Four Lessons to be learned from the 2014 Scottish Referendum

Government authorities in the UK declared that the “Yes” campaign for secession had failed by a margin of approximately 55 per cent to 45 per cent.

Yet, even without a majority vote for secession, Scotland’s campaign for separation from the United Kingdom provided numerous insights into the future of the secession movement and those who defended the status quo.

Lesson 1: Global elites greatly fear secession and decentralization

Global elite institutions and individuals including Goldman Sachs, Alan Greenspan, David Cameron and several major banks pulled out all the stops to sow fear about Scottish independence. Global bankers recruited to the cause by UK diplomats and civil service treasury staff vowed to punish Scotland, declaring they would move out of Scotland if independence were declared.

A Deutsche Bank report compared independence to the decision to return to the gold standard in the 1920s and said it might spark a rerun of the Great Depression, at least north of the border.

When it comes to predictions of economic doom, it doesn’t get much more hysterical than that. Except that it does. David Cameron nearly burst into tears begging the Scots not to vote for independence.

The elite onslaught against secession employed at least two strategies. The first involved threats and “for your own good” lectures. Things will “not work out well” for Scotland in case of secession, intoned Robert Zoellick of the World Bank.

The late Senator John McCain implied that Scottish independence would be good for terrorists. The second strategy involved pleading and begging, which, of course, betrayed how truly fearful the West’s ruling class is of secession.

In addition to Cameron’s histrionics based on nostalgia and maudlin appeals to not break “this family apart,” Cameron bribed Scots with numerous promises of more money, more autonomy, and more power within the UK.

The threats that focused on the future of the Scottish monetary system are particularly telling. The very last thing that governments in London, Brussels, or Washington, DC want to see is an established Western country secede from a monetary system and join another in an orderly fashion.

Lesson 2: Secession movements will demand a vote

While the Westminster elite was desperate to see the Scotland referendum fail, few argued that the Scots had no right to vote on the matter. Some argued that all of the UK should vote on it, but most observers appeared to simply accept that the Scots were entitled to vote by themselves or through their politically elected officials on Scotland’s status in the UK.

Lesson 3: Secession is a good way to bargain

Centralizers fear secession to the point where they’re willing to throw a lot of perks at the secessionists. In Scotland’s case, the promises involved a lot of additional government welfare.

Threatening secession can be a useful tactic to obtain additional autonomy. Moreover, it will often force a central government to submit to a referendum on its legitimacy.

Ultimately, however, what really matters to Westminster is the ability to inflate the money supply and control the financial system.

Politicians from the Westminster government may be willing to part with many powers, but the power to inflate and control the banks will never be given up lightly.

Lesson 4: Centralization is unnecessary for economic success

As predicted by a host of observers of trends in state legitimacy, the state’s status as the central fact in the political order of the world continues to decline with smaller national groups and economic regions breaking up the old order in favour of both local autonomy and international alliances.

Scotland’s secession effort is one example and the short-term defeat in the referendum will do little to alter the trend.

In addition, the economic realities of the modern world with constantly moving capital and labour will continue to undermine the Westminster political system which was built on the idea of economic nationalism coupled with the myth that economic self-sufficiency can only be retained within the UK.

The proliferation of trade among nations with huge national markets, labour forces, and a willingness to trade internationally has destroyed the UK government claims that only the nation-state can provide the markets, coercive power, and international clout necessary for economic growth.

Scots see access to international markets as something that is quite attainable without the added baggage of the UK central state to which they are presently beholden. Scotland does not need England to facilitate its trade with countries worldwide.

Small nations do very well when it comes to economic performance, and smallness is hardly a liability. The assertion that bigger is better was always easily disprovable but remained popular for centuries.

The success of the Scottish secessionist claims that Scotland could indeed compete internationally has shown that the continued dominance of the old myth is failing.

Conclusion

The drive for Scottish independence will continue to grow as the UK economy stagnates, and the promises of Westminster Unionist politicians will fall on very deaf ears.

Summarised from an article written by Ryan McMaken, Editor and Economist at the Mises Institute.