least for this supper all were over 35, most were over 50]

OK - so the average life expectancy in Scotland when Burns was born was just 32 years2.

Now averages are funny things [infant mortality brings down the average a lot3] but still - 32 - it's a sobering thought, is it not?

Well if that’s a sobering thought, maybe we should turn our attention to drink!

When Burns wrote of 'reaming swats, that drank divinely'4, he was of course referring to the foaming, creamy ale that was drunk not just in taverns but with every meal - drunk because it was purer, safer than the water.

So if you choose to indulge in 'guid auld Scotch drink'5 tonight [or even New Zealand sauvignon blanc or Chilean cabernet sauvignon] you can take comfort from the fact that what you are doing is something that, in 18th century Scotland, would have been considered simply healthy best practice!

[so you can drink guilt free tonight]

But what about the meal, what food would Burns have been used to?

His diet would have consisted primarily of oatmeal-porridge, barley-broth, potatoes [introduced to Scotland just 20 years before his birth6] and milk - maybe some kale, peas or beans. But meat was just an occasional luxury ... and hunger, famine even, was a reality for many.

[We’re not talking about Tesco’s running out of avocados here]

Towards the end of his life, while staying in Dumfries, he wrote to one friend:
“Here, we have actual famine, & that too in the midst of plenty – many days my family & hundreds of other families, are absolutely without one grain of meal; as money cannot purchase it”
 - from letter to France Anna Dunlop, Jan 1796
Later that same year he wrote:
“if I die not of disease, I must perish with Hunger"
– from letter to Alexander Cunningham, July 1796
So as we tuck into our haggis this evening, we should appreciate that for the man we’re here to celebrate, this meal really would have been a special treat - particularly because haggis features that most precious commodity of the time: meat.

Hopefully that has helped get us all into an 18th century frame of mind – and perhaps help us appreciate why he wrote the paean of praise to the humble haggis that we'll be hearing very soon.


['Address to the Haggis']

['Selkirk Grace']

Soup


So while we wait for our main-course to arrive, I want to talk very briefly about Burns the farmer. In later years he was also an exciseman (a tax collector for the British state no less!)  but he was born a farmer's son and farmed nearly all of his adult life. In his own words:
"I was bred to the plough, and am independent”
- from Address to the Caledonian Hunt, 178728
[Independent of mind, of course - we'll come on to discuss that.]

Well bred to the plough he may have been, but in truth he was not a great farmer. How could he be when his mind was continually distracted by higher things?

As a 19th century biographer wrote7:
“to him the stubble-field was musing-ground, and the walk behind the plough, a twilight saunter on Parnassus”  
[Parnassus of course being the home of the “muses” in Greek mythology]

So as he ploughed, he mused - and luckily for us, he let his mind wander and committed his thoughts to rhyme.

When his plough turned down a mountain daisy, he would grieve for it - and apologise to it:
“Wee, modest, crimson-tippèd flow'r,
 
Thou's met me in an evil hour;
For I maun crush amang the stoure
Thy slender stem:
To spare thee now is past my pow'r,
Thou bonie gem”
- from 'To a Mountain Daisy'
The words of a great poet - but surely not concerns a good farmer would find time for.

And perhaps most famously of all – when his ploughshare [the “coulter”] disturbed a field-mouse’s nest, he took time to ponder the moral questions this raised. In the process he reflected not just on the similarities between him and his 'fellow mortal', but also - towards the end of the poem - I'd suggest his real insight is to pin-point the fundamental difference between man and mouse.

[This is the only poem I'm going to recite in full this evening - it's not too long but it's worth highlighting a phrase which can trip some people up; 'A daimen-icker in a thrave' refers to the occasional ear of corn (the daimen-icker) out of a bundle of 24 ears of corn (the thrave).]

'To A Mouse (On Turning Her Up in Her Nest with the Plough)'
Wee, sleekit, cowrin, tim’rous beastie,
O, what a panic’s in thy breastie!
Thou need na start awa sae hasty,
Wi’ bickering brattle!
I wad be laith to rin an’ chase thee,
Wi’ murdering pattle!

I’m truly sorry Man’s dominion
Has broken Nature’s social union,
An’ justifies that ill opinion
Which makes thee startle
At me, thy poor, earth-born companion
An’ fellow-mortal!


I doubt na, whyles, but thou may thieve;
What then? poor beastie, thou maun live!
A daimen-icker in a thrave
‘S a sma’ requet;
I’ll get a blessin wi’ the lave,
An’ never miss’t!


Thy wee-bit housie, too, in ruin!
Its silly wa’s the win’s are strewin!
An’ naething, now, to big a new ane,
O’ foggage green!
An’ bleak December’s win’s ensuing,
Baith snell an’ keen!


Thou saw the fields laid bare an’ waste,
An’ weary Winter comin fast,
An’ cozie here, beneath the blast,
Thou thought to dwell,
Till crash! the cruel coulter past
Out thro’ thy cell.


That wee bit heap o’ leaves and stibble,
Has cost thee monie a weary nibble!
Now thou’s turned out, for a’ thy trouble,
But house or hald,
To thole the Winter’s sleety dribble,
An’ cranreuch cauld!


But Mousie, thou art no thy lane,
In proving foresight may be vain:
The best-laid schemes o’ Mice an’ Men
Gang aft agley,
An’ lea’e us nought but grief an’ pain,
For promis’d joy!


Still thou are blest, compared wi’ me!
The present only toucheth thee:
But Och! I backward cast my e’e,
On prospects drear!
An’ forward, tho’ I cannot see,
I guess an’ fear!

Main course & pudding 


 🎵 Song: 'Ae Fond Kiss' 🎵
"Ae fond kiss, and then we sever;
Ae fareweel, and then forever!"
The pain of lost love - the agony of saying goodbye to a loved one, never to see them again. But I'd suggest the genius of Burns lies in recognising that the sadness of separation is the ticket-price price you pay for the joy of  love:
"But to see her was to love her;
Love but her, and love forever.
Had we never lov'd sae kindly,
Had we never lov'd sae blindly,
Never met—or never parted—
We had ne'er been broken-hearted."
The broken heart is the price you pay for the joy of the love that comes before.

The words of this song were written by Burns as a parting gift, sent in a letter to a women with whom he had become infatuated – in his letters he referred to her as his “Clarinda”, her real name was Nancy8 - and that letter was his farewell to her as she sailed to Jamaica and he expected never to see her again.

We’ll come back to Nancy – but first we have to tackle that most difficult of subjects: Burns and women.

It was a woman - a girl really - working beside him during the harvest who first inspired Burns, an infatuated 15 year-old boy to, in his own words, 'commit the sin of rhyme'9.

And in that first poem, 'Handsome Nell', I think we can see the first flickers of the genius that was to come in these lines:
“She dresses aye sae clean and neat,
 Baith decent and genteel,
And then there's something in her gait
Gars* ony dress look weel"
*makes, compels

[15 years old: can you imagine any 15 year-old you've know expressing emotion like that?]

