A fortnight ago, about 130 business leaders, who between them employ 50,000 people in Scotland, wrote an open letter in the Scotsman newspaper saying No Thanks to separation. The group, led by the chief executive of engineering giant Weir, Keith Cochrane, said the “business case” for Scottish independence had not been made.

Kingfisher boss Cheshire does not believe Scotland will be able to keep the pound, which would mean repricing 35,00 products, with the cost being passed on to customers. He called on other business leaders to come out and make similar points, saying “It’s now or never.”

Jean-Bernard Levy, the head of France’s Thales – Britain’s second-largest defence contractor – said a yes vote would force the company to reconsider its facilities on both sides of the border.

BP boss Bob Dudley, said he does not want to see Scotland “drifting away” from the UK, because independence would almost certainly mean higher costs for his business.

HSBC chairman Douglas Flint has warned that uncertainty over Scotland’s currency could prompt capital flight from the country and leave it in a “parlous” financial state.

Weir, one of Scotland’s biggest companies, said independence will “guarantee” higher costs for business but produce few and uncertain benefits, after commissioning a report on the economics.

Standard Life, one of the main pillars of Scotland’s finance industry, has set up English subsidiaries as a part of “contingency” planning that could see it quit Scotland.

Royal Bank of Scotland, Scotland’s biggest bank, has tried not to raise the temperature despite harbouring concerns over the risks to its credit rating and business.

Lloyds Banking Group has warned of a “material impact” on its costs and borrowing, implying a knock-on impact for businesses and customers for the owner of Lloyds, Halifax and Bank of Scotland.

Alliance Trust, a pensions and savings firm based in Dundee, has been registering companies in England.

Former Sainsbury’s boss Justin King, was accused of scaremongering by the Scottish National party when he warned that independence could mean higher food prices north of the border. Asda and Morrisons have also warned consumers would face higher prices, reflecting the higher transport costs for some remote areas.

 

 

Spain's prime minister, Mariano Rajoy, has said it could take years for an independent Scotland to be integrated into the EU, as all 28 countries would need to unanimously agree.

"It's clear that if one part of a state separates, it converts itself into a third territory with respect to the EU," he said, pointing to treaties and remarks by EU leaders. "They can ask to be integrated and begin a process that could take years. In the case of Spain it took eight years." Rajoy has previously suggested he would block Scotland's entry into the EU. With the referendum in Scotland only hours away, the strength of the yes campaign has buoyed separatists in Catalonia and put the Spanish government on the defensive. Madrid argues that unlike Scotland, any type of vote for independence in Catalonia would violate the country's 1978 constitution, which states that such issues must be decided by all Spaniards. Rajoy's remarks to parliament on Wednesday came in response to a question from Aitor Esteban, a Basque Nationalist party MP, who asked: "If the yes campaign wins tomorrow's Scottish referendum, will your government facilitate the integration of Scotland in the European Union?" Rajoy said he had spoken to representatives from the 28 countries in the EU and that "everyone in Europe thinks that these processes are tremendously negative because they generate economic recessions and more poverty for everyone". They act like a "torpedo to the vulnerabilities of the EU, which was created to integrate states, not to fragment them. Strong states are what's needed today," he said. Rajoy sought to draw a clear line between the secession movements in Scotland and Catalonia. "There are many differences between the process of Scotland and that of here. The main one is that Scotland has virtually no powers compared to Catalonia and other autonomous regions."

On Tuesday, Spain's foreign minister, José Manuel García Margallo, said his government would do everything it could to block any sort of referendum from taking place in Catalonia. "Each and every Spaniards is the owner of each and every square centimetre of the country," he said. On Wednesday, he said Scottish secession would be a catastrophe. "It would start a process of Balkanisation that nobody in Europe wants," he said. Alex Salmond, Scotland's first minister, has long argued that it would be possible for the country to renegotiate membership of the EU from within. In a speech on the subject in April, he said it would be absurd to deny the people of Scotland entry. "The Scottish government recognises that continued membership of the EU will require negotiations on the specific terms. That is only right and proper, but these negotiations will be completed within the 18-month period between a yes vote in September and achieving independence in March 2016," he said. "Scotland will ask for continued membership on the basis of 'continuity of effect'." "Five and a quarter million people ceasing to be EU citizens against their will … is more than absurd. There is simply no legal basis in the EU treaties for any such proposition. And it is against the founding principles of the European Union."

Russia's ruling party is heading to a convincing victory in Crimea's polls, less than six months after annexing the region.

