‘Wales could be a prosperous country if it had its own currency’
Martin Shipton
Wales could become a more prosperous nation by ditching the pound and creating its own currency, according to a monetary guru whose anti-establishment ideas are challenging economic orthodoxy.
Warren Mosler had a highly successful career in the US financial sector, founding his own hedge fund and owning his own bank, before embarking on a mission to convince the world that mainstream economics is based on a fundamental misunderstanding of the way money is created – and that once that’s understood, public spending can be used to create full employment.
On Friday August 29 he gave a lecture at Tramshed Tech in Cardiff that was attended by former Plaid Cymru leader Leanne Wood and Mark Hooper, Plaid’s lead Senedd candidate in the new super-constituency of Pen-y-Bont Bro Morgannwg, which covers Bridgend and the Vale of Glamorgan.
The gold standard
Mr Mosler’s starting point is that since the gold standard was abolished during the Great Depression of the 1930s – before which the value of a country’s currency was linked to the amount of gold it possessed – money has essentially been created by governments. Contrary to popular belief, banks do not lend to borrowers the money deposited with them by their customers. Instead, the money they lend is created by banks simply by creating credit in a borrower’s bank account.
The same can be done to ensure the economy is working for people, rather than people working for the economy. Both at the time of the banking sector crash in 2008 and the Covid-19 crisis in 2020, banks injected billions of pounds into the economy to ensure its survival. There is no reason why that couldn’t be done in the interests of social improvement.
When that is understood, argues Mr Mosler, there is no reason for a country to punish itself by cutting public spending to “balance the books”. A country’s independence is determined by its ability to act freely economically. Being linked to the British pound would not provide such freedom because crucial decisions would be taken by the central bank – the Bank of England – over which Wales has no control.
Independent Wales
Asked by Nation.Cymru what advice he would give to those arguing for an independent Wales in terms of the currency issue, Mr Mosler said: “The first thing that comes to mind is that 30 years ago, this was the same question in Quebec, Canada. The people there knew me, and I wrote a paper on how they could have their own currency and how it would work. They would go to an immediate prosperity and it would be a strong currency. My ideas got published in the French separatist newspaper, two pages in the centre section. But they lost the referendum in 1995 [by 50.58% to 49.42%]. It was very close. So I’m not new to this.
“I wrote a paper for Scotland on how to start an independent currency, and from a purely economic prosperity point of view, you would want to have your own currency. Not that there aren’t things you can do as halfway measures. But you’re far better off starting your own currency, because the UK doesn’t operate their currency properly. They don’t operate it for a public purpose, the way it could be operated.
“If they were doing it properly, we wouldn’t be having this discussion. You would be more than happy to be a member of the UK and you’d be at full employment, with prosperity. Life would be nice. The streets would be clean, the schools would be excellent, education would be good, and, you know, the air would be clean and the public health service would be fully funded. You’d be at full employment all the time. That’s the natural state of an economy with a government that knows how to operate their currency.”
Deficit
Asked how he responded to the often mooted argument that Wales couldn’t afford to operate independently of England and would instantly have a huge deficit, Mr Mosler said: ”Well, the first thing you say is why does it matter? The US has run a huge trade deficit. It’s the strongest growth country in the world, with the highest standard of living.
“Once you have control of your economy, whatever deficit you’ve assigned to Wales, it’s gone. We’re going to wipe that out and you’ll never have that again.
“We’ll take care of our own finances. OK, now you can tax and spend. You’ll have your own interest rate in your own punt or whatever you want to call it, and you can have a proper zero rate policy.
“You can have a properly funded public sector. You’ll be running some kind of a residual deficit. It might be 2% of GDP, it might be 10%. You don’t even have to publish a number. It doesn’t matter. You’ll have a far higher level of price stability than the United Kingdom. Nobody can ever have perfect price stability.