And so began a long history of loving women – and of being loved by them.

He grew to be a relatively tall, good-looking man with dark, bright eyes – and with women in particular he he was witty, eloquent ... and persuasive.

But his talents didn't end there. As one of his conquests said:
“an hour with him in the dark was worth a lifetime of light with any other body”10
[that's not a bad review, is it?]

And Nancy – the woman he wrote 'Ae Fond Kiss' for? They never did meet again, but she certainly never forgot him. Some 40 years later, an 86 year-old Nancy wrote in her journal, under the date 6th December 183111:
 'This day I can never forget. Parted with Burns, in the year 1791, never more to meet in this world. Oh, may we meet in Heaven!'
He certainly left his mark with mark with women - not least in that he got at least 6 different women pregnant and fathered 12 children that we’re sure of [some say 14]12.

One of those women, by the way, was the maid of that same Nancy to whom he wrote 'Ae Fond Kiss'. She was their go between, she carried the letters between them13 - and somehow in the process Burns got her pregnant!

He clearly had "issues".

But to characterise Burns as a lothario - a selfish womaniser - is, I'd suggest, to do him a disservice. If you read his letters it seems clear to me that he genuinely loved them all. In his own words:
“my heart was completely tinder, and was eternally lighted up by some goddess or other”
– from letter to Dr John Moore
He was a weak-hearted lover – [weak-hearted: plot point!] – and he couldn't help but fall in love. In fact heartbreak was the catalyst for his most creatively productive period.

His heart was broken when - in his mid-twenties - he met, wooed, got pregnant [of course he did] and decided to marry the woman who would eventually bear nine of his children: Jean Armour, his 'Bonnie Jean'.

But his reputation preceded him – he already had one illegitimate child by this time (who now was being raised by his mother14) and he didn't hide his disdain for religion – so Jean's father forbade the marriage and forced Jean to renounce him.

Burns was distraught - and this triggered a period of manic poetic productivity. It was said that:
“He persevered in song & sought solace in verse, when all other solace was denied him”15
Let's sample some of it:
“Ye jovial boys who love the joys
The blissful joys of lovers;
Yet dare avow with dauntless brow,
when th’ bony lass discovers*;
I pray draw near and lend an ear,
And welcome in a Frater
For I’ve lately been on quarantine
A proven fornicator"

- from 'The Fornicator' 
*shows to be pregnant

He showed nothing but scorn for the pious and holier-than-thou who presumed to judge him - particularly those who wore religion as a shield:
“God knows, I’m no the thing I should be,
Nor am I even the thing I could be,
But twenty times I rather would be
An atheist clean
Than under gospel colors hid be
just for a screen”
- from 'Epistle to the Rev John McMath' 
Or perhaps even more scathingly:
“O ye, wha are sae guid yoursel’
Sae pious and sae holy
Ye’ve nought to do but mark and tell
Your neebours fauts and folly!”

-  from 'Address to the Unco Guid'
So shunned by the pious and renouced by Jean, he 'went all but mad', he 'roamed, moody and idle about the land'16 -  fortunately for us, writing frenetically as he did.

He still found time to fall in love again [of course he did].

He became betrothed to Mary Campbell (his 'Highland Mary') and planned to sail with her to Jamaica to start a new life - but decided to publish his poems first to help finance their new life.

Tragically, Mary died while waiting for him at the port [probably in premature child-birth].

His trunk was literally packed and on its way to the dock when his works were published to immediate and wide acclaimed. So he changed his plans and headed to Edinburgh – there for his feet to touch carpet for the first time – and he enjoyed two years of being lauded and favoured by the great and the good.

And there he met Nancy – his “Clarinda”, to whom he would write 'Ae Fond Kiss' - and we have come full circle.

Shortly after Nancy sailed to Jamaica he finally married his Bonnie Jean;
“On peace an rest my mind was bent,
And, fool I was! I married"
- from 'O, Ay My Wife She Dang Me'
A few years later, Jean was to take in Robert’s latest illegitimate child and bring her up as her own– you can just imagine the weary resignation with which she uttered those immortal words:
“'Our Robbie should have had twa wives”17

So why do we celebrate this man?

He had a reputation as drunkard, he was certainly a womaniser, unfaithful to his wife, a 'proven fornicator'. We can can I'm sure agree that he was no saint - but I hope we can also agree that he was a genius.

Walter Scott may have been responsible for the shortbread-tin view of Scotland so beloved of tourists - but Burns managed to capture the true essence of 'Scottishness' in a way that Scots today still relate to.

His first published works were titled: 'Poems, Chiefly in the Scottish Dialect' – and that dialect is critical, because he wrote using the language of the fireside, he captured the way that common people actually spoke.

It was said that 'the auld doric to him was what an ancient harp might be to a minstrel'18

[Scottish dialect was the instrument on which he played - and If you think of other famous 18th century poets - Blake, Byron, Coleridge, Keats, Shelly, Wordsworth – beautiful writers all, but none of them wrote with the voice of the common man19]

And he described characters with such deft observational skill that they still live today – think of the drunken reveller Tam O’ Shanter or his shrew-like wife Kate, waiting at home 'gathering her brows like gathering storm, nursing her wrath to keep it warm'20.

[I see some flickers of recognition in the audience!]

But his canvas was so much broader than just Scotland and Scottishness.

He was capable of biting satire - fearless when denouncing the hypocritical and the entitled. But he also - with compassion, humour and wit – was understanding and forgiving of the moral frailty of the common man.

He observed the human condition and articulated fundamental truths about it and - above all - he championed the goodness that he believed exists in us all.
“Then let us pray that come it may,
As come it will for a’ that,
That Sense and Worth, o’er a’ the earth
Shall bear the gree an’ a’ that
For a’ that, an’ a’ that,
It’s comin yet for a’ that,
That Man to Man the warld o’er
Shall brithers be for a’ that.”
- from 'A Man's a Man For a' That'21
Or as in 'To A Louse'
“O would some power the giftie gie us to see ourselves as others see us”
[Somehow those words seem more appropriate now than ever - words witten 260 years ago that still resonate today]

In fact, whether you’ve noticed it or not, his words have echoed through the ages.

In the 19th century when a shipping magnate wanted to build the world's fastest Tea Clipper, he named her 'Cutty Sark' in direct reference to Burns' narrative masterpiece 'Tam O'Shanter'22.

In the 21st century when John Steinbeck wrote 'Of Mice and Men' he was, of course, quoting that line from 'To A Mouse': 'the best-laid schemes o' Mice an Men gang aft agley'.