A preliminary count on Monday showed Crimea's regional branch of the United Russia party was leading with 71.04 percent of votes, after 50 percent of the ballots had been counted, Crimea's electoral commission said. The ultra-nationalist Liberal Democratic Party of Russia (LDPR), led by firebrand lawyer Vladimir Zhirinovsky who backs the Kremlin, was running second with just over eight percent of the vote. No other party appeared to have broken the five percent barrier for representation in the Crimean regional parliament, with a turnout of around 52 percent. The residents of the Black Sea peninsula were voting to select politicians for the parliaments of Crimea and Sevastopol, and for local city councillors. In polls for the regional parliament of the city of Sevastopol, United Russia had won 76 percent, while LDPR won 7 percent, with 65 percent of the votes counted.

Russian Prime Minister Dmitry Medvedev, who leads the United Russia, said the vote proved Russia was acting legitimately in Crimea.  "All the participants in the electoral campaign in Crimea have proved to us and our neighbours that power in Russia is based on legal procedures," Medvedev said on Monday in remarks released by the government. However critics called foul, saying politics in the region had come to resemble the Soviet political landscape, with the election characterised by favoritism towards Russian President Vladimir Putin's ruling party. "Suddenly, in three months everything became United Russia here," Andrei Brezhnev, head of the Communist Party of Social Justice said.  Ukraine condemned the votes as illegitimate in a statement issued by its foreign ministry.

Russia's gas supplies to Poland have dropped by 45%, Poland's state gas firm PGNiG says, amid tensions over Ukraine.

The news came just hours after Poland stopped providing gas to Ukraine through "reverse-flow" pipelines. The Russian gas volumes were 24% lower on Tuesday and 20% lower on Monday, according to PGNiG. That shortfall prompted Poland to halt reverse-flow. Poland and Ukraine rely heavily on Russian natural gas. Russia is in a pricing dispute over gas with Ukraine. Some analysts believe Russia, which stopped gas supplies to Ukraine in June over the pricing dispute, is punishing Poland for sending gas to Ukraine. Ukrainian forces have been fighting pro-Russian rebels in eastern Ukraine since April, after the separatists declared independence in two regions. Russia has denied arming the rebels and sending soldiers across the border. On Wednesday Russia's state gas monopoly Gazprom denied Poland's allegation that it had reduced gas supplies. "Currently exactly the same volume of gas is being delivered to Poland as on previous days - 23m cubic metres daily," Gazprom said in a statement (in Russian) quoted by Russia's Ria Novosti news agency. Hungary and Slovakia pump much more gas to Ukraine than Poland via reverse-flow, but they have not yet reported a significant drop in their supply from Russia.

Earlier this year Gazprom and Russian President Vladimir Putin warned of consequences if EU member states went ahead with reverse-flow deliveries to Ukraine. Mr Putin argued that such deliveries would undermine existing gas contracts with the EU.

The Russian business daily Kommersant reports (in Russian) that this week Poland asked for extra Russian gas supplies because of a cold snap, but Gazprom refused, saying it did not have enough gas to pump into Russia's underground storage tanks.

A decision by Russia to cut its gas exports to Poland without warning rekindled fears last night about Europe's reliance on Siberian gas at a time of increasing tension between Moscow and the west. The Polish state energy group, PGNiG, said it was trying to find out why volumes had been slashed by up to 24% at a time when it had been exporting gas itself to Ukraine to make up for Russian shortfalls there. Its counterpart in Kiev, Ukrtransgaz, accused Kremlin-controlled Gazprom of deliberately penalising Poland and undermining onward gas supplies to Kiev. "Today Russia started limiting gas supplies to Poland in order to disrupt the reverse (flows) from Poland that we receive ... Poland stopped reverse supplies to Ukraine in the range of 4m cubic metres," said Ihor Prokopiv, chief executive of Ukrtransgaz, according to the Russian news agency, RIA. Nick Perry, a British energy consultant, said that it was not surprising that the west was nervous about Gazprom's actions. "Since the 1990s, the International Energy Agency (IEA) has been investigating how Europe would survive if they lost some of its biggest sources of gas for six months. People have been looking at this for a long time." But Gazprom sources insisted the shortfall could be attributed to maintenance work that was going on fields and pipelines ahead of the important winter season when demand is at its highest. A formal statement from the group sidestepped the issue by saying it was pumping gas to all destinations "according to the resources available for exports and for the continuing pumping to storage facilities in the Russian Federation".

