Which brings us neatly to the second big question, of how much of the UK's national debt Scotland ought to take on. And, within that, how much of the debt related to rescuing the semi-nationalised Scottish-based Royal Bank of Scotland and, arguably the Scottish bit of the Lloyds/TSB/Halifax/Bank of Scotland combine. Either way, the debt-to-GDP ratio of an independent Scotland might prove so large as to sink it financially before it was even born; 100 per cent of GDP is well within the bounds, being about 10 per cent of the UK's projected £1tr debt and Scottish GDP at about £100bn.
Scotland's non-existent track record in managing public finances might also leave markets to impose an immediate "risk premium", meaning even higher borrowing costs, lower investment and lower consumption levels immediately. Apart from Edinburgh New Town, where there would be rush for handsome townhouses to serve as embassies and high commissions, property would be swiftly devalued. Short term, independence would be tough, until Scotland demonstrated its strengths.
Aye, weel. I'm not so sure it would be as simple as that. To suggest that Scotland should take on 10% of the UK's national debt, because our GDP is 10% of the UK's, ignores the matched question of which assets we should inherit. Look at it another way: has public sector investment in Scotland amounted to anything near 10% of public sector investment in the UK? Think of the rail network, think of motorways, think of the numbers of hospitals, schools. Some counting needing to be done, I suggest. And then there is the bloated defence establishment: our share of defence debt should perhaps reflect the number of submarines, eurofighters, aircraft carriers, tanks and equipment which we would be expected to take on. Oh and by the way, we probably won't need any of those palatial embassies in which UK diplomats like to reside.
I will leave the banks for another post; but bear in mind that these are multinational in nature, doing a lot more business south of the border rather than north of it.
Interesting times, eh?