The Bank of England is going to take on modern monetary theory

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The Bank of England has issued this press release this week:

It says:

‘Can’t we just print more money?’ is a new pop-economics book, written by the Bank of England, which will be published this May in partnership with Cornerstone Press. The book addresses ten economic questions, from, ‘Why are all my clothes made in Asia?’ to ‘What actually is money?’ Along the way, it offers idiosyncratic examples of economics in action: from the City of London to Springfield Power Plant; from Babylonian gold lending 4,000 years ago, to the economic effects of the Covid pandemic.

The book, which will be published on 19 May, is part of the Bank’s work to increase public understanding about the economy and the Bank’s role in it. The Bank’s advance and future royalties will be used to buy copies of the book for thousands of state school libraries and support the Bank’s wider education programme.

‘Can’t We Just Print More Money?’ has been written by Rupal Patel, an economist who works in the Bank’s Financial Stability directorate, and Jack Meaning, who works in the Chief Economist’s office. It includes a foreword from the Governor, Andrew Bailey.

Andrew Bailey said: ‘The economy – and economics – is all around us, in the decisions we all make every day at home, at work, or in the shops. Despite this, economics is generally not well understood, and nor are economists. We hope that, as well as being an entertaining and informative read, ‘Can’t We Just Print More Money?’ will help demystify economics and encourage people to learn how we can use it to tackle some of the biggest challenges facing the world today.’

Call me cynical if you wish but I think this is going to say three things.

First, it will say that we cannot just print more money - which everyone would agree with unless appropriate caveats are added. I suspect that the wrong ones will be. In other words, this will be a denial of modern monetary theory rather than something useful.

Second, I suspect it will argue for strong monetary policy.

And third, it will definitely defend independent central banks.

As I say, call me cynical, but the chance that this book will in any way be objective is, I think, close to zero.

And if its explanation of money is as bad as that on the current Bank of England website it will also fail to explain what money is too.

I am looking forward to this.