Jonathan Stern, a gas expert at the Oxford Institute for Energy Studies and a member of the EU-Russia Gas Advisory Council, believed there was more likely a technical not a political problem....well ... Doesn't Poland have an agreement with Russian Gazprom, in which it stated that it is not allowed to 'reverse flow' gas? Therefore Poland should blame themselves for breaking the contract in the first place. Think about it as a business. You sell two people apples (A and B). You sell them at difference prices in accordance with the a long-term contract, 'A' for lower price and 'B' for higher. Then A decides to make a himself a profit and starts reselling those apples to the other person (B). Soon, B decides to stop buying apples from you and rather buy them from A. Hence you lose-out on your profits. You can take A as being Poland, B as Ukraine, and you the apple seller as Russian Gazprom. See the logic?

While the German government is sending its first troops to Iraq and preparing to deliver arms, Der Spiegel is lamenting what it calls the decrepit condition of the Bundeswehr (armed forces) and calling for an increase in the defence budget. Under the headline “Appearance and Reality,” the latest issue of Germany’s largest circulation news magazine criticizes the policies of Defence Minister Ursula von der Leyen. The tenor of the article is clear: If Germany wants to be more involved militarily in the world, it needs a suitably equipped army. Der Spiegel sees a major problem and claims that the state of the Bundeswehr’s equipment is “disastrous.” This is despite the fact that the defence minister has, more than any other member of the government, distanced herself from the policy of “military restraint” advocated previously by all post-World War II German governments, including, in recent years, that led by current Chancellor Angela Merkel and former Foreign Minister Guido Westerwelle.  At the Munich Security Conference in January, von der Leyen made it clear that indifference was “not an option for a country like Germany.” Faced with possible genocide, she declared, Germany was “almost doomed to take on more responsibility.”

“But how will that work with the Bundeswehr?” asks Der Spiegel.

German troops are not ready for the new situation, either in terms of personnel or equipment, the magazine writes. It cites a number of major problems, including the military’s “dilapidated equipment.”

Remarkably, Der Spiegel begins its critical survey with the Luftwaffe (Air Force), which is of particular importance for a powerful imperialist intervention force. The magazine quotes a “confidential report” by the Luftwaffe to the Defence Ministry indicating that “almost the entire German Euro Fighter fleet is lame.” The report concludes that the Luftwaffe needs “a major repair operation.” In large diagrams, the reader is confronted with the “dramatic situation” in relation to combat aircraft and transport planes. Of 109 Euro Fighter jets in the inventory of the Bundeswehr, only eight are fully operational, Der Spiegel writes, a particularly “awkward” problem for the government because it has promised to send up to six of these planes to the Baltic States beginning next week. There, the planes are to monitor the airspace in the Russian border region. In the logistics sector too, the situation is disastrous, the magazine writes. Of 67 CH-53 transport helicopters, only seven are currently airworthy, while just five of 33 NH90 machines are operational. There is a severe shortage of spare parts and qualified mechanics. The army is also under enormous pressure, according to Der Spiegel. The prescribed interval of 20 months between foreign missions is often not maintained, leaving many soldiers exhausted.

This is mainly due to a lack of new recruits. Despite an annual budget of 30 million euros for advertising, the Bundeswehr is unattractive, especially for qualified specialists. “Too few young men and women feel the urge to take up poorly paid positions in the army,” says the magazine.

In particular, at the level of noncommissioned officer and in the Navy there are no junior staff entering the ranks. Der Spiegel cites the ending of conscription in 2011 as the reason. Since then, the Bundeswehr has sought 60,000 new recruits every year and spent millions on advertising. Without saying it openly, the Spiegel authors suggest that the simplest solution would be to reintroduce conscription. In any event, the defence budget must be urgently increased. Otherwise, the announcement of a more active German role in international crisis zones remains empty talk, the magazine writes. It complains that developments are currently going in the opposite direction. This year, the defence budget decreased by 400 million euros to 32.8 billion, and is slated to shrink further to 32.1 billion in 2016. By international standards, Germany’s military spending as a percentage of gross domestic product (GDP) is relatively low. Even little Denmark spends proportionately more, the magazine writes scornfully. The NATO summit in Cardiff, which starts next weekend, will set a minimum baseline for military expenditure at two percent of GDP. Germany’s current defence budget stands at 1.29 percent. Implementing the new standard will mean increasing spending on the Bundeswehr every year by about 18 billion euros.

Der Spiegel is using the NATO summit to put the defence minister under pressure from the right, claiming that von der Leyen is shirking the debate over defence spending because Merkel’s highest fiscal priority is a balanced budget. Der Spiegel’s demand for increased military spending means imposing further austerity measures and cuts in social spending to finance the army.