“You’ve got a crop failure. Food prices are going to go up. Somebody strikes oil. The oil price is going to go down, up and down. You’re going to have relative value changes all the time, but you’re going to have an inherent level of price stability and the ability to cope with it far better than the UK.”
Unsurprisingly, Mr Mosler is scathing about the way Chancellor Rachel Reeves is running the economy. He said: “You would have full employment if the government were doing its job properly. Yes. Whereas, you know, Rachel Reeves is saying, well, we’ve got to screw people because we’ve got to get more money. So they’re thinking up new ways of taxing people in order to get more revenue. It’s totally unnecessary.”
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Righty-ho! This has been discussed before on Nation Cymru and anyone with a sensible view and rightly criticised.
Why is these people never discuss Peru, Venezuela or Zimbabwe in their assessments? I’ve seen at first hand the impact of this mismanagement and it is really not pretty with millions of people put into destitution.
Look up modern monetary theory. Essential idea is that the sovereign banks creates new money every rime it spends. Spending comes first before any tax or borowing. Tax isn’t a means of raising revenue but is the main way to control inflation. The current hammer for controlling inflation is bank of England interest rates. This is set by ex bankers and and at higher rates punishes working people, slows spending in the productive economy but rewards banks and those who are asset rich. Money can be created and invested in the productive economy. Tax can be used to control inflation… Read more »
There has to be a limit to the amount of money you can print that’s relates to the size of the economy otherwise you’re selling economic perpetual motion that would allow every country to pay all of their citizens a generous salary to sit at home and do nothing.
Every single MMT economist would agree with you there. There is nothing Warren says or implies that says govts can endlessly create money. His point is that they should spend UP TO full employment. Keeping people unemployed in Wales because the financial sector and housing markets in London are ‘running hot’ is beyond stupid. But that’s where we are now. And without your own currency and a functioning economic framework, that’s where you will be once independence arrives.
There are those, including some in this thread, who believe there’s no limit, consequences or downside to printing money. The reality is it devalues a currency causing inflation, so the printed money should be used to invest in ways that support the economy to grow and counter this inflationary effect, such as building infrastructure. “Keeping people unemployed in Wales because the financial sector and housing markets in London are ‘running hot’ is beyond stupid” Absolutely right but this isn’t an economic strategy but a legacy of empire that has given us what I call the Hunger Games economy where London… Read more »
The problem is not ‘London’ (which has some of the worst poverty, after accounting for housing costs, in the UK) but capitalism, and specifically the domination over UK economic policy of financial interests that gain not so much from keeping money scarce as from ensuring that money supply is directed towards increasing asset prices rather than employment and living standards. Economics and politics should not be reduced to geography.
The problem isn’t capitalism, it’s unfettered capitalism. If your car gets a flat tyre you don’t vow to never drive again, you fix the actual problem.
And “London” controls the UK economy so any distortions in the UK economy are “London’s” fault. London in this context clearly refers to the UK central government, not the people who live there.
Couldn’t agree more.
Zimbabwe and Venezuela are forcibly exiled and isolated from the global economy. Of course that couldn’t have anything to do with hyperinflation…
Honestly, where do you get this from? Not exiled. And certainly not forcibly.
Millions died of starvation, poverty and aids, due to gross corruption and mismanagement, but you’re happy to blame some imaginary enemy?
Where did I get this from? From the most cursory knowledge of history.
Zimbabwe were (rather famously) declared a rogue state early into the first Bush W administration for no real reason and subsequently isolated from the international community. The same happened to Venezuela under Chavez when they dared to begin nationalising their assets and invest oil profits into the wellbeing of their people.
And since when have millions of people died in Zimbabwe and Venezuela from starvation?
Yes the population declined by around 30%. More than in Ireland during the famine.
Zimbabwe was not declared a rogue state by the US governmen. Never. Criticised by Rice but not aligned to North Korea etc
There were asset freezers and travel bans to senior government ministers, but that’s probably fair enough given they were participating in genocide, don’t you agree?
economic sanctions didn’t occur as US and UK knew who they’ll hurt more.
always good to debate these things with some of the finest minds in the country!
