Could an independent heart outweigh a sceptical economic mind?
When it comes to the key battleground of the Independence referendum, a river runs through it. Glasgow, amid the Labour-voting heartland of west Scotland, is where I think it will be won or lost.
The hard pro-independence bloc is formed around the SNP and the non-party progressive left; the hardest part of the unionist bloc includes Orangemen, Conservatives and Labour politicians whose political future depends on a No vote.
But in the middle is Clydeside – a traditional Labour heartland but one with radical traditions, and where people are very proud of moments in history where the heart has ruled the head.
At a public level – on the hustings and TV – the debate is all about economics.
Will Scotland be allowed to use the pound? Will the Bank of England stand behind the Scottish banks? Will the oil money be enough to fund the expanded public spending the SNP is pledged to?
The No campaign answers negative to all this.
And that, plus the implicit threat that the remains of shipbuilding will move south, has been enough to rally the majority of the workforce of the remaining shipyards behind the No campaign.
But for opponents of independence, the worry remains the “sod it factor” (only it the word used here is not “sod”.) For all the warnings from employers, for all the official pleas from big Labour party figures, the fear is that people on Clydeside, and other Labour heartlands, will simply get into the voting booth let their emotions guide their hands to the Yes box.
If you survey the economic arguments against independence they are impressive: Scotland’s deficit, without oil money, runs towards £6bn a year.
Even on the Scottish government’s best scenario, which Westminster does not believe, there is a £1.2bn surplus in 2016 – and even then only if Scotland magically has no debt interest to pay.
On top of that there are the banks.
UK bank assets – ie loans – are nearly five times its GDP. That’s a dangerously large debt.
But on independence, the size of the Scottish banking sector would be over twelve times GDP.
That’s a problem because, on day one it is not yet clear who would stand behind the Scottish banking sector: who would guarantee its deposits, who would regulate etc?
The nightmare scenario being dangled in front of Scottish voters’ eyes is that the remains of engineering move south, and that large parts of banking do likewise.
I went to try these problems out on the strongest demographic for the Yes vote – 18-30 year olds – at the world-famous Sub Club, a nightclub in Glasgow city centre.
Figuring that 2am would be a good time to get people speaking frankly, I collared people who’d come outside for a cigarette. The message could not have been clearer.
“We’re not voting for Alex Salmond,” one worse-for-wear woman tells me. “We’re voting to have our own government. I want to leave aside all that crap about the pound and Trident. We’re voting for something we haven’t had before.”
A young guy tells me “I want full fiscal autonomy for Scotland. So every penny we spend has to be raised by us. For years in every election we might as well not vote for all the effect our votes have at Westminster. Even if it gets tough and we make mistakes, I would rather make them on our own.”
One young woman, a sound engineer in the movie industry, told me there was a different vibe about Scotland. She’d been to Coventry in England and found it dire.
“Here they’re not prejudiced against migrants, against homosexuals, they say ‘Yeah, come in, it’s Scotland, we’re not gonna place effing restrictions on anybody’.”
I try to pin down her accent, a mixture of the Gorbals and somewhere else. “Bulgaria,” she says. She moved a couple of years ago. Does she get a vote? “Aye,” she says.
At Axis Animations, a company that makes adverts and trailers for video games, they employ about 80 people – again many of them from abroad. They trade mainly in euros and dollars and compete with companies in Toronto, Vancouver, Paris and Hollywood.
For Richard Scott, the boss, the big economic arguments being thrown around by the two camps are largely irrelevant.
He says: “We need a currency that is stable. We get paid by a lot of our customers in dollars, others in Euros, so we need a currency that’s predictable against them.”
I ask what criteria he will use to decide. He winces. “I don’t know,” he says. “Clarity on some of the issues, but that may be impossible.”
Like a lot of the “don’t knows” I sense even nuclear-strength macroeconomics will not be big enough to stop him voting Yes, if his gut feeling says so.
