I’m with Warren Mosler on this one. He and I don’t agree on everything, but this? Holy ham and cheese on a wig! 
I have seen how this works in nations where there is little or no tax collections and the monetary system is flooded with largesse from aid agencies. Politicians don’t need citizens anymore. If the august body on Capitol Hill is given the power to create any money that it wants on demand – that’s essentially the same thing. It’s like an invasion of UFO people handing out bags of money worth $100 billion to a few folks. What happens then? Shazam! The economy swivels like the head of an owl.
Trust me on this – when that swivel happens – you … don’t … matter!
Beyond that, the western world, and the modern world is built on the ability of private parties to decide what is or is not worth loaning money to. This has been true for over 1,000 years.That is what took down royal dynasties. They became beholden to the bankers. Mr. Wolfe, if you think inequality is a problem now, you wait.
Last, Mr. Wolfe, do you really think that congress would do better? Really? After the Marxist experiment of the 20th Century? That was the same thing you see. Marxism was another experiment in making things perfect. 
Yep. Banking isn’t perfect. Democracy sucks. It’s better than the alternatives though.
quantiger - A sometimes snarky blog 
You totally missed the whole point here. Politicians will no be able to control the amount of money. Bank will decide to give a loan as before but will not be able to create money out of thin air. It will be just like an investment. Banks will be just like car rental serivces, you can lend only something you own or provided to you by something else. Pleae read the imf paper chicago plan revisited ( search google)
That is not what I read of Martin Wolfe’s proposal. At all.
Practically speaking, if private banks can’t create money by credit, then politicians (directly, or through appointees) create money – and no one else.