But that’s the point, a currency is there to be independent. Countries have to learn to be largely self-sufficient when they become independent. If they can’t manage an economy that’s cut off without hyperinflation with a currency under their own control… what example is that to a country that’s seeking to do something broadly similar? Wales, like Venezuela depends extremely heavily on exports. From it’s lamb, to its renewable energy exports. It also relies heavily on imports to subsidize an ailing, aging workforce with significant unemployment and deprivation. Naturally other countries are going to be wary of a newly independent… Read more »
Maybe they don’t discuss those countries because its completely irrelevant?
Venezuela and Zimbabwe had their own currencies for decades and were doing just fine right up until they were deliberately and arbitrarily excluded from the global marketplace by the US.
Your whole thesis is that its literally impossible for a country to have its own currency.
I was in one of those countries at the time. I do not remember being deliberately and arbitrarily excluded from the global marketplace. Where did you get that idea they were?
No, I’m not saying that it’s impossible to create a new currency. That’s quite ann irrational extrapolation!
MMT theorists usually reference Japan, which has seen a large increase in money supply but for decades still struggled against deflation. The Japanese experience has proved difficult for mainstream economics and currency traders to understand. Uncontrolled money creation would undoubtedly be inflationary but no serious MMT theorist advocates this, although some MMT supporters do not always sufficiently acknowledge the constraints and risks in money creation. The contrasting experiences of Japan and Zimbabwe/Venezuela show that the economic circumstances and institutions of a country are the decisive factors in deciding whether or not a country should engage in controlled risk-managed monetary expansion.… Read more »
Is this the Magic Money Tree explained?
Even barter sounds more realistic. How would we trade or borrow? Perhaps now is not the time to take advice from an American hedge fund manager, we already have our own in Nigel Farage.
I’d like for someone to provide an example of where this magic beans plan has worked previously, in modern times. Otherwise no-one should be gambling their future on an experiment.
Narnia. Went well apparently.
A good question, Basil, but easily answered. A bit long though, sorry. All governments with a sovereign fiat currency spend by creating currency or usually a credit (as authorised by parliament etc) placed in their departmental account. This has been going on for many years in some countries, but the UK only since 1931 when the gold standard was abandoned. No similar government needs to borrow but there is utility in bonds… We don’t therefore have a ‘tax and spend’ economy. Government revenue pays for nothing, despite much propaganda to the contrary from the media and politicians of too many… Read more »
Yet again, a series of unsupported generalisations that again serve only to emphasise your total lack of understanding of economics.
I ask again. In my recent article I presented the difficulties involved with a separate currency and I asked then, and I ask again, please answer the issues I raised.
You won’t because you can’t.
Dr Ball, would you say the same about Warren Mosler?
Yes. His views are nonsense.
Interesting response elsewhere here, he made his money through traditional economics.
Don’t do as I do, do as I say…
He made his money by realising that sovereign governments couldn’t go bust. So not really John. When are you up for a debate on all of this with me?
i should have added this addendum to my earlier reply.
I ask again. Answer the issues I raised in my original article on the
difficulties of a separate currency.
You will no because you cannot.
So which countries have successfully achieved independence by adopting their own new currency on day one?
My assumption is that a newly independent state must first prove the economy can work well independently before you can ask the rest of the world to trust a new currency.
And to get there, a trusted established currency must be used for the transition period. Which doesn’t have to be sterling.
Otherwise you’re running on magic beans.
No, most countries create their own currency early on. A currency is about keeping wealth in a given area otherwise we’d all be using the Renmibi (yuan) or the dollar (US). Usually the currency comes immediately after independence. Naturally it’s not a magic cure all but markets are relatively willing to adapt to new currencies, they just want to know the rules they have to play by first and if they think the rules means the currency won’t properly store value, they’ll drop it. When it comes to the market, they’re literally gambling on whether they think it would be… Read more »
So name one that is a good example to follow.
