I am delighted that Larry Elliott (Think our governments can no longer control capitalism? You’ve been duped, 14 December) has discovered Professor Bill Mitchell’s book Reclaiming the State.

Mitchell is a respected “heterodox” economist who specialises in modern monetary theory, and writes an almost daily blog in which he explains MMT and its political and economic implications. If Elliott were to fully learn the lessons of MMT from Mitchell’s book and/or blog, then perhaps he would not write (as he recently did) about governments of countries like the UK (which issues its own currency in a floating exchange rate system) having to “borrow” in order to run a fiscal deficit. The “borrowing” that does take place is a “voluntary” restriction placed upon the government’s freedom to spend, for reasons that are no longer valid (if they ever were), as Mitchell expertly explains, and could be dropped, if the government so willed.

The alternative to “borrowing” is called overt monetary financing (OMF) as espoused by such extreme leftwingers as Adair Turner (irony intended). That the government (or Bank of England, which is owned by the government) can do this was demonstrated by QE, the creation of money “out of thin air”. If it can do it for the bankers and speculators, then it can do it for the real economy – and it is high time it did so.

Mike Ellwood

Abingdon, Oxfordshire

• Larry Elliott says the political right has for decades used the state to undermine workers. He neglects to mention the elephant in the room, namely migrant labour. There is nothing like a labour shortage to bring a halt to the exploitation of workers. If you want a living wage for UK workers, then control immigration. There will be a cost, but national cohesiveness can’t be had on the cheap.

Yugo Kovach



Winterborne Houghton, Dorset

• Larry Elliott claims “there is no self-righting mechanism” under “turbo-charged capitalism” to restore the balance between employers, “the predators”, and employees, “the prey”. There is: it’s called revolution.

Gareth Reeves

Durham

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