Since the open turn to great power politics and militarism earlier this year, the government has made it clear it is willing to assert its foreign policy interests with military force. In Ukraine in February, it orchestrated a coup together with the US that brought to power in Kiev an anti-Russian regime resting on fascists and anti-Semites. Now it is using the ISIS offensive in Iraq to intervene in the Middle East.

This offensive is accompanied by a media propaganda barrage that aims to intimidate and silence opponents of war. Der Spiegel is playing a leading role in this war propaganda. A few weeks ago, it appeared with the headline: “Stop Putin now!” This was widely understood as a call for war against Russia.

Despite this media campaign, and despite the fact that all of the parliamentary parties support the war course, the government has not succeeded in breaking through the widespread antiwar sentiment in the population. An increase in military spending—especially under conditions of the debt ceiling—will now be associated directly with harsh social cuts. In sections of the ruling class, fears are growing that the current government may not be able to impose such cuts against the resistance of the working class.

The lead article in the same edition of Der Spiegel hints at this concern. It notes that Germany is maintaining the number at work at a record high, the social welfare and tax coffers are full, and the country is not piling up new debts. “We are super-optimists,” it declares. But, it worries, today’s prosperity stems from the Agenda 2010 “reforms,” and one must wonder what new reforms are needed to sustain this situation for another ten years.

“What is necessary is a political stock-taking,” writes Der Spiegel. The election campaign, which mainly revolved around avoiding further burdens, is now almost a year past. “It is time that the government broaden its horizons and that of the country beyond the current well-being.” Der Spiegel calls for a new round of drastic austerity measures, which must be imposed even in the face of resistance from the working class.  Here it becomes clear that the call for increased military spending and better equipment for the army is directed against the German population. The recent events in the working-class town of Ferguson in the US have shown how quickly social protest can develop. When workers and young people responded in Ferguson with demonstrations to the murder of Michael Brown by the police, the ruling class placed the city under virtual martial law and imposed a state of emergency. The German government is preparing similarly scenarios. For several years, special Bundeswehr units have been established that are designed exclusively for use domestically. The so-called “Regional Security and Support Forces” (RSUKr) consist of reservists who are responsible for “homeland security” in direct cooperation with active Bundeswehr units. Their “ability spectrum” includes “security tasks” and the intervention in “disasters” and “severe accidents.” The Bundeswehr web site states: “Here, the soldiers of the RSUKr benefit greatly from their local knowledge, since the units have been widely established throughout Germany.”

In July 2012, the German Supreme Court ruled in favour of the deployment of the Bundeswehr at home. Since November last year, the RSUKr units have achieved a nominal strength of about 3,200 men and are fully established and active.

There is another gloomy assessment of the world's jobs market On Tuesday. The International Labour Organisation, the World Bank, and the Organisation for Economic Co-operation and Development (OECD) have produced a labour market update for the G20 employment and labour ministers' meeting in Melbourne.

It highlights "large employment gaps remain in most G20 countries", the grouping of the world's biggest developed and emerging market economies. The authors also say that "the quality of employment remains a concern" and that "the deep global financial and economic crisis and slow recovery in many G20 countries has resulted not only in higher unemployment but also in slow and fragile wage gains for G20 workers." The paper concludes: "Seven years after the onset of the global financial and economic crisis, the economic recovery may be strengthening but remains weak and fragile. The employment challenges across most G20 countries are still very sizeable both in terms of a persistently large jobs gap and low quality of many available jobs."The current growth trajectory, if unchanged, will not create enough quality jobs – giving rise to the risk that the jobs gap will remain substantial, underemployment and informal employment will rise, and sluggish growth in wages and incomes will continue to place downward pressure on consumption, living standards and global aggregate demand. Underlining these challenges is the fact that income inequality continues to widen across the G20 countries. "The G20 commitment to boost GDP by more than 2% by 2018 over and above the baseline projections is certainly a welcome step, although it will be important to ensure that this additional growth is job-rich and inclusive"....Of course the report is gloomy - and if the present way of sharing out work is to persist it can only get gloomier. Automation is creeping through every aspect of our lives, gone way beyond the industries now and the amount of work left for humans dwindles by the day.It pays businesses to get rid of people wherever they can - people are its greatest expense. They are now commodities to be plugged in then cast aside as the profit/loss account dictates. Unless someone thinks up something soon to share out what remains of human work, the whole edifice will collapse. People unemployed? No money to spend? - No one to buy the outpourings of these factories; to buy services etc. No wonder the rich are worried about the "stagnant" economy.