Friday, 22 November 2013

Reality behind the IFS report on independence



Last week the London-based Institute for Fiscal Studies (IFS) produced a report titled ‘Fiscal Sustainability in an Independent Scotland’.

It has been virtually impossible to miss the IFS analysis as the British print and broadcast media screamed its contents from every front-page and lead-item in news bulletins. Needless to say, the report’s findings – that an independent Scotland would have a fiscal deficit and in order to balance the national books would either have to impose spending cuts or raise taxes - were reported as fact.

In reality, the IFS report was based almost entirely on British Government figures and economic strategy. It was, therefore, largely a piece of British unionist propaganda. However, that did not stop the British State broadcaster, the BBC, running the anti-independence assertions unchallenged.

The BBC is now beyond a joke. It is acting as an organ of the British State and is complicit in disseminating pro-British Union propaganda. Notice even the little things, such as anything the pro-independence ‘YES’ campaign says is reported as ‘claims’, while pro-British Union stories are stated as fact. Last week’s IFS report was a classic example. The outcomes of the organisation’s analysis were presented, not as ‘claims’ by a London-based think-tank, but were stated as the factual position that would be faced by an independent Scotland.

Much was made by the British media (including its Scottish sub-section) that the Institute for Fiscal Studies is a “respected” and “independent” organisation. Scots politicians and activists within the British unionist coalition of Tory, Labour and Liberal Democrats also majored on the ‘independence’ of the IFS. Isn’t it strange how independence is a good thing, except for the nation of Scotland?

There is little more unedifying than Scots joyously lavishing praise on a report that rubbishes the abilities of fellow Scots and the potential of their own nation. That, however, was the sight that greeted viewers as Labour and Lib Dem politicians rushed into TV studios to side with their Tory partners in attacking the prospect of a successful, independent Scotland.

The British unionist message remains clear: uniquely amongst all the peoples of the world, only the Scots are too wee, too poor and too stupid to govern their own country.

Without as much as a questioning glance, British unionist politicians and the media in Scotland accepted the IFS’s assertions that an independent Scotland would have to either impose cuts to public spending or raise taxes in order to balance the books. The same politicians and media also overlooked the fact the IFS stated the UK would be in a similar position for the next 50 years.

Now, notwithstanding that no credible economist would attempt to predict what will be happening in 2063, the IFS projections for the UK point to the fundamental flaw in its assertions about an independent Scotland. The Institute for Fiscal Studies report was based on the government of an independent Scotland continuing to pursue the failed economic policies of UK Governments, which would be extremely unlikely, to say the least. Under the IFS model, an independent Scotland would still be paying billions-of-pounds towards the creation and maintenance of nuclear missiles, and would still fund overseas military actions like the invasion and occupation of Iraq and Afghanistan.

On the other side of the IFS’s flawed analysis, income to an independent Scottish exchequer from oil fields in the north sea is marked down to the very lowest estimate (from the UK Government’s Office of Budget Responsibility), while no provision is made for the development of new fields around the north and west coasts of Scotland.

In fact, to be fair, the IFS report does actually highlight how things could be very different in an independent Scotland, but that part – surprise, surprise – was overlooked by British unionist politicians and the media. The report states: “These factors are inherently uncertain and could also evolve differently if Scotland were independent rather than part of the UK; in addition, they could be substantially affected by the policies chosen by the government of an independent Scotland.”

It is also interesting to note the Labour Party’s lauding of the Institute for Fiscal Studies, particularly the use of “respected” and “independent” to describe the organisation.

The IFS was formed in the late 1960s by four men – Will Hopper (a banker and Conservative politician), Bob Buist (an investment manager), Nils Taube (a stockbroker) and John Chown (a tax consultant). The think-tank is regularly described as advocating right-wing, neoliberal economic policies – Tax Research UK is on record saying, “The Institute for Fiscal Studies is a body that persistently recommends tax increases that benefit the wealthiest in society at cost to those who make their living from work and the poorest in society”. In addition, tax analyst Richard Murphy said the IFS has “a bias towards the neoliberal view that suggests labour should be heavily taxed whilst capital is left virtually tax free”.

Already standing shoulder-to-shoulder with the toxic Tories, it appears there is no right-wing organisation the London-controlled Labour Party will not cosy-up to in its attempt to prevent Scotland becoming a normal, independent nation.

Meanwhile, respected individual members of the Labour Party in Scotland are taking a very different view. Last week, Alex Mosson, the former Labour Lord Provost of Glasgow said: “This referendum is all about us, the people of Scotland, and our right to self-determination. Once we achieve independence I'm sure people will start to regain their interest and engagement in politics, and that will be a good thing for democracy. But first we need to find our self-confidence and become a successful, more prosperous and fairer nation. I am totally convinced that only a Yes vote will get us to that point.”

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