Monday, 26 April 2021

Sturgeon on Andrew Marr, 25/04/21

Anybody who read my analysis of Sturgeon's last four TV interviews could be forgiven for feeling a weary sense of déjà vu if they watched her being grilled by Andrew Marr yesterday 


1. She sounds like a Brexiteer as she attempts to wish away border issues

Firstly Marr pressed her on the obvious fact that - post-Brexit - her proposition for Scotland to become independent and to rejoin the EU would inevitably mean a hard border between Scotland and England, with obviously damaging economic consequences (given 60% of Scotland's exports go to the rest of the UK.)

She starts her response with a revealing line: "it's not the SNP that raises issues of borders, this issue only transpires because of [Brexit]"As the following exchange shows, it's clear why the SNP don't want to talk about borders - but to suggest that the party pursing separatism is not "raising the issue of borders" is laughable.

Rightly pressed by Marr that "you can't have both [EU and UK market membership]" she just keeps repeating the same meaningless assertion that somehow these border issues can be wished away:

  • "I want to and will work with others to make sure we keep trade flowing easily across the border between Scotland and England"
  • "of course we want to keep trade flowing across the England/Scotland border [...] we would work to make sure that happened"
  • "and we will work to make sure that we have trade flowing easily across that border"
  • "we will need to work to ensure that that [free trade with rUK] can be secured"
  • "we would work as a country to make sure that for our businesses there was no difficulties in terms of their day-to-day experiences in trading"
  • "I want Scotland to be able to trade freely across that [EU market] and yes, do the work that takes away the practical difficulties for trade across the England Scotland border"
  • "We will put in place arrangements and we will negotiate those arrangement with the UK that means that businesses do not in pracatical sense suffer from any of that [trade friction]"
  • "We will keep trade flowing freely ..  we will put in place arrangements to keep trade flowing"
The fact that the SNP want to make border issues go away doesn't mean they would, any more than Brexiteers can make border issues on the island of Ireland go away.

Regular observers of Sturgeon's interviews will notice she throws in a couple of her usual attempts at misdirection along the way;
  • "Scotland exports more manufactured goods to the rest of the world than we do to the rest of the UK" - but the issue under debate here is not "rest of the world" market access but EU market access specifically - and why focus on manufactured goods and ignore the massively significant services sector?
  • On at least two occasions she mentions that the EU market is "seven times the size of the UK" - neglecting to mention that, after over 40 years of unfettered market access, Scotland exports three times as much to rUK as it does to the EU
She even states that "we shouldn't be forced to choose between these two things" - and yet in a world where Brexit has happened, it is only her proposal that Scotland should leave the UK which forces Scots to choose between UK and EU market membership.

2. She claims she doesn't know what the economics of separation will look like - but this doesn't stop her being convinced that it's in Scots' best interests

When asked if the SNP has modelled the impact of independence on people's incomes, for the second time during this interview she resorts to her trusty fall-back that it's unreasonable to expect her to answer any questions about the economics of separation - they are apparently for another day
  • "we'll set out, when it comes to an independence referendum, what the implications are ..."
  • "not yet, we will do all of that as we did in 2014 [...] we will do that then..."
  • "you can go and look at the 2014 White Paper ..."
  • "on the basis of quality, up-to-date information - that's what we did in 2014 and it is what we will do again"
You have to admire the sheer chutzpah of suggesting we look back at the 2014 White Paper on independence to see the quality of economic analysis we should expect from her party. Not only did that White Paper include the risible suggestion that the set-up costs for an independent Scotland would be just £200m [Sturgeon herself has subsequently claimed the set-up costs just for the limited welfare powers devolved in 2016 would be "between £400m-£660m"] but it also forecast oil revenues of £6.8bn-£7.9bn pa [since then actual oil revenues have averaged c.£0.6bn pa]. The 2014 White Paper has been shown to have been a false prospectus - why should we expect anything difference next time?

This claim that the economic analysis for separation just hasn't been done is a common theme from Sturgeon's recent interviews. The question this raises is obvious: if you admit to not knowing what the economic implications of separation would be, how can you be so sure it's in the best interests of the Scottish people? Or to put it another way: if that analysis showed that separation would be economically damaging, would you change your life-long committment to Scottish independence?

It is ridiculous to expect us to believe that the SNP hasn't done up-to-date analysis on the economic implications of their core strategy - the only reason they don't share it is surely because they know an honest assessment of the economic consequences of separation would be unpalatable to Scottish voters.

