I understand economics and have provided a new school of economic thought that has been used enabling the set economic targets to be achieved. There is evidence the work I have produced has been used by the government because it has been extracted from work I have written and put directly into the new Pension Tax Manual, which is the pension regulations. I have written four books and many articles that have policies in them that have been used. There is a letter in the work from the former Chancellor of the Exchequer stating the work would be used to review conservative party pension policy, which subsequently happened. Much of the work in the paper was adopted and included in the new pension regulations and reforms. There is both evidence of the word for word inclusion of copyrighted work I have produced and many letters from politicians. The work you explain as an understanding of economics 'Modern Monetary Theory' led to a financial crisis and economic outcomes that were very far from the targets. There are reasons why the targets are set they help to make sure money maintains it value and the financial markets are stabilised, this has happened since pension reform has been used as an economic control tool. Even if the letter is just an acknowledgement of the receipt of the paper, large extracts of the text in the paper have been included in the updated version of the Registered Pension Schemes Manual which is called the Pension Tax Manual. The acknowledgement of the receipt of the paper and then the subsequent extraction from the paper is evidence the paper is the originating source of the pension reforms. Regardless of your view of what the word review means there is an acknowledgement of the receipt of the paper and then the later extraction of the exact text which was included in the pension regulations. Even if you take everything else out of the letter it is an acknowledgement of the paper's existence and contents and attributes the work to me, the work has been used in later pension regulation so it has been used.
My opinion of your work has not changed. In my view you fail to recognize that government is the source of money, whereas government, via its taxing of society, and society, via its productivity, are sources of money's value. The nominal amount of sovereign fiat money is unlimited; it's value is not. Schemes such as yours that assume an incorrect axiomatic fundamental, viz., the Government's money is limited, are wrong from the start. Constraint on our profligacy stems from our society's productivity. That's were emphasis should lie. You've proposed an alternative to controlling interest rates for the purpose of stabilizing the Pound's value and responding to recessions. Your alternative requires regulating the amount of money flowing into pension savings. This is a bad idea as it echoes your fundamental mistake. Such a scheme will prove even less effective than the Central Bank's control of interest rates. Under normal economic circumstances, it is demand limited credit relative to productivity that has the largest direct effect on inflation. Your proposed regulation of the amount of money flowing into pension savings -- you claim the government is already doing this at your suggestion! -- is pointless because as things stand now governments' tools for controlling inflation go far beyond controlling the base interest rate. The tools are numerous and effective. In the final analysis the only thing that matters with regard to pension savings -- as it's impossible for the Government to run out of money -- is the amount of buying power in a pension at the time it is paid out. Governments, together with their central banks, have adequate tools for regulating inflation and thus the buying power of money. Their two main tools are transactions on the open bond market and taxation. These two tools, along with intentional deficit spending, are adequate for control of money moving between the Government Treasury and the private sector, i.e., "outside money." Central banks have long recognized that control of the wholesale price of money, i.e., the base interest rate, provides an inadequate tool for controlling inflation except at rate extremes. They also recognize that the "inside" money supply is dependent on demand limited credit markets, a factor only weakly influenced by the Central Banks' control of interest rates. Governments with their own fiat money do not sell bounds to raise money -- there is no need for that, as the government is the source of money! -- rather bounds are used by government to remove money from, and supply money to, the private sector economy. The same can be said for taxation, however taxation carries with it no definite future obligation. Taxation also serves the critically important purpose of giving fiat money value. Bonds also act as a risk free, interest paying store of money; thus providing an incentive for their purchase. Deficit spending, for whatever reason governments engage in it, also has the effect of increasing the amount of money in the private sector. This is can be useful whenever it is desirable that private savings be increased, or when there is a gain in productivity or population. Good governments with healthy economies must run a cumulative net deficit over time or their economies will be overtaken by recession and deflation. Your schemes, so far as i can tell, do not recognize any of these main tenets of sovereign fiat money management.