The Euro, is the most recent example of a currency that economies have embraced, reasonably happily. You could argue whether the EU is considered a country itself though. There’s also the US dollar. Most countries established their currencies centuries ago close to their founding though. There are also local examples like the Brixton Pound. There’s the swiss franc that’s still going strong or perhaps even the canadian dollar. So Switzerland, Canada, Germany… these are relatively good examples to follow in fair economic management while achieving broadly socially good aims. As I pointed out though, the currency doesn’t create independence, independence… Read more »
You’re missing the point which is about launching a new currency at the same time as gaining independence. The Euro was adopted by countries that were already proven economies, not as they were trying to find their feet as a new state. Malta, a far more autonomous nation than Wales, still took 8 years between gaining independence and adopting the Lira.
Again, it’s roughly how it’s normally done, as soon as a country is created the currency follows absurdly quickly. You either adopt the currency you had previously (this works out great if you’re happy to be controlled by the monetary policy of a third party), you take on a third party currency (same diff), or you take on your own currency. Basically every modern country that still has its own currency is a good example. 8 years is a tiny amount of time, it’s worth pointing out that Malta adopted the Euro and that the Lira was adopted after the… Read more »
The point I’m making isn’t that a new currency can’t be an ambition, only that it shouldn’t happen on day one. People need to have confidence that an independent state can function normally before being asked to take a bet on a new currency. Do you have any examples in recent history where a brand new currency and a brand new state launched at the same time?
Germany no longer has its own currency. None of the Eurozone countries do.
Warren Mosler is quite right – Cymru could be prosperous provided we were independent of England. We could be similar to Australia, Canada and Ireland, though without the mineral wealth of the first two (ours has gone). And provided we didn’t overreach ourselves – stop the exploitation of our land, our seas and other resources, establish border controls (electronic and invisible for Welsh residents), land reform, longterm investment by the state in culture, afforestation, water and energy management, low-energy transportation systems – restoring our quality of life en route…while working within environmental limits. If you want to be rich or… Read more »
I’m not disputing that independence is a route to greater prosperity. Ireland proves this is possible. The topic is how to get there, and you need to show that creating a new currency on day one isn’t reckless and unnecessary, and doesn’t put the whole project at risk.
Simply asserting that ‘Cymru could be prosperous provided we were independent of England’ doesn’t suffice to make the case for independence. Many small countries are prosperous; many are poor.
Much more needs to done to make the case convincing. In particular, it needs to be shown how an independent Cymru would engage with the rest of the world, and in particular with England. Every prosperous small country is well integrated into the wider world economy, especially with its near neighbours.
No country where free markets supposedly prevail has reached full employment or eliminated poverty.
Neoliberalism has been an experiment, permitted despite its historical record of failure. The corruption, the exploitation of people, societies, cultures and resources. We are much poorer because of this wildly radical (er, not in a good way) theory, Basil.
It is important that we direct our dissatisfaction not only at the governments that followed that dogma so slavishly, but the dogma itself. Neoliberalism has not ‘worked’ (apart from making a few very rich), cannot do so and will not.
No country where any other philosophy prevails has reached full employment, never mind eliminated poverty either. If anything… neo-liberalism has come tantalizingly close in its various flavors across Europe and America. I believe Europe is currently the closest to achieving the elimination of poverty, in fact in some measures, it already has, for example when you consider absolute poverty Europe has some of the lowest numbers in the world, where countries like China or South and South east Asia or many parts of Africa have some of the highest. China, is a great example in fairness, it went down the… Read more »
The Chinese economy has been steered to a much higher degree than neoliberalism would propose. It would be better described as party-state capitalism.
MMT is better contrasted with fiscal rules than with neoliberalism. Although many MMT advocates associate it with progressive proposals such as a job guarantee, seeing deficits as a myth could also be used to justify Trump-style tax-cutting.
