Thursday, 30 August 2012

Osborne is playing Cameron’s long game for the Union.

Tax revenues are down says the treasury; it’s been all over the news recently. Part of the blame we’re told lies with Scotland’s Oil industry, revenues are alleged to be plummeting. We’re informed it’s just a foretaste of what’s to come.

Every indication is that this current scenario is one with its roots firmly embedded in Westminster, originating with the budget following the Holyrood GE when a referendum during the life of the current Scots administration became a self evident fact.

Consider the thought process at the treasury; it was the lead up to the last budget.

Whitehall needed income to try to balance the books, at least a little. The red ink was too much of a reminder of that ongoing fiscal incompetence that Westminster has displayed for so many decades, administration after administration.

Long term policy also had to be accounted for; the newly matured elephant in the room was that impending Scottish independence referendum. If the books were full of red ink leading up to it, it’s nothing to what they’ll look like after 2014 if the Scots do what every indicator suggests they should, and vote with their feet to leave. This very obvious red ink might even help the Scots decide to leave.

There were small items that could be tackled, inconsequential things to London’s minions, like the demonisation of the disabled, things which can be used to divert attention from what’s really happening – the destruction of the social fabric of these islands.

Then there’s the big issue which will possibly hasten the realization that the fabric is actually being torn asunder – Scottish independence.

In the eyes of both Westminster’s UK government and the UK’s mainstream national media Scottish independence and Scottish oil revenues are inexorably intertwined – kill one, defuse the other, stifle independence, secure the revenues. It’s all about playing the long game for the money, resources and assets of the Scottish nation.

This tax raid on the oil industry is explained and planned behind closed doors of course. Let’s consider this little scenario with a hypothetical reconstruction of the chat between Danny Alexander, chief secretary to the treasury and David Cameron. In case Danny Alexander is credited by too much intuition through this article [in the opinion of some readers] we should recall the treasury has exceptionally well educated, intelligent and paid analysts at its beck and call.

Danny: Dave, we need a tax raid on Scotland’s oil revenues.

Dave: We need money to balance the books – we’ve got to have income to stop the country falling apart now, and the oil industry won’t like another tax hit.

Danny: But the fields already in production will keep producing – we get the extra money anyway.

Dave: What about future investment, we need these marginal fields and the lot that probably lies in deep water West of Shetland (got the name right – yes?) developed, we need that future income.

Danny: Dave, look, slam the tax in NOW, stifle development, and as older fields go offline the revenues will decrease – we’ve got a home run for the referendum, we just need to tell them “look at your vaunted oil revenues – they’re going south, and fast”.

Dave: But Danny, we need money NOW.

Danny: Dave, we get more until these fields go offline or get mothballed, add that to a lower demand from the global economy and we can expect the North Sea data to look quite dreadful by the time the referendum comes around – but the oil will still be there, the markets will know that, and it should be worth even more.

Dave: rubbing his chin – Keep talking.

Danny: So, we’ve got money in the bank, a nice reserve, potentially vast untapped oil reserves out beyond Rockall, and because we can terrify the damned Scots into voting “No” when they see what’s happening to their vaunted oil revenues, we insure we get it for decades to come.

Dave: Danny, that’s a great idea, get George here and we’ll have him include it in the budget – we’ll paint it as plummeting revenues if it does happen, and just take the revenues if it doesn’t – brilliant Win-Win Danny boy. Teach those darned Scots not to mess with us, eh.

George Osborne enters:

Dave: George, let me explain Danny’s idea - (witterings ensue) - Now, what’s your opinion.

George: after unfolding a towel and using a marker to on it to outline his thoughts – Brilliant Dave, well done Danny, but what if instead of just complaining the Scots tumble to what’s going on, it might be harder to hide than even Coulson’s indiscretions.

Dave: Suggestions George?

Danny [interrupting]: George, let them eat cake got some queen or other over the channel beheaded, we need to behead the independence movement, I mean, without any kind of positive argument that can withstand even basic scrutiny we’ll only deflect attention from our hollow arguments for so long, and it might not be long enough.

George: I know – we’ll tax pies and bridies, they’re another Scots institution anyway, but we’d better call it a pasty tax in case the Scots get the idea they’re being targeted again. Get the papers involved, leak it, and create an uproar over something that’s meaningless. Divert their attention and they’ll forget by the time the revenues plummet and then, we use those against them as well.

Dave: Great, so we bring in money, and if we have to abandon the pie, sorry, pasty tax, well we weren’t exactly expecting it to make a difference anyway – Scotch pies or Scots oil and whisky. It’ll all take a year or so to percolate, and if we need to we can even use it as the reason to change economic policy at the next budget – the oil revenues are a disaster – it’s Brilliant, we save face and the Scots get the blame!

Danny: Even the City will want it, they’ll know with these reserves we’re good for our debts, then my people tell me we can make lots of noise about our credit rating as well, because this independence thingy, it’s not looking good for our credit rating, I mean, I’m hearing rumors we go down a few notches and they, erm, ahem, don’t.

Dave: I’m sold, but keep it quiet, mums the word.

George: I’ll go arrange the leaks, but I think Danny deserves credit for this.

And so it came to pass that Danny Alexander received the public acclimation for the partial destruction and dismantling of an industry in the short term, an industry which in our present age is one of the jewels in Scotland’s industrial crown.

He received that acclimation from his puppet-masters because, for whatever reason, he’s certainly playing Westminster’s long game.

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