Stormcloaks all the way. First off, the empire will obviously crumble regardless. The White-Gold Concordat pretty much marked the end of the empire as we know it. Some may see it as a military/diplomatic "strategy", but look at the distaste it left with it's people. There will never be widespread support for the empire again...they don't have the diplomatic resources for victory, never mind the military resources. I personally found the state of the Empire as quite the joke after reading The Talos Mistake: http://www.uesp.net/wiki/Skyrim:The_Talos_Mistake I mean, not only do they ban worship, they claim it as a mistake all along...this government is the hope of Tamriel?!? Secondly, I don't see much of the racism in Nords/Stormcloaks that people claim. Sure, in game, you see segregation in Windhelm, and a few Nords showing blatant racism towards the Dunmer ( A drunk and a bum, mind you..), but really you have to look at the bigger picture; the Dunmer aren't exactly a shining example of anti-racism themselves (in fact, they are probably the most racist race out of all of them), and they really don't make a great case for "adjusting to society" when the Nords allow them into Windhelm: http://www.uesp.net/wiki/Lore:Scourge_of_the_Gray_Quarter In fact, it's quite obvious it's almost like they feel they are "owed" something, and I wouldn't blame the Nords for being angry at them for not participating in society and the current government, as well as just being plain lazy themselves, demanding some sort of welfare or whatnot because they experienced a tragedy...in fact, I find it quite hilarious that these clowns do nothing, yet Dunmer in Riften have adjusted quite nicely. But also, segregation is most likely needed in this situation, as Dunmer and Argonians aren't exactly friends themselves (And by reading some books, it looks like the Argonians were in Windhelm before the Dunmer). Keeping separation is most likely in the Stormcloaks interests, otherwise the state of the city could be at peril with "race wars". And...more Dumner racism... http://www.uesp.net/wiki/Skyrim:Dunmer_of_Skyrim I find it "saintly" enough that the Nords even allowed the Dumner into their city with this kind of attitude. But seriously, at least the Nords aren't partaking in obvious slavery...something that the Dunmer were quite fond of before. The whole Dunmer situation also goes back to history, as it is quite obvious that many Nords are disgusted at the thought of Dumner in Windhelm, simply because they drove out the elves after the Night of Tears with Ysgramor and the 500 companions. They are, if you haven't noticed, a proud and "legend" inclined nationalistic folk. See if the Dunmer would allow Argonians and Khajit the same "benefits" in much of Vvardenfell. Oh yeah, for anyone saying the Nords have no claim to this land over elves.... http://www.uesp.net/wiki/Skyrim:Frontier,_Conquest But, let's go back to why I feel the Stormcloaks would be better equipped to handle the AD. For one, I don't see Hammerfell joining back with the Empire anytime soon, thus I could easily see an alliance with Skyrim if it broke from the Empire. The Empire failed massively with both Hammerfell and Skyrim backing, and that has to be probably 70-80% of it's forces. Why would ANYONE say the Empire would be ok with just Skyrim? They do not have the balls to fight till the end, and would sooner give up every province except Cyrodill (scratch that, they would give up everything except the white gold tower!) just to postpone elimination for no later than 10 years while giving up every other freedom. No, a Stormcloak victory gives credence to a sect that is willing to fight with everything they got, that will not submit before death, that will fight for what they believe is right, that will not bow down to what they ultimately see as wrong. I don't see this in the Imperials today...in fact, the Stormcloaks look more like the true leaders and military of the Empire than the current Empire! No, independence is the way to go at this point, with military allies with other provinces (and an alliance with Hammerfell is a deadly alliance in itself). There is also the question of the dragons, obviously they aren't all dead, and under certain circumstances they are relatively friendly with the people of Skyrim as well. I can see "The Way of the Voice" as a useful tool for the people of Skyrim, a teaching/philosophy that could ultimately provide military uses as well. To say the dragons have no part in the future of this at all (with assistance of the Dragonborn), is a little ignorant. I don't think the Empire would be too keen on keeping dragons around at all (evident by Delphine and her insistence of eliminating each and every one...I don't think the Empire and the Blades are that far apart in philosophy on the matter). And I know Ulfric isn't in cahoots with the AD...there really is no evidence to the matter, just that the AD WANT a civil war. They DON'T want it to end, and in such issues, Ulfric would obviously be an asset to them. An Ulfric win? Not so much. It's obvious he despises being told what to do, is not a diplomatic individual when it comes to his homeland, and despises the AD occupation of Skyrim. An Ulfric win would obviously drive the AD out from the North of Cyrodill, thus actually give the AD a disadvantage militarily.