And when 20th century politicians say 'the rocks will melt wi’ the sun'  before they’d change a policy23, we know they're stealing a line from 'My Luv is Like a Red Red Rose':
“Till a’ the seas gang dry, my dear
and the rocks will melt wi’ the sun!
And I will Luve thee still, my dear,
Till a’ the seas gang dry”
And of course, when at  New Year - and on nights like tonight - we sing 'Auld Lang Syne' we are singing something that Burns was responsible for capturing and putting in print24.

***

But to celebrate the great man’s life, it is our duty to consider the circumstances of his death.

His love of drink – and the pressure put on him to drink - certainly didn’t help
“occasional hard drinking is the devil to me [..] it is the private parties in the family way, among the hard drinking gentlemen of this country that does me the mischief”
- from letter to Frances Anna Dunlop, Dec 1792
[I know how he feels]

But it was that weak heart – that easily broken heart - that did for him. We think now that he suffered from chronic rheumatic heart disease and we know, from his own letters, that he suffered throughout his life. Just one example of many:
“I have only known existence by the pressure of the heavy hand of sickness; and have counted time by the reprecussions of pain! Rheumatism, cold and fever have formed, to me, a terrible Trinity in Unity, which makes me close my eyes in misery, and open them without hope”
- from letter to George Thomson, Apr 1796
[he certainly knew how to feel sorry for himself - but we now know he had just cause]

And sadly, most of his last letters see him begging for money to settle debts, fearful that his wife and children would be left in penury. Burns was:
“a man who had little art in making money, and still less in keeping it”25
But he never lost his wit – or indeed his love of women.

With a fitting symmetry - for than man first inspired to rhyme by a bonny lass – his last work was written for the nurse who tended his death bed;
“Or were I in the wildest waste,
Sae black and bare, sae black and bare,
The desert were a Paradise,
If thou wert there, if thou wert there"

- from 'O, Wert Thou in the Cauld Blast' (deathbed poem to Jessie Lewars)26
He passed away on 21st July 1796, at just 37 years of age27.

His funeral was attende by 10,000 mourners - and on the day of his funeral his wife Jean gave birth to the last of his children.

Now, before I propose the toast, I’d like to take advantage of the poignancy of this moment to ask Aileen to perform one of Burns' most touching works (and something Aileen sings beautifully): 'Ay Waukin O'.

[The song of a woman who lies awake, unable to sleep for thinking of her lover]

 🎵 Song: 'Ay Waukin O'🎵

So now, ladies and gentlemen, it just remains for me to ask you to raise your glasses and join me in a toast: to the Immortal Memory of Robert Burns

****


Sources

Robert Burns, The Complete Poetical Works, edited by James A Mackay [Alloway Publishing]

Life of Robert Burns by Allan Cunningham [published in 1842 - available online here]

The Complete Letters of Robert Burns, edited by James A Mackay [Alloway Publishing]

The Robert Burns Story, John Cairney [via iTunes]

Robert Burns: man o' independent mind, Professor Chris Whatley [These Islands]

Burness Genealogy and Family History: Descendants of Robert Burns


Timeline (cobbled together from the above)

  1. 05/1785 to Elizabeth Paton (servant girl): Elizabeth “Bessy” – lived to 32 yrs
  2. 09/1786 to Jean Armour: Robert – lived to 71 yrs
  3. 09/1786 to Jean Armour: Jean – died an infant [13 mths]
    10/1786 to Margaret (Mary) Campbell – possibly died in premature labour
    05/1787 to May Cameron - became pregnant, outcome unknown
  4. 05/1788 to Jean Armour: twin – died unnamed
  5. 05/1788 to Jean Armour: twin – died unnamed
    [08/1788 marriage to Jean Armour recognised]
  6. 11/1788 to Janet (Jenny) Clow (maid): Robert - unknown
  7. 05/1789 to Jean Armour: Frances Wallace – died aged 13 yrs
  8. 04/1791 to Jean Armour: William Nicol – lived to 80 yrs
  9. 03/1791 To Anna Park (barmaid):Elizabeth “Betty” – lived to 82 yrs
  10. 11/1792 to Jean Armour: Elizabeth R – died an infant [2 yrs]
  11. 08/1794 to Jean Armour: James G – lived to 72 yrs
  12. 07/1796 to Jean Armour: Maxwell – died an infant [2 yrs]



Footnotes

  1.  A little bit of poetic license is being used here - although that legend exists, in truth this incident appears to have occurred some days after his birth 
  2. Mortality in Early Modern Scotland
  3. An interesting illustration of this point can be gleaned from the timeline above. Of the 11 of Burns children for whom we know the outcome their average age was c. 32 - bang on the average for the time. Dig a little deeper and you'll see that 5 died as infants and one other failed to reach adult-hood - but of those that did reach adulthood, 4 of them lived to be over 70 (2 of them to over 80). The point being, if you survived to adulthood you could reasonably expect to live beyond your 50s (which is why Burns can still be considered to have "died young" at 37, despite that being greater than the average life expectancy at the time)
  4. from Tam O'Shanter:
    But to our tale:-- Ae market-night, Tam had got planted unco right; Fast by an ingle, bleezing finely, Wi' reaming swats, that drank divinely
  5. from Scotch Drink
    O thou, my muse! guid auld Scotch drink! Whether thro' wimplin worms thou jink, Or, richly brown, ream owre the brink, In glorious faem,Inspire me, till I lisp an' wink, To sing thy name!
  6. "The introduction of the potato to Scotland in 1739 greatly improved the diet of the peasantry"
  7. from Life of Robert Burns by Allan Cunningham [published in 1842]
  8. Agnes "Nancy" Maclehose
  9. In a letter for Dr John Moore, August 1787:
    “... brought to me my sixteenth year; a little before which period I first committed the sin of rhyme - [...] she altogether unwittingly to herself, initiated in me a certain delicious passion, which in spite of acid disappointment, gin-horse prudence and bookworm philosophy, I hold to be the first of human joys, our dearest blessing here below!”
  10. from Life of Robert Burns by Allan Cunningham [published in 1842]
  11. attributed to multiple sources
  12. See timeline above
  13. She was certainly Nancy's maid and appears to have met Burns delivering one of her letters
  14. See timeline above
  15. from Life of Robert Burns by Allan Cunningham [published in 1842]
  16. from Life of Robert Burns by Allan Cunningham [published in 1842]
  17. "Our Robbie should have had twa wives"
  18. Attributed to Reverend Paterson by Major J. Fraser Morgan  in The William Will Memorial Lecture to the Vernacular Circle of the Burns Club of London: llth January 1982 [via the Burns Chronicle]
  19. OK, full disclosure: I googled a list of 18th century poets and I think my assertion is fair, but I stand ready to be corrected!
  20. Tam O'Shanter, obviously
  21. The following verse is perhaps better known
    For a' that, an' a' that. 
    Our toils obscure an' a' that, 
    The rank is but the guinea's stamp, 
    The Man's the gowd* for a' that.
    *gold
  22. Shipping magnate John Willis in 1869 - the figurehead famously features the witch Nanny Dee with the tail of Tam's grey mare Meg clasped in her hand
  23. Alex Salmon, about tuition fees. For obvious reasons I decided to not use the following example, but I include it here for completeness:

    In the fevered world of Scottish politics, you’ll regularly hear supporters of independence quoting Burns' line from a poem written in 1791:

    “We're bought and sold for English gold
    Such a parcel of rogues in a nation!”