No economic case is offered because none exists.

In 2014 the SNP were fond of pointing out that Scotland's 8.2% of the UK's population generated 9.4% of tax revenues but received "only" 9.3% of public spending. The same Scottish Government GERS report they were quoting then now shows that (mainly due to the crash in North Sea oil revenues) Scotland generates just 8.0% of the UK's tax revenues but still receives 9.2% of public spending. It's not surprising that the Nicola Sturgeon is asking for more time to think of a way to manufacture a grievance out of those figures.


3. She asks us to believe she still hasn't read the LSE's analysis on the border friction impact of Scexit - yet she enthusiastically endorsed the same team's analysis of the costs of Brexit based on the same model

Possibly the highlight of this interview is when she is pressed on the LSE modelling which shows how damaging leaving the UK to join the EU would be for the Scottish economy. As with previous interviews, she rather unconvincingly claims not to be that familiar with the analysis and tries to dismiss it as being "very narrowly based"
  • "if that's the study I think you're quoting at me - and I'll be corrected if i'm wrong here -  I think by its own admission it was a very narrowly based study that didn't properly take account of ..."
But Marr is well prepared and she's walked into his trap - he notes that when the same economists using the same model ran the same analysis for Brexit she had said: "this analysis demonstrates that leaving the EU will have profound and long-lasting impact on the public finances and the wider economic and societal well-being of Scotland"

She's trapped, so this famously well-briefed politician feigns ignorance of this headline grabbing analysis: "fine, well ... you know what you're quoting, I don't know for sure what you're quoting because I don't have it in front of me ...". 

[As an aside: she needs to be prepared for many more of her words to come back to haunt her. The parallels between Brexit and Scexit are manifold and pretty much all of the economic objections to Brexit which she wholeheartedly agreed with apply to Scexit, only more so.]

She then claims she will "engage on the substance of the point" before heading off down another well trodden path by setting up a straw man which has nothing to do with the point Marr was making:
  • "[you're suggesting that] somehow uniquely Scotland is incapable of being a successful properous independent country .."
This is another standard "go to" for Sturgeon when snookered on economic questions: unable to answer the specific point, she accuses the interviewer of suggesting independence is not possible (when all they are doing is highlighting what the costs of independence might be, a question she refuses to engage with).


4. When rattled, she resorts to claiming Scotland is "one of the wealthiest countries in the world" while simultaneously claiming that lots of countries are "wealthier than Scotland" (which is the UK's fault, obviously)

She's clearly rattled at this point and launches into a confused and frankly rather logically incoherent rant. It's worth repeating in full:
  • "look across Europe right now, we look across the world and we see a plethora, a multitude of countries similar in size to Scotland - sometimes smaller than Scotland - lacking all of the resources that Scotland has and - you know - by and large, almost without exception these countries are wealthier than Scotland, they are ... er .. healthier than Scotland, they are happier in terms of the studies that are done - Scotland is one of the wealthiest countries in the world and if you're pointing me to studies that are about Scotland's fiscal position [he wasn't] within the UK then frankly that's not an argument against independence, that is an argument for Scotland being able to take control of our vast resources, make better economic decisions than Westminster governments tend to make on our behalf and build the same prosperity that countries similar to us enjoy already ..."
Apart from claiming Scotland is "one of the wealthiest countries in the world" at the same time as complaining about all of these countries that are "wealthier than Scotland", she's pre-empted Marr's next question - she know's she's going to get asked about the scale of Scotland's deficit so wants to get her retaliation in first.

Predictably enough, she goes on to claim that Scotland's deficit makes the case for breaking away from the UK ("you're making my point for me"). 

What she fails to address is that Scotland's higher deficit is not due to poor economic performance in terms of revenue generation, but higher spending due to the benefits of UK-wide pooling and sharing (i.e. Scotland's 8.2% of the UK's population receiving 9.2% of public spending).

Presumably the scale of Scotland's deficit is the basis on which she claims that all those other countries are "wealthier" than Scotland. I'd be tempted to ask why she insists on talking Scotland down ... but I'd rather ask whether if the Barnett Formula was scrapped and public spending in Scotland was cut by 10% (which would obviously reduce the deficit), would she think that would make Scotland "wealthier"?

