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Green/Labour collaboration to achieve People’s Quantitative Easing?

March 3, 2018

Wikipedia describes People’s Quantitative Easing as a policy proposed by Jeremy Corbyn during the 2015 Labour leadership election, which would require the Bank of England to create money to finance government investment via a National Investment Bank.

As Bright Green adds, “People’s QE is essentially a re-badging of an idea contained in the Green New Deal, championed on numerous occasions by Caroline Lucas. Green Infrastructure QE was the idea of using public money to build highly insulated homes and to convert buildings to be more energy efficient.  By doing so, the economy would grow, people would have better-quality homes to live in and we would finally be starting to take proper action to deal with climate change”.

We also draw attention to the work of Richard Murphy and Colin Hines who presented Green Quantitative Easing in 2010 as explained here. In this alternative form of QE, the money created by the Bank of England is provided to a National Investment Bank to inject into the real economy. In other words, it funds new investment, infrastructure repairs and retrofitting.

QE4People says: “The current Quantitative Easing program of the European Central Bank is an ineffective and unfair response to the financial crisis. We, civil society organisations from all across Europe, propose an alternative form of QE which would make sure money is spent into the real economy and benefits those that need it the most. We call this concept ‘Quantitative Easing for People’ “.

Current QE is ineffective, unfair and risky. It works by pushing money into the financial markets, in the hope that some of the new money will ‘trickle down’ to the real, non-financial economy, through extra spending by the wealthy, or through money creation by private banks – when they make loans.

In 2016, MEP Molly Scott Cato spoke to EU Reporter’s Catherine Feore on a better alternative to the ECB’s quantitative easing programme. She argues that #QE4People could be used to finance green investment and expressed the hope that there could be some cross=-party collaboration on this issue- just as Bright Green does in the final paragraph of this post.

In the UK, the Bank of England created £375bn, used to flood the financial markets, and by the Bank of England’s own estimates, this pushed up share and bond prices by around 20%. Since 40% of the stock market wealth is held by the richest 5% of households, QE has made those households better off by an average of £128,000 each and the evidence is that it has done very little to create jobs and increase economic growth.

With over 18 million people currently unemployed, the Eurozone needs money to be injected directly into the real economy instead, so it can improve people’s lives by boosting employment and spending.

There is a range of concrete proposals for how QE for People could be implemented. The money currently being created by the European Central Bank could be given directly to Eurozone citizens and/or spent on much needed public investment such as green infrastructure, affordable housing – or in any other way which would contribute to the genuine development of the real economy.

QE4People, and their civil society organisation members from all across Europe, believe they urgently need to re-think this approach and turn this wasted opportunity into a programme that delivers a sustainable recovery in the Eurozone. They aim to foster a public debate around Quantitative Easing for People, arguing that the money created through QE should be spent into the real economy so that it can benefit individuals and society as a whole.

In a recent article in The Week, Delhi’s Devinder Sharma harks back to 2013, when an Oxfam report said that $240 billion, the net income in 2012 of the richest 100 billionaires, would be enough to wipe out global poverty four times over.

In other words, he continues, removing global poverty and hunger, which was always on the top of WEF rhetoric, required only $60 billion.

Over the years, he continues, especially after the economic meltdown in 2008-09, the United States and the European Union have been aggressively printing money and he tweeted that year to then US President Barack Obama asking him to print an additional $120 billion and give it to a group of international organisations (with backing from G-20 countries) to launch a time bound programme to remove poverty two times over. As expected, he didn’t get any response, but later he learnt that economists had launched a campaign for ‘Quantitative Easing for People’ in 2015 and comments: “That’s the way it should have been. Poverty and hunger could have become history by now”.

Endnote, Bright Green says that the Labour Party may now have a proper socialist leader once more, but the Green Party is still the home of ecosocialists . . . and while retaining our own distinctive ideas and influences, Corbyn’s election is a chance for us to collaborate to achieve our aims.





Conference on Money Reform at Gottlieb Duttweiler Institute

February 18, 2018


The American Monetary Institute sends news of the fully booked Conference on Money Reform at Gottlieb Duttweiler Institute which took place earlier this month. Our Money, Our Banks, Our Country: Money Creation in the Modern Economy Conference was presented at the beautiful Gottlieb Duttweiler Institute near Zurich, Switzerland.

It was well organized and hosted by Uli Kortsch, founder of the Monetary Trust Initiative and Global Partners Investments.

Speakers on money creation and current conditions included Prof. Richard Werner, Prof. Larry Kotlikoff, William White, William Dunkelberg, and Martin Wolf, Chief Financial Commentator, Financial Times. Read more about the contributors here.