The true alternative to neoliberalism is socialism, understood as the need to confront power and ownership over economic resources, real as well as financial.
The biggest weakness of MMT is not its description of how money works but its lack of attention to real world limits, often treated as an afterthought in parentheses, as you have done.
Those limits are not just the existence of unused or underutilised resources, but social, political and economic, both internally and externally. MMT places excessive focus on the money supply, control over which is just one aspect of how an economy functions.
This is literally how money has worked since the beginning of civilisation, right up to the advent of neoliberalism. And how well is neoliberalism going?
Literally every state throughout the history of mankind has a currency. That’s kind of how the entire concept of civilisation works.
How many have gained independence for and started a new currency on the same day?
The WG couldn’t even implement a 20mph speed limit in a smooth and coherent manner, let alone a currency. Actually though, part of me wants to see them try. The mind absolutely boggles at the fun DJ Eluned & Co could have with that one.
I think the comments that have already appeared are sufficient enough of a response and need do further detailed comment from me.
I would refer readers to the article written by me and published recently in Nation Cymru detailing the substantial difficulties in establishing a separate currency.
But what really worries me is that leading members of Plaid Cymru believe in this fairy tale and take the people of Wales for fools.
I agree; but I’m less worried about Plaid currency fantasists. They can’t bring themselves to openly advocate independence any time soon, let alone a new currency. Not happening.
Man who made fortune from “career in the US financial sector, founding his own hedge fund and owning his own bank” now tries to tell us it doesn’t work!
Sure thing.
The US economy is literally designed to be dysfunctional in a way that hands the financial sector total power over the economy and grotesque levels of wealth.
In practice, Wales would probably be better off sticking with the pound immediately after independence, at least for a transition period. A full Welsh currency might come later, once stability and trust are built. Realistically, Scotland are going to achieve independent first, and they will have more bargaining power with London. Wales would be wiser to watch how Scotland negotiates its independence settlement and then negotiate from a clearer and more informed position.
Sticking with sterling is also a big risk because it requires the Bank For England to be a good faith partner and not set policies that are slightly inconvenient for a much larger economy but fatal to new small ones.
It also affects fiscal policy. Wales will not be able to spend to employ all available resources if it has to borrow (and pay back interest on a ‘foreign currency’). It’s government needs to earn and this can only happen from either large exports or taking more from the public via privatisation etc.
It can spend what’s raised in taxes. And sell bonds to borrow for investment.
Taxes remove wealth from the private sector. Borrowing in a foreign currency means you have to earn in the foreign currency to pay interest. So your government sees us all as a cash machine. It sells assets to enable foreign companies to earn rent. That’s the neoliberal route that has punished Wales for a century. This is an opportunity to abandon that framing and start to work for the public purpose. You can only do this with your own currency, as that enables you to run whatever fiscal deficit (remember you aren’t paying interest on assets that people want to… Read more »
Seeing there are tiny dependencies around the world including in the UK that have not only their own climate but printed currency there no excuse that Wales with a population of 3.2 million for some reason can’t or won’t and do they have the will to do it. Seeing how they regard further devolution, Welsh workers, and of course HS2 consequential denied, speaks volumes why Wales lacks so much other countries take for granted. We’ve had both English & Welsh Labour dominate Wales since 1900 at Westminster, and with the inception of devolution in 1997 on Cardiff. And not once… Read more »
I have a great invention: a perpetual motion machine – looking for a bank to back it! 😉
Sound dodgy. You need to be an ‘intellect’ or ‘thinker’ like mr’s mosler and hooper or ms wood to get away with such nonsense talk and get published in a news outlet, apparently
A significant and major intervention from a leading economic voice. How many of those mainstream economic voices that tell everyone that Wales needs the UKs tax base etc take the time to come and speak to activists and policymakers? None. Warren is explaining how Wales can use its currency for the public purpose. And that without its own currency after independence Wales will stay in pretty much the appalling economic position it has as part of the UK. Engage with the insights and the understanding from MMT and you just might be able to get the progressive society you want.… Read more »
Wales would never have its own currency unless it remains independent of the EU and the UK. The EU requires members to use the Euro. The UK only got an exemption because it had been a member prior to the Euro. There are a lot of problems with his line of thinking and they don’t seem to match up with reality, for example his line about Wales could have full employment. This is neither possible, nor desirable for a resilient and adaptive economy. You will generally want unemployment to be running at between 6% and 8% of the workforce. Usually… Read more »
Frictional unemployment does not need to be more than around 1% of the total labour force. Anything much above that is wasted resources. I am not an MMT enthusiast but MMT advocates are right to point to the human and economic costs of unutilised resources and to prioritise reducing those, including through judicious use of money creation.
