All posts by thomas

Retailers and the customs union

Stillorgan Shopping Centre - South Dublin (Ireland)
Stillorgan Shopping Centre – South Dublin (Ireland).
There was an interesting article in The Irish Times today about the consequences for Ireland when the (r-)UK leaves the EU’s customs union:

Even if there were a free-trade agreement, allowing free movement of goods between the UK and the EU, this will not apply to imports from countries outside the EU. Thus border controls will be essential to ensure that imports from third countries, such as China or India, comply with EU regulations.

This will have huge implications for the retail sector, much of which currently operates on a British Isles basis. Goods travel from warehouses in the UK to the Republic without problem. After Brexit, this will require new bureaucracy and customs duties, entailing a major increase in cost.

That could raise prices significantly for Irish consumers, posing serious competitiveness problems for the wider economy. Because of the small size of the Irish retail market, going it alone is a high-cost option.

Although they don’t mention it, this is likely to be a much bigger problem than most people realise because of the way modern businesses depend on just-in-time manufacturing and low stock levels. What this means is that shops tend to get new deliveries all the time instead of having a lot of stock, and this will lead to huge problems if the over-night deliveries sometimes get disrupted by customs checks.

It’s possible some companies will start treating Ireland as part of their French operation rather their British one (for instance, Kellogg’s might prefer to sell the products made for the French market in Ireland instead of the British ones to avoid the customs checks). That would definitely make Ireland feel less British over time.

From a Scottish perspective, it means that if we leave the UK at the same time as Brexit in order to remain in the EU, and if the rUK proceeds with the harmful policy of leaving the EU’s Customs Union, retailers are likely to start treating Scotland and Ireland as one market (which again might been seen as a subdivision of the Scandinavian or the French one), whereas the rUK will be seen as a rather distinct one. It would make the products in Scottish and Irish shops more similar over time, and less similar to the ones found in England and Wales.

It’s worth bearing in mind that the EU’s Customs Union is almost ten times as big as the rUK’s one, so although it will be annoying to lose some of the English and Welsh products in the supermarkets, the consequences for Scotland will be much worse if we leave the EU together with the rUK.

I’d much rather Westminster decided to remain in the EU’s Customs Union, but if they really are hell-bent on leaving it, it’s yet another argument why Scotland should become independent within the EU.

The Scottish Independence Convention

Driving into Scotland after 2014
Driving into Scotland after 2014.
Yesterday I took part in the Scottish Independence Convention in Glasgow. There was a great buzz – it’s clear there are many thousands of activists who are desperate to go out and campaign for independence as soon as they get a chance.

The day was divided into three sessions: Policy, strategy and movement.

The policy session was a bit weak – there were lots of interesting ideas floating around, but a voice inside my head kept shouting that we’re living in an age of fake news and social media, and having wonderful, worked-through policies won’t really matter during a campaign. For instance, I’m a great fan of a citizens’ income, but I’m not convinced that’s the kind of thing that would really matter in a heated campaign (and in a worst-case scenario, it would allow our opponents to portray us as hopeless idealists).

One sentence that stayed with me was Jim Mather’s comment that “Last time was like a tennis game where only Better Together were allowed to serve” (quoted from memory). I think that’s a great summary of the campaign, but is developing a lot of policies really the right way to prevent that from happening again? I’m not so sure. The problem wasn’t that we couldn’t return the ball, but that we never served. We need to have more questions for the other side and to be much less passive.

The strategy session was by far the best bit. Craig Dalzell talked about opinion polls and what they tell us about Yes and No voters. It was interesting, and surprising in parts, such as when he pointed out that support for independence has dropped to 75% amongst SNP voters, and that we have a real problem with women over 55. Two things that I don’t think Craig mentioned was looking at how Leave/Remain corresponds to Yes/No, and to what extent the support for independence is caused by where you live – for instance, is the North East turning Unionist?

