At the last referendum, the questions on what currency Scotland would use, the supposed budget deficit along with our continued membership of the EU were 3 of the arguments used against Scottish Independence.
The EU argument is no longer an issue, due to actions taken by Westminster in 2016. But currency and budget deficit – or otherwise – still are.
The Tories talk about “magic money trees” and scoff at how an Independent Scotland would pay for its services and infrastructure.
The letters of magic money tree (MMT) also stand for something else: Modern Monetary Theory. In reality Westminster’s talk of austerity is one of the biggest cons they have pulled.
Taken to its basics as long as you have your own sovereign fiat currency like the UK pound is, you can never go bankrupt. Its like the ultimate gold plated credit card that has an unlimited credit limit.
Quantitative easing is just a fancy name for the government central bank printing money.
Which it has been giving to banks and has also started buying its own debt back from them.
This is a process Japan, has done for years, where the government issues debt as bonds to borrow money on, the central bank prints yen and buys the bonds giving the government the money and any interest back on the bonds.
Japan now owns 60% of its own debt, when you owe yourself money, you are not in debt any more.
Now i hear you say, what about inflation, that’s were tax comes in, it is used to control money supply in system, by controlling and remove it via tax to prevent inflation.
This is why we don’t need GBP or the Euro, we require our own sovereign fiat currency in an independent Scotland
Setting this up would require some work, like some funding for central bank. But seeing as we own part of our own 375 billion debt that the UK owes itself, this would be more than enough to set up a bank.
Slovakia set up its own central bank when the Czechoslovakian republic split in the so called velvet divorce. So its not as if a small European country hasn’t done this in the recent past.
A Scottish pound free floating should be our goal for an independent Scotland, it may start off at an initial low rate against other currencies, but as bloomberg reported last year, GBP could drop to $.80 in the event of Scottish independence post brexit.
A Scottish pound or whatever its called would eventually grow to be a strong currency, given Scotland’s balance of trade.
Currently Scotland is the only part of UK with a trade surplus, exports of goods were up by 19% to nearly £29bn, while they rose by 13% for the UK as a whole and the UK government figures show Scotland exported than it imported.
To use any other countries currency would put us in thrall to that countries central bank; By using our own currency, within a short period of time, our balanced economy would grow and is more than capable of supporting our own currency, under which we would thrive more so, than using anyone else’s currency.