#IndyRef, #Out and the blind faith of Referendum campaigns…

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Ian Parsley as part of the Stratagem series of guest blogs, lays out why the No campaign arrived at currency as its king card in the #IndyRef debate…

Why is the focus on the currency? Throughout the campaign, polls have shown around 45-50% of people certain to vote No, and 35-40% certain to vote Yes. The “undecideds” are therefore crucial to the outcome and, if they are telling the truth to pollsters, they will decide which way to vote based on economic issues.

It was expected, early on, that this would mean the focus would fall on oil revenues. However, it has become rapidly apparent that oil can be argued either way – Yes supporters argue it would make Scotland one of the wealthiest nations in the world; No supporters argue the oil will run out within a generation (implicitly leaving Scotland worse off than its neighbours). So the economic issue turned to currency.

It turned to currency mainly because the No campaign realised it could attack on the subject. Rightly or wrongly, it had long ago decided to “play for a draw” and go for an essentially cautious (perhaps negative) campaign, not least because its job has been to defend a fairly firm opinion poll lead since the outset.

And, he notes, this has given rise to a degree of unreal certainty on both sides of the debate which we can only see replicated in a future referendum over the UK’s (or rUK’s) withdrawal from the EU…

This can turn referendums, supposedly the ultimate exercise in representative democracy, into events of great frustration and disenchantment.

As we look forward regardless of the result this year, the same warning applies to a potential ‘in/out’ referendum on the European Union. Already, we hear dire warnings from ‘In’ campaigners about the millions of UK jobs which “depend” on EU membership; and equally dire claims from ‘Out’ campaigners about the “£17 billion” that constitutes the alleged “cost” of that membership.

Most alarming of all, perhaps, is the way that each side will show absolute faith in their own side’s case, and give no credence at all to any of the other side’s. The people who determine the outcome, therefore, are people in the middle who merely become increasingly confused and disenchanted by the claim and counter-claim being thrown about by either side – that would apply to any EU referendum across the UK just as it does in Scotland currently.

We in Northern Ireland are familiar with the notion, currently being experienced in Scotland, that our side is completely right and the other side is completely wrong! It is small wonder that many people of more moderate view in Scotland regard themselves as insufficiently informed. They are!

Unfortunately, we needn’t expect anything different in a prospective EU referendum across the UK later in the decade.

It’s a view somewhat underlined by Jane Suiter and Theresa Reidy…

Referendums are often classified as low information elections. Research demonstrates that it can be difficult to engage voters on the specific information and arguments involved (Lupia 1994, McDermott 1997) and consequently they can be decided on issues other than the matter at hand. Referendums also vary from traditional political contests, in that they are usually focused on a single issue; the dynamics of political party interaction can diverge from national and local elections; non-political actors may often have a prominent role in the campaign; and voters may or may not have strong, clear views on the issue being decided.

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  • http://batman-news.com Scotty_dog

    Whatever the reason for the No campaign settling on the currency question as its “king card”, it was a huge mistake on their part! When Alistair Darling admitted during the last debate live on air with Alex Salmond, that “of course Scotland can use the pound!”, it was lights out for No. It was always going to be so, as sterling is a fully tradeable international currency whether or not the rUK agreed to a currency union. But the currency union refusal threat was always going to be seen as an empty threat anyway even before Darling’s admission on air. Personally, I am delighted that the No campaign have made such an obvious blunder with their central strategy. Lol.

  • Bryan Magee

    In the longer term the Scots may go for the Euro but in the mean time the road would be sterlingization.

    I don’t see Sterlingization as a good long term option because:

    *no lender of last resort option is possible for their banking sector under this option
    *there are severe restrictions on monetary policy requiring fiscal policy to be used for stabilization – monetary stocks depend on balance of payments surpluses.

    Scotland can use the pound but it is not a great option for these reasons. It may be better off with its own currency.

    Given that it will be subject to idiosyncratic shocks from oil price changes, its not clear it would be best for it to use the Euro.

    Not clear whether EU will admit Scotland absent a commitment to join the Euro.

  • kensei

    You can’t compare referendums on fairly trivial or technical stuff that doesn’t engage voters with an in/out referendum on the Union. It’s impossible to argue that Scottish voters are not fully engaged, and it is impossible to argue that Scottish voters are insufficiently informed. They are flooded with facts – I note Wings has its “Wee Blue Book” out as one of the latest (no blog on this? A crowd funded blog just knocked out 250k printed copies of its argument, which seems astonishing). There is no consensus on particular figures or consensus on what the figures say, but frankly its the voters job to sort it out.

    Currency was chosen because it was a source of FUD and a source of FUD Unionist parties could further stoke with promises not to go for a formal currency Union in London. But the various claims have been debated. There is certainly enough there for people to satisfy themselves if alternatives are viable or not, and if there is huge risks or not. It may not be technical enough for political anoraks, but the detail will be carried out by a Scottish Parliament tasked with dealing with the currency issue. And that’s probably good enough.

  • Steve Baron

    Get the real facts on referendums http://www.youtube.com/user/BetterDemocracyNZ

  • mickfealty
  • Ian James Parsley

    Yes, my own personal view (as discussed on Twitter with none other than David McWilliams 36 hours ago) is that iScotland would end up in the Eurozone. If it still exists…

  • http://batman-news.com Scotty_dog

    Not necessarily in the least, Ian and Bryan. Nothing more than pure speculation without a shred of evidence to back it up. More scaremongering by anti independence unionists. Scotland will use the pound.