    But others might point out that - as the aftermath of the French Revolution became clearer - in 1795 he wrote:

    “Be Britain still to Britain true,
    Amang ourselves united;”

    I guess you pay’s your money and you takes your choice!

  24. I choose my words carefully here, because the extent to which Burns reworked a traditional ballad is a subject of some debate - the tune of 'Auld Lang Syne' itself is known to have been in print since 1700 [per "Poetical Works of Robert Burns" edited by James A Mackay]
  25. A line attributed to Robert Cox in various sources
  26. In one of those remarkable co-incidences that makes life so interesting, one of the audience members approached me after this speech to introduce themselves as a direct descendent of Jesse Lewars, whose portrait hangs in their house
  27. There is a rather fantastical version of Burns' final moments offered by Allan Cunningham
    "He had laid his head quietly on the pillow awaiting dissolution, when his attendant reminded him of his medicine of his medicine and held a cup to his lips. He started up suddenly, drained the cup at a gulp, threw his hands before him like a man about to swim and sprung from head to foot of the bed – fell with his face down and expired with a groan”
    but I tend to share the view that this a rather over-embellished anecdote
  28. OK, so this note is out of sync: but I think it's worth putting the extract in context:
    "Though much indebted to your goodness, I do not approach you, my Lords and Gentlemen, in the usual stile of dedication, to thank you for past favours; that path is so hackneyed by prostituted Learning , that honest Rusticity is ashamed of it. Nor do I present this "Address" with the venal soul of a servile Author, looking for a continuation of those favors. I was bred to the Plough and am independent.”

Monday, 8 October 2018

Responding to Commonweal


On a recent trip home to Islay I picked up a copy of the Ileach (the local paper) and read an article relaying the pro-independence arguments that had been put forward by the Commonweal's Robin MacAlpine at a recent meeting there. Being familiar with the Commonweal's "White Paper Project", I felt compelled to respond.
***

I read with interest Chris Abell’s article in last month’s Ileach describing the Commonweal’s “strategy for winning independence”, as outlined by Robin McAlpine at a recent meeting on Islay.

Let me be clear about where I stand - there is after all no view from nowhere, there are merely different points of view. As Chairman of These Islands, a think tank which aims to encourage well-informed and civilised debate about the constitutional future of the UK, I have no party political allegiance but stand unabashedly for the view that more unites the nations of the United Kingdom than divides them (and I’m familiar with the Commonweal’s “White Paper Project”).

We’re told Mr MacAlpine is “unpersuaded by arguments that Scotland has neither the competence nor the resources for independence”. Unfortunately he is arguing against a straw man of his own making here, because nobody suggests that Scotland can’t be independent, we merely respectfully disagree about what the implications of such a move might be.

Claims that the Commonweal’s plans are “pragmatic and practical” and “do not dodge the difficult issues” deserve to be challenged.

Scotland’s current deficit according to the Scottish Government’s own GERS figures is 7.9% of GDP. The Commonweal assume a Year One deficit for an independent Scotland of 5.5%, similar to the SNP’s own “Sustainable Growth Commission” assumption of 5.9%. These Islands has published a detailed paper (reviewed and endorsed by senior economists) which carefully explains why the assumptions used to reach these figures are not just heroically optimistic but in some cases fundamentally flawed.

Even if we accept these figures, a small independent country starting life with a deficit of more than 5.0% while trying to create its own currency would face huge challenges. For context: the EU’s “excessive deficit” threshold is set at 3.0% and the European Fiscal Compact specifies a 0.5% limit.

Contrast this with where we are today: the UK’s deficit is shared across our entire population, so the people of Scotland are currently only asked to bear their population share of a 1.9% deficit. So even to accept the Commonweal’s 5.5% figure is to accept that independence would make us materially poorer on day one. That difference of 3.6% of GDP is equivalent to over £6bn a year.

If we take the current GERS 7.9% figure as being a more realistic starting point, the figure becomes just over £10 billion or c.£1,900 a year for every man, woman and child in Scotland. That is the effective net fiscal transfer in Scotland’s favour as a result of the Barnett Formula, it is the tangible benefit of UK-wide pooling and sharing. Pointing out the fact that an independent Scotland would lose that transfer is not to suggest that Scotland couldn’t be independent, it is merely to highlight the very real implications for our capacity to invest in public services.

This simple fiscal arithmetic is why the SNP’s Growth Commission concluded that an independent Scotland would require at least a decade of further austerity. Nicola Sturgeon admitted as much in 2016 when challenged by Andrew Neil during a BBC interview: “we would deal with the deficit in the same way as the UK’s dealing with the deficit” she said.



So when pressed the SNP tacitly accept that independence would mean an extended period of further austerity. Given the additional challenge of being a new small country creating our own currency, it’s pretty clear that this would need to be far deeper austerity than anything we’ve experienced in recent times.

This context exposes the misleading nature of the Commonweal’s assertion that “nothing need change […] in health and social services, local government and policing”.  A pragmatic and practical assessment that didn’t dodge the difficult issues would address the fact that significant cuts would be required to those public services which affect all of our day-to-day lives. The Commonweal’s paper simply fails to address this inconvenient truth.

After quoting research showing people “hate spinning, sarcasm and name calling and have little patience for negative campaigning and sloganeering”, MacAlpine apparently went on to talk of “the overwhelming shame of being governed from Westminster by a bickering crew of incompetent, lazy and lying politicians” and “their inability to look out for any interests but their own”. It’s a shame to read he resorted to such language, but it’s also unclear why he believes replacing politicians in Westminster (including 59 Scottish MPs) with more politicians in Holyrood would cure this problem – presumably it has something to do with our old friend Scottish exceptionalism?

There’s also an assertion that Brexit means independence is “beginning to make more sense to folk”. In fact for many of us the challenges of Brexit merely illustrate how much more destructive and painful breaking up the UK would be. Scotland is far more integrated with the UK than the UK is with the EU. As well as having full fiscal pooling and sharing (i.e. we share the deficit) we share a currency, defence and international affairs costs and have deeply integrated machinery of state. However bad Brexit may be, breaking up the UK would be an order of magnitude worse; two wrongs don’t make a right.

A final thought for those who suggest that Scotland receiving a fiscal transfer is evidence of economic failure under Westminster rule. The cause of Scotland’s higher deficit is mainly higher per capita spending rather than lower per capita revenue generation. Ileachs should understand this concept: just as Scotland is a relatively high “cost-to-serve” part of the UK, so Islay is of Scotland. Factor in the likes of Road Equivalent Tariff ferry subsidies, the costs of providing services to our remote communities and flights to the mainland for emergency medical procedures and I’m pretty sure Islay would have a higher per capita deficit than Scotland as a whole. The implied fiscal transfer that results is not evidence of an economic failing but of successful pooling and sharing, it demonstrates that we have a spirit of solidarity that goes beyond asking everybody to “pay their own way”.

