Friday, 24 October 2014

Half full or half empty?

Glyn Morris draws attention to the story about Plaid arguing that Wales isn’t ready, in economic terms, for independence.  It’s not a new statement of course; it repeats a statement which Plaid made about 18 months ago.  I didn’t agree then, and I don’t agree now – not because I think that there would not be problems, but because I don’t see the existing problems being resolved within existing structures and processes.  Quite the opposite, in fact – I’d argue that the problems that we face are a result of existing structures and policies, and a pre-condition that they be solved first is a recipe for indefinite delay of any discussion of independence.
But how poor is Wales, in reality?  One of the things that the Yes campaign did quite effectively in Scotland was to argue that Scotland’s GDP per head put the country amongst the league of the wealthiest, not the poorest.  Where would Wales sit in that table?
There are plenty of different rankings of countries to be found, and they show slightly different rankings for countries.  This Wikipedia page for instance shows several different ways of calculating relative wealth.  If we want an absolute measure, then which one we select becomes an important decision; but if we’re only after a relative measure, it really doesn’t matter a great deal which we choose.
Wales isn’t listed, naturally enough – it’s a list of sovereign states – but if we use as a rule of thumb the claim that Wales’ output per head is about 70% of that of the whole UK, it’s easy enough to work out where Wales would come on any one of the rankings here if we were listed separately.  The answer, depending on which list we choose, is around 30th. 
Yes, on a simplistic measure of GDP per head, Wales would be one of the 30 or so most prosperous countries in the world – with another 150 or more which are poorer than us, including such outposts of unsustainable independence as Russia.  Even within the EU, there are a basket of countries which are worse off than Wales would be – and, as far as I’m aware, no-one is arguing that they’re “too poor” to be independent member states.
We have, perhaps, become too accustomed to seeing the glass as half empty; comparing ourselves to the richest areas and finding ourselves wanting.  It’s an inevitable result of an approach which simply demands that we get our fair share, and given that we’re not getting our fair share now, it’s not a wholly unreasonable tactic.  It needs to be tempered though with a more positive message about what we can do, and about what Wales could be if we assumed responsibility ourselves.  And that’s the message which has been lacking for too long.
There’s more to economics than GDP, of course.  And the transition from where we are to where we could be will neither be quick nor easy.  But continuing to see ourselves as poverty-stricken victims is not the right starting place, when, for most of the world’s countries and population we look like a very wealthy country.  The question is about how we take control of the wealth we have and build on it by taking responsibility for our own future.  Arguing that we’re not ready to do that is simply perpetuating what we are.  We can do better than that.


Earthshaker said...

An excellent post John, those who want Welsh Independence need to leave the politics of the begging bowl and grievance to Labour and Lib Dems (the Tories don’t care either way). It’s embarrassing to hear a Plaid Cymru leader say how much Wales (or rather the very wealthy in Wales) paid in to the UK during the Industrial Revolution and because of that we should get a better deal – leave it to Cawryn Jones and Labour to sound grovelling and pathetic.

Plaid need to remember that when Ireland was fighting for it’s independence either Eamon De Valera or Micheal Collins said that Ireland may be worse off initially, but they’d be free to make their own decisions and that was a price worth paying for Irish freedom, that’s the sort of message Plaid Cymru’s leaders need to start making to transform the debate about Welsh independence.
Wales’s GDP is 70% of the UK’s and here’s a quote about the Irish economy before independence to prove that it’s possible.

'And while post-independence Ireland was relatively poor, stagnant and emigration high, the previous 120 years of London rule had returned the same outcomes (except in north-east Ulster). In 1913, according to Maddison, Ireland’s GDP was 57% that of Great Britain. Surely Ireland is an example of both Dublin and London misrule.'

Anonymous said...

Much discussion took place during the Scottish independence campaign about the amount and price per barrel of it's oil exports. In Wales, someone should calculate the price per litre of water exports, price per therm of gas transfers, and price per kilowatt hour of electricity exports. I'm waiting for the English would rush to build a replacement nuclear power station at Dungeness, drown a valley in the Cotswolds, plant wind turbines on the South Downs and turn Clacton-on-Sea into an LNG terminal.

Anonymous said...

Spot on, there is no reason why Wales should rank near the top of any GDP list. We aren't anywhere near the richest and at the moment we don't deserve to be. But in time, who knows.

But what is important is that the people of Wales get the public services they deserve. And especially so when it comes to matters health.

Those that have worked and paid tax and NI in England should and must, by right, be allowed universal freedom to all NHS England services. Similarly so for anyone who has worked and paid taxes in Scotland.

As for the rump, in truth they should be grateful for what we can manage to provide here in Wales. And it means they get to speak their own language too.

Everyone wins.

John Dixon said...


