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Author Topic: SNP  (Read 898 times)

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BillyStubbsTears

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SNP
« on October 27, 2020, 05:43:38 pm by BillyStubbsTears »
It is quite something to see the SNP still riding high and heading towards another independence referendum.

That's the SNP who based their plan Independent Scotland's finances before the last Ref on the assumption that oil would never drop below $110/barrel. Within 12 months of the vote, oil was selling at $25/barrel.

And the even bigger question that they fudged last time was what currency they would have. Either an independent Scottish Groat, which would be wildly unstable with the oil prices. Or tied into the Pound or Euro, in which case they would be unable to borrow to finance their chronic deficit.

Anyway. Looks like they have a rising star who has sorted all that shit out for them.

  https://mobile.twitter.com/NJ_Timothy/status/1320406247783485440

Jesus wept...



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albie

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Re: SNP
« Reply #1 on October 27, 2020, 06:05:49 pm by albie »
BST,

Not following your argument here.
A new referendum would not rely upon the price of oil as a touchstone.

Why would the SNP be unable to borrow, when interest rates are at historic lows?
Why would it matter if their currency was tied to the Euro, not sterling?

Colemans Left Hook

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Re: SNP
« Reply #2 on October 27, 2020, 06:35:10 pm by Colemans Left Hook »
I am sure all our "political active members" know that the break even point oil price for "your old friends" Russia is $40 a barrel - below that they lose money.  Good job they have a mountain of dollars

Was it $20 a barrel the price went to when the "little man" (same size as Napoleon & Hitler) went to war  over oil with the Saudis ?

just fact checked and the Saudis need $80 which is  a big surprise

"What oil price does Russia need?
roughly $40
According to the International Monetary Fund, Russia needs an oil price of roughly $40 a barrel to balance its budget, while Saudi Arabia needs over $80 a barrel to balance its books. Both countries have huge reserves, can borrow and can, of course, cut their budgets, but that means austerity.

and as for the Scottish unit of currency perhaps a "rob-roy"  or a "burns"  a "bannockburn" or even a "haggi"  (couldnt stomach that one)

the Russian currency is after all a load of "ruble"  which is what The Scottish currency would become

Metalmicky

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Re: SNP
« Reply #3 on October 27, 2020, 06:38:05 pm by Metalmicky »
Like the new currency idea in that link....


BillyStubbsTears

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Re: SNP
« Reply #4 on October 27, 2020, 06:56:00 pm by BillyStubbsTears »
Albie.

My point about oil was that in the LAST referendum, their fiscal plans were based on high levels of oil revenue. Their economy would have been destroyed by the collapse in oil prices in 2015.

Regarding borrowing, you have to understand how the international bond markets work. Yes, interest rates are low, but only for countries who have either low debt or the ability for the debt to be backed by a central bank. So the UK, Japan, USA etc have been able to run huge deficits while still having low interest rates. The reason is that, in the worst case, their central bank can print money to pay back the debt.

But countries that don't have the backing of a central bank run the risk of going bankrupt without having a central bank to print money to pay back the creditors. So the rate you pay on borrowing goes up because you pay a risk premium. The creditors are insuring themselves against the danger that they might never get their money back.

That is why bond rates went through the roof in Greece, Italy, Spain, Portugal and Ireland in 2011. They all had to massively cut public spending because, in simple terms, they couldn't borrow any more.

That is precisely the position an independent Scotland would be in if they retained the Pound or joined the Euro. That was explained in detail time and again in 2014, but the SNP blanked it and refused to engage in the discussion. Disgusting politics. They led Scotland to the brink of economic catastrophe because they are zealots who value independence above everything. And they've never had to face up to the responsibility of their dream.

Janso

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Re: SNP
« Reply #5 on October 27, 2020, 06:57:38 pm by Janso »
That was explained in detail time and again in 2014, but the SNP blanked it and refused to engage in the discussion. Disgusting politics. They led Scotland to the brink of economic catastrophe because they are zealots who value independence above everything. And they've never had to face up to the responsibility of their dream.

This is all mainstream Scottish nationalism is, with great dollops of Anglophobia.

albie

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Re: SNP
« Reply #6 on October 27, 2020, 08:14:20 pm by albie »
BST,

The last referendum tells you nothing about the parameters covering the next, which Doris says will not be in this parliament.

There are key issues to be resolved about the currency base. The SNP leadership favoured Sterling parity, the SNP conference disagreed and supported an independent currency.

Your explanation of the international position, in relation to debt and financing, is contested.
Here is a view from Richard Murphy, taxation specialist;
https://www.youtube.com/watch?v=NoOfXUZj4gM

The conservatism of the SNP leadership has been a constraint upon the development of a coherent independence policy. I would expect that to change before a new indy vote.

BillyStubbsTears

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Re: SNP
« Reply #7 on October 27, 2020, 10:01:17 pm by BillyStubbsTears »
Albie. Thanks for that. After wasting 90 minutes watching that shite tonight, I've just wasted another 10 minutes listening to a man talk about everything bar what my point was.

He doesn't once mention the key point that I raised. How Scotland finances its deficit if it is tied to the Pound and doesn't have its own central bank. He glosses over that by talking about the interest rate that the UK has and implies that Scotland would pay the same. But it wouldn't we know that absolutely clearly and unambiguously from the Eurozone debt crisis. Economies that run large deficits (Scotland's is currently something like 8-10% of its GDP) and don't have the backing of their own central bank cannot borrow on the bond markets without paying punitively high interest rates. Full stop.