In general, there was a consensus that change was needed.

There were presentations for the Swiss full money initiative by

Prof. Sergio Rossi,

Prof. Joseph Huber,

and Lecturer Katarina Serafimova

and against by

Economics Editor Jurg Muller,

Prof. Aleksander Berentsen,

and Ruedi Noser, politician.


Robert Poteat*, Director, American Monetary Institute summarises:

In terms of a debate, the presenters for the initiative gave well-constructed and documented presentations with slides and data. The presenters against the initiative provided no data or logic to support their position.  Their arguments mostly relied on fear of change.

In the opinion of this observer, the people against the initiative gave strength to support the initiative with the intellectual poverty of their arguments.*


*To read more about Robert Poteat, click on this link and scroll to the foot of the page.





Monetary Reform Light: Joseph Huber

February 4, 2018


Joseph Huber, chair of economic and environmental sociology at Martin Luther University of Halle-Wittenberg, Germany. writes:

“If a full ‘big bang’ transition from bankmoney to sovereign money cannot be achieved in the immediate future, something less radical might be attainable, some kind of monetary reform light”.


Sovereign digital currency coexisting with bankmoney 

Since around 2013/14 a number of scholars have been calling for ‘digital cash’, that is, the use of electronic or digital central-bank money in public circulation, not solely in interbank circulation as is the case today.

Over time, the high-powered central-bank money – either as sovereign currency on account or sovereign cryptocurrency – might take over the now predominant role of bankmoney on bank giro accounts.[1]

If a full ‘big bang’ transition from bankmoney to sovereign money cannot be achieved in the immediate future, something less radical might be attainable, some kind of monetary reform light.

Such reasoning is also encouraged by a growing number of central banks, who are now looking into the matter by conducting research and even enacting pilot projects.

The common feature of the various approaches put forth is the introduction of non-cash central-bank money into general public use, but without directly challenging the present bankmoney privilege, that is, the banking sector’s ability to create the very bankmoney on which the banks operate in their dealings with the non-bank public.

The idea relates to giving the non-bank public the option to choose between bankmoney and central-bank money, with the two coexisting side by side.

Some supporters idealise the approach as ‘combining the best of both worlds’[2], while others hope for the approach to be a half-way house towards full monetary reform, gradually reversing the wrong-headed development of the last hundred years through which bankmoney has driven out central-bank money by about 90–97 per cent.

As a result of that development we have a bankmoney regime today, pro-actively led by the banks’ primary credit and deposit creation (= bankmoney creation), while central banks have given up control over the stock of money, deliberately accommodating the banks’ residual demand for solid cash and reserves (= electronic central-bank money in a bank’s central-bank account).

Rather than being in control of the money, central banks have become anytime refinancers of the banks, no longer caring about the stock of money and restricting themselves to short-term base rate policy which is supposed to influence consumer price inflation.

Before discussing what electronic or digital central-bank money exactly is, and whether it is predominantly about sovereign cryptocurrency  or sovereign currency on account, a number of developments which make monetary reform measures rather urgent are outlined in the following section.

It should be noted that two other approaches often mentioned in the present context are helicopter money (also known as Quantitative Easing for people), and safe deposits by way of a voluntary 100% reserve on individual deposits. However, helicopter money and 100% reserve-backed deposits do not actually belong here, as will be discussed in two brief appendices at the end of the paper.

Read on here:


[1] Wortmann 2017a+b, Dyson/Hodgson 2016, Yamaguchi/Yamaguchi 2016, Huber 2017 188–190, Huber 2014 #ecash.

Wortmann, Edgar. 2017a. The virtual euro, Ons Geld Working Paper, Utrecht, https://

  • Wortmann, Edgar. 2017b. Deleveraging without a crunch, Ons Geld Working Paper, Utrecht, pdf.
  • Dyson/Hodgson 2016,
  • Dyson, Ben/Hodgson, Graham. 2016. Digital Cash. Why Central Banks should start Issuing Electronic Money, London: Positive Money.
  • Yamaguchi/Yamaguchi 2016,
  • Yamaguchi, Kaoru/Yamaguchi, Yokei. 2016. Peer-to-Peer Public Money System, Japan Futures Research Center, Working Paper No. 02-2016, Nov 2016.
  • Huber 2017 188–190,
  • Huber 2014 #ecash.
  • Huber, Joseph. 2014. Monetary reform as incremental innovation, http://www.sovereign­, #ecash and #offbalance.
  • Huber, Joseph. 2017. Sovereign Money, London: Palgrave Macmillan.

