George Kerevan: Scotland must stop being dewy-eyed about EU and focus on indy

Formally, the message is designed to boost tourism, though presumably only after the pandemic. But the in-your-face point of the slick advert is unquestionably political: Scotland voted to stay in the EU in 2016 and (if leading SNP politicians have their way) will sign up to rejoin the morning after we get independence.

Here’s the thing. Wherever you stand on re-joining, the odds are that by the time an independent Scotland is ready to (re)negotiate membership, the EU is likely to have moved on from the body we were forcibly taken out of by Boris and co. So it might be useful to examine the economic, political and social trends driving the evolution of the European Union rather than get too misty-eyed about the mythical Europe that lies beyond Dunbar lighthouse, courtesy of VisitScotland’s publicity team.

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Sans the UK, the EU is basically a Franco-German political alliance with Berlin in the driving seat. The EU27 economy is dominated by German and Dutch exports (the Netherlands being effectively a German lander). The rest of the EU27 acts either as a constituent part of the German industrial supply chain (Poland) or supplies Germany with consumer goods and services (Italy and Spain). France is semi-detached from this system, relying on its own internal market, global defence exports and supplying sophisticated services to the EU.

The loss of the UK is hardly going to upset this autarkic system. Indeed, one wonders how a UK that was out-competed by Germany whilst inside the EU will be able to perform any better now it is outside the single market. But more to the point, it’s also difficult to see how an independent Scotland can reintegrate itself into this German monopoly without subordinating its economy to Berlin’s economic requirements. One might counter that being a German economic colony is hardly a misfortune.

Providing a safe Brigadoon vacation spot for Europeans and acting as a technological ideas feeder for German industry (as does Denmark) could be a niche for Scotland in the EU. But tourism is a low-wage industry based on carbon-exuding air travel. And Scotland has a way to go if it wants to displace Danish high tech in the German market.

However, the EU economy as a whole is facing its own existential crisis. This comes in the form of Germany’s failure to compete with the Americans and Chinese in new technological developments, especially in artificial intelligence and driverless electric cars.

At the weekend, the Financial Times published a massive survey of the top 100 global companies that have benefited from the pandemic. Of these – led by Tesla – 30 are American. But 36 are Chinese.

They include electric carmaker BYD and LONGi, the world’s largest manufacturer of silicon chips.

And how many EU firms make the cut? A modest 13, only three of them in Germany. Note: the UK has one company on the winners’ list – online retailer Ocado. It is interesting that two of the German stars are also online retailers plus one pharmaceutical company (hardly a surprise). No German high tech engineering firm makes the global 100, a sure sign the EU economy is being crushed between US and Chinese competition.

Which may explain why last week the EU signed a new investment pact with Beijing, despite a last-minute attempt by the incoming Biden administration to prevent it. China wants EU cash to invest in its slowing domestic economy, the better to capture global markets. Beijing also wants to buy its way into Europe. Hence the deal to free up two-way capital flows, despite French crocodile tears over insidious Chinese labour practices. What is significant is Berlin’s willingness to side with Beijing rather than Washington. Scotland might care to muse on this development.

AT the very least, don’t expect Germany and the EU to knuckle under as Joe Biden’s tame ally. The Trump years have signalled to Europe that America is quite capable of asserting its own interests above Europe’s whenever it wants to. Expect Germany to set about creating its own set of alliances, playing off China against America.

There is also the question of Russo-German relations. Putin’s Kremlin is a haven for genuine gangsters, but the inclination of Berlin has always been a rapprochement with Moscow. Russia is a natural market and supplier of raw materials for Germany. With its economy buckling, expect Germany to embrace Russia as part of its sphere of influence.

Where the EU still has some global economic muscle is using the euro as an international trading currency. Portugal has just taken over as EU president for the next six months and has already called a summit in March to discuss the euro currency project, plus a further summit in June to mastermind European banking union.

Conclusion: expect any new member of the EU to be required to join the currency zone. I know there are get-out clauses, but the political wind tells me Scotland will have to sign up to the euro.

For some, that’s not a problem. One of the reasons the SNP Growth Commission was so strongly in favour of keeping the pound pro tem was that many commissioners envisaged the true transition would be to the euro – so an interim Scottish currency was a wasteful distraction. Pity they were unwilling to say so in public.

Personally, I think that joining the eurozone will preclude an independent Scotland pursuing the socialist and communitarian economic policies I would wish for. Which is why the battle for an independent Scottish currency is so important.

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Indeed, the economic and political direction of a German-dominated EU is debatable when it comes to Scotland’s long-term interests. Yet nowhere in the present discussion regarding Scotland’s prospective EU membership has any serious thought been given to the political, democratic and economic shortcomings of the European Union as presently constituted.

Granted, the reality of finding ourselves marooned inside Boris Johnson’s Little Englander madhouse – and a spectacularly ill-governed madhouse at that – demands Scotland’s immediate attention. The priority is independence. Nevertheless, let’s stop being dewy-eyed about the EU.

You can be a good internationalist and still criticise Brussels. The same Brussels that forced appalling austerity on Greece and Spain in order to save Germany’s greedy banking houses. The same EU where wages have stagnated as a share of GDP for over two decades because of neoliberal policies prosecuted by Brussels and geared to protecting European big business.

So next time VisitScotland uses public money to send a love letter to Brussels, the actress at Dunbar lighthouse should intone: “As long as Scotland’s still here, Europe, you are always welcome. But only if you are a different kind of Europe. A Europe that serves ordinary folk – not the Volkswagen bosses who lied about their car emissions or the bankers who screwed poor people everywhere and were protected by the European Commission.”