Stewart Kirkpatrick was better than I’ve ever heard him – he’s clearly done a lot of heavy thinking about what went wrong last time. One recommendation he made was setting up a lot of very specific Yes groups, such as Pensioners for Yes. I think this is a wonderful idea, and one that should happen now.

One thing Stewart didn’t mention – but I think it relates to this – is that this needs to be connected to chapping doors. As a Danish Yes activist, talking to random voters isn’t a great use of my time – it easily becomes a talk about why I ended up in Scotland. I should be talking to immigrants from Scandinavia, Germany and the Netherlands, because I think I’d be better at convincing them of the merits of voting Yes than an activist who was born and bred in Scotland. In the same ways, activists from England, those who are working in the NHS, the pensioners, the Leave voters, and so on, should all be sent to be right doors. In other words, Yes Scotland II should create a database of people’s origins and interests and use this to make activists chap on the right doors.

As the last bit of this session, Lesley Riddoch hosted an interactive session where she was walking around the hall with a microphone. It was probably the best bit of the day – there were just so many knowledgable people there with really interesting things to say.

The movement session was weak. Tommy Sheppard spoke well on behalf of the SNP, but most of the speakers couldn’t keep to their allocated time, and even though many interesting things were said, I couldn’t really concentrate any longer.

Finally Patrick Harvie gave a rousing speech to send us all off.

If the SIC are to hold another event like this (and I hope they do!), here are a few bits of advice: (1) Fewer speakers: Although almost all the speakers were interesting, it was too much for one day. Perhaps it’d be better to have parallel sessions. (2) More interaction: Most people were desperate to talk. There should be more interactive sessions, and perhaps also an opportunity to break up into smaller groups to discuss specific topics. (3) A buffet lunch: All 800 of us were supposed to find a place to have lunch, finish it and come back within a hour. It would have been better to have had a huge buffet lunch for everybody so that you could have a good blether while eating.

One general sentiment that I picked up was that people are desperate to start campaigning again. However, waiting for the SNP to fire the starting gun is pointless, because we need as much time as possible to convince people. At the same time, it’s hard to campaign without some sort of central office, so we need some sort of Yes Scotland II to be set up as a matter of priority. I think the Scottish Independence Convention might have to play that role, given that all major players seem to be happy to work with them.

If the SIC are happy to become Yes Scotland II, I don’t see why we can’t start campaigning tomorrow to create the majority for independence that we need to escape the hard and chaotic Brexit that Theresa May and her merry Brexiteers have in store for the UK.

People and companies are starting to leave the UK – we need Indyref2 soon!

The UK government seems to be moving towards a hard Brexit, perhaps even a chaotic one. Of course it might well be that they’ll change their minds after a few meetings in Brussels, but people and companies are already starting to act to protect themselves in case worst comes to worst. It’s clear from the Facebook forum for EU citizens in the UK that a large number of people are already starting to leave the country, and in this article the Financial Times warns that companies will leave soon if there isn’t a transitional deal to prevent Brexit from kicking in as soon as 2019:

The uncertainty over losing rights has made UK-based businesses call for early transition guarantees. Without those, big banks in London say they will take decisions assuming there will be no transition.

If there is no agreement by March 2018 — basically one year before Britain’s formal exit in 2019 — the value of the interim deal diminishes dramatically for the UK. Companies would already have taken action to protect their own interests. The Treasury is alive to the risk of a City exodus if transition terms are not clear at an early stage.


That leverage is strengthened by another cold calculation in Paris, Brussels and Berlin: the longer Britain waits for a transition deal to be discussed and agreed, the more likely businesses will decide to move or shift investment away from the UK. For the EU-27, late agreement on transition would maximise relocation while still avoiding a “cliff edge” — sudden and disruptive change for businesses stemming from a sudden exit.

So people have started leaving already, and companies will follow soon, and unfortunately they’ll leave Scotland, too, unless it’s clear that we’re likely to remain within the EU. If we don’t hold Indyref2 till Brexit is done and dusted, they will all have left and found permanent new homes elsewhere, and they’ll be extremely difficult to tempt back to Scotland.

