Why an independent Scotland could become the richest country on Earth

On a per capita basis, the nation has all the ingredients to be one of the world's most prosperous nations

Share
Related Topics

An independent Scotland could become the richest country on earth. I’m not joking. It has all the necessary ingredients. Let me explain.

Each year the World Bank, the IMF and the CIA each independently publish a list of the richest countries in the world - as measured by GDP per capita at purchasing power parity.

The UK sits at a rather disappointing 21st, but topping those rankings you have the likes of Qatar, Luxembourg, Singapore, Brunei, Norway and Switzerland.

Some of these nations have got there thanks to their oil. But oil isn’t everything – otherwise the likes of Saudi Arabia (28th), Russia (43rd) or Iran (78th) would feature.

Others have got there because they are financial or commercial centres. But the same regulatory options that have enabled them to be so are open to other countries - they have just not been adopted.

There is, however, one characteristic common to all the top ten ranking nations, bar one. It is that they are small. In the top five, Singapore and Norway both have around 5 million; Qatar 3 million; Luxembourg and Brunei around half a million.

The one exception is the US. It ranks 6th (IMF), 7th (World Bank) and 14th (CIA). In 1950, and indeed in 1970, it was top. Back then though, its states were semi-autonomous and, on a gold standard, its money was independent. As its state has grown and power become more centralized, its ranking has slid.

This is because there is a direct correlation between the size of the state and the wealth of the people - the bigger the former, the smaller the latter. The more power is concentrated, the less wealth is spread.

But in a small nation, forced to live from a smaller tax base, there is more of a limit to how big state institutions can grow. Monitoring becomes more efficient, it is harder to obfuscate, so there is more transparency and accountability, and less waste. Change is easier to implement, making a nation flexible, dynamic and competitive. With fewer people, there is less of a wealth gap between those at the top and the bottom.

The evidence of history is that the free-est countries with the widest dispersal of power have always been the most prosperous and innovative.

The city-states of pre- and early-Renaissance Italy are a good example. There was no single ruling body except for the Roman Catholic Church. If people, ideas or innovation were suppressed in one state, they could quickly move to another, so there was competition. Venice, in particular, showed great innovation in turning apparently useless marsh into a unique, thriving city. Renaissance Italy became breathtakingly prosperous and produced some of the greatest individuals that ever lived.

But it would be overtaken by Protestant northern Europe. The bible was translated into local vernacular, and Gutenberg’s printing press furthered the spread of knowledge – and thus the decentralization of power. The pace was set by Holland, also made up of many small states, then Britain led the pack. In spite of its union with Scotland and its later empire building, England would disperse centralized power by reducing the authorities of the monarch after the Civil War of 1642–51, and later by linking its currency to gold.

Since its unification in the late 19th century, Italy has been nothing like the force it once was, blighted by infighting, bureaucracy, organized crime, corruption, rent- seeking, inflation and division. Its state is bloated, its political system dysfunctional.

So back to Scotland.

It now has the opportunity to enact the same legislation, taxation and regulation that other top ten countries on that list employ, following, say, the blueprint of Singapore. It already has a rich tradition in trade, finance and banking.

It has the oil.

And, with just five million people, it is small.

Scottish First Minister Alex Salmond presents the White Paper for Scottish independence Scottish First Minister Alex Salmond presents the White Paper for Scottish independence

 

 

 

 

 

 

 

 

 

 

 

It has all the ingredients to be the richest country on earth – on a per capita basis. It has ‘the triple’. I can think of no other nation in the world with such a wonderful opportunity.

The Scottish contribution to the world, whether in engineering, invention, industry or finance, has been astounding. Think Adam Smith, Alexander Fleming, John Logie Baird, James Watt. You cannot doubt Scottish talent - they are a formidable people. But they do not dominate the global stage as they once did. There will be a tough period of adjustment to get through, yes, but independent, living off their tax base, with dynamism and self-belief restored, they can do so once again.

But, first, they must make the right choices.

Dominic Frisby is the author of Life After The State. An audiobook version is available here.

 


Watch Alex Salmond discuss currency and Scottish independence

React Now

iJobs Job Widget
iJobs General

Maths Teacher - September 2014

£100 - £165 per day: Randstad Education Leeds: We are looking for a Teacher of...

English Teacher

Main Teacher Pay Scale : Randstad Education Leeds: English Teacher RequiredImm...

KS2 Teacher

£90 - £120 per day + tax deductable expenses: Randstad Education Leicester: KS...

B2B Bids and Tenders Pricing Specialist

£35000 - £45000 per annum + excellent company benefits : Pro-Recruitment Group...

Day In a Page

Read Next
 

i Editor’s Letter: Britain's sexism

Oliver Duff Oliver Duff
 

Nigel Farage: I’m taking on the status quo, and the Establishment’s fighting back

Nigel Farage
Homelessness: Why is the supported lodgings lifeline under threat?

Why is the supported lodgings lifeline under threat?

Zubairi Sentongo swapped poverty in Uganda for homelessness in Britain. But a YMCA scheme connected him with a couple offering warmth and shelter
A History of the First World War in 100 Moments: When the world’s biggest shed took over Regent’s Park

A History of the First World War in 100 Moments

When the world’s biggest shed took over Regent’s Park
The pain of IVF

The pain of IVF

As an Italian woman vows to keep the babies from someone else’s eggs, Julian Baggini ponders how the reality of childbirth is often messier than the natural ideal
Supersize art

Is big better? Britain's latest super-sized art

The Kelpies are the latest addition to a growing army of giant sculptures. But naysayers are asking what a pair of gigantic horse heads tells us about Falkirk?
James Dean: Back on the big screen

James Dean: Back on the big screen

As 'Rebel without a Cause' is re-released, Geoffrey Macnab reveals how its star perfected his moody act
Catch-22: How the cult classic was adapted for the stage

How a cult classic was adapted for the stage

More than half a century after it was published 'Catch-22' will make its British stage debut next week
10 best activity books for children

10 best activity books for children

Keep little ones busy this bank holiday with one of these creative, educational and fun books
Arsenal 3 West Ham United 1: Five things we learnt from the battle between the London sides

Five things we learnt from Arsenal's win over West Ham

Arsenal still in driving seat for Champions League spot and Carroll can make late charge into England’s World Cup squad
Copa del Rey final: Barcelona are paying for their complacency and not even victory over Real Madrid will put things right

Pete Jenson on the Copa del Rey final

Barcelona are paying for their complacency and not even victory over Real Madrid will put things right
Rafa to reign? Ten issues clay courts will serve up this season

Rafa to reign? Ten issues clay courts will serve up this season

With the tennis circus now rolling on to the slowest surface, Paul Newman highlights who'll be making the headlines – and why
Exclusive: NHS faces financial disaster in 2015 as politicians urged to find radical solution

NHS faces financial disaster in 2015

Politicians urged to find radical solution
Ukraine crisis: How spontaneous are the pro-Russian protests breaking out in Ukraine’s east?

Ukraine crisis

How spontaneous are the pro-Russian protests breaking out in Ukraine’s east?
A History of the First World War in 100 moments: The first execution at the Tower of London for 167 years

The first execution at the Tower of London for 167 years

A history of the First World War in 100 moments
Fires could turn Amazon rainforest into a desert as human activity and climate change threaten ‘lungs of the world’, says study

New threat to the Amazon rainforest:

Fires that scorch the ‘lungs of the Earth’
Liverpool, Chelsea and Manchester City: And the winner of this season’s Premier League title will be...

Who’s in box seat now? The winner of the title will be ...

Who is in best shape to take the Premier League prize?