Are Positive Money’s ideas connected to a political ideology?

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The short answer is no. It has been advocated by economists that identify with all sides of the political spectrum. The original idea was put forward by Fredrick Soddy, a Nobel prizewinning chemist. The idea was picked up in the 1930s by several economists working at the University of Chicago, including: Frank H. Knight, Henry C. Simons, Aaron Director, Paul H. Douglas, Lloyd W. Mints, Henry Schultz, Garfield V. Cox, Albert G. Hart. Economists at other Universities also supported the plan, including Irving Fisher at Yale University, Frank D. Graham at Princeton University, Earl J. Hamilton at Duke University, Willford I. King at New York University and Charles R. Whittlesey at Princeton University. Variations of these ideas have since been proposed by Milton Friedman, James Tobin, John Kay, Laurence Kotlikoff, Joseph Huber and James Robertson.

These economists were from all sides of the political spectrum  For example, Fredrick Soddy was considered to be strongly left wing, whereas Henry Simons favoured laissez faire (free market) economic policies. While the Positive Money idea of preventing banks creating money was associated with the University of Chicago in the 1930s, it is important to realise that the economics department at this time was very different to the ‘Chicago school’ that most people know. While the staff of the 1930s department held a variety of political views, by the 1950s the Chicago school had became closely associated with Milton Friedman, free market economics and Monetarism.

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