I’m not saying that we need to hold Indyref2 very soon – but just announcing that it definitely will be held in 2018 will make people and companies delay a move away from Scotland, and it might make companies in the rUK explore whether a move to Scotland would be cheaper and easier than relocating to Dubling, Paris, Amsterdam or Berlin.

Indeed, just announcing Indyref2 is likely to have a beneficial effect on the Scottish economy, so I reckon Kenny MacAskill is worrying needlessly when he thinks the economy is doing too badly to allow us to win a new independence referendum now.

If companies are leaving the rUK (but not Scotland) in great numbers during the Indyref2 campaign, surely that will be a great reason for many people to vote Yes.

However, we can’t afford to wait till they’ve all left before we call the referendum. Nicola Sturgeon has been saying exactly the right things recently, reassuring people and companies in Scotland that we won’t be leaving the Internal Market because she’ll call the referendum if the Brexit isn’t soft.

I expect the exodus away from the UK will speed up drastically once Article 50 gets triggered, so that would probably be the best time to announce the date for Indyref2 to ensure that Scotland doesn’t get completely flattened by the Brexit train crash.

That’s not federalism!

So Kezia Dugdale has been talking about introducing federalism again. I must admit that I stopped reading as soon as I got to this bit:

[A] federal solution where “every nation and the regions of England could take more responsibility for what happens in their communities”.

Most instances of federalism are quite symmetric, which means that specific powers belong to specific levels of government, and that the same levels exist everywhere. (There are some instances of asymmetric federalism, but they’re much rarer.) What that means is that if Scotland is responsible for criminal law, health, education and agriculture, one would expect the same powers to be devolved to the other constituent parts of the UK. That’s fine with Wales and Northern Ireland, but what about England?

Does Kezia want to devolve criminal law, health, education and agriculture to the English regions (completely removing these areas from Westminster), or does she want to create an English Parliament to devolve them to?

I rather suspect she doesn’t want to do either of these things, and she really wants to keep a system where Westminster is the parliament for both the UK and for England, devolving only a couple of insignificant areas to the English regions in order to look like she doing something.

That’s not federalism!

The United Celtic Republics

As I’ve said many times before, the reason I don’t believe in a federal UK is because England is so much bigger than all the other parts put together that it would need to be split into two or more separate nations for it to work (and each part would need to have its own legal system, NHS, education system and football team in order for federal symmetry to be achieved), but the English clearly don’t want to see their nation chopped up any more than the Scots would, so there is no practical way forward.

However, if the Republic of Ireland was willing, I would have nothing against being part of a federal country called the United Celtic Republics. I guess Ireland and Scotland would form it, but I reckon Northern Ireland would join soon afterwards, and I wouldn’t be surprised if Wales joined eventually, too.

Crucially, none of the constituent parts would be able to dominate the federal parliament, which together with a proper constitution would be the best way to ensure that the country works for everybody.

One obvious advantage would be that it could inherit Ireland’s EU membership, so there wouldn’t be any worries on that front.

There might be some disagreement about the location of the federal capital, but there’s really only one city that is both Irish and Scottish, so I think Glasgow would be the obvious choice.

Of course I don’t really believe the United Celtic Republics will ever be formed, but I honestly think Scotland and the other Celtic nations could all thrive within it. The problem with the UK is that England is far too large compared to the rest, and the lack of a codified constitution makes the situation even worse. It’s not being part of a union that makes me fight for Scottish independence, it’s being part of an unequal and badly designed one.

An extra referendum to cheer up the unhappy ones?

They Call Me Mellow Yellow
They Call Me Mellow Yellow.
Wings over Scotland is asking how we can prevent Yes-Leave voters from becoming No voters and suggests that the SNP should promise a referendum on EU membership post-independence:

We’re increasingly coming to the view that the answer is for the SNP to commit to a second EU referendum in the event of Scotland becoming independent.