I have never said the government has not got an unlimited money supply. They have through quantitative easing, although this can cause inflation which would normally make the interest rate rise. The pension saving alterations are used instead of altering the interest rate, which is should be set at the rate that reflects risk not the central banks economic stimulation or retraction agenda. The alterations in pension saving have enabled the central bank to keep interest rates low, which has stopped a further series of debt defaults. It has also when needed enabled the economy to be stimulated. Since 2012 when pension pumping was first used unemployment fell significantly. The interest rate was already at half a percent for three years with unemployment rising. When pension pumping was used unemployment dropped it was effective and has kept the UK economy in growth for the last decade. It is a very sensitive model for controlling the economic targets and saves billions every year by reducing debt repayments and making pension tax relief payments more affordable. The rate of inflation has been kept at low levels, so has the interest rate, economic growth rates have hit the 2% GDP targets, unemployment rates have fallen and massive treasury cost efficiencies have been made. Just look at the results, they speak for themselves. It is flat lines economic target hitting in the UK since they starting managing pension saving rates and reforming pension regulations. See below. http://morganisteconomics.blogspot.com/p/success.html https://www.elitetrader.com/et/threads/pension-pumpind-and-unemployment.345788/
The Government's unlimited supply of money is an inherent feature of fiat money, regardless of whether a government engages in quantitative easing. Fiat money facilitates quantitative easing, a process in which the government uses its central bank to buy the Government's bonds on the open market. This swells reserve accounts forcing the base interest rate rapidly toward zero.
It doesn't cause inflation, as you can see, because it is done at a time when demand for money and thus credit is shrinking. Alternatively, it can be done as a part of a government subsidized loan program. Typically, OE results in swollen reserve accounts which banks may be iunable to loan out because demand for credit has dried up. In such an instance, the base interest rate will be driven rapidly toward zero.
Alterations in pension savings have nothing to do with the Central Bank's ability to keep interest rates low. All the C.B. has to do to keep rates low is flood reserve accounts with money by buying bonds. And, as we both agree, the Central Bank's ability to buy bonds is unlimited.
In the United Kingdom the central bank is limited at increasing money supply and has to go through processes of approval to do it. Regardless of whether their ability to increase money supply exists outside of QE, QE is the recognised approved process of increasing money. I think it is more a case of increasing the monetary base when QE is involved instead of merely increasing the money supply. There is a difference and why QE is so controversial because it dilutes the monetary base. The link below describes monetary base as credit creation instead of merely allowing more of the existing money supply to used actively in the economy. It is when credit is created that QE is involved and it will dilute the money supply. This can often lead to inflation. https://xplaind.com/814601/money-supply-and-monetary-base
Generally I will agree that in small amount QE will not create inflation and I even recommend it at certain times. However when it is used on massive scale it can dilute the money supply and lead to less foreign interest in an economy. There is another issue with QE and diluting the money supply, if the number of monetary units in an economy expand it can make them less valuable to foreign currency stock holders. This will reduce the value of the currency on the foreign exchange market which will reduce the purchasing power of goods from abroad, this may lead to inflation. Too much QE often causes inflation due to the reduced ability to procure goods from abroad.
Yes you are correct pension saving alterations have nothing to do with the central bank and its ability to keep the interest rate low. However the central bank has to hit an inflation target in the United Kingdom it is 2%. They use the interest rate to hit the interest rate target, if inflation rises they put the interest rate up. To stop the interest rate from rising pension saving is increased to lower inflation preventing the need to increase the interest rate. The opposite is also true, if the interest rate is low and the central bank does not want to lower it they reduce the annual amount people can save in their pension, 'Pension Pumping'. The interest rate is now longer used to achieved the inflation target. The interest rate and inflation rate are kept low reducing the cost of paying government debt making treasury cost efficiencies. In the UK they now use alterations to pension saving to control inflation and hit economic targets. It works.