[2] Striner 2015 47.

Striner, Richard. 2015. How America can spend its way back to greatness. A guide to monetary reform, Santa Barbara, CA: Praeger.





Financial red lights are flashing again: helicopter money has to be in the tool kit

January 22, 2018

“There are so many lights flashing red, I’m losing count” – Neil Woodford, the UK’s most high-profile fund manager, is quoted in a range of media outlets.

Niall Ferguson who predicted the 2008 crash also warned in November’s Times, “Look up: financial red lights are flashing again!”

In the FT Woodford says, “Whether it’s bitcoin going through $10,000, European junk bonds yielding less than US Treasuries, historic low levels of volatility or triple-leveraged exchange traded funds attracting gigantic inflows — there are so many lights flashing red that I am losing count.” Jason Cummins, chief US economist at Brevan Howard (offshore based hedge fund management company) agrees in another FT article, “several metrics of market valuation are indeed flashing red”.

  • Equities have added to last year’s 20 per cent gains and already broken records.
  • New risks to financial stability, such as the recent interest in bitcoin, are reminiscent of the kind of investor mania that often precedes a financial crisis.
  • The cyclically adjusted price/earnings ratio currently exceeds the peak seen on the eve of the stock market crash of 1929 and is approaching the all-time high seen during the tech bubble in 2000.
  • Credit valuations are high despite a flood of issuance.
  • High-yield and investment-grade volumes reached record levels in 2017

He reminds readers that the two most recent recessions were caused by financial market excesses rather than macroeconomic ones, adding that “it seems politically naive to fight a stock market crash by trying to bail out Wall Street again” at a time when the US is politically divided. Then says, “it is worth asking what role monetary policy should play”.

Economist Desmond Lachman, a Fellow of the American Enterprise Institute  for Public Policy Research, a Washington think tank, answers:

“Jason Cummins does us all a service by noting that various financial market indicators are flashing red about financial stability risk. However one has to ask whether it is not too late for the Fed to do anything now by issuing warnings or by raising interest rates to avoid excessive market risk taking.” He continues that there is ‘scope for monetary and fiscal policy to address the fallout from the bursting of financial asset market bubbles’.

“Though there is no political appetite for yet another round of quantitative easing, there would seem to be nothing to stop the US from the US from resorting to some form of Milton Friedman-style “helicopter money” that would involve the US Treasury sending each citizen a cheque that would be financed by the Federal Reserve on the easiest of terms.

“One would think that helicopter money would be effective in providing the economy with needed stimulus in the event of a large asset price correction. It would also be politically very popular in that, unlike quantitative easing, it would not be seen as a policy that favoured Wall Street over Main Street”.

Endnote by Martin Wolf

Why should state-created currency be predominantly employed to back the money created by banks as a byproduct of often irresponsible lending?    . . . the view that it is never right to respond to a financial crisis with monetary financing of a consciously expanded fiscal deficit – helicopter money, in brief – is wrong. It simply has to be in the tool kit.





The Labour party would have found an ally in Attwood

December 27, 2017

Dr Geoffrey Ingham recently wrote in the Financial Times (Letters):

“The early 19th century member of parliament, proto-Keynesian and pro-industry Birmingham banker Thomas Attwood must be cheering from his grave at the Labour party’s proposal to move most of the Bank of England to Birmingham “to shake up more than three centuries of association between the Old Lady and the City of London”.

“In the 1820s, Attwood railed against the City and the Bank in parliament and print: “Half the circulation of the kingdom is determined in stagnant masses into what is called the money market, in order to gorge the moneyed interest.” Rather, he advocated that “the use of credit should be expanded until the demand for labour, in all the great departments of industry, becomes permanently greater than its supply”.

“The prime minister, Lord Melbourne, summarily dismissed his impudence: “Birmingham is not England.”

“If Labour’s fantasy is to be pursued perhaps they might also look at the part played by the Treasury in the fate of the Wilson-Brown industrial strategy in the 1960s. Attwood was again prescient:

“The Bank of England is a grand political engine . . . by means of which the Treasury may pinch and grind the country as they please.”

“In Yes, Prime Minister, the PM Jim Hacker sent shivers through Sir Humphrey Appleby with his plan to relocate the Treasury “somewhere up North”. Needless to say, Sir Humphrey prevailed.”

In an email message Geoffrey Ingham said that he came across Thomas Attwood when he was writing his book Capitalism Divided? (1984) on the deleterious effects of the City and its close links with the Bank and Treasury, on the British economy.

He added that Attwood has been very much overlooked in academic economics and history and that he broadly agrees with Attwood’s aims.