Not for the first time, you seem to have managed to completely misread, or have simply ignored, what was written. Actually, Wales is near the top - in global terms - of GDP tables; to much of the world we look like, and are, a very wealthy country. It's only by restricting the range of comparators used that we appear poor.

I won't attempt to pretend that all is well with some of our services - that would be to follow your approach of seeing only one side of any story - but again, it depends with whom we make the comparison. Most of the world's population would see our health service as something to aspire to, not to ridicule.

The point of the post - which was obviously lost on you - is that we need to see the positives as well as the negatives. And that the only people, ultimately, who can make things even better are ourselves.

Anonymous said...

I certainly agree with your last sentence, the only people who can help Wales are those that actually live in Wales.

But, whereas you seem to think there is much to be grateful for in today's Wales I do not. Rather, I remember the days when our education system truly was than envy of the modern world, and that includes our closest neighbour England. And I remember the days when our medical teaching hospitals were regarded as not only equal in stature but also in practice to those in the rest of the UK. And I remember the days when our healthcare services for the sick and needy were such that you would never dream of drawing comparisons with those across the border because, in fact, the services were the same. Each an integral part of the much admire, UK wide, NHS service.

Perhaps I am much older than you but I suspect not. I suspect I just have a better memory.

John Dixon said...

Again, you willfully miss the point. I did not say that there is much to be grateful for - what I said was that Wales is, in global terms, a comparatively rich country and that the services we have here are, again in global terms, better than most.

"And I remember the days when our healthcare services for the sick and needy were such that you would never dream of drawing comparisons with those across the border because, in fact, the services were the same."

Really? Your memory must be playing tricks on you. Comparisons of services between areas have been around a very long time; they didn't start with devolution (although devolution has redefined the areas to be compared). The idea that the NHS is a monolithic body providing services to a consistent standard across the whole of England is delusional - there are differences between parts of England just as there are differences between Wales and England. And all those differences would still be there even if the Assembly were to be abolished. What's changed is the politicization of those differences in pursuit of party advantage. Whatever, that's enough on the NHS - it's not the subject of this post at all, and not for further debate in this thread.

Anonymous said...

Interestingly, and just like so many other politicians of the Left, you equate good public services with wealth. In other words, if we don't fund them sufficiently they have a right not to be much good.

This is, of course, patent nonsense.

Take a look at some of the public services in poor countries like Vietnam (education), Cuba (health), the former UUSR (health & education). And by public services I mean health and education.

You'll quickly see that a good public service has everything to do with the 'will of the people' and good leadership and absolutely nothing to do with funding. Kids can be taught well without any money whatsoever just as long as there is a bit of food on the table and someone willing to teach them.

Mind, we'll only start to find this out when someone has the guts to stand up and shout to the perpetual 'needy' that less is really a whole lot more.

John Dixon said...

"you equate good public services with wealth"

Your ability to read things that haven't been written continues to surprise me.

Anonymous said...

Anon 21:11 here again. When you say there's more to economics than GDP you remind me of a chance encounter I had on the London tube not so long ago with a fellow graduate from the Welsh education system. He'd been working Africa as an engineering 'consultant'. I couldn't figure out why an independent country in Africa, where he was on contract, had such abundant natural resources was so 'poor'. The reply was quite simple. You cannot make finished product if your staff have to take the afternoon off to dig yams to feed the kids, or train a technician if he dies from a broken wrist due to lack of health system, or send an office clerk on an IT course if she's semi literate due to a lack of education system. In Wales we do have such world-class state institutions, but for some reason we exclude such structure as a 'public sector burden' on GDP rather than it being an asset. The opposite question arises in Scandinavia, my contribution to the London tube discussion. The reason why it's a good idea for a multi-national company build cars in a country with 55% tax is because the state pays the maternity, the pension bill, lifelong health and social care, most of the commuting costs and the adult education fees. Why is the economic standing of Wales calculated as if Wales is London? It isn't. Further more, energy and water in an independent Wales not only involves charging and economic price for exports (which can be re-invested in R&D and infrastructure) it also involves a degree of state ownership. Something which Anon2 might consider. Strangely, in the run to be pro-British the Labour Party in Wales have abandoned such concepts. This leads me to the question - why does such a discussion between two Welshmen occur on the London underground and not in the M4 services at Pont Abraham? Answers on a postcard.

John Dixon said...

"for some reason we exclude such structure as a 'public sector burden' on GDP rather than it being an asset"

Absolutely. Worse still, it seems to have become part of the political consensus that anything done by the state is a 'burden' being paid for by the profits of the private sector. It's a nonsense; whether we pay for something at point of use, or through an insurance scheme, or through taxes doesn't matter - it all comes down to the same thing - we pay for services and we get them. Where it makes a difference is the way in which the payments are shared between us - so no surprise about political opposition to the state from the Tories. But the other parties seem to have fallen for the same story, and seem afraid to challenge orthodoxy as well.