On Zack Polanski's Magic Money Tree, economic gravity simply doesn't exist

The Green Party leader thinks Modern Monetary Theory is a cure for Britain's woes - others see it as snake oil at best. By Jonathan Prynn

- Jonathan Prynn

Just a week on from Rachel Reeves's chaotic and poorly received "more of the same" Budget, are you ready for the new paradigm? That is what Green Party leader Zack Polanski is calling his revolutionary way of thinking about the economy that turns almost everything we have long held true about how to run the country's finances on its head.

We have already heard a lot about the wealth tax that would slap a one per cent levy on all assets worth more than £10 million and two per cent on those valued at £1 billion or more.

Less known but far more significant for most of us is the Modern Monetary Theory, or MMT, as it is known, that is the intellectual core of Polanski's vision of a radically different Britain.

In essence Polanski believes that it is time for politicians to throw off the shackles of deficits, fiscal rules, OBR projections and gilt yields that they have been obsessed with.

He maintains that by adopting MMT the UK's government can stop being scared of the City - the bond markets in particular - and become freed up to start spend heavily on infrastructure, the green transition and investment in health, education and welfare for the most vulnerable in society. It is what some call "the politics of care".

Polanski has named his three favourite economists as Left-wing journalist and writer Grace Blakeley, author of Vulture Capitalism: Corporate Crimes, Backdoor Bailouts and the Death of Freedom; former Citibank financial trader turned anti-inequality activist and author Gary Stevenson, who is a member of the Patriotic Millionaires group; and accountancy academic and outspoken commentator Richard Murphy, whose publications include The Joy of Tax.

While none are practicing professional economists, the trio have had a huge impact on the emerging thinking of Polanski and the party he leads. So what is MMT and how would it work in practice?