  • http://www.thedissenter.co.uk/ thedissenter

    The greatest difficulty in most referendums is for the side that does not wish to change the status quo, particularly where the question rests on something that has been about so long it is just ‘comfortable’. Being excited about the status quo is a tough call, and leaves those with exciting emotional calls for ‘change’ with a better shout. Where a complex issue such as currency is raised it is hard to trump an emotional appeal, because if you are making a call on head over heart it has to be a slam dunk argument and currency is not that argument. It is a good argument, but not clear and decisive.

  • mickfealty

    If you truly want independence from (the Bank of) England, then surely you’d want the Euro, or something like it?

  • http://batman-news.com Scotty_dog

    Mick, the Bank of England is not England. Scotland is looking to win independence from Westminster, not independence from the Bank of England (which is itself independent from Westminster). The pound belongs to Scotland just as much as it does to rUK, it is Scotland’s pound too and there is no reason to change that now. In ten years time, well who knows what might happen, let’s just wait and see about that, there’s no rush you know.

  • Ian James Parsley

    Which part of “end up” did you not understand?!

  • Ian James Parsley

    No it doesn’t. Sterling is the currency of the UK. Leave the UK, you leave Sterling.

    Likewise the UK is a member state of the EU. Leave the UK, you leave the EU.

    You really do need to be honest about that, or people could make a horrible error based on false claims. If you’re confident about “independence”, at least be clear with people what it is!

  • http://batman-news.com Scotty_dog

    The bit that said “would”, as in “would end up in the Eurozone”. What’s the matter, didn’t you even read what you wrote? Speculation with no evidence, scaremongering unionist waffle.

  • http://batman-news.com Scotty_dog

    IJP, wrong! That unionist currency argument was lost months ago, do try to keep up with the topic you are supposedly blogging on. Go and check it out with your Bitter Together friends at Westminster, you had better come up with another fear and gloom story to scare the Scots with, but methinks you are running out of time. Lol

  • Ian James Parsley

    On the contrary, it has been accepted by many “Yes” supporters, including Lawyers for Yes. But what would they know, eh?!

  • http://batman-news.com Scotty_dog

    They know a steaming pile of horse **** when they see it, that’s why they are Lawyers for Yes, not Lawyers for No! If you were right, which you’re not, we wouldn’t have anyone for Yes as they would all be far too frightened to do anything on their own unless Westminster told them everything would be okay. Scotland will use the pound, that much at least has now been agreed by the No side, Alistair Darling admitted it live on TV, and the rest is history. As will the 307 year old union before much longer!

  • kensei

    A separate currency seems dismissed by everyone, and I’m not sure why. It allows a monetary policy tailored to Scotland, you have your lender of last resort and you can impose capital controls more easily if desired. Basically it avoids all the problems Ireland has with the Euro. Yes, it imposes currency costs with trading partners and the oil means it might be a hard currency, but there are plenty of examples in Europe and they cope.

    It probably depends on how aligned you see your economy with Germany in the long run. The black swan argument is one 2008 level recession will wipe out any gains in normal times many times over. There are intermediate solutions too – you could peg the currency, doesn’t have to be 1:1.

    Seems like its an option that’d need closely looked at rather than dismissed to me.

  • kensei

    Except that isn’t clear. Leave the UK and you might leave sterling. You dont have to if an agreement can be made, and it’s not even vanishingly unlikely, despite what No might say. It’ll be up for negotiations with everything else.

    As for the EU, I’d view the idea that Scotland leaves it as fundamentally dishonest. Assume its not automatic, which isnt clear at this point. Everyone in Scotland is an EU citizen who would retain their rights; the EU isn’t going to leave them ouide. They just aren’t. Even aside from that, there are massively good strategic reasons to have Scotland. You might say there might be some renegotiation of terms, bit that’s an entirely different thing.

    So I ah, if you are going to call for honesty, try being honest?

  • Ian James Parsley

    It *is* clear that if you are independent, you leave the country you were previously in. You leave its currency, you leave the institutions of which it is a member state, and so on.

    What is unclear is what the outcome of subsequent negotiations would be. You may of course subsequently wish to renegotiate your way back in to a common fiscal regime, or peg your currency, or whatever. I have to say personally that, if that is the plan because your interests are so closely aligned, you’re probably better not leaving in the first place!

  • http://batman-news.com Scotty_dog

    Kensei, I called Parsley out on that earlier and he couldn’t even answer me. He knows all that already before you explained it to him again. He and the other anti independence unionists don’t actually know how to sell the benefits of that fabulous union of Scotland being at the mercy of Westminster – because there aren’t any benefits. All they can ever do is try and scare people and threaten them and tell them some terrible awful calamity will bestow upon Scotland if she has the audacity to vote for independence. Threats won’t work anymore, the people of Scotland don’t believe their bull any longer. Scotland is not too poor or too wee or too stupid – as the unionists would have us believe. We are quite grown up and we will take our rightful place among all the other grown up independent sovereign countries of the world.

  • Steve Baron

    And have you ever read a bigger load of uninformed crap in your life Mick? I doubt it. That guy did absolutely no research and gave his own uninformed commentary. Probably the worst anti referendum article I have ever read.