This is the second part of Bill Mitchell’s article concerning the Scottish Growth Commission Report (Part 1 here) – what Scotland’s financial and economic policy should be after independence. It is neo-liberal to the core, which is no surprise to anyone who is willing to face reality with regard to the Scottish National Party.
Richard Murphy summed up Mitchell’s articles (original here):
The Growth Commission recommendations are consistent with the mainstream neoliberal consensus of these issues. They are not conducive to the creation of a vibrant, progressive nation.
Scotland would be exposed to British government decisions yet have no political stake in those decisions.
If the Scottish people determined that they wanted to retain the use of the pound as the national currency, then Scotland would be better off staying within Britain and exerting internal political pressure to improve its situation.
That is an inferior outcome to establishing an independent nation with its own currency.
However, it would be much better than declaring independence but then continuing to use the pound and accept whatever monetary and fiscal policies the British government decided.
Yes, in that situation, the Scottish government (as now) could have some fiscal initiatives. But, ultimately, when the crunch came, it would face a shortage of pounds and austerity would be required.
Overall, an independent nation has to have its own currency and monetary policy. Otherwise, the independence is a sham.