I speed along the Clyde in a fast boat, with Tam Brotherstone and Davy Torrance. With one hand they cling to the speeding inflatable, with the other, each points to the places they used to know and work: Fairfields – now BAE Systems – the Yarrow yard, Harland and Wolff.
The remaining workforce of the Clyde shipbuilding industry is, in its majority, voting no.
They’ve been convinced by both public and private warnings that British defence work will move south. But Tam and Davy, long retired, are pounding the cobblestones and walkways by the Clyde trying to change this.
“I think the workforce’s attitude is ‘I’m Alright Jack’ and it won’t do. I’m no economist but if you’ve got an industry with a single customer, you’re doomed. We need to diversify Scottish shipbuilding, with government support, like Germany supports its industry.”
I ask don’t they fear the shipbuilders quitting the Clyde? Tam thinks it’s bluff. “They don’t build ships here out of altruism. They’re here because of our skills – and if they do walk away, don’t you think there is capital in Scotland to pick up the work they abandon?”
Davy shows me the last ever newspaper of the Upper Clyde Shipbuilders work-in, from 1972.
He points to a picture of himself, at the boardroom table of the shipyard they’d taken over and run. After months occupying the supposedly doomed shipyards the Conservative government of Edward Heath caved in and saved them – though not permanently, as the ruinscape of the river banks shows.
He thinks it’s the old radical spirit of Clydeside that’s animating.
“People are talking everywhere”, says Davy, “on the streets, in the swimming baths – people come up to you and talk. I can feel it – people are moving towards Yes.”
Even people sceptical of the independence call admit Scotland could run itself as a separate economy.
“Scotland could most definitely survive as an independent economy”, says Jo Armstrong, former policy adviser to the Scottish executive, who now runs the think tank Fiscal Affairs Scotland.
“But the question is will it be better? Short term the question of how we manage the deficit and what currency arrangement we put in place – both these things will determine how long it takes until things get better. It could last a generation, or it could be worse.”
“It’s not clear to me,” says Ms Armstrong, “that the pro-independence people are being open and honest about the deficit. If we want to increase growth by encouraging more investment, via lower taxes, then we may have to have less in terms of public services short term – or different types of public service. That’s not coming across.”
Here’s my take, with three weeks to go. Of the big macro bogey-issues – banking, debt, oil and the pound – the most critical is banking.
An independent Scotland is going to need a central bank with a very different mindset than the Bank of England: it will have to amass foreign exchange reserves, to guard against the danger of capital flight, and it will have to set up rapidly a credible bank regulation system.
Credibility has to be earned – and it is earned by hard choices.
Long before then, faced with the risks of banks where there is no clear lender of last resort, the finance industry may flow south. This is a big risk and one you have to weight against the potential rewards.
As for the pound: I can’t see an independent Scotland sticking with it for long. It will need fiscal autonomy to balance the reality of falling oil revenues and rising deficits. For that it would need its own currency. All the economies that have successfully dodged their way through the crisis – Iceland, Norway, Denmark – have unique currencies, outside the Euro.
Many Scottish people have an optimistic view of what the rewards of independence might be – the ability to attract new business by manipulating tax rates, the ability to run a more expensive welfare state from oil money etc. But there is no evidence the sums add up, nor can there be until the experiment begins.
But the danger for the London based media is to see these as “economic issues” and the more general desire for independence as a gut issue. It is not.
There is huge frustration among Scottish people with Westminster parties wedded to free market economics. That too is an economic issue and it is powerful. The killer argument for the Yes camp, in the coming weeks, will be that this is the one chance people have to break away from an economic strategy biased towards privatisation, free markets and high inequality.
From the dance floor of the Sub Club to the veterans of Clyde shipbuilding, there is a radicalism in Scotland that wants the chance to try something different to the neoliberal model. And whatever their union leaders say, I doubt people in the Clyde shipbuilding industry are immune to it.
Those who fear the “sod it factor”, once millions of ordinary voters get inside the polling stations on 18 September, may be right.
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