Scotland benefits economically from being in the UK and the Scottish Government now has tax raising and benefits powers which would allow them to redistribute wealth very differently from today if they had the political will. Maybe the Commonweal should focus on how these hard-fought-for powers could be used to create a fairer Scotland in the UK rather than campaigning for a poorer Scotland outside it.

***

Wordcount discipline prevented me commenting on the hints about nationalising the Scottish whisky industry, the unfounded assertion that "support for independence has never been higher" or the fact that some of the ideas mentioned either are possible now with devolved powers or would fall foul of EU state-aid limits (the Commonweal is equivocal about future EU membership).

For completeness, this is the Ileach article I was respondong to:






Tuesday, 24 July 2018

In other news ...

I've been quiet on this blog recently - here's why.

Yesterday saw the publication of a paper which I authored for the These Islands forum (which I co-founded and chair), which responds to the SNP's Growth Commission in what I think can fairly be described as forensic detail.  You can read the full report here


It offers a very carefully constructed, respectful but thorough analysis of the Growth Commission's output. On this blog I took care to respond to specific Growth Commission claims, recommendations and analyses as these were revealed - the paper offers a more considered view.

If the angry swarm of cybernats on Twitter would do the same, they'd avoid making the rather embarrassing mistake of attacking the paper as the ramblings of a "dog food salesman" - it has not only passed review by the These Islands advisory council but has been explicitly endorsed by highly respected economists.


The Growth Commission (and SNP leader Nicola Sturgeon who commissioned it) asked for their report to form the starting point of a debate. My paper is intended to contribute to that debate and at least the media response has been encouraging, with pretty much wall-to-wall coverage in Scottish print media:


I also appeared on BBC Radio Scotland's Good Morning Scotland [listen from 1:48:30 here] to (frustratingly briefly) discuss the paper.  Unbeknownst to me, SNP MP Kirsty Blackman was allowed an unchallenged reply and I was given no chance to rebut her claims. For the record: she shouldn't really be dismissing analysis endorsed by the people above as "nonsense" and her claims about pensions and HS2 costs were just  a re-run of tired and discredited arguments beloved of GERS-deniers. If she's right about Scotland subsidising UK pensions in the GERS figures (she isn't) then it's really weird that the Growth Commission didn't pick this up during its two year gestation period (they didn't, because it isn't so).

It looks likely that Ms Blackman agreed to appear on condition of responding to me but not debating. This is a presumption on my part, but if I'm right it suggests a rather strange approach to "opening up debate".

I also had a piece published for the New Statesman (which was their "most popular" the day it was published) - I encourage people interested in the nature of political debate in Scotland to read it.


As well as the widespread coverage in the Daily papers, there have been a number of significant online pieces - here's just a selection:
  • "having commended Andrew Wilson two months ago for a serious-minded and valuable contribution to debating Scotland's future, I'll do the same for Kevin Hague." - Douglas Fraser for BBC Scotland
  • "the most detailed response to the Growth Commission report to date" - Business Insider
  • "These Islands published a paper that forensically dissects the SNP's Sustainable Growth Commission Report and its "optimistic" assessment of the prospects for the Scottish economy under independence" - reaction.life
The social media reaction to all of this has been predictably depressing, with an onslaught of personal attacks against me from people who clearly haven't even glanced at let alone read the paper or its endorsements (just google "dog food salesman" if you fancy a laugh).

Zoomers are gonna zoom, but a couple of more high profile reactions are worth highlighting.

This from SNP MP Peter Grant is - well - "interesting"

This from SNP MSP James Dornan - responding to the cybernat in chief - is in a similar vein



And then there's this is from Growth Commission member Iain Docherty who - having incoherently attempted to criticise our "analytical frame" - confessed to having not actually bothered to read the report before passing judgement



What a time to be alive.



Friday, 15 June 2018

Growth Commission: A Simple Mistake

I'm indebted to Fraser Whyte who first spotted this rather significant error in the Growth Commission report and blogged about it here.

I trust Fraser - he's good - but what he identified was such a howler that I wanted to check and, having a bit more time, dig a layer deeper.  Fraser was right - if anything it's even worse than he thought.

So here we go, with references to the Growth Commission report indicated [thus]...

The largest claimed saving is for spending reductions compared to allocated UK government spending of 0.8% of GDP [B4.67]. The justification for this figure in the report is unclear and based on demonstrably flawed assumptions.

The report suggests [B4.57] a comprehensive 2 year review to analyse “where savings could be made where costs need not be replicated”.

The report then [B4.58] seems to declare the result of this proposed analysis by stating “This analysis shows an improvement in the public finances of around £1 billion [...] the equivalent of 0.8% of GDP”

An immediate concern here is that £1 billion is in fact 0.67% of 2016-17 onshore GDP1, but the figure of 0.8% is the one the report goes on to use.

A bigger issue is the way in which the £1 billion figure is justified. It is explained [B4.58] as being made up of savings of £0.4bn and revenue benefits of £0.6bn.

The asserted potential saving of £0.4bn from costs “that will no longer be required” is supported by a few examples that total just £170m2. Even the examples given are not well justified3 and include a sweeping “more than £100m for Whitehall running costs that will not need to be duplicated in Scotland”.

The revenue benefit of £0.6bn is explained as being associated with £2.4bn of “spending that is allocated to Scotland but takes place elsewhere”. Not only does this £2.4bn include costs that the report has just assumed will be saved (and so can’t be transferred), the assertion that all of this £2.4bn4 of spending currently allocated to Scotland takes place outside of Scotland is simply and very materially wrong.

To illustrate: the £2.4bn includes £484m [Table 4-2] of ‘Public & Common Services’ costs. In 2015-16 the equivalent figure was £467m, a figure we can break down in detail by using the GERS expenditure database.

This shows us that not only does this figure include all of the costs that the Growth Commission has explicitly assumed will be saved5, but that it includes spend which already takes place in Scotland.

The figure includes, for example, £234m6 of current expenditure on HM Revenue & Customs, this being Scotland’s 8.3% population share of the total UK figure7. In fact we know that 12% of HMRC headcount is currently based in Scotland8, so it is simply wrong to assume that Scotland would benefit from transferring this expenditure to Scotland.

In fact, in this specific example it seems likely that Scotland would see economic harm as a result of independence, as a greater share of HMRC employees are in Scotland than Scotland’s population share9.

