If the inflation we are witnessing is cost-push, instead of demand-pull, or insofar as it is cost-push, there is another way of dealing with the problem which governments and their central banks should seriously consider: compensated price discounts. Instead of increasing wages across the board (which will only further increase prices), the same amount of money required for the wage increases could be spent on reducing prices through a universally applied discount (a kind of reverse sales tax). Retailers would be compensated to the extent of the discount (enabling them to meet their costs in full), while consumers would see the purchasing power of their current wages, savings, etc., correspondingly increased. The cost-push inflation would be neutralized and everyone would benefit.
Now, if we can agree that inflation is a bad thing and that we need to address it, i.e., to neutralise it, it is likewise crucial that we can accurately discern what it is, in fact, that is causing the inflation. For there are two basic forms that inflation may take: 1) demand-pull and 2) cost-push. Just as in medicine, successful treatment most likely presupposes a correct diagnosis.
I hate haggling. I have always hated haggling. Why do I dislike it so? In the first place, haggling seems like a tremendous waste of time, energy, and resources that could have been better spent on other things. It seems horribly inefficient. Beyond that, and even more fundamentally, haggling tacitly presupposes as a distinct possibility (if not probability) that there is a threat of rapacious hostility on the part of the seller. To defend himself from this threat, the buyer is coerced into haggling himself as it is his only means of countering it. For me, the underlying antagonism robs the experience of shopping of whatever pleasure it might otherwise possess.
... The persistence of the five-day work week, while ostensibly due to economic reasons, is actually the outcome of the political imperative of vested interests that understand all too well the threat increased free time poses to them. Put differently, the four-day work week is a truly revolutionary proposal in more ways than one - and it is a tribute to the radical nature of Social Credit that its measures are altogether supportive of it.
A few months ago I visited a friend of a friend at the new home he had recently purchased. The house itself was a suburban stand-alone dwelling in a quiet and, by all impressions, pleasant neighbourhood. As we entered through the front door, there, on the ground, stood a computer, or rather a series of computers, all hooked up together with countless wires. The main screen revealed that these computers were busy, feverishly busy, engaged as they were in all sorts of apparently endless computations. In an instant, I realized what I was witnessing: a mining operation, as in “mining for cryptocurrency”. And, sure enough, this friend of a friend was “mining” Ethereum, a cryptocurrency that was introduced in 2015.
While there are significant differences between Modern Monetary Theory (MMT) and Douglas Social Credit, Professor Kelton’s talk allows us to turn our attention, for a change, on some of the points of commonality.
Centuries of minting coins from precious metals gave rise to an extremely harmful superstition: the notion that the volume of money should be determined by the quantity of the mineral used for coinage. As with many other grave errors, there were those with a vested interest in maintaining the notion among the general public and elevating it to the status of a dogma. Perhaps the ultimate expression of this dogma was the gold standard
One of the most dangerous aspects of liberal democracy and the absolute rule of the house of commons or representatives is that the voting people are placed under the illusion that as long as they exercise their right to vote in elections, no tyranny can ever manifest and an almost absolute legitimacy is given to politicians and all they legislate, say and do in political office. This bestows upon politicians and parliaments vast power that is beyond what any absolute monarchs or dictators ever dreamt of. Under this system of elected government, the danger of totalitarianism is ever-more present when, for example, governments can mandate possibly ineffective or dangerous vaccines or impose lockdowns during supposed pandemics via fear or panic mongering despite the virus in question having a very low death rate. In turn, the people or the masses, manipulated or directed by whatever financial oligarchy, media, or capricious and emotional thoughts or reactions, can vote or be directed to vote for whichever party or policy they like, no matter how foolish or immoral it is and regardless of the consequences for themselves and the nation. And having a population that is ignorant, socially and economically illiterate, or morally degenerate makes this system of popular governance all the more dangerous. Douglas explains this also in Realistic Constitutionalism: “Vox populi is not only not vox Dei, but such empirical psychologists as Gustave le Bon have demonstrated beyond all reasonable doubt that in itself it is far more likely to be vox diaboli.”[i]
Indeed, Social Credit itself, as a social vision involving monetary, economic, and political reform, is firmly ensconced in a broader Tory framework. That is to say, Social Credit is the fruit of authentic Tory thinking and it is also the necessary means, as I hope to soon illustrate, for the restoration of an authentically Tory political regime.
Is it possible that the greatest cause of environmental damage is in the psychological disorders and bad habits of our mental processes; our habitually trodden mental pathways which need urgent modification? And moreover, could it be that misconceptions about the need for full employment are at the heart of it all? Now that must be heresy, surely!
