Article: From positive money UL
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FROM POSITIVE MONEY UK
The Bank of England still prints paper money (e.g. £10 notes). Because it only costs a few pence to print a £10 note, the government makes a profit on every single bank note that it prints. Between 2000 and 2009, this profit on newly-created money added up to £18 billion – enough to pay the salaries of around 90,000 nurses over that time.
But the Bank of England only creates the paper money (3% of all money), and leaves it to banks to create the electronic money that we also use every day (97% of all money). When banks create money, they – not the government or the taxpayer – get the benefits of creating that money.
From 2002 to 2009, banks increased the amount of money in the UK by £1 trillion through lending (with every new loan creating new money). Because this money was created by banks, it’s the banks that get the benefit from it (in this case, the interest received on £1 trillion of additional loans).
If the government had created this money instead of the banks, taxpayers would have been able to pay up to £1 trillion less taxes: approximately £33,000 for every person who pays income tax over just 7 years.
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Dikemaskini [Updated]: Sam Ahmad 20240611