This reveals another flaw in the analysis: not only are the Commission fundamentally wrong in assuming that no central spending allocated to Scotland takes place in Scotland, they don't consider the mirroring effect which is that there will be costs spent in Scotland that are currently allocated to the rest of the UK.  What the true net effect of this is would require deeper analysis - but we can be sure that the Growth Commission's analysis is simply and very significantly wrong.

So the assumed saving of 0.8% of GDP from spending reductions (compared to GERS allocated UK government spending) falls apart when tested and is clearly heavily overstated.

Two years they spent writing this report.

Two years.




Notes:

1. Using 2016-17 GERS figure of £150,025m for onshore GDP (£1bn is 0.63% of the £159,389m total GDP figure)

2. [B4.58] £50m associated with running costs of the House of Commons & House of Lords, £20m for the Scotland Office and “more than £100m for Whitehall Department running costs”

3. According to the 2015-16 GERS expenditure database, a total of just £36m is allocated for House of Commons and House of Lords; the Scotland Office figure is £23m

4. This figure appears to be made up of total allocated spending [Table 4-2] of £4.7bn less international affairs (£0.8), all economic affairs (£1.0bn), and we presume accounting adjustments and EU transactions (£0.5m)

5. House of Lords & House of Commons (£36m), Scotland Office (£23m) and various “Whitehall Costs” including Cabinet Office, DfID, HMRC, HMT etc.

6. This £234m is categorised as “non-identifiable expenditure” in the database, but this does not mean the expenditure takes place outside Scotland. We suspect this may have been the cause of the Commission’s misunderstanding

7. £2,838m, defined in the GERS expenditure database as: HMR041-S041A003-UK-TES_CUR-Non-ID-CG-SUB010100

8. Institute for Government, “Governing after the Referendum” - Figure 2, page 24

9. Of course to answer this question properly we’d need to know the share of spend, not just share of employment – but the point at issue here is that the Growth Commission’s assumptions are clearly and materially flawed.

Tuesday, 5 June 2018

Growth Commission: Cohort Selection

As a quick exercise I wanted to check how the Growth Commission's "peer group of 12 countries" had been selected. The report offer no explanation at all other than by inference - so I used the same data sources they used to create an objective list of comparable small countries.

My criteria are very simple: countries which qualify as IMF "advanced economies", ranked by size. I've added IMF 2016 GDP/Capita ($US) for comparison purposes as this is the primary measure the Growth Commission use. The highlighted countries are those selected for the Growth Commission's “peer group of the 12 most successful small advanced economies”.


The important point to make here is that this cohort has been pre-screened for success. All of those countries excluded that lie within the population extremes of those selected have lower GDP/Capita than Scotland (and indeed at both the higher and lower end, the population extremes conveniently stop just the right side of examples where GDP/Capita is lower than Scotland's).

There is nothing wrong with this as long as we appreciate that the Growth Commission is seeking to learn from successful small advanced economies. What they are unable to do from the analysis presented is draw any robust conclusions about whether or not small advanced economies are somehow intrinsically more successful than large ones.

It's perhaps unfortunate that in the introduction to the report (p10, 2.28) the Chair Andrew Wilson asserts “The evidence demonstrates that smaller countries, partly because of their greater need to respond to global challenges, produce better governance, policy and therefore living standards.” 

This may or may not be the case, but no such evidence is presented in the report.

Saturday, 2 June 2018

Andrew Wilson's Doublethink Masterclass

I'll keep this brief.

I've just caught up with Andrew Wilson's Sunday Politics Scotland interview from 27/05/2018. If you want to hear the words I'm taking issue with being spoken, watch here from 7:30



Verbatim, emphases mine:
"well in fact, we do the opposite of what the OBR and George Osborne has done because we don't put assumptions for growth into the numbers - we could have just said 'well we've modeled it, we think growth's going to be faster and look here, everything's fine' ... [interviewer interruption] .. well, we assume that over time the average performance of the past is the average performance of the future for inflation and growth, and we say 'what would you do?' - now the point of this Gordon if I may say is, that without making wild predictions for growth we show how over a period of 5 to 10 years - while growing the public finances, rejecting austerity, stewarding growth at the same time - we can bring discipline to the public finances sustainably."
You might want to watch the clip to believe that's what he said, but it is - and it's consistent with his comment to me on Twitter that "there is no growth rate assumption".

So let's quickly unpick the bizarre logic of the first half of this extract before turning to the assertion in the second half.

He states "we don't put assumptions for growth into the numbers" before then describing the assumptions for growth they put into the numbers: "we assume that over time the average performance of the past is the average performance of the future for inflation and growth".

So they do put assumptions for growth into the numbers - which is obvious because without assumptions for growth they couldn't make the assertion he then goes on to make.

We know this anyway because the report is explicit about the assumption used to drive the analysis that AW refers to when he says "we show how over a period of 5 to 10 years [..] we can bring discipline to the public finances sustainably". He's referring to the analysis behind this graph (note how 9 years has become "5 to 10 years");


It's genuinely baffling to me that AW would say "we don't put assumptions for growth into the numbers" when the assumptions that are required to support the assertion he goes on to make are explicitly laid out in the report itself


[These aren't always easy to read: B12.18 makes explicit a 1.5% pa real GDP growth assumption]

I've been through detailed analysis of this in other blogs (eg. here) but in essence the sums are really simple (and by the way don't require any inflation assumptions at all, presumably they're in there just to allow better sounding nominal figures to be quoted).

You only need a three row spreadsheet to show that if you grow Spend 1% slower than GDP then - all other things being equal - a 5.9% deficit would indeed become less than a 3% deficit after 9 years (because spend/GDP necessarily declines). If you like, here's that in graph form and in the context of historical actuals and the various deficit figures you will see quoted in the report (more detail here)


By rights we should show this graph based on onshore GDP only, although it doesn't materially change the conclusion


OK, so we know that in fact AW has made an assumption for growth to make his statement stack up. 1.5% assumed real GDP growth means that, if spending growth is 1% less, then that's 0.5% real spending growth - which allows AW the soundbite of "growing the public finances, rejecting austerity" because real spending is increasing.

In that clearly well-rehearsed sound-bite he also says "stewarding growth at the same time" - I think maybe he should have said assuming higher growth at the same time.

So he's made a growth assumption and it's a really important one - if that assumption was less than 1.0% then he'd be advocating real spending cuts to "bring discipline to the public finances sustainably".

So let's look at some actual real GDP growth rates

  • Over the "austerity decade" from 2006-07 up to 2016-17, Scottish onshore GDP showed average real growth of just 0.8% pa
  • The latest forecast from the Scottish Fiscal Commission (published 31/05/2018) is for GDP growth in 2023 to be running at 0.9% pa

Hold on. If real GDP growth is less than 1.0% then applying AW's fiscal rule of getting the deficit down to below 3% within 10 years would require public spending cuts - would require austerity far and above anything we've seen while being in the UK, as this simple graph illustrates;



Now to be fair, it's true that if you go back long enough (I reckon 14 years) then you can get to an historic average real onshore GDP growth rate of 1.5% - but that takes you back to when the economy was booming. Making assertions about how you would "reject austerity" if the economic conditions were such that even George Osborne would not be suggesting austerity is hardly a meaningful contribution to the debate.

