Meantime, big business has finally decided it's time to stand up and be counted. Better Together is quoting the boss of a major investment bank specialising in the energy sector thusly:
Quote:
Colin Welsh, chief executive officer of Simmons & Company International Limited, corporate finance specialists for the energy sector, said today;
“I wholeheartedly endorse what Bob Dudley said yesterday regarding the uncertainty that the question of independence brings to our industry and the threat that this poses to our economic future. This is an issue that is too important for the business community to stay silent on and the oil and gas industry needs to stand up and say what it thinks before it is too late.”
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---------- Post added at 17:58 ---------- Previous post was at 17:44 ----------
Quote:
Originally Posted by Mr Angry
".....how likely would the voters of Enlgand, Wales and Northern Ireland be to agree to underwrite the Scottish banking system and to allow the Scottish government to influence rUK tax policy?"
I don't recall the electorate being asked to agree to underwrite the British banking system.
It seems it's not always the case that the electorate are consulted on such matters. Surely Scotland could have a pound or currency pegged to the UK pound rate? The Falklands do it and they, Wales and NI all print their own banknotes which are pegged to the pound. Here in NI we can transact at point of sale in Euros or pounds sterling, Northern, Ulster, Bank of Ireland and First Trust notes (to name but a few). Whilst I'm not an economist I don't see why it would be such a stretch for Scotland to do likewise.
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Banks in Wales do not print their own banknotes.
And notes printed in Scotland are not 'pegged' to the pound because they are not a distinct currency. Every single one of them is backed by a deposit of identical value, held at the Bank of England on behalf of the Scottish banks. A Scottish banknote is simply a promissory note, a substitute for the real thing. I believe this to be the case for notes issued in NI also.
Your comment about underwriting the British banking system rather misses the point. Regardless of your feelings about reckless bankers, what occurred in 2008 was a rescue of the British banking system, by the British government, using taxes raised in Britain.
In a future currency union, constituted to avoid the debacle currently destroying southern Europe, there is a risk of the Scottish banking system, being rescued by the English/Welsh/NI Government, using taxes raised in England/Wales/NI. Politically, the use of English/Welsh/NI taxes being used to rescue the economy of a foreign neighbour, is a wholly different proposition to the notion of using that money to rescue the State's own economy. It is likely, in my view, that calls for a referendum on this issue in rUK would be very loud and quite possibly irresistible.
You are of course correct, you can fully or partially substitute your own currency, either by pegging or by simply using the foreign country outright. It works well enough for tiny economies like the Falklands, Gibraltar, British Virgin Islands (US$) and a few others. However it comes with one massive risk, a risk which given recent history any sane person should consider simply too great. A fiscal authority without its own currency cannot be lender of last resort to its own banking system. Had RBS blown up in an independent Scotland running a substitute currency ... goodnight Vienna.
Incidentally, you can transact in Pounds, Euros, Dollars or lumps of Wensleydale cheese, anywhere in the UK, just so long as the buyer and seller agree on the rate of exchange. Agreement being the operative word. It gets a little more complex at government level, however.