Whether Independence Is Consistent with Scotland Keeping the Pound - Essay Example

Is Independence Consistent With Scotland Keeping The Pound? INTRODUCTION Prior to discuss about whether independence is consistent with Scotland keeping the Pound, it would be vital to mention that the currency choice possesses a broad array of financial implications. Justifiably, currency choice affects trade regulations with other nations, hindering effective utilisation of the policies in the fiscal as well as monetary sections and others associated with financial stability. From a theoretical perspective, as a self-governing state, Scotland would certainly possess three particular currency options. These options may include “The Euro”, “A new Scottish currency” and “keeping Pound as a part of a formal sterling currency union.” The UK government argued in this regard that after independence, the economies of Scotland and rest of the UK might start to vary due to certain imperative factors encompassing the formulation along with the execution of the above-discussed policies, fluctuating interest rates and incessantly transforming financial conditions among others (Webb 2-15). It would be vital to mention that the aforementioned factors eventually erupts the question concerning whether independence is consistent with Scotland keeping the Pound. THESIS STATEMENT This thesis intends to elaborate on the arguments propounded when determining whether independence is consistent with Scotland keeping the Pound. AN EVIDENCE BASED CASE FOR SCOTTISH INDEPENDENCE Scottish independence is not simply a subject matter of constitutional sovereignty. It can be apparently observed in this similar concern that there are certain states, particularly in Europe, which are legally sovereign but possess minimal scope towards administering themselves. In this regard, the social arrangement of Scotland represents that the political behaviour of the state has become quite converged in recent days, as compared to the earlier years. Notably, Scotland, among other European states, experienced massive deindustrialisation, owing to which the economy of the state became excessively reliant on consumer spending and on an exaggerated housing market as well. Thus, the sovereignty of Scotland emphasised augmenting public finances and endeavouring towards enhancing the ability of affording a liberal welfare state and most vitally, enriching the public services. It has been argued by the nationalists in this similar concern that Scotland, with its sovereign power, would be able to manage as well as utilise the accessible resources efficiently with the incorporation of various activities that may comprise balancing revenues with international trade, coping with the fluctuations concerning interest rates and contributing extensively towards raising wealth funds (Keating 1-16). It has often been argued that Scotland is a more egalitarian society as compared to England. This might be owing to the reason that the European state was broadly restored as a haven of communal democracy. Moreover, a greater acceptance of public sector as well as government provisions can be viewed to be persisting in Scotland. It is worth mentioning that without possessing own currency, an independent Scotland would not be able to reap intended benefits with the incorporation of varied financial instruments, likewise failing to adopt monetary policies effectively. This would certainly make the European state to rely more on fiscal policies, resulting in generating greater extent of economic non-stabilisation as well as fluctuation by a considerable extent (BCC, “Scottish independence: Keeping pound has restrictions”). It is worth mentioning in this similar concern that as an independent state, Scotland will certainly have less concern about preserving its nationality and advancing diverse forms of social cooperation. It is strongly believed in this regard that as an independent state and possessing own currency, Scotland will possess the capability to address and mitigate the challenges like precarious employment, transforming family structures and demographic related issues among others in the near future, with greater independency (Keating 1-16). THE VALUE OF POUND FOR SCOTLAND Currency plays an imperative role not only in carrying out the buying as well as the selling processes efficiently, but also in making solid planning towards securing the future. These roles eventually result in raising and developing financial stability of any particular nation by a greater degree. It has been apparently observed that relying much on Pound, citizens of Scotland are now able to borrow as well as save money from the varied financial institutions present throughout the UK. Moreover, the value of the currency for Scotland can also be determined in the form of the creation of jobs, which is rising incessantly in the state in modern times as compared to the past years. Nevertheless, it is obvious that a sovereign state, without having its own currency, is likely to face several challenges that may disrupt its financial viability in the global domain. In this similar context, the challenges can be duly identified as rising pressures for lessening public spending, increased level of taxation and finding difficulties in borrowing money in order to meet any sort of deficit among others (McDougall 4-18). Thus, it can be affirmed that the reliance of Scotland on Pound will certainly contribute in raising the financial viability of the state at large but also impose challenges to its independent behaviour, especially in the economic domain. DETERMINATION OF CONSISTENCY OF INDEPENDENCE WITH SCOTLAND KEEPING THE POUND While determining whether independence is consistent with Scotland keeping the Pound, it can be affirmed that independence would certainly provide active support to Scotland in creating massive number of jobs and complying with the fluctuations of interest rates among others. In the same context, it has been currently argued that losing the Pound would certainly make the European state face certain critical challenges, which will mainly include higher living costs, financial instability, accessibility of fewer jobs, higher taxes and risks related to provide pensions (McDougall 2-19). In addition, there are certain aspects, which eventually indicate that independence is not consistent with Scotland keeping the Pound. One of such aspects can be explained with reference to the fact that keeping the Pound of a sovereign Scotland will not only make the European state limited in terms of its macroeconomic planning options, but will also make its relationship with Europe more complicated (Keating 1-16). On the other hand, arguments have been made ascertaining that independence is consistent with Scotland keeping the Pound. This can be justified with reference to the fact that Scotland possessed robust as well as stable banking systems during the period 1716-1844 when keeping the Pound and benefitted with European trade growth. Moreover, the European state was witnessed possessing no ‘central bank’, ‘bank bailouts’ and lender of ‘last resort’ during the aforesaid period, which may also be summed as the benefits of keeping the Pound. It is in this context that the independence remained much consistent with Scotland, keeping the currency, rewarding better prospect towards returning to the above setting and simultaneously, resulting in attracting more investors to promote development of the state at large. It is projected that the independence will disrupt the consistency with Scotland in keeping the currency of Pound as the opportunity of forming effective monetary sharing and banking union arrangements will certainly become unsustainable between the state and the remaining parts of the UK (Johnston Publishing Ltd, “Scottish Independence: Scotland Would Leave Pound”). It is worth mentioning that independent Scotland might keep the currency of Pound to ensure greater financial stability, which in turn would certainly assist in developing the economy of the European state at large. However, this consistency with Scotland keeping the Pound might generate certain disagreements with the rest of the UK, as this will include framing new fiscal along with monetary policies and others associated with economic stability (Guardian News and Media Limited, “Independent Scotland May Keep Pound To Ensure Stability”). Arguably, one of the important aspects, which can eventually result in making independence to remain consistent with Scotland, keeping the currency of Pound, is the involvement of the European state in sharing certain powers with the remaining European states. In this regard, the powers that might get shared by Scotland with the other European states shall include banking controls, taxation policies and investment options among others (OurKingdom, “Scotland Should Relish the Chance to Run its Own Currency”). One of the vital factors, which broadly signify that independence is consistent with Scotland keeping the Pound, is the strong monetary position possessed by this European state. Justifiably, Scotland is viewed to be one of the richest nations throughout the globe, ranked 8th among the 34 developed nations in the sphere of total financial outputs. Moreover, the financial position of Scotland can be found to have remained much stronger in comparison with other European states due to the reasons of raising substantial amount of tax and the strong base of public finances over the previous thirty years. It is worth mentioning that this consistency might prove to be quite beneficial for Scotland, which can be duly measured in terms of utilising the accessible resources efficiently, enhancing the living standard of the Scottish people and finally, developing the economy of the state among others. It is worth mentioning in this context that the government of Scotland strongly believes that gaining independence would be a key aspect towards attaining greater economic success. In order to accomplish this objective, Scotland needs to control its respective fiscal as well as financial powers, which in turn would result in generating enormous employment opportunities (BBC, “Scottish independence: Yes vote means leaving pound, says Osborne”; Crown, “Scotland’s Future”). Specially mentioning, the consistency of independence with Scotland keeping the Pound would rely upon certain aspects in future. In this regard, the aspects can be apparently viewed as the financial position of the European state and the business setting, persisting within the region among others. The government of the state strongly believes that the consistency of independence with Scotland keeping the Pound will certainly result in addressing and mitigating the challenges that appear while conducting international trade (CBI, “The Scottish Government’s Plans for Independence”). CONCLUSION Based on the above analysis and discussion, it can be ascertained that numerous arguments were raised concerning the determination of whether independence is consistent with Scotland keeping the Pound. It is worth mentioning in this context that a greater leap in this consistency would certainly support Scotland and its government to develop the economy, resulting in protecting the self-interests of the people belonging to this state. The factors that entail strong financial positioning and the capability towards establishing clear as well as robust banking system ultimately represents the consistency of independence with Scotland keeping the Pound. On the other hand, the anticipation of generating complicated relationship with the remaining states of Europe and the restrictions imposed on utilising the investment options efficiently eventually signifies the inconsistency of independence with Scotland keeping the Pound. Thus, it is apparent that the government of Scotland would make deliberate efforts towards establishing the state as an independent one and maintaining consistency keeping the Pound with the intention to reap the benefits required to suffice its previous motives. These benefits may include generating maximum employment opportunities and enhancing the living standards of the Scots among others. It is projected in this regard that the consistency of independence with Scotland keeping the Pound would certainly make the European state to mitigate the challenges associated with international trade by a certain degree in the short run, but cause many challenges to its stability in the long run. Works Cited Blair McDougall. “The End of Our Shared Currency.” Securing the Pound in Your Pocket (2014): 4-18. Print. Blair McDougall. “Introduction.” Taking a Pounding (2014): 2-19. Print. “Scottish Independence: Keeping Pound Has Restrictions.” BBC. 2014. Web. 17 Jun. 2014. “Scottish Independence: Yes Vote Means Leaving Pound, Says Osborne.” BBC. 2014. Web. 17 Jun. 2014. “Scotland’s Future.” Crown. 2013. Web. 17 Jun. 2014. “The Scottish Government’s Plans for Independence.” CBI. n.d. Web. 17 Jun. 2014. Dominic Webb. “Currency Options.” Economic Aspects of Scottish Independence: Currency (2014): 2-15. Print. “Independent Scotland May Keep Pound To Ensure Stability.” Guardian News and Media Limited. 2014. Web. 17 Jun. 2014. “Scottish Independence: Scotland Would Leave Pound.” Johnston Publishing Ltd. 2014. Web. 17 Jun. 2014. Michael Keating. “The Choice of Roads for Scotland.” Scotland as a Social Democratic Social Investment State (2014): 1-16. Print. “Scotland Should Relish the Chance to Run its Own Currency.” OurKingdom. 2014. Web. 17 Jun. 2014. Read More