In essence, what has been put forward is a temporary implementation of the bare-bone essentials of the Douglas Social Credit monetary reform, as part of the U.S. government’s financial response to the Covid-19 crisis. Imagine that, all this time—countless decades in fact— Social Crediters have been calling for certain changes to the financial and economic structure of society, and now, if this bill is passed and becomes law, we will have a taste of it, ironically, without any of its proponents having known anything at all, presumably, about C.H. Douglas. That very fact confirms of one of Douglas’ key predictions: The increasing financial stress induced by ever-increasing debt in combination with steady labour displacement will eventually force a solution along Social Credit lines; the Coronavirus was merely the proverbial feather that broke the Camel’s back. Make no mistake about it; what we are looking at here is Douglas Social Credit in embryo.
But what if there is another way by means of which Australia could fund the stimulus package without driving up the National Debt? What if the stimulus money, something which both the economy as a whole and individual consumers desperately need, could be issued not as a debt, but as a ‘debt-free’ credit, or, in other words, as money that never need to be repaid by its recipients to the issuer, in this case, to the government viafuture taxes? This would obviously provide the benefit without imposing the disadvantages associated with increased debt.
This is a similar tale to the one experienced by British engineer Major C.H. Douglas just before the outbreak of World War I. Douglas was working on the London tube when his superiors announced that there was no more public money for any further construction. The budget had been reached and construction would have to halt. Douglas thought this strange since the materials, the know-how and the manpower were all present. The only thing lacking was money – but why? Then on the 28th of July, 1914, the Great War began and suddenly there was money available for everything the war effort required. This set the engineer on a quest to discover more about the nature of money and capitalist accounting. WWI was Douglas’ ‘teaching moment’ just as COVID-19 is our teaching moment. It will teach us many things: about our friends, family, colleagues, neighbours and communities. It will have lessons to impart regarding the way we think about work, about our health, education and child care systems, and the very standards to which we hold our own governments to account. But it will also teach us about our money, who controls it and what we can do to promote healthy and prosperous communities in a time when our faith in our political leaders and financial systems is being urgently and critically tested.
If we examine the financial system in terms of one of its chief products, i.e., debt, we can easily come to understand the essence of the Social Credit analysis and remedial proposals. In sum, the problem with the existing financial system from a Douglas Social Credit point of view is that it functions after the pattern of a positive feedback loop, amplifying debt, whereas it should, in the interests of stability, functionality, and therefore human satisfaction, function after the pattern of a negative feedback loop, dynamically liquidating excess or surplus debt in the chain of production with debt-free credits. The Social Credit remedial proposals were designed to change the financial dynamic from a positive feedback loop to a negative feedback loop.
The great danger, therefore, with a Coronavirus UBI is that, while it may be introduced sans conditions initially, the state, or rather the powers that control the state, might eventually decide to make all sorts of demands on UBI recipients. They may require vaccination, for example, as a condition of receiving it, or specific community services in exchange for it, or the surrender of privacy and other civil rights. The tying of any such stipulations to a UBI or a National Dividend would be completely at odds with the Douglas Social Credit vision for society and must be vehemently opposed on that basis by freedom-loving people everywhere. A conditional UBI would not lead to greater freedom in the long run, but only to less freedom, perhaps even to much less freedom than we enjoy at present, depending on the nature of the conditions the state imposes and their scope. In the limit, we can imagine a society in which a UBI is granted in exchange for total state-direction of people’s lives:
“The abolition of poverty in the midst of plenty, important as that is, is not the core of the problem. It is conceivable that people might be provided for as well-fed slaves.”
“… the primary characteristic of the slave is not bad treatment. It is that he is without any say in his own policy.”
 C.H. Douglas The “Land for the (Chosen) People” Racket: http://www.yamaguchy.com/library/douglas/land.html
We have been accustomed, in Social Credit circles, to describe Douglas Social Credit as ‘practical Christianity’, and I think that this is indeed correct. Nevertheless, for some time I have noticed various points of contact between Social Credit and the Zoroastrian religion. This, too, shouldn’t come as any surprise or be seen as a contradiction, since the particular vision of the world shared by the prophet Zoroaster exerted a heavy influence, especially during the Babylonian Captivity, on Old Testament Judaism and thereby on Christianity. The Persian Zoroastrian King, Cyrus, is recognized in the Bible as being anointed by God and inspired by Him to liberate the Jews in Babylon. Cyrus, for his part, appears to have recognized the God of Israel and his own God as being one and the same. Furthermore, there is a direct connection between Zoroastrianism and Christianity insofar as Zoroaster had predicted the coming of a Saoshyant, or world saviour, who would be born of a virgin … the three Magi who visited the Christ Child were, in fact, Zoroastrian priests who had correctly read the anticipated signs, both of the times and in the heavens, so as to be alerted to the timing of His birth.
