Scottish independence won't be achieved through this delusion

This conclusion to my column last week sparked off a spate of readers’ protests. From Alex Thomson of Coldstream, for instance, who wrote a letter to the editor demanding “some kind of elucidation and explanation”. I’m glad to oblige.

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I’ll start with the fount of all wisdom on this subject, Nicola Sturgeon herself, and a speech she made to a conference at the University of Sheffield a couple of years ago. It was a rare event, because it set forth some of her government’s basic economic thinking, as opposed to the usual wish list of handouts.

She referred to the concept of inclusive growth, which has been diffused in UK public discourse, especially by the Joseph Rowntree Foundation. The bright young economists there seek solutions to the problem of poverty as it raises its ugly head in novel forms for the 21st century. For example, in the recent appearance of poor people who are in jobs.

Nicola commented: “This focus on inclusive growth … is first and foremost a matter of basic morality. Everyone in any society should have a fair chance to fulfil their potential.”

The link between economics and morality is something that has exercised thinkers ever since Adam Smith of Kirkcaldy made his debut as an author with The Theory of Moral Sentiments in 1759. It was meant as the introductory instalment in a series of works that would deal with the entire range of social questions free of any prior assumptions, especially religious ones. The next instalment was The Wealth of Nations in 1776, the founding statement of the intellectual discipline of economics.

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Nowadays too many people assume Smith was the apostle of heartless capitalism, but I can show this is not true from what he wrote in 1759: “How disagreeable does he appear to be, whose hard and obdurate heart feels for himself only, but is altogether insensible to the happiness or misery of others! ... and hence it is that to feel much for others and little for ourselves, that to restrain our selfish, and to indulge our benevolent affections, constitutes the perfection of human nature; and can alone produce among mankind that harmony of sentiments and passions in which consists their whole grace and propriety.”

Beneath the flowery language is the fact that Smith sees how social progress depends on co-operative effort. What he had worked out by 1776, and catalogued then, was the many ways in which this process went on, not all of them immediately obvious to the casual observer. Hence the “invisible hand” behind the capitalist system.

The trouble is that, despite many efforts over the last 250 years, it has proved impossible to establish any straight correlation between economics and morality.

Economics was a tiny wee green shoot in the 18th century but has since burgeoned into a stupendous tropical rain forest full of ideas and experiments.

In the meantime traditional morality has collapsed into a scarcely less kaleidoscopic array of concepts and systems. The best we can say is that our society is open to different moralities rather than constrained by one of them, or even inclined to be so.

There is at all events no point where economics and morality converge in any simple manner, allowing a virtuous government like the Scottish one just to lift its latest caring policy off the peg. On the contrary, today economists tend to steer clear of moral questions altogether. They argue their job is to study trade-offs and incentives and interactions, leaving value judgments to the political process and to society. Yet economists would never listen for long to the pronouncements of a moral philosopher on those topics. You do not know, they would say to him, what you are talking about.

I noticed that at the weekend another of the present generation of formidable female politicians, the German chancellor Angela Merkel, said this: “It is seductive, but also fatal, to close one’s eyes to the complexity of global interdependency in favour of creating one’s own simplistic worldview.” She was talking about Donald Trump, but the same warning might usefully be given to our First Minister and her trendy lefty conception of the Scottish economy.

Nicola has often stated that, while of course she is in favour of economic growth, it must go hand in hand with greater equality. This is in fact a contradiction, an impossibility. Growth and equality occur not in the abstract, but in the real world. There, at any given time, we find companies that are flourishing and expanding, companies that are successful but stable, companies that are declining and failing.

To give actual examples, in Scotland at the moment we have Skyscanner, we have Scottish Widows and we have, or have had, House of Fraser. It stands to reason that these three types cannot, among other things, offer the same rewards to their employees. Skyscanner will bid up wages to attract whizz-kids, Scottish Widows just needs to keep its dependable executives happy and at House of Fraser – well, the sales staff were lucky to get out with their last pay slips. To talk of equality among this miscellany is blethers.

Yet my model of the Scottish economy is a grossly simplified one. Instead of three, there are in fact 350,000 Scottish businesses, each of them unique whether fabulous, just fine or total flop. How can we possibly demand of them that, in addition to everything else they need to worry about in the digital world, they should submit to a uniform demand for equality too, at least if they want politicians to smile on them?

We should instead just leave them to get on with the business they after all know best, rather than pressure them to sign up to the government’s delusion that, with enough legislation and bureaucracy, we can make Scotland perfect. Because this project is bound to crash, it is not going to take us forward to independence either.

I say so with all the more conviction while our real economy still lags behind even the miserable performance of Brexit Britain. Graeme Roy, director of the think tank, the Fraser of Allander Institute, has gone on record to say one burden on us is muddle in government, with its “proliferation of different strategies, advisory groups and bodies which have arguably cluttered the policy and delivery landscape … The risk with such an approach is that it can lead to confusion, a lack of alignment, duplication and weakened accountability. It also makes evaluating what actually works all the more difficult. Strategies and advisory groups are no substitute for good policy delivery based on evidence, data and impact.”

This is a sobering verdict if we recall that, till he left for the institute in 2016, Roy was head of the First Minister’s policy unit and chief economic adviser to her.

I wrote what I wrote last week because I dislike the elevation of politics over economics with a guddle of priorities all the wrong way round, trying to do too much and getting nowhere.