Now, we can hear a lot of people sighing already. FOUR national referendums in the space of about five years (we’re not including the AV one, which nobody cared about) would be an awful lot of democracy and an awful lot of campaigning.

But we can see no other way to cut the Gordian knot of the electorate coming to decisions that contradict each other.

I fully understand the reasoning, and it’s an argument that has crossed my mind, too. However, I think it would be a bad idea.

Firstly, I fear it will put off many No-Remain voters, which is the very group we need to convince to obtain a Yes vote next time. We’ll need to argue till we’re blue in the face that the extra referendum of course is a formality that will of course be won by the pro-EU side, and that’ll turn off the exact voters that the referendum was designed for.

Secondly, as I’ve argued in another blog post, there simply aren’t that many Yes-Leave voters left in the Yes camp. There are many, many more No-Remain voters that could be convinced by a Scotland-in-the-EU campaign than there are Yes-Leave voters who might vote No because they hate the EU so much.

Thirdly, all signs are that the negative consequences of Brexit will become much more visible over the next year. It would be foolish to have committed to a Scottish EU referendum if Brexit turns toxic.

Finally, we mustn’t forget – as I’ve said before – that we cannot win a referendum by appealing only to Yes-Remain and Yes-Leave voters. Those two groups together add up to about 45% of voters, as Indyref1 showed. We have to win over a sizeable chunk of the No-Remain voters. As the Brexit referendum demonstrated, Yes-Remain plus No-Remain add up to 62% of the Scottish electorate. That’s the way to win Indyref2. Chasing Yes-Leave voters is a dead end, and especially so if doing so means turning away No-Remain voters.

Brexit: The book

I often feel that the vast majority of people in the UK (including Scotland) know very little about the EU, believing it is basically a glorified free-trade area.

This lack of understanding has made it very easy for the right-wing media to portray the EU as being out of control, when most of the time it is doing exactly what it was supposed to do.

Ian Dunt’s wee book about Brexit is thus very much needed. A lot of it is basically teaching the reader about the EU and the associated countries (with chapter headings such as “What is the European project?”, “What is the single market?”, “Norway” and “Switzerland”), and only then does it proceed to look at the details of Brexit, cataloguing the hurdles ahead (e.g., “How can we keep the UK together?”, “How talented are the Brexit ministers?” and “Making a new country”).

In general it’s a fine book. Many people have described it as really scary, but I actually found it too positive and optimistic about Brexit in places. There are many interesting details in it – for instance this bit about vets was entirely new to me:

Industry estimates suggest that 95% of vets in meat hygiene graduated elsewhere in the EU. British vets simply do not like the work. The problem is not only it is more poorly paid, though it is. The trouble is that someone willing to go through the extensive training requirements of veterinary medicine generally does not do so in order to spend their working life watching animals being killd and the washing of their carcasses by former convicts.

I didn’t like the chapter about Scotland much, though. I think the author has spent too much time speaking to Unionists or Yellow Tribe members like Alex Neil, because he seems to think that getting more powers devolved to Scotland (e.g., with regard to agriculture and fishing) would satisfy pro-independence voters, when of course it wouldn’t. Those powers would be pointless because they’d need to be handed back to the EU post-independence, and they wouldn’t allow us to build a more compassionate and socially just society, which is what motivates most of us.

In the concluding chapter, Ian Dunt suggests that the outcome of Brexit will be a European Hongkong:

Britain is about to experience a toxic mix of weak law and strong lobbying. It is tantamount to switching a country off and on again. Except that it will not revert to its original state. It will revert, in all likelihood, to a low-tax, low-regulation laissez faire economy, more akin to that of Singapore or Hong Kong than the countries on the Continent. [p.161]

As I’ve explained in another article, I agree this would seem like the likely result, and if we can’t prevent a hard Brexit from happening, we need to get out before it’s too late.

If you aren’t a major EU policy wonk, you’ll probably learn a lot of useful stuff from reading this book, and if you are, it’s still a useful list of all the options and obstacles in one place. Everybody should read it before it’s too late.