Good points Lyn. The much wider issue is that the use of interest rates to manage the economy ensure we have unemployment. Mmt does not use interest rates in this way so unemployment is by design much lower under an MMT framework.
Fifty years of experience has shown that abruptly raising interest rates can crash an economy (as Volcker did in the early 80s) but tuning rates has slow and indeterminate effects on inflation, while lowering rates proved ineffective in generating growth following the bankers’ crash. MMT is quite right to emphasise fiscal policy. But interest rates remain important for investment decisions, even though growth and certainty probably count for more. The MMT preference is for zero interest rates, at least for short term risk-free (government) assets, although term and risk premiums would make commercial borrowing more expensive than that. But while… Read more »
We don’t need foreign investors to hold Welsh sovereign currency. You actually don’t even want them to! That is pretty much a pointless exercise. This is, as Warren pointed out, still stuck in gold standard thinking. It is challenging to discard all the gold standard hang-ups, and that is derailing the opportunity of a sovereign currency. The whole trade / FX narrative has not moved away from fixed exchange rates. Sounds like time for another pint or three!
Are you suggesting that nobody will want to invest or borrow in the sovereign currency? I’ve never come across that proposed in the MMT literature. How would the economy function?
Anyone or any business (Welsh or foreign) wishing to purchase any assets (financial instruments or direct investment) denominated in Welsh currency will expect a risk-adjusted return at least equal to that available from investing in foreign currency assets. Similarly, anyone wishing to borrow will consider doing so in a foreign currency if offered rates look lower. How could it be otherwise?
You are still operating within the neoliberal framework. You need to step back (which is very hard to do) to understand the logic. Every point you make is underpinned by gold standard neoclassical economic assumptions. Warren tried to convey this last week – and, of course, it takes much longer than 75 minutes to start addressing issues like this. People will still hedge risk with currency fluctuations, but the last thing Wales wants is ‘hot money’ and people investing in a financial product that is your currency. At 0% interest rates, 0% interest on reserve balances, and perhaps no more… Read more »
Sorry, but your position on this makes no sense. An individual wishing to open a savings account is going to look at the interest rates on offer. If they have a free choice between saving in sterling and saving in punts, they will want the account that gives them the best return, taking account of risks such as financial stability or depreciation. If someone can choose a sterling savings bond at 4%, why would they want a punt savings bond at a rate lower than that? With free movement of capital, the rate of interest on Welsh government bonds will… Read more »
What has the savings rate for private borrowers got to do with anything? What about the borrower? Would you rather borrow at 4% or 1%? I am not sure how, in any way, this affects anything that a government wishes to do. The government doesn’t need to borrow. It doesn’t need people to borrow for it to spend. Borrowing and lending will still take place in the private market. I think we are too far off on our paradigms to make this a fruitful conversation.
There is far more to economic theory and policy than ‘a government with a sovereign currency does not need to tax or borrow before it can spend’. MMT is right on that but it should be the starting point for analysis not the end of it.
Rates of return to private assets certainly matter. In 2022, financial system assets in the UK totalled £27 trillion, over ten times public sector net debt. MMT has to broaden its vision to become credible.