Since MMT is receiving more and more press and would appear, in my view at any rate (and more on this shortly), to be the system’s answer to the neo-liberalism of the past 30-40 years, it is crucially important that Social Crediters become aware of what MMT claims and what it proposes and also what the due Social Credit response to MMT should be. In what follows, I will attempt to outline some of the more salient MMT propositions and policy-prescriptions and to indicate both the points of contact and commonality with Social Credit, as well as the key areas of disagreement where the two part ways.
Looking back, we can observe that the triumph of the MoC, thanks in no small part to the role played by the Socialists (often unwittingly), has enabled it to turn the three revolutions to its advantage - at the expense of the common man. The Mechanical Revolution, the Electrical Revolution and the French Revolution were meant to liberate man from toil and tyranny: instead, they have led to his further subjugation through wage-slavery, debt-slavery and rising taxation. It is more than a little tragic that the sincere studies, serious struggles and severe sacrifices of countless radicals, revolutionaries and other activists who strove for a better world in the name of Socialism should have led to this outcome - the tightening of the invisible chains that bind mankind.
The very first Social Credit work of Major Douglas - The Delusion of Super-Production was published in 'The New Age', thanks to A. R. Orage, who, prior to encountering Douglas, had been a guild socialist. Thus, Social Credit may be said to have emerged on the left side of the political spectrum, (though of course the philosophy of Social Credit transcends left and right, and Douglas himself was a conservative, albeit an unorthodox one.)
'Don't touch! - There are terrible people who instead of solving a problem, bungle it and make it more difficult for all who come after. Whoever can't hit the nail on the head should please not hit it at all.'
(Friedrich Nietzsche, The Wanderer and his Shadow, 326 )
As we have seen, radicals agreed that the economic system was at fault: they differed as to where the fault lay. In order to properly appreciate their differences, it is necessary to explore the economic system in greater detail.
Left-wing radicals and monetary reformers both identified one of the key paradoxes of the industrial age: widespread poverty amidst extraordinary productive capacity - capacity that was more than capable of meeting the requirements of the population, so much so that a hitherto unheard of phenomena - overproduction, had arisen. There are an abundance of interesting accounts of this development.
In the course of human history, few developments can match the importance of the Industrial Revolution in transforming the lives and livelihoods of men across the globe as it reshaped politics, economics and society. Upon closer scrutiny, this Revolution (a phrase that may be said to refer to the technical, economic and social changes centered in Europe and North America over the period from 1750 to 1900 AD), turns out to be a collection of phenomena, at least two of which deserve to be regarded as revolutions in their own right. These are the development and widespread adoption of steam-powered machinery in the late 18th and early 19th centuries, which we may denote as the Mechanical Revolution (MR), and the development and widespread use of electricity (and numerous other inventions, such as the internal combustion engine) from the late 19th century onwards, which we may likewise denote as the Electrical Revolution (ER). Each involved a transformation, not only of the means and methods of production, but also of transportation, with railroads resulting from the MR, and automobiles, from the ER. It is for this reason that economic historians sometimes speak of a 'second' Industrial Revolution in the last quarter of the 19th century.
In attempting to communicate Social Credit ideas to a wider public, one often encounters hindrances and barriers of various sorts. One of the difficulties that tends to be characteristic of the contemporary Christian milieu in particular, is the belief, more or less unconscious in most cases, that engaging with questions of money, economics, finance and so forth is ‘mundane’ and therefore of no interest to Christianity, which is ‘otherworldly’. There is, in the minds of some people, a strict separation between the religious/spiritual/supernatural sphere and that of profane concerns, a separation which is somewhat analogous to the liberal democratic principle of ‘separation between Church and State’.
Relying on bank credit, indirectly through taxation or directly via borrowing, to fund a Universal Basic Income (UBI) scheme is untenable. A fundamental reform of the financial system is the only viable means to ensure a future in which sustainable purchasing power is in the hands of the Canadian consumer. There is no need to take from Peter to give to Paul. Not one penny of anyone’s income would need to be redistributed. There is enough for everyone to have an income, a UBI, under a corrected financial system as advocated by Douglas Social Credit.
We are often told that people should not ‘live beyond their means’, that is, that no individual person, nor any corporate entity like a business or a government, should spend more money during a given period than they take in as income or as revenue. Doing so is judged to be profligate, irresponsible, