"...This is because the majority of money – around 97 percent – is borrowed into existence when banks make loans to companies and households… the remaining three percent is borrowed into existence by government (although it could simply create it directly at the stroke of a keyboard)."

He makes some good points but this is misleading. Where does he think government spending comes from? Public sector wages? The health service? local government budgets? Education budgets? Transport budgets? etc etc.

The government creates all the money to enable these things of course and just like the monies created by other banks where re-payments to the lender is money destroyed, taxes returned to the government are also monies destroyed or removed from the system.

Government can create as much money as it requires and indeed does to pay for all these things: it could not be otherwise. Moreover, if it can show a believable growth and return can be enabled by any capital investment it can do near anything it wishes without destroying confidence in the currency.

The problem lies with the Idee fixe that a government has to borrow money from private sources by means of bonds, or indeed by more idiotic means such as the PFI schemes and PPI's. Bonds are merely a religious tribute paid to the notion of private capital in a capitalist society...but the other forms of public borrowing are rentier scams: endless subsidies for the wealthy.

Of course we have seen the truth of the matter in action. In actuality as in the banking crisis, it is the central bank: ie. The government and through them the public whom act as security for the private system and who are the actual lenders of last resort.

-Nothing will get done until we stop pretending that it is the tail that wags the dog.

But of course nothing will get done anyway because our politicians are mere bureaucrats with no experience of anything real whatsoever. People without even the imagination to inspire an idea, never mind the practical abilities to execute one.