Don’t take your Scotch straight!

The Scottish campaign for political sovereignty and economic association with the rest of the United Kingdom and the European Union updates the Quebec independence playbook. Effectively, not only are we a little nicer than they are, we’re smarter. Scotland can be as competitive as England and, at the same time, it can be more socially enlightened as an independent unitary state.

The Scots gave the world Adam Smith’s mind and Canada’s banking culture. Naturally, their sovereigntist government wants to keep the Pound, their common currency with Britain and their 40-year-old free trade association with the European Union as well.

The response of England’s political, bureaucratic, and business leaders now effectively mimics Canadian federalist "no" campaigns in Quebec’s two independence referenda. This shouldn’t, however, make Canadian federalists proud. Cameron, his ministers, and their Bank Governor (Canada’s former Bank Governor) Mark Carney, and now backed by England’s business leaders, are hammering those careful Scots with that terrible word: instability.

Carney first advised the Scots that their wished-for independence would be highly circumscribed in this interdependent world of easy nervous flows of capital. The "no" campaigners insist, too, that what’s left of the United Kingdom could, in fact, refuse to let Scotland stay in the Pound currency area and, as well, that the EU might be reluctant to allow them to stay in the European common market as an independent nation. They could destabilize politics in Europe and cause uncertainty about the stability of the Pound.

If the Scots vote to stay, these warnings will appear shrewd. If the Scots leave, these warnings probably will not survive the night the votes are counted.

Nothing about the future uttered in any election campaign can be totally refuted. Nevertheless, their warnings are both hypocritical and farfetched.

Britain’s precious Pound and Carney’s old Canadian dollar are highly influenced by what others think of their government’s fiscal and monetary policies. Neither Britain, nor Canada, nor a separate Scotland in the future would be free to do — or threaten to do — whatever it likes economically. Economically literate Scots know about the limits of economic sovereignty today as well — and possibly better — than anti-Europe and anti-American nationalists in either Britain or Canada.

Indeed, there exists no separatist sentiment in Scotland as nostalgic and as ambitious as Britain’s vehement keep-the-Pound-and-don’t-use-the-Euro majority to Scotland’s south.

If the rest of the United Kingdom refused to maintain its currency union with an independent Scotland, their citizens and businesses that hold equity in Scotland could lose a fortune, and Carney’s Pound would become even less stable in currency markets.

The "no" campaign says their threat is credible because keeping an independent Scotland in the currency union could threaten the Pound’s reputation. The Scots, after all, could turn around and act like the Greeks and those other places on the continent that still don’t speak English in the office.

This is truly bizarre.

Today, Scotland holds 59 seats in the UK Parliament. A Scot today has as much right as a Londoner to aspire to be Prime Minister of the United Kingdom or Governor of its central bank. Cameron, Carney, and the entire English establishment sleep soundly knowing: if the Scots vote "no" in the referendum, the Scottish electorate next year could determine who forms the next government of the United Kingdom.

They’re smart enough to influence the destiny of the United Kingdom. But they’re not competent to manage their own affairs?

Scotland’s Quebec touch: a ‘sovereignty-association’ referendum

"Sovereignty-association" isn’t a new idea. It’s a complicated and rather unemotional concept and has been defeated before. Free trade, however, isn’t a new idea either. Yet in 1776, Scotland’s Adam Smith and his book Wealth of Nations launched it’s eventual global takeover.

In the 1960s and 1970s, nationalists assumed that if the superpowers’ Cold War ended without blowing us up, distinct societies of viable size could achieve genuine national independence. Canadians and nationalists in the province of Quebec imagined that they could manage their affairs independently of the US and, conceivably, of each other. Consequently, when the René Lévesque sovereigntist government asked Quebecers in 1980 for a mandate to negotiate merely a new partnership — ‘sovereignty-association’ — the Government of Canada responded with scorn.

It was a sleazy trick. Quebec nationalists, like serious nationalists everywhere, surely would never stick to any arrangement that would significantly limit their national power. In two referendums, Ottawa insisted that Lévesque’s model was merely a Trojan horse; inside its clapboard shell crouched wild-eyed Anglo-haters, with fascist undergarments. Pierre Trudeau would snip that his ideas were both naïve and deceitful. 