What matters is what you do when times are harder than average, when real GDP growth is less than 1.0%. Andrew Wilson works hard to be distinctly unclear about this (as did Commission member MSP Kate Forbes on Question Time) , but the Growth Commission report is clear for those who can be bothered to read it: if GDP growth was as sluggish as it has been for the last decade or as slow as the Fiscal Commission forecast, the Commission recommends embracing austerity as enthusiastically as any Tory chancellor.



* Addendum *

This is astonishing - I've just seen what Nicola Sturgeon said at FMQ's on Thursday (from 12:41)


Verbatim, emphases mine:
"I've got some analysis here which I'm going to share with the chamber, and hopefully it'll be ... it'll be of embarrassment to the Tories, hopefully it'll be of interest to Labour. If the spending recommendations of the Growth Commission had been applied over the past ten years, the £2.6bn real-terms cuts imposed on the budget of the Scottish government by Tory governments at Westminster would have been completely wiped out, it would have eradicated austerity in Scotland. That is the reality"

Anybody who has read this post or indeed my post on similar claims made by SNP MSP Kate Forbes on Question Time  will know that that very much is not "the reality" - that is in fact a big steaming pile of horseshit.

* Addendum 2 *

And today I'm told that Andrew Wilson is quoted as saying this in the National [he did - here]


Anybody who has read the report and/or who has followed my recent blogs and/or who has thought about what applying the report's deficit reduction "model" would mean will know that this isn't spin, it isn't doublethink - it's an out and out lie.

Friday, 1 June 2018

Kate Forbes SNP MSP Question Time Claim

Kate Forbes MSP sat on the SNP's Sustainable Growth Commission (see blogs passim).

I was just catching up with Thursday Night's Question Time and was taken aback when she made the following statement (about 31 mins in);
"Over the last 10 years the Scottish Budget has been cut by 8.5%; in contrast, this report predicts that if we had been an independent country our spending could have increased by 5% over those 10 years. Minus 8 to plus 5."
Now.

I've spent a fair amount of time with the numbers in the Growth Commission report and I didn't recognise the figures she quoted at all. I went back and had another look, I searched (based on the quoted figures and likely phrases) but with no joy. I asked around - an opposition MSP friend said he'd heard SNP members making similar assertions in the Chamber during FMQs. I was curious.

So I tweeted Kate (and the report's author Andrew Wilson) asking for a page reference ... and then ploughed ahead anyway trying to work how she could possibly justify that statement.

To her great credit, Kate DM'd me just as I'd finished this piece (late on a Friday night) and offered me her brief explanation which I'll *reveal* as we go - so do stay awake.

In her quote she rhetorically compares actual figures for the "Scottish Budget" to what sounded like some weird predicted-historical figure for "our spending".

I don't want to disappear down a rabbit-hole of different Scottish Budget line definitions (have a burrow here if you're really interested) - but instead I'll focus just on total Scottish Spending, as that's what matters and it's what the Growth Commission focus on. [first reveal: I now know that this was indeed the figure Kate was referring to for her "plus 5"].

The Growth Commission rightly uses GERS as its main source and so should we.

The Growth Commission states:
"real increases in public spending should be limited to sufficiently less than GDP growth over the business cycle to reduce the deficit to below 3% within 5 to 10 years" [3.187]
Given how big our notional deficit was in these last 10 years (peaking at 10.0%) I think we can safely assume that the report would "predict" - if it did, which it didn't, but if it did it would - spending growth slower than GDP growth.

So let's look at the Scottish figures for the last 10 years (2016/17 vs 2006/07)
  • Real GDP Growth (inc N Sea): -1.9%
  • Real GDP Growth (onshore only): +8.0% (or +0.8% pa)
Clearly the Growth Commission is focusing on the onshore economy, so applying their rule would suggest that we "could have" increased our total spending by something "sufficiently less than" 0.8% pa.

The Growth Commission suggest spending growth at 1.0% pa less than GDP growth [see their Fig 12-2 and point B12.18] and illustrate (correctly) that this would reduce a 5.9% deficit to a 2.9% deficit over 9 years.

Note that in 2009/10 our deficit was in fact 10.0%, so at that point one would argue we'd have needed a far more aggressive rule, but we'll let that pass.

If we applied the "1% less than GDP growth" rule over the last 10 years, then we would have needed to see an average annual real decline in spending of 0.2% pa - or a decline over 10 years of 2%.

What we actually saw - per GERS - was a real spending increase over those 10 years of  10.1% (an average increase of +1.0% pa).

So in Kate's terms: applying the Growth Commission's "prediction" to the last 10 years would see what was actually a 10.1% increase in spending become a 2.3% decrease. Plus 10 to minus 2.

Kate claimed "minus 8 to plus 5" - following the logic above, a fairer statement would have been  "plus 10 to minus 2" - almost the complete reverse.

So what's going on here?

Two things;

1. Kate is not comparing like with like. The Scottish budget is a subset of total Scottish spending - the Growth Commission rightly focuses on total Scottish spending, so should Kate when she talks of what could have happenend and so should we. [I also suspect her -8.5% figure includes budget forecast out to 2019/20 rather than purely historic data, but I honestly can't be bothered to check]. Basically the "minus 8" is boohickey.

2. [second reveal] Kate has been good enough to tell me that she arrived at her +5.0% "based on what the GC recommends in terms of increased public spending in Scotland over a 10 year period (by 0.5% per year)"

I'm incredulous.

She's compared a non-comparable subset of our historical public spending over a period during which average onshore GDP growth was actually 0.8% pa with a projection that assumes real GDP growth of 1.5% pa!

The very simple point which Kate (a Commission member, remember) has apparently misunderstood is that the figure of  0.5% pa is most definitely not the GC's spending growth recommendation - it's an illustration of how you could get the deficit down to 3% within 10 years if real GDP growth was 1.5% pa

But over the last 10 years real GDP Growth wasn't 1.5% pa, it was 0.8% pa - so to have got the deficit down at the rate the Growth Commission recommends, we'd have had to reduce public spending in real terms by 2% over those 10 years.

In fact - due to pooling and sharing within the UK, due to not having to focus on getting Scotland's deficit rapidly down to 3% - we were able to increase our public spending by 10% over that period.

The precise opposite of what Kate claimed is true.



Read the quote again:
"this report predicts that if we had been an independent country our spending could have increased by 5% over those 10 years"
She asserts that the report says something about what could have happened over the last 10 years. It simply does not.

She implies that the report's recommendations - if applied to the economic conditions we experienced during the last 10 years - would have led to 5% spending growth. They would not have.

Hell, even if you very generously interpret her statement as suggesting that the report predicts 5% spending growth over the next 10 years, that isn't true either.

