David R. Henderson  

Scotland, Quebec, and Tupy

Clive Crook on Scotland... Start!...
Scotland's greater statism and, ironically for the birth place of Adam Smith, suspicion of capitalism, is a potent obstacle to reform in England and Wales. It is also a serious danger to economic prosperity north of the border. Sooner or later, Scotland will need to introduce reforms that it would never accept from a Westminster government. The end of the Union maybe [sic] a high price to pay for the end of socialism on the British isles, but the rewards from a more robust, long-term economic growth are not negligible either.
This is from Marian L. Tupy, "Scottish Independence Will Kill Socialism on Both Sides of the Border," September 17, 2014.

I think Marian's point is exaggerated but I think he has the direction of change correct. This is similar to a point I made in a piece in the Wall Street Journal when Quebec voters were voting on separation in the mid-1990s. I can't find the piece on-line but it's David R. Henderson, "If Quebec Separates, Almost Everybody Wins," Wall Street Journal, January 19, 1996.

The basic idea of both Marian's and my pieces is that the smaller entity whose majority votes to secede, if they do so vote, is one that is more statist than the one that they voted to secede from. So statism in the bigger country will fall. One would expect statism in the smaller country to increase because it is no longer constrained by the bigger country. But what people in the smaller country will learn is that they can socialize the costs only within their smaller country, not within the bigger country. So they face a constraint that is tougher than the one they previously faced. Therefore, they become less statist. Is that a sure thing? No, but the odds are good.

One big hedge about Quebec. I have made this argument about Quebec to my Canadian friend Jason Clemens. Jason comes back by pointing out that in Canada there is zero federal intervention in education. "Why do you think that is?", he asks. "I don't know," I answer. "Because Quebec is in the union and they won't allow it," he answers, "Let Quebec out and that constraint goes away." He has a point. So the bottom line is that the consequence for a particular country will depend, more than I said in my WSJ piece, on the specifics.

By the way, Marian L. Tupy wrote "European Union" for The Concise Encyclopedia of Economics.

Postscript: At the risk of making this post too chatty, let me add that I like the post of our guest blogger, Alberto Mingardi, earlier today on this. I do want to challenge, though, not Alberto, but Clive Crook, on one thing. Crook writes:

A Scotland that stays in the union reluctantly will be of little use to itself or anybody else.

This is way too anthropomorphic. If Scotland stays in the union, Scots will have lives, just as if they left. It reminds me of various comments I've seen over the years on Canada of the flavor, "Why does it exist?" or "What's the point of Canada anyway?" I can assure you that when I grew up in Canada, well before I became a libertarian, I didn't ask those questions. Nor do, typically, adult Canadians. The people who ask those questions tend to be the type (I'm thinking Bill Kristol here) who think that nations have to stand for something rather than being places where people can carry on their lives in peace.

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COMMENTS (10 to date)
RPLong writes:

I think there is cohesiveness in Tupy's and Clemens' points. Quebec separatism has been a powerful check on federal power in Canada. It was the Quebec Charter of Human Rights and Freedoms, for example, that enabled much-needed health care reforms in Canada more broadly. The Quebec separatists have been an important inspiration to the Albertans' quest to free up trade in Canada, even between provinces.

It seems to be a little better for freedom (or at least for local governance) if there are separatist agitators prodding the federal government to check itself and its power. Even if Scotland doesn't ultimately secede, this kind of exercise is good for liberty, in my opinion.

Tupy's point of comparison was what happened in Czechoslovakia in the 1990s. For those who haven't bothered to read the whole piece, which is well written.

Andrew_FL writes:

An independent Scotland might learn it cannot sustain Nordic Socialism (any more than the Nordic countries themselves). But Scotland doesn't really propose to become independent. I proposes to become a separate member of the EU. They-meaning the separatists-don't want to be governed from London, but they don't intend to replace it with being governed from Edinburgh; they intend to replace it with de facto governance from Brussels.

Mark V Anderson writes:

RPLong -- In my opinion, pluralism is always good for democracy and freedom. This is because it weakens the tendency of centralized power, which is almost always the source of tyranny, whether it be the murderous tyranny of the USSR or the more benign tyranny of the US govt.

Separatists will add to the pluralism in a country, so it is good in that sense. But when they succeed, it is usually bad for both sides.

Peter Johnson writes:

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RPLong writes:

Mark V Anderson - Very interesting point. I wonder to what extent we can draw inferences about immigration if we assume you're correct.

CJM writes:

Sadly, economists, with their love of models and abstract thinking, fail too often to see other perspectives. In the Canadian constitution, in contrast to the American, certain powers go to the central power (Ottawa) and certain powers to the provinces, such as property rights and education. This was agreed to at the 1864 meeting in Charlottetown, 150 years ago last week, ratified in Quebec City in October 1864, and the basis of the British North America Act, in essence the Canadian constitution which was an Act of the British Partiament, but finally repatriated by the Canadian Parliament in 1982.

King George III, by the way, after the British conquest in 1759, where Britain took control not just part of present day Quebec but much of the Ohio Valley, gave the former French colony control of their language, their religion, and their legal system, an unbelievable act of magnamity given the narrow mindset of so many political leaders today.

Pithlord writes:


And the Declaration of Independence lambastes poor old George III precisely for that magnanimous act!

("For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies:")


It is valid that Quebec's existence makes Canada more federalist, but Chaouilli is a dubious argument that it makes Canada more libertarian. One swing judge decided to base her decision on the Quebec Charter, as opposed to the Canadian Charter, but this was a transparently political way of limiting the decision's scope. I don't think anyone believes it has anything to do with any difference in the text of the documents, let alone a greater support for private medicine in Quebec.

Mark Bahner writes:
Jason comes back by pointing out that in Canada there is zero federal intervention in education. "Why do you think that is?", he asks.

Because the Canadians actually pay attention to the Tenth Amendment of their Constitution?

P.S. Just kidding.

P.P.S. That nice feature of Canadian life won't make up for the long, cold winter nights. I'm gonna stay south of the Mason-Dixon line. ;-)

Mark Bahner writes:
In the Canadian constitution, in contrast to the American, certain powers go to the central power (Ottawa) and certain powers to the provinces, such as property rights and education.

I doubt James Madison would recognize your characterization of the U.S. Constitution. The U.S. Constitution does not list education as one of the enumerated powers of the federal government. Therefore, involvement in education is not an authorized power of the U.S. federal government.

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