Last week, in a 667-page plan, Scotland’s nationalist first minister Alex Salmond put forward a similar sovereignty-association proposal in a much calmer time — a time when nationalist romantics are less certain and taken less seriously. Political interdependence is now the normal way groups of affluent and civilized people organize their affairs.

Two huge, loose federations — the Eurozone and the United States — manage the world’s two biggest currencies, their open markets and business cycles, while the citizens in their dozens of sovereign member states manage what they don’t assign to the two giant associations. (Canadians, Englishmen, Quebecers, and Scots prosper today, in large measure, because these two gigantic concoctions work.)

It’s unsurprising and unimportant that the Government of Great Britain rejected Scotland’s proposals before the referendum; it’s the status quo’s nature to tell us that change causes trouble. However, it’s not reasonable for resolute liberal journals like The Economist to complain that Scotland’s plan is too utilitarian and too optimistic at the same time:

“He [Salmond] would also have to negotiate EU membership, continued use of sterling, the division of Britain’s national debt, NATO membership and much else besides. Voting for independence would be an act of faith.”

Certainly, the island of Great Britain has had limited experience with federal-style government. The English political class long-believed that even their descendants couldn’t make decentralized federal systems work in North America and that "Europeans" couldn’t make them work in Europe as well. Nevertheless, the elite that will do most of the fear mongering in Scotland’s referendum debate will, at the same time, deeply treasure their international alliances and associations and the acts of faith — as negotiators and traders — that made Britain great.

If Scotland votes yes, British leaders will set their feelings aside and, by morning, start working on how to maintain every mechanism and institution with the Scots that serves their mutual interests.

"Sovereignty-association" isn’t unworkable. It simply may not be necessary for Scotland.

Fundamentally, it is just another way to think about how to encourage rigorous, responsible local democracy within a wider association. It’s too bad that on this continent it is only advocated as a way to break up federations rather than as a way to create a closer union of Canadians and Americans.

Fear and the future of the Canadian marriage

Tight housing markets can carry marriages through rocky patches. While not as attractive as patriotism, fear has helped mightily hold Canada’s federation together ever since its inception. Forum Poll’s survey for the National Post on Quebec and Canadian expectations about an independent Quebec are not flattering, but they’re relevant. The lay of the land that Form reports will influence the uniters and dividers.

Rory Barrs' concluding paragraphs are probably the most important:

“If Quebec did separate from Canada, a large majority (81%) believes the rest of the country would get along just fine, while only 12% do not. As for Quebec’s fate, 65% of respondents think it could not survive as an independent country, while 23% believe it could.

“Quebecers were much more optimistic, with 40% saying the province is self-sustainable.”

In other words, a cocky majority of Canadians don’t fear losing Quebec, while only a plurality of Quebecers will say that they believe they can function on their own, as a sovereign nation in North America.

From the heady days of the Quiet Revolution in the 60s, much has changed: aimless, inarticulate English-speaking now will carry on, while Quebec—after tossing off over two centuries of Anglo dominion—will fail.

These expectations are shallow. Canada wouldn’t include Quebec, but it would hardly head off on its own. Quebec would no more strive to be “self-sustainable” than its affluent neighbors on this continent and in Europe. These expectations, however, will shape the start of the debate, if not the outcome.

For traditional federalists like Stephen Harper and, for instance, the leadership of the Liberal Party, these numbers are reassuring: they needn’t get too excited about the demands of the Parti Quebecois Government and they needn’t compromise substantively either. Essentially, Canadians don’t feel that much is at risk, whether Quebec bluffs or not.

For the Government of Quebec and its independence movement, these numbers suggest they go back to Réne Lévesque and Sovereignty-Association.

Rather than making a series of micro-management demands for more powers for Quebec’s bureaucracy, they should get back to the expansive, confident vision of their founding proposition: the idea that little as well as giant nation-states can prosper in close association with others.

I prefer full-blown federation. But the alternative on this continent for Quebec and the rest of Canada is essentially the same—self-government in economic, cultural, and strategic association with the United States.