Hello Alistair, been meaning to reply to your posts on this topic. Bear in mind most of what I write is largely derived from the internet and history books and therefore comes with that caveat. The first politician in recent times to mention the Darien project was probably Danny Alexander about 5 years ago.
Alistair Campbell wrote:Most discussion of which I am aware suggests that there would have been a split of assets and liabilities on some basis to be negotiated - in particular the national debt would have been allocated on a per capita basis (as some of the £400k was intended as compensation for liability to future debt).
There is no doubt that Scotland brought to the UK assets, future undiscovered assets (oil) and debts such as the Darien Money. These would be large amounts to consider in any agreed basis for separation. I doubt whether the position on future independence was considered or documented when the union was discussed in 1707 or in the abortive attempts in 1702, as they were more concerned with the union of states. Usually the best way to sort out a mixup is to start with the largest items. The Royal Bank of Scotland however have an accurate archive of documents concerning the Darien and who lost what. Although you cant now see the archive it is mentioned here:-
http://caledonianmercury.com/2011/07/01 ... er/0021842
The Darien money is often referred to as "The Equivalent" and looking up that term will find a few more references. The Darien money seems to have been aggregated into the National debt of Scotland and the UK at the time without specific funding or issuance of debt instruments; something similar to pubic sector pension liabilities.
Regarding my £2tr estimate I looked up the historic MLR figures from the BoE here:-
http://www.bankofengland.co.uk/statisti ... serate.pdf
You need to page down to find the rates from 1700 onward. I also looked at the chart tab in this link:-
https://docs.google.com/spreadsheets/d/ ... li=1#gid=1
I then guessed 5% as the average rate since 1700. I took 1700 rather than 1707 as the debt would have been bubbling since that time. 1.05^316 x 400,000 is approximately 1.986 x 10^12. which I must admit I rounded to the nearest £tr. What this figure represents is the amount that the debt would have accrued to if no interest were paid and the debt left unfunded as informal National Debt.
You rightly question is 5% correct under the circumstances. Well no its probably too low ! MLR is the lowest rate of interest that the BoE charges as a lender of last resort to balance, among others transactions between trusted internal institutions of the UK. Where there are risks involved or sovereign loans external to the UK higher rates would be charged. There aren't many examples recently but one is the loan to Ireland in 2010. This loan for £3.26 Bn was initially charged at 5.8% and then reduced to 3.5%. ie a margin over .5 % of 5.3% and 3.0 %. In 1707 Scotland was not quite a bankrupt nation but a formal rate would have been higher than 5%.
The crown estates are sometimes mentioned as relevant as the whole shoreline of Scotland was ceded to the English Crown at about that time but according to some sources independently of the Union. This might have relevance as the nearest land to what we know as Scottish north sea oil would be the Scottish shoreline which belongs to the English Crown. a debate will be had over whether the crown estates are separate from the UK and whether they are part of ENG or SCO. Another factor relating to north sea oil is that the UN boundaries were drawn up assuming the union continued and moves along a line of latitude at some points whereas maritime law specifies boundaries by reference to perpendiculars from land. This interpretation would move the boundaries further north into what is sometimes thought of as the Scottish sector.
I don't propose to get too much involved in this debate and I'm glad I'm not involved in the real debate when it starts !
