No taxpayers money – only public money

THE Morning Star is a national daily newspaper providing a socialist perspective on the news. This is a summary of my talk at the last meeting of Cheltenham Morning Star Supporters Group.

The UK is one of the richest countries but politicians say we “can’t afford” things people need, like a publicly funded NHS, fast modern transport networks, or quality free care for older people. Can we afford them? Yes, we can.

Government says the ‘National Debt’ is our responsibility and we have to help repay it. That argument ignores the important fact that the UK government is the sole issuer of a sovereign currency, the Pound. Modern Monetary Theory (MMT) says the UK government can create sufficient currency to fund services people need.

MMT disrupts the narrative and challenges opinions about budgeting, debt and inflation. Most pundits won’t give MMT any credibility: if they did, they’d be tacitly admitting they’re wrong. That’s why there’s a consistent view among the main parties that their Fiscal Rules are the only way to run the economy.

Does the government have to balance the books? No - sovereign governments like ours can create pounds by issuing bonds. Government bond holders know they’re an important risk-free investment.

For more than 200 years, national debt has been a foundation of UK wealth. In Austen’s ‘Pride and Prejudice,’ much of the suitors’ income came from holdings in the 4 per cents—part of the national debt, which has never been “repaid” in all that time.

The money the UK Government spends is created by the Bank of England, not by cuts or higher taxes. All government spending is funded by money creation. There is no taxpayer’s money.

There is only public money. When we understand the true nature of money we can hold government to account and ensure it uses its currency sovereignty to serve the people of the country.

To find out more, visit the Gower Institute at https://gimms.org.uk/