This guy sounds like a complete charlatan, or has no idea how economies actually work. Wealth is derived from two things only: energy and raw materials. Energy is used to convert raw materials into useful product. That’s it. Services are a zero sum arrangement. Money is simply an exchange medium, having no intrinsic value itself, and the more of there is in ciculation, the less value it has (it’s what causes inflation – things don’t get more expensive, money loses its purchasing power). The finance sector is a sham of smoke and mirrors, and this guy’s been inhaling too much… Read more »
You’d be surprised what raw materials are around for Wales to exploit, even if we’re just talking about mining (and I’m not talking about coal). Copper, Silver, Gold and Lead are currently mined in Wales. I’ll refer you back to the 25 May 2023 article by Martin Shipton on Nation.cymru detailing results from the British Geological Society, a report co-authored by Kathryn Goodenough (yes I double checked the name and yes she’s real).
There is confusion in both the article and many of the comments between MMT and a sovereign currency. These are not the same. It would be possible for the UK government to adopt MMT. Conversely, it would be possible for an independent Wales to have a sovereign currency without following MMT, as implied by the Laurentjoye paper ‘Currency options for an independent Wales’ commissioned by Senedd.
I am pleasantly surprised, Lyn E, to find that I am almost in total agreement with your contributions to this thread!
I course, I could quibble – I was astonished that you could think I treat real world limits as an afterthought.
From Wikipedia –
Parentheses contain adjunctive material that serves to clarify (in the manner of a gloss) or is aside from the main point
To clarify, it was this second application of parentheses I was employing. The main point of course was money creation by government.
Keep up the good work!
One real world constraint that an independent Wales would face would be the need to import goods and services, to pay for which we would need to export to obtain the required foreign currency. The US is no guide here, as the world accepts dollars but would not accept Welsh currency. We will have to produce goods and services that the rest of the world wants.
A sovereign country can issue its own currency but not the foreign currency it needs. I don’t think MMT has given enough consideration to this.
I wouldn’t want to accuse you of serial whataboutery, Lyn E, as you do raise some important points. But it would be quite wrong to imply that MMT advocates, possibly including yourself, have not thought about all of these matters. There is a strong body of academic and professional literature that supports MMT, one that will no doubt evolve further over time. By way of comparison, the intellectual basis for neoliberalism is threadbare, with lots of dogma and cant to match the unreality and immorality of its failure. Yes, it does make a few people rich but it won’t endure… Read more »
Sorry, but it’s not good enough to say ‘neoliberalism’ is worse, if only because there is not a straight choice between mainstream economics and MMT. Many heterodox economists are unconvinced by MMT or at least by all the claims MMT supporters make.
I have read quite widely on MMT and I have yet to come across anything that adequately addresses the situation that an independent Wales would face, overshadowed by a much larger neighbour with a strong financial sector. If you know of any MMT literature that deals with that, please share links or references, thanks.
But surely this is academic as Plaid and SNP in Scotland if running their respective independent countries have vowed to return to EU with it’s adoption of the € as a non-negotiable condition of joining.
You can only join the Euro AFTER you have had your own currency.
But that’s not true is it. Irish reunification will see Northern Ireland adopt the Euro on day one of its UK independence.
That is a very particular and, in fact, a unique case. Ireland is already a member! That is in no way a like-for-like comparison when considering Wales and Scotland. The EU is very, very clear.
It might be. If Northern Ireland can become a devolved region of the Republic, what in principle would stop Wales doing the same for a transition period which would enable EU membership and the Euro on day one of independence from Westminster.
And, of course, Ireland used the pound before the Euro. So there’s that.
Is this guy also suggesting that the euro-zone would become more prosperous if they ditched the Euro and reverted to national currencies?
I would imagine Warren would put conditions on a statement like that. But would be in general agreement with that idea. The main point is that these countries (like the UK) are not using the power of their currency to increase wellbeing. They are all neoliberal and informed by the wrong economic ideas. However, that is not the argument he is making in this article, which focuses on Wales.