A moveable feast

by Mar 12, 2012 No Comments

Alex Salmond is fond of quoting that “great English economist”, John Maynard Keynes.

When confronted with an earlier economic prediction that hadn’t turned out as planned, Keynes nonchalantly retorted: “When the facts change, I change my mind. What do you do, sir?” It’s a good line and, of course, a convenient one, providing the First Minister with handy cover for a series of policy U-turns.

First off, there is no shame in U-turns. Even Margaret Thatcher, despite the rhetoric (“You turn if you want to, the Lady’s not for turning”) flip-flopped when it proved expedient, just as David Cameron has in his two years as Prime Minister. All good leaders are pragmatists. What matters is consistency on first principles, the essence of whatever ideology or political brand it is you’re selling.

The First Minister is no exception, and usually executes U-turns with sensitivity and even a degree of honesty. He does so, however, even when the facts have not – as Keynes rationalised his own volte-face – changed. This is crucial to understanding Salmond’s leadership style, and also the modern SNP as it gears up for the most important vote in its history. Fittingly, perhaps, the 2014 independence referendum will fall in the SNP’s 80th year.

Who ought to be head of state in an independent Scotland is a case in point. Now the SNP seems to regard interest in the detail of this as rather eccentric, as if the head of state in a new nation – ceremonial or otherwise – is a minor concern, of as much importance as a change of letterhead. But given that the monarchy epitomises many things Nationalists claim to reject (unelected decision-making, wasting public money and privilege), this is rather odd.

Party policy, as endorsed at the 1997 SNP conference, was for a post-independence referendum on a monarchy versus a republic.

The party recently stated this had changed in 1999, which doesn’t stack up given its presence in the 2001 and 2003 manifestos. I’m told the policy was actually changed at a more recent gathering of the party’s National Council (to which no journalists are admitted), but my attempts to find out when and how have been ignored.

Andrew Neil also had a go during a fairly rigorous interview with the First Minister on the BBC’s Sunday Politics programme last weekend.

Salmond simply shrugged it off, saying that the referendum policy was 15 years old, as if age somehow rendered certain policies null and void. Asked directly if that meant there would be “no post-independence referendum on a republic”, the SNP leader replied with admirable brevity: “Correct.” Does any of this matter? Probably not. Every challenge on this front simply provides Salmond with another opportunity to remind voters that he wants to keep Her Majesty firmly upon her throne. And it’s a sensible line to take. Even when he was a member of the republican 79 Group, Salmond realised that most Scots, particularly working-class ones, liked and respected Elizabeth, Queen of Scots. The facts in that respect haven’t changed, but SNP policy has.

Andrew Neil also grilled Salmond on membership of the European Union should Scotland become independent; the First Minister reiterated familiar lines about Scotland “automatically” becoming a member or successor state. Now there is certainly expert (albeit rather old) opinion which supports this assertion, but a lot appears to be based on the mistaken assumption that the United Kingdom comprises two states – Scotland and England – which would both become successor states should the former secede.

The UK, of course, is actually a multinational state which also includes a principality called Wales and a province called Northern Ireland. It seems highly likely, therefore, that the rest of the UK – or rUK – would be deemed the ‘successor’ state (just as the UK was in 1922 by the League of Nations). In truth, we won’t know until – or rather if – Scotland becomes independent.

Few, meanwhile, seem in any doubt it would be admitted even were it to end up outside the club. Scots are, after all, EU ‘citizens’, a legal status that can’t easily be rescinded.

When it comes to Europe the facts, particularly since 2008, have changed considerably. Despite espousing ‘independence in Europe’, the SNP is actually a rather curious ‘pro-European’ party: it opposes closer fiscal integration (a position repeated by Salmond during his BBC interview), the Common Fisheries Policy and, for at least the next decade, membership of the euro. It isn’t clear exactly what aspect of the European project – apart from a seat at the top table – the SNP supports.

Talking of the euro, membership of which the First Minister was enthusiastic about until relatively recently (“we’re in sterling and sterling is sinking like a stone,” he said in 2009. “It’s now about parity with the euro”), it now appears to resemble a once entertaining uncle the SNP would rather not meet at any future family gathering. The facts in this respect have changed rather radically, leading to Salmond lumping for the least scary option: continued membership of sterling.

As with the monarchy, any attempt to critique the obvious contradictions in this position merely provide the party with a convenient opportunity to re-emphasise its present position.

It remains, however, a point of weakness.

Importantly, when challenged by Andrew Neil about this, Salmond conceded that retaining Bank of England control would, in practical terms, limit an independent Scotland’s fiscal policy which, he added, was “limited in the modern world anyway”.

The SNP also argues that as the Bank of England is already “independent” of the UK Government, then its status vis-à-vis an independent Scotland would be much the same. Not only does this conveniently ignore that the governor and four external members are appointed by the Chancellor of the Exchequer, but makes Nicola Sturgeon’s argument that Scotland ought to have a place on the Monetary Policy Committee look rather odd.

How, precisely, can space be found on the board of an independent organisation which, as currently constituted, provides no scope for territorial representation?

Post-1922 Ireland is the example that keeps springing to mind in this respect. As a column in Money Week recently pointed out, a “currency helps a nation to adjust to changes in its circumstances. Ireland did not have a currency, and it did not adjust.” Indeed, despite their nationalism, the Irish Free State’s early leaders pegged the Irish punt to the pound sterling at a rate of one to one, “so that in monetary terms, Ireland never left the UK”.

The notion that this would not constrain an independent Scotland’s fiscal policy in any way is as fanciful as maintaining that low-tax economics can fund high public spending. Again, Salmond conceded the former point in his interview with Andrew Neil, acknowledging the need for a fiscal agreement with the Bank of England. “Let’s say your stability pact said that over the long term your borrowing shouldn’t exceed three per cent of GDP,” he said. “Well, I would argue that’s no more than the fiscal discipline that a sensible country would have in any case.” This sort of stuff, argue some Nationalists in the twitter sphere, is sheer pedantry; unionist nit-picking designed to undermine the SNP’s vision of a prosperous, independent Scotland.

Sovereignty, they point out, is key. True, that sovereignty may be constrained in practical terms, but Scotland – technically at least – would not be bound, as it is now, by fiscal or monetary arrangements that ran contrary to her best interests.

It is in relation to the definition of ‘independence’ that the facts have changed most substantially. Since 2008, when the Scottish banking sector took centre stage in a global economic catastrophe and the euro dream was trashed, previously useful facts changed both drastically, swiftly and unexpectedly.

Paradoxically, the one SNP policy position that hasn’t changed as a result is its commitment to independence. On that, the pragmatic Mr Salmond remains dogmatic.

James Mitchell quotes a wonderful Freudian slip in his new book on the SNP membership (Transition to Power, OUP) from his interviews with senior party members, some of whom conceded there was “no such thing as independence”, only to hastily add “as sometimes/usually understood”. The party leadership is – to varying degrees – refreshingly frank in this respect, and as Mitchell’s research demonstrates, most SNP members are willing to go along with Salmond’s approach. He has, after all, won two elections against all the odds.

“The evolution of policy,” Salmond told Andrew Neil, “is a sensible thing in the modern world.” Perhaps at this weekend’s conference the SNP will attempt to evolve party policy on NATO membership and even Trident, both relics of another era in which the facts were very different. The First Minister will, however, need to find another quote. As Robert Skidelsky, Keynes’ most thorough biographer, judged in 2003, the “when the facts change” quote so often attributed to that great English economist is almost certainly apocryphal.

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