She then repeats here lines from previous interviews about all countries having deficits (ignoring the relative scale of those deficits) and quotes the UK's total debt figure (something which makes separation more costly, not less) before repeating another well rehearsed line:
  • "right now the taxes that are paid in Scotland pay for health and education and all of those devolved services as well as reserved services like welfare and pensions"
To repeat what I've said before: this is sophistry of the worst kind. 

Pensions and social security are the only areas of reserved spending that Scottish taxes would fund over and above what is currently the Scottish Government's budget. That means funding from elsewhere would have to be found to fund the additional c.£7bn of reserved spending that currently takes place in Scotland [e.g. Network Rail costs, subsidies for Scotland's renewables industry, R&D tax credits, research grants, civil servants employed in Scotland, nuclear decommissioning costs, BBC spending in Scotland, defence spending in Scotland and much, much more]. That £7bn is also before considering Scotland's share of Overseas Development Aid, UK's international diplomatic presence, debt interest costs and defence spending outside Scotland [details here].

This isn't complicated. Perhaps an interviewer should ask her: if Scotland's taxes pay for all of that stuff, why do her own government's national accounts show a (pre-pandemic) deficit of £15 billion or 8.6% of GDP? 

She just talks over Marr when he tries to make this point and gets quite ranty - she really doesn't like being asked about the deficit: "Scotland needs no lectures about tough choices, we have suffered a decade of Tory austerity".

Yet pressed on how she'd fund her spending committments, she admits that "because we're still within the UK" the Barnett Formula will deliver the funding she needs. But asked how she'd pay for her spending proposals if Scotland were independent:
  • "we'll deal with a deficit in the same way almost every other country across the world that has a deficit deals with that - you manage your finances through borrowing, through prudent decisions about public spending ..." 
... and at that point the interview runs out of time, which is a shame. 

Sturgeon's plan is for Scotland to continue using Sterling indefinitely, which means that unlike "almost every other country across the world" Scotland wouldn't have the ability to deal with the defict in the way most have: by printing money. Similarly the cost of borrowing for a newly independent country without its own currency and central bank would be far higher than for a mature economy like the UK.

As for making "prudent decisions about public spending" - well that's exactly the point some of us keep making: being "prudent" about public spending would mean massive cuts to public services. Her own Growth Commission (whose approach she recently confirmed she still endorses) recommended shrinking the deficit to below 3% within a decade by growing public spending more slowly than GDP. Given the economic starting position an independent Scotland would face, in layman's terms that translates into austerity on steroids. No wonder she doesn't want to admit to any analysis of the economic implications of separation.

Perhaps that's why Sturgeon always refers to "Tory austerity" - to differentiate it from what would, in her eyes at least, be the morally justifiable "SNP austerity" which would inevitably follow Scexit.




4 comments:

Unknown said...

Excellent, as usual.

Denis Munro said...

She is as slippery as an eel. Before Brexit, I saw her interviewed by Andrew Neil and she said that a recent study had shown that over 100,000 Scottish jobs would be at risk from leaving the EU. This was from a Fraser of Allander study for the GMB and it did indeed say that 134,000 Scottish jobs depended on the EU. What she did not mention, of course, was that the same study said that 560,000 Scottish jobs depended on trade with rUK. Unfortunately, Andrew Neil failed to nail her on that occasion.

Unknown said...

We all know that it would be hard for an independent Scotland to get back into the EU, despite the SNP lie to their supporters that they'll get back in. This will make it even tougher as for 5 to 10 years at least that hard border will exist between Scotland and both the UK and the EU, and if a Labour Government take the UK back into the EU or at least a Norway type agreement she's well and truly stiffed. Add to that the huge number of companies and people that will leave Scotland and move to England in the event of a vote for independence and you can see that the problem is so big that Independence would be a disaster.
And then take into account that the likes of the Shetlands and the Orkneys are not going to want to go with the Nationalists and the revenue numbers get worse as a large chunk of the oil revenue will go too.
But Sturgeon knows this she's just stirring up grievance to Kling on to power.

John Miller said...

I voted for Brexit so I understand SNP supporters attitudes but Project Fear arguments merely convinced me I was right. Had Mr Hague presented Remainers arguments I would not have been so sanguine.

My experience of visiting Scotland many years ago compared to 2 years ago has convinced me the SNP has done an effective job of convincing many Scots that the English politicians are the spawn of the devil..

Scots need to learn that ALL politicians deserve that epithet and that the behaviour of the EU will come at a price they may not wish to pay.