Why would an independent Scotland expect a currency union with the UK?

[JapaneseMargaret]

I mean, I can see why they would, but doesn't that just totally undermine their desire for independence?

Am I missing something blindingly obvious...?

I didn't use Iceland as an example - I was asking a question as there are many interesting and informed people on the thread.

I would also point out that I do not understand alot about economics. I do understand about triaging patients etc that does not make me a numpty

www.poundsterlinglive.com/breaking-news-articles/877-why-scotland-should-peg-an-independent-currency-to-the-british-pound-sterling-554654
Deutsche bank view on currency.

archive.is/VASeD
Wall Street journals view.

And and interesting view from the Adam Smith Institute.
www.adamsmith.org/news/press-releases/comment-an-independent-scotland-would-be-better-off-using-the-pound-without

Not much of these reasonable,thought out articles to be seen in Scottish press.

'Rather than discussion, rather outlining the benefits to me, a public sector worker with three children, of staying in the union'.

That's exactly what we're all trying to find out - how would it benefit us to stay or to go. But they can't tell us, because they don't know. No-one does. So in choosing to separate, we have to take the risk of things getting worse, or decide the stakes are too high to gamble.

Interesting articles, FannyFifer. It's good to get an international perspective - even if one of them is by the dreaded Adam Smith Institute.

Exciting times.

Solopower - it's not much of a gamble. Anyone who has a UK passport is not going to lose it just because they live in Scotland.

But as someone pointed out (on another thread?), it is a class issue thing. So to an extent it depends on whether one is working class, middle class or other.

As a person of Scots origin resident in England, I am a UK citizen. I am very happy for the Union to continue. However, if the people who now live in Scotland vote for independence, I wish them well. I will then be living in a different country, and I would not expect the country I live in to be entering into obligations to form a currency union with a foreign country. I don't think the voters of E&W&NI would vote for it, and I believe the politicians who say the offer is not and will not be on the table.

Currency union is a big burden to carry, especially between nations that are not trying to achieve greater political union. In the Eurozone, the people of Germany are resentful because they feel they were obliged to bail out other European countries that got into a muddle.

Next time RBoS goes bankrupt, E&W&NI will doubtless be among those wishing to help, as no doubt will the rest of the EU, but the BoE will no longer be Scotland's central bank, and will be under no special obligation.

Scottish independence: Barroso says joining EU would be 'difficult'

Oh dear. Looks like the EU President is now saying that ".... it's going to be extremely difficult, if not impossible" for Scotland to join the EU. Not because England would object. But in fact that objection may come from other countries such as Spain who would be petrified that if the precedent was set then Catalonia would try to follow suit.

So....two of the most fundamental reasons for Scottish independence now appear to be HUGE risks.

1. Scotland will keep the British pound. Except the head of the civil service, the chief of the BoE both advise against rUK entering into a deal. And all three main parties have said they won't do it either.

1. Scotland will join the EU. Bearing in mind that in the beginning Salmond argued that membership would be automatic. That turned out to be crap. So he's been spinning that it'd be a formality. Except now the EU president is saying actually it could be downright impossible.

What else have the SNP got planned that could turn out to be utter bollocks? How can anyone be trusting them with the future of their country?

1a
It used to be fundamental that an independent Scotland wouldn't use the UK pound. Scotland would be freed from the shackles of its oppressive neighbour and would embrace the freedom and security of the Euro.

But surely the decision will be taken on emotional grounds anyway?

I think that the spanish are worried that if Scotland becomes independent and joins the EU that the Basque region of spain will follow suit. It is vindictive of spain to refuse to let scotland join the EU. I hope that other countries including England would put pressure on Spain to let the scots in.

Very few English people feel vindictive towards scotland. I don't think many English people are particulary bothered if scotland chooses independence. Scotland is not a colony to be subdued.

I think that English politicians are fearful of currency union with an independent country because they have seen what a disaster the EURO has been. Unlike the Eurozone England and scotland are moving apart politically. It would be a nightmare if the English and the Scottish goverment had diametrically different economic policies.

Spain would not want Gibraltar to apply for membership either.

It would be catastrophic for Spain if Scotland gained independence and eu entry. It is a relatively new country and unlike the uk and Scotland, relies heavily on Catalonia and the Basque Country for most of its income. I think I read somewhere recently that 30% of Spain's money comes from Catalonia! the basque region is also very comparatively wealthy. If the precendent was set by Scotland, Spain could very easily implode leaving the very poor south (50% youth unemployment in Andalusia) in an extremely precarious scenario. It's not "vindictive" to want to protect your people.

I think Baroso has probably done more for the 'Better Together' campaign than everyone else put together.

It is vindictive of spain to refuse to let scotland join the EU.

Vindictive means there's an element of revenge. In Spain's case there is none so their position is not because of vindictiveness but self interest.

Spain cannot risk letting Scotland join the EU because then it sets a precedent for it's own regions that wants independence from Spain. In short if they let Scotland join they risk their very own country.

That's not vindictiveness but the complete opposite.

I'm listening to Salmond now who is spinning like mad. Apparently Scotland is loaded because of the oil/gas in the North Sea. A 'hotbed' of success.

If that's the case I don't see why he's so desperate share the pound. Set up your own currency and make the rUK so envious that we'd want to adopt the Scottish pound!

Scotland is not a region.

Do you prefer the term province?

Think you will find country is the word, same as England.

The united kingdom is four countries that share a monarch and a parliment. Scotland has its own language, history and culture. Nearest comparable situation to the UK is the US with its 51 states.

some prefer the word "nation"

It would certainly be a more accurate term than country.

fannyfifer if by that you mean the Spanish situation isn't comparable with the UK/ Scotland's as they are merely "regions" The Basque Country has it's own language (much more widely spoken than the Scottish) history and culture and local govt. They would very much consider Scotland's fate to be a precendent for their own and for their situation to be comparable.

I'm struggling to understand why rUK would want, effectively, to underwrite an independent country's public debt, and be a lender of last resort (and regulator) for its banks. Especially given the size some of those banks relative to Scotland's GDP.

It doesn't want to.

That's my point really, the 'yes' campaign keep saying it's in the interests of rUK, but that just doesn't seem to be true. Their campaign seems to be predicated on a number of assumptions (EU membership would be another one) that may not be true, with no published alternative plans. It seems a bit half baked!

Person "A"
I want you to give me X, and you should agree because it is in your best interests

Person "B"
No, I don't agree that it's in my interests, and I don't want to give it to you

Person "A"
You're only saying that because you're a horrid bully!