Norway started their oil fund in 1990 and it is now worth >$800bn USD. Our oil patch is aging but 30 years of oil is enough time. Our prudent reputation is well earned and I have no doubt we’ll take the steps necessary to transform our economy over the course of 30 years of independence to ensure that we remain prosperous when the time comes.
The more immediate concern is our over reliance on the retail banking sector with the vast majority of customers based in England and the inevitable deposit flight that will commence next Friday. Anti Scottish sentiment is taking hold in England as the No campaign has belatedly realised that Independence is going to happen and have switched their tactic from scaremongering to promising the world. Anti Scottish sentiment is stirring down south, this isn’t going to be an amicable separation.
If you ever meet a Scottish person that is anything other than indifferent to the royal family, they’re either a 70+ year old blue blooded English person pretending to be Scottish or a total ****, or both. We’ll become a republic.
No matter what the result will be, I´m really impressed by the impact of that referendum: Spanish govies yields widened yesterday on the upcoming vote because of fears that Catalunia might also separate from Spain!!
Losing 3% of your GDP in free cash is pretty substantial. It may only be 3% of your GDP, but it’s nearly half of all provincial consumption tax revenues or pretty much equal to your provincial debt service. That’s a fair chunk of coin you get for just being Canadian. Your HST would have to go to >20% to recover the difference in government revenues. Then there is health transfers and other expenditures that are certainly not 1:1. I could imagine Quebec could spend less on defense than their contribution to Canada, but lots of defense expenditures from Canada benefit Quebec so those go poof overnight too.
Scotland on the other hand is a net provider to the UK, much like Alberta. Economically, their finances would instantly improve (taxes down, or resource fund established), whereas in Quebec, it would instantly decline (taxes up).
Scotland, like Alberta, currently has no incentive to establish a Norway like oil fund because it will be pilfered by their less fiscally responsible neighbours in their current arrangements. Being an independant resource state allows much more planning for the future.
1 good year of GDP growth ? And in the context of post 2008 monetary manipulation ? Please.
We still haven’t talked about federal taxes that are leaving the province. Nor the province’s contribution to federal programmes.
Of course I get your point, Geo ; I am just saying that the transfer system is not what keeps Québécois people from starving, like it is often portrayed in the federalist media. Let’s stop drinking the kool-aid for a minute.
I am not saying that Québec would be better off financially without Canada. There would be sacrifices. But the picture is a mixed one and Québec would still be better off than 75% of the world’s economies.
^ All true. But the fact that independence will give Scotland the ability to build a sovereign wealth fund is important. And something Alberta should also be aware of, being in a similar spot.
Quebec entered the Confederation with 40% of the country’s population. Today, it’s barely over 20%. In a century, it will be closer to the 10-15% range. Quebec political power is waning in the Confederation and with that comes less say over how to spend the money it sends to the central government. This is especially problematic when there is such a divergence in mentality between 2 different cultures. The last time a political party won both Quebec and the rest of Canada was 1988. 25 years and 8 elections ago.
Quebec sends $44 billion in taxes to Ottawa and “receives back” $51 billion. The latter amount is tied with contingencies and provisions on how and where to spend the money. It comes down to whether you rather have full discretion over the $44 billion or have $51 billion and be told how to spend it. The federal government has too much taxation power. That was never the intention when the Confederation was formed in 1867. The federal government took on massive taxation power during the 2 World Wars and kept it ever since, much to the detriment of the provinces.
To use current numbers for a territory with mere provincial powers and extrapolate them to an independent country is foolish. An independent country has full control over its policy and economic levers.
Of course, we then have all the delicate identity issue, which is not to be minimized, especially for a culture and language representing only 2% of the continent. If people only thought in economic terms, they would stay in their parent’s basement.
RBS will almost certainly move to London with a yes vote. Yes or No that organisation still has massive problems. I hope that desposit flight won’t take hold but there’s a big risk it will.