Has government run out of money? And why does it borrow its own currency?‏

The dominant concept of money is that resources only come into existence when money is mobilised. This gives the financial elite who control money and credit enormous power over government, the economy and over all aspects of our lives. Keynes recognised this absurdity in 1928:

It is 'imbecile' he said to say that something is unaffordable when labour and resources lie idle and it is only by using society's resources fully that anything can be afforded. The reality is the opposite: money is the means by which labour and resources are mobilised in all societies which have moved beyond subsistence production and simple barter.

Money is a token system and to say that there is no more money and we must close libraries, shut down school repairs is as ridiculous as cancelling trains because we have run out of tickets. Get that point across and the rest should follow.

So, governments could finance a large proportion of its spending simply by issuing its own money and investing in improved infrastructure. The island of Guernsey has done this for decades. There is no difference here from issuing IOU's and from borrowing from banks except that the economic rent - interest - is captured by the public authority if it chooses to charge it.

Governments can and should issue their own debt free money instead of borrowing it by issuing IOU's called gilts on which large amonunts of interest have to be paid to the owners. Who ironically end up being general citizens like us, as the banks trade the IOU's on to our pension funds.

Ask your friends and colleagues...why if the government owns its currency why must it go into debt to get some?