During a BBC referendum debate, Jenny Marra – the Labour MSP – said that oil production from the North Sea was declining. She was pleased with delivering this supposedly telling blow to the case for independence, and her words were welcomed by the old ladies in the audience clapping at something seemingly detrimental to their country.
Ms Marra was correct. Oil production has declined to between 1.2 million and 1.4 million barrels per day, but whereas that presents a problem for the UK, it does not do so for an independent Scotland. The reason is arithmetic and trade. That amount of oil is more valuable to a Scotland of five million than it is for a UK of 60 million. It makes the Scots enormously rich in energy, but does no such thing for the UK.
This fact is underlined when we look at trade figures. For decades, the UK balance of payments, the difference between what is paid for imports and what is earned by exports, was a disaster. In the 1970 election, the delivery of one big aircraft, an import, was enough in the final week of the campaign to tilt the balance of payments against Harold Wilson’s Labour government, and he lost. But along came Scottish oil, and as it gushed forth in those first decades the balance of trade changed, with huge exports of the new black gold. The beneficiary of Scotland’s early oil wealth was, irony of ironies, the Margaret Thatcher regime. While she spent it, the Scots were in a prison of lies, being told repeatedly that it was not as valuable as the SNP claimed.
With the decline of North Sea production, the UK trade balance in energy has moved from being a surplus of £9 billion in 2000, to a deficit of £21bn in 2012. But the amount of oil Ms Marra disparages would have a different effect on Scotland’s balance of trade. With oil and its export credited solely to our economy, we would have a huge trade surplus and that would make our economy inherently strong.
There is also the black stuff itself. All the debate has been about oil tax revenues, never about actually what a small oil-rich country could do with it to build additional wealth and create jobs outside of the oil industry. A bit of imagination shows what could be done. As we would be oil-rich, we could use a portion of it to produce cheaper fuel both for transport companies, families and aircraft. That would boost the transport industry, the tourism industry, take less money out of family budgets, and if Scottish airports offered airlines cheaper fuel it would give us a real edge in competing for direct flights. That’s what the Gulf states do, where petrol is cheaper than water.
What about that other Unionist cry, “it won’t last, it will run out”? Here are the facts: so far, 41 billion barrels have been extracted from under our sea. Another 21 billion barrels are still to be had there; then there is the Atlantic, and the Clyde. I suspect that in their darkest moments, as Scots become more familiar with the facts about oil – as distinct from the lies they were fed previously – the Unionists would like to see a big hole develop and the oil disappear, but that won’t happen. It’s there. It will be ours, and we shall make good use of it to create jobs, spread wealth, and make this a better society because it will be a more equal one.
Land value tax would end one fiscal farce
Ever heard of land value tax? It is a Green Party policy and a good one. It makes some pay who have never paid taxes before to local government and it would replace the council tax.
Land value tax means the size of your house, improvements and its amenities are irrelevant. The land it sits on is valued, as is all other land. Today, those who own 4,438,000 hectares of agricultural land, 1,799,783 of sporting estates, 1,342,000 of forestry (often used for tax avoidance), and 2,630 hectares of vacant urban land pay no taxes. If public investment, such as road and rail development, or the creation of national parks, raises the value of their land they gain. In London, £3.5 billion of public money was spent on the Jubilee Line. Land along that line jumped in value to the tune of £13.2bn. Now that is really something for nothing.
So, we have a pensioner couple paying council tax on a two-bed apartment while the Duke of Buccleuch pays nothing on his vast landholdings. Land value tax would put a stop to that.
How about we get real pride?
“I’m a proud Scot” are words often heard. I am not. How can we be proud of a country where the number of food banks are growing, payday loan companies are expanding, where people deprived of benefits become destitute?