PETER MULLEN'S suggestion that capitalism no longer exists in

this country is simply risible (Echo, Nov 16).

Words have meanings and they should be respected.

The term capitalism refers to the ownership of the means of

production in private sector hands rather than the Government's.

With the sale of the nationalised industries in the Eighties and Nineties, little is left in the state sector.

These transfers included gas, electricity, steel and water production together with telecommunications, rail transport and many more. You may question the virtues of our largely capitalist system, but it is absurd to suggest that it is socialist.

The real point of concern is the concentration of wealth in this country in the hands of the better off.

Only nine per cent is held by the poorer half of the population with the other 91 per cent held by the rest.

Rev Mullen's other conceptual error is the notion that national income is a static cake that is divided 60 per cent private sector and 40 per cent taxes and state controlled.

In fact, national income is a circular flow.

An NHS nurse is paid from tax revenues but she then spends that income largely on capitalist-produced goods and services.

The money just flows back into the hands of the wealthy.

Taxation spent directly by the Government flows straight to capitalist enterprise whether they be NHS purchases from drugs companies or transport department contracts with road building companies etc.

A much better measure of the proportion of public versus private sector is employment. In round figures, of 30m total workers, less than six million (and falling rapidly) are in the public sector. That's hardly a socialist distribution.

Rob Meggs, Hartlepool.