And as a tiny petroeconomy, if Scotland had its own currency and central bank, it would oscillate wildly as oil prices went up and down. Tipping the economy by turns into inflationary overdrive and recessionary braking.

Your man can make as many other points as he wishes, but that is the massive issue that the SNP has always avoided. An independent Scotland cannot run a deficit. Full stop. So have independence by all means. But be honest with the people who support that. Tell them that they cannot have independence and the level of Govt spending that they have got used to. Choose one or the other.

BillyStubbsTears

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Re: SNP
« Reply #8 on October 27, 2020, 10:07:14 pm by BillyStubbsTears »
And excuse my tetchiness on this, but if there is one thing I despise in politicians, it is deliberately misleading people and avoiding difficult discussions. And the SNP has been doing that on this topic for year.

In the 2014 referendum, Salmond debated with Alastair Darling on this issue. Salmond wanted one thing only as an outcome an dhe got it. He goaded Darling into stating the bleeding obvious, which was that Scotland COULD retain the Pound after independence. Darling tried to move the discussion onto what the consequences of that would be (which I've laid out here). Salmond bullied his way through that, ignoring the details and crowing "There you have it ladies and gentlemen. We CAN have the Pound after independence."

Deliberate and calculated decision to keep the public ignorant of what they were signing up to. It was as bad as what the Leave side did in the Brexit campaign. Fortunately for Scotland, enough people disbelieved it to save them from the consequences, because I'll tell you this. If Scotland had voted to Leave the UK in Sept 2014, there would have been riots in Glasgow begging to return by Sept 2015, after the oil price had collapsed and Scotland's bond rate had exploded. They would have been hit as hard as Greece was in 2011. Never in recent history has a political party been so fortunate in losing a vote. They were saved from their own consequences.

big fat yorkshire pudding

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Re: SNP
« Reply #9 on October 27, 2020, 10:19:16 pm by big fat yorkshire pudding »
The SNP should just be honest and admit it's not an economically sound choice and that is perfectly fine.  They won't though because they know they'll lose too much on that front.

What is interesting is despite their avoidance of English items their approach to covid is very similar and has had very similar outcomes aswell.

Janso

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Re: SNP
« Reply #10 on October 27, 2020, 11:09:05 pm by Janso »
Having spent an awful lot of time in Scotland over the last few years, I can tell you the case for Scottish independence has never been built on anything more than "Toooooaries" and England apparently stealing their oil, and anyone who opposes is labelled a Quisling and accused of calling Scotland "too wee" to stand on its own. Completely disconnected from anything remotely resembling a factual argument.

They also seem to think voting for independence will magic them to the front of the queue to join the EU, and that they wouldn't have to decimate their public sector to meet the entry requirements due to the massive financial black hole. And there's also the little matter of the SNP's unofficial meddling with Catalonia. I think Spain would have something to say about it.

albie

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Re: SNP
« Reply #11 on October 28, 2020, 12:17:54 am by albie »
Billy,

From your post, you have not understood what Murphy is saying.

He is saying Scotland would need to have both an independent currency, and a central bank, in order to exercise any political independence.
https://www.youtube.com/watch?v=YMLddlxapwQ

The Salmond/Darling exchange is not relevant any more...that is the point!
2014 and the oil price is not the basis for a new referendum, it is just history.

By 2024 the economy of the UK (and all its parts) will be in a completely different place, due to Brexit changes among other demographic shifts. A new Indy ref is not a reheat of 2014.

If a no deal Brexit goes ahead, and Holyrood elects an SNP policy slate, on what basis could a new ref be refused?
We renew the democratic mandate every 5 years to allow for change to be accepted.

Axholme Lion

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Re: SNP
« Reply #12 on October 28, 2020, 02:20:41 pm by Axholme Lion »
If they want to go let them go as long as we don't have to pay anything towards them.

River Don

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Re: SNP
« Reply #13 on October 28, 2020, 03:14:30 pm by River Don »
Billy,

From your post, you have not understood what Murphy is saying.

He is saying Scotland would need to have both an independent currency, and a central bank, in order to exercise any political independence.
https://www.youtube.com/watch?v=YMLddlxapwQ

The Salmond/Darling exchange is not relevant any more...that is the point!
2014 and the oil price is not the basis for a new referendum, it is just history.

By 2024 the economy of the UK (and all its parts) will be in a completely different place, due to Brexit changes among other demographic shifts. A new Indy ref is not a reheat of 2014.

If a no deal Brexit goes ahead, and Holyrood elects an SNP policy slate, on what basis could a new ref be refused?
We renew the democratic mandate every 5 years to allow for change to be accepted.

An independant Scottish economy would still be highly dependent on oil and the oil market is firmly in the doldrums. There is an excess of oil and low demand for it, particularly with the global economy held back by the covid crisis. Even if the covid crisis were to subside American fracking is still holding the oil price down. Then there might even be a problem if renewable energy and electric vehicles take off.

For the foreseeable future oil isn't going to be hitting the heights of $100 again. It's a problem not only for the Scots but the Russians and Saudis too.

 

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