Greenspan's views on money creation discussed alongside UK spending vote

Alan Greenspan advised Congress regarding money creation while Parliament voted on spending instructions. A report noted that Alan Greenspan, during his time as Chair of the Federal Reserve, told Congress in 2005 that there was nothing to prevent the federal government from creating as much money as it wanted and paying it to somebody. This principle was applied to sterling.

The report argues that the UK state finances itself differently than a household budget. It explains that Parliament instructs the Bank of England, which credits private accounts, meaning government borrowing ends up as financial assets held by households, firms, and pension funds.