The Report's Chairman has pointed out to me that the report makes no growth forecasts (see here) - so it can't be making any predictions about spend levels other than spend relative to GDP.

I think we're meant to understand that when the report [B12.18 and Fig 12-2] assumes 1.5% real GDP growth and 0.5% real spending growth, this is merely illustrative of how one could get a deficit down from 5.9% to below 3% within 10 years. I certainly hope so, because just yesterday the Scottish Fiscal Commission forecast that our GDP growth would be 0.9% in 2023 - on that basis the report "predicts" that spending growth would need to be 0.9% - 1.0% = a decline of 0.1% pa.

Still, the statement sounded good on Question Time and way more people watch that programme than will ever read this blog - so Kate can be happy, safe in the knowledge that she's done her bit to ensure the "new debate about independence" will be as fact-free as the last.

** Addendum **
I now see that Kate was merely following the lead set for her by the Report's Chairman Andrew Wilson and indeed our own First Minister Nicola Sturgeon - I've blogged the details here
***



***
For those who are disappointed there wasn't a graph in here, this is what Scotland's spending would have looked like if we had applied the GC's rule of spending growth being 1% behind GDP growth last time our deficit rose to the levels the GC uses as its starting point



It's pretty clear that if applied historically, the Growth Commission's spending growth recommendation would have led to greater spending cuts than those we've experienced under the "Westminster austerity model" the Commission claims to "explicitly reject".

Thursday, 31 May 2018

There Is No Growth Assumption

There appears to be be some confusion about the SNP's Sustainable Growth Commission recommendations when it comes to austerity. Let me attempt to quickly clear that up.

Nicola Sturgeon has taken to Twitter to make clear that the report "explicitly rejects austerity" and "recommends above inflation spending growth each year"


Unfortunately, Sturgeon goes on in that same thread to then assert that the report's "projections about deficit reduction [...] make no assumption about higher growth"


These two statements can't both be true - at least not without making some extremely contorted semantic distinctions between recommendations, projections and assumptions.

The following quotes are extracted directly from "Part B: The Framework & Strategy for the Sustainable Public Finances of an Independent Scotland"
"For the initial consolidation period, we recommend modest real terms increases in public sector expenditure" [B12.17]
"At Scotland's long-term trend GDP growth rate of 1.5% and inflation of 2%, this would mean that nominal increases in public spending of 2.5% would reduce the inherited deficit from 5.9% of GDP to less than 3% of GDP by year 9 (figure 12-2)." [B12.18]
"This rule would also have the same effect of reducing the deficit to less than 3% of GDP, at different levels of growth ..." [B12.20]


That section of the report is making assumptions about growth to be able to make a projection about deficit reduction that could be achieved while accepting the recommendation of modest real terms increases in public sector expenditure.


In fact for the deficit/GDP analysis shown here you don't need to make any inflation assumptions: as the sub-title of the graph shows, this illustration only needs to assume "Spending Change 1.0% less than Growth Rate". I've recreated the analysis (details here) to perhaps illustrate more clearly what it implies



Here's the problem: while all that's required to draw this graph is an assumption that spending growth will lag GDP growth by 1.0% (hence "would also have the same effect [..] at different levels of growth"), for that to translate into the recommended "modest real terms increases in public sector expenditure" we obviously have to assume real GDP growth of over 1.0%.

At the risk of labouring the point: to get the deficit down at this rate the report assumes that [Real Spend Growth] = [Real GDP Growth - 1.0%], a number that can only be positive if Real GDP Growth is more than 1.0%.

That's why in B12.18 the report assumes a real GDP growth rate of 1.5%, because spend growth at 1.0% less than that would still lead to "modest real terms" spending increase of 0.5% pa.

Let's compare and contrast these two statements
"During the transition period real increases in public spending should be limited to sufficiently less than GDP growth over the business cycle to reduce the deficit to below 3% within 5 to 10 years" [3.187]
"For the initial consolidation period, we recommend modest real terms increases in public sector expenditure" [B12.17]
The second statement above can only be consistent with the first statement if we assume real GDP Growth of c.1.5% pa or greater (as the report does for its illustration in Fig 12-2).

But, when I asked him for any comments on my previous blog on this topic (Growth Commission: Embracing Austerity), the report's Chairman Andrew Wilson was very clear:"There is no growth rate assumption"



Let's be clear: you can't say the report "recommends above inflation spending growth each year" (Sturgeon's words) or "recommend modest real terms increases in public sector expenditure" (the report's words) while also recommending "public spending growth  limited to significantly less than GDP growth [..] to reduce the deficit to below 3% within 5 to 10 years" (the report's words) without making a growth rate assumption - or at the very least, without making a minimum real growth rate assumption.

So I'm sorry, but to assert that "there is no growth assumption" at the same time as making claims that the report "rejects the austerity model" while recommending to "reduced the deficit to below 3% within 5 to 10 years" is, at best, carelessly inconsistent. At worst, it's a cynical attempt to mislead.

***

Let's finish by returning to the illustration the report uses to show how they assume we could get the deficit down to 3% of GDP within 10 years.

As discussed here, to create this illustration the report makes no assumptions about economic disruption caused by separation from the UK, makes heroically optimistic assumptions about cost savings we'd achieve to calculate our "legacy deficit" starting point and brushes over the practical challenges and implications of their sterlingisation recommendation - but let's park all of that and look only at what "Spending Change at 1.0% less than Growth Rate" would look like in the context of our actual historical spending levels and GDP growth rates.

The graph below shows two lines: actual real-terms Scottish Spending per GERS and what that figure would have been if from 1998/99 we'd applied the Growth Commission's Fig 12-2 assumption of  "Spend Growth 1.0% less than GDP Growth":



So there we have it. If applied in the recent past, the assumption the Growth Commission uses to illustrate how we could achieve their recommendation of getting from their "legacy deficit" to a deficit of under 3% of GDP within 10 years ... would have produced dramatically lower levels of public spending for Scotland than "Westminster austerity" has actually delivered.

That's unfair though - by rights we should apply the rule only when the deficit rose to the sorts of levels the Growth Commission is predicting we'd need to be dealing with. OK then

If applied historically, the Growth Commission's spending growth recommendation would have led to greater spending austerity than that we've experienced under the "Westminster austerity model" the Commission "explicitly rejects".

Of course if you assume higher GDP growth then that would change this picture - but as the Report's Chairman makes clear: "There is no growth rate assumption"



** ADDENDUM **
I'm indebted to @blairmcdougall for pointing out to me that the Scottish Fiscal Commission forecasts published today are for 0.9% pa long run GDP growth

On this basis, to achieve the deficit reduction at the pace the Growth Commission assumes in its illustration, we would have to be cutting real terms public spending by 0.1% pa (presumably by more than that on a per capita basis). Austerity for the long-run then.
** ENDS **