Ronald MacDonald thinks Scotland in EU would pay more for debt than Brexit UK

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Professor Ronald MacDonald, former Independent (shy Tory) councillor on Skye and member of the anti-Independence activist group SBUK, will be all over the MSM today with his latest predictions of an independent Scotland’s need to pay a higher price to borrow.

His report in Daily Business yesterday is missing two key words – EU and Brexit.

He argues that Scotland would pay more without the UK’s ‘long history of credibility.’

He chooses not to mention that Brexit, according to the Bank of England in 2019, will cause lenders to: seek compensation for bearing the higher risk and, because greater uncertainty leads to increasing default risk, they will also demand a higher default premium.

https://www.bankofengland.co.uk/-/media/boe/files/working-paper/2019/brexit-and-uncertainty-insights-from-the-decision-maker-panel.pdf

He does not, of course, mention Scotland in the EU or the EU at all. No doubt he’ll tell us we will struggle to be admitted?

15 thoughts on “Ronald MacDonald thinks Scotland in EU would pay more for debt than Brexit UK”

  1. ‘UK’ and ‘credibility’, a contradiction in terms if ever there was.

    Banks, countries, the EU will be falling over themselves to lend to resource rich Scotland when independent and rejoining the EU. Should Scotland need a wee loan, it will be because of the legacy of being squeezed financially for centuries by their masters in England.
    A Scotland shackled to England and out of the EU is the worst of both worlds, who the hell would choose that willingly.
    No thanks.

    Liked by 5 people

  2. What a load of coital bovine scatology
    The most vital considerations any lender
    Gives to any National Borrower is to assess
    1 Ability to repay particularly if matters go pear shaped
    2. Appraise and value what assets are owned
    3.Past history and trustworthiness
    4.Socially and politically stability
    5. What the monies are required for
    6.Will proper fiscal controls be applied by the borrower once they receive the monies
    7.Has due diligence and proper risk management been carried out
    As a New Nation Scotland will undoubtedly have problems regards previous track record as their is none to refer to
    With regards all other criteria tis The lenders who shall have to compete with each other in order to secure the business
    Of a asset rich.educated, skilled workforce,excellent higher educational facilities, naturally a canny people with a long history in financial management
    And a forward outward looking nation
    With a sound proper constitution more than willing to play its full part in working with others for the policies that this world now requires with urgency
    So we qualify by a mile and tis us that hold most of the aces at the lenders tables
    After all that is the business they are in
    And they WANT to lend money to those who can and will repay no matter what
    One way or another
    You only have to look at major SNP recent government major infrastructure projects
    And compare such with those of Westminster and see whom delivered on/ below budget and program and the resultant fiscal boost resulting to the economy NO NEED to elaborate on the latter
    Tis Scotland that would firmly be at the front of the queue and The Impovershed,Asset poor England way further down the line and more likely to be subject to higher loan interest,strict conditions and imposed terms prior to phased money releases
    All this is not rocket science it is a matter of pure common sense by both borrower and lender Nothing more Nothing Less

    Liked by 4 people

  3. I seem to remember that not so very long ago,the London treasury announced that in the event of Scottish independence,it alone would be responsible for all of the debt it had created.
    Designed to shore up the pound but they put themselves on record.
    An independent Scotland would in reality have to settle up assets and liabilities but it will not be a straight population share of Westminster’s debt,something much less probably.

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    1. Yes. I think I read somewhere an independent Scotland would be likely to accept a share of debt. I have no idea how that might be assessed. All that oil? Almost all of the oil in Scottish waters and the majority of gas, too. All those oil workers (Scottish and English) and their income tax and NI contributions. Do you think we in Scotland might be in credit?

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      1. We might need to unravel GERS over many years? Hmmm.

        Destruction of Scottish industry and the creation of health inequalities costing billions each year?

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    2. I wrote this on Labour Hame some months ago. It is apposite here.

      “(1) There is NO LEGAL CASE for a newly independent Scotland to take on ANY of the “continuing” UK’s national debt. That is simply a fact. The debt lies with the UK and it would stay with the UK. George Osbourne confirmed this prior to indyref1 but unionists have continued to argue the opposite as if he said nothing at all. I think “blinkered” is the apt expression.

      (2) Professor Brian Ashcroft of Strathclyde University (a unionist) brought out a paper in 2013 that, initially, sought to make the points Mr Hoskins gleefully makes about Scotland’s fiscal position within the UK.
      https://www.scottisheconomywatch.com/brian-ashcrofts-scottish/2013/07/has-scotland-already-spent-its-oil-fund.html
      Unfortunately for him and the unionist cause it actually proved the exact opposite. To his credit though, he still published it. Naturally, because it blew the “subsidy junkie” myth out of the water thus undermining the case for the Union, it was ignored by the media and few ever got to see its findings.

      The Professor found that between 1980 and 2012, Scotland had £1,357bn spent on it. However, the actual tax take over the same period was £1,425bn! That is, despite the UK having around £1-1.5trn of debt in 2012, Scotland had contributed absolutely nothing towards it and was actually £68bn in credit. Yet we were still having to stump up for interest payments on a population share of the UK debt (the Prof estimates that cost at £83bn), thus the “subsidy junkie” myth was invoked when in actual fact the exact opposite was the case.

      UK govt austerity, incompetence and gross mismanagement of North Sea resources may have seen a “real” deficit in Scotland’s finances since 2012 but that won’t amount to anywhere near the £68bn in credit we started on, or impact on the truly humongous debt run up by the rUK.

      The upshot from this is that there is NO MORAL CASE for a newly independent Scotland to shoulder ANY of the UK’s debt run up by 2020.

      (3) With no legal or moral case, any attempt by the rUK to force a newly independent Scotland to pay for rUK’s debts could only be successful through fraud (ie convincing the Scottish govt of the “subsidy junkie” myth) or threats which are unlikely to endear Scots or the wider international community to them.

      (4) The recent splurge in UK govt spending would easily be affordable (within the context of this discussion) for a newly independent Scotland as it would have no historical debt for it to be added to. 8% of the “splurge” + £0 = 8% of the “splurge”; 8% of the “splurge” + 8% of £1.8trn = a bad argument for the Union”.
      (I have edited slightly for clarity).

      When you add in a more “realistic” North Sea tax regime (ie one that actually taxes rather than subsidises it) Scotland’s fiscal position brightens substantially. Not enough to tempt Prof McDonald out of the darkness though I fear.
      —————————————-
      Hope this posts this time. WordPress can be exasperating at times.

      Liked by 2 people

  4. MacDonald is also on the Advisory Board of These Islands, alongside such luminaries as Brian Wilson and Kevin Hague.
    At least is removes any “stigma” of neutrality the media might have tried to pretend, when the referendum is debated.
    Scotland level of “debt” will very much depend on a fair divvying up of assets and proper allocation of that debt over decades (Vienna Convention). Its not something the “Scottish” media want to discuss.

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  5. Prof. Richard Murphy suggests that the newly independent Scotland could pay,as a good will gesture, a proportion of debt interest only. Only paying back capital when rUK does. Any QE money is out of the equation.

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  6. “Scotland is a basket case”that is all we hear.

    What I would like to see is someone do a study what England and the others would be like without Scotland and its revenue .
    You only had to listen to Dominic Raab spouting off in Parliament yesterday how they would make Brits. powerful again,that is what it is all about they would no longer be at the top table,no more strutting on the world stage a poor country going cap and hand to America to be the next State,maybe a bit over the top but lets hear the Unionist cabal tell us how England would cope on their own.

    Ronnie Mac just another creepy Unionist.

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  7. All the old Better Together ‘Project Fear’ attack lines from 2014 are being rolled out again with increasing regularity. Since they felt these were effective in stemming the ‘drift’ (as they would have seen it) to YES then they probably think they will be effective again, knowing that the media will faithfully push them out without criticism or reference to the veracity of the promises made if Scotland voted NO.

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