It’s only in the last couple of years that I’ve been able to envisage a viable route to monetary reform, after thirty years or so thinking about it, and I don’t think the problem is only political will. I suspect the author is overlooking a significant technical issue, one which can’t easily be overcome without upsetting large segments of the public.

The root of the problem lies in the fact that money in its current form conflates functions which are at odds with each other: as a medium of exchange its value depends on it circulating, but as a store of wealth its value lies in the ability to hold on to it, i.e. take it out of circulation. In its base form (cash), it can be taken out of circulation by anybody who has a surplus. That’s the underlying reason why people receive interest on surplus money and, because it leads to a steady flow of wealth from the poor to the rich, it’s one of the principal drivers of inequality.

Reforming that aspect of money means separating the different functions. In practice that would mean establishing a form of cash which loses value if it stops circulating at an acceptable rate. This is something which has mostly only been advocated by outsiders (OpenDemocracy published my own take on it, In search of honest money, a few years ago) but some prominent economists and central bankers have also been discussing the issue in recent years, particularly since the 2008 crash. But, as Ken Rogoff described in a recent Prospect article, there is significant public resistance to it.

The only viable route I can see would involve phasing in a completely new currency, focusing initially on the problem that we currently use a unit of account whose value is arbitrary … but that’s too much to go into here.