The Bank of England has a mission: to promote the good of the people of the United Kingdom

November 21, 2017

Thomas Attwood, political campaigner and Member of Parliament, was the leading figure in the successful public campaign for the Great Reform Act of 1832 strongly resisted by the ‘landed interest’. In Birmingham and London it was estimated that over 100,000 people attended demonstrations in favour of this parliamentary reform.

A parliamentary website focussing on ‘the Birmingham connection’ adds that on 7 May 1832 the Gathering of the Unions, also known as the Meeting of the Unions, was held on Newhall Hill – a giant demonstration involving 200,000 people and 40 Unions.

The act addressed the unequal distribution of seats, extended the votes to the less affluent and abolished ‘rotten boroughs’. It is said (Ziegler, King William IV) that when the Houses of Parliament burnt down in 1834, Queen Adelaide thought it was divine punishment for passing the Great Reform Act

As a British banker and economist, Thomas Attwood argued that Britain should have a paper currency which was not tied to gold – now taken for granted.

His second proposal: that the government should base the supply of money on the productive capacity of the economy and regulate it so as to be sufficient to maintain full employment – is somewhat relevant to MP Caroline Lucas’ Green QE proposal (2016) which Attwood might well have supported.

Caroline Lucas is a member of the Green New Deal Group, convened by Colin Hines. GND wants money funnelled into environmentally beneficial infrastructure projects via “green quantitative easing”, helping to make the country more resilient to flooding, and reduce the threat of climate change by making every building in the country energy-efficient, and creating, she suggested, “huge numbers of jobs in every constituency”.

Attwood also advocated countering economic depressions by increasing the money supply and  Mark Carney, governor of the Bank of England, said in his reply to Ms Lucas’ proposal, that he had done this in 2009, with the quantitative easing programme to bolster the crisis-hit economy, printing £375bn of new money and using it to buy government bonds.

He appeared to agree with both Attwood’s proposals up to a point, in that he said in his letter to Ms Lucas, that the bank could buy new types of assets instead of UK government bonds, if it ever has another round of quantitative easing.



Mark Carney and Sam Woods and Sir Jon Cunliffe, deputy governors at the Bank and ex-Treasury officials were speaking at an event in Liverpool called “Future Forum”, described as part of an initiative by the Bank of England to modernise its approach to communicating with the general public by deliberately trying to avoid complex economic language in order to the make itself more accountable.

They went to local schools and then to the town centre to speak to local people about what it is exactly the bank does. Mr Carney explained that it was founded in 1694, and “its purpose, its original mission, is the same mission as we have today, which is to promote the good of the people of the United Kingdom”. And that mission’s goals are:

  • to keep prices low and stable to avoid Inflation which hurts the poorest the most.
  • to provide tools for children, 11 to 16, to understand the economy and how to make economic decisions.

And no more???




Universal Basic Income

November 7, 2017


With his care for the less economically prosperous, Thomas Attwood might well have approved the work of the basic income movement – though probably, like James Robertsonwould have advocated its implementation as part of a wider coherent set of economic and monetary reforms.

Readers are directed to news from Dylan Matthews (US Occupy website), who wrote in October about a forthcoming (2018)Basic Income pilot involving a ‘random sample of the 300,000 residents of Stockton, California’.

Some of Silicon Valley’s tech entrepreneurs and investors involved see basic income as the way to give support to Americans if artificial intelligence and other automation advances lead to unemployment for vast swathes of the population, redistributing the wealth that Silicon Valley creates to poorer people and localities left behind.

In 2011, a pilot BI project was launched in rural Madhya Pradesh through the Self-Employed Women’s Association (SEWA), in collaboration with UNICEF.

o   Basic living conditions, starting with sanitation, better access to clean drinking water, improvements in cooking and lighting energy sources, improved significantly.

o   There was a major increase in food sufficiency, improved diets, better nutrition and reduction in seasonal illnesses.

o   Better health of children led to higher school attendance and improved performance. The basic income also facilitated spending on school uniforms, books and stationery.

o   The cash transfer facilitated small scale investments such as buying better raw materials and equipment, which resulted in a higher income.

o   There was also a shift, especially in the tribal village, from wage labour and bonded labour to owning farms and to other forms of self-employment.

o   Women’s empowerment was another outcome of the pilot studies: their participation in economic decision making in the household improved.

The basic income also enabled indebted villagers to pay back the money lenders and borrow less from them.

See this excellent video account – well worth twelve minutes of your time.

The blog also gives references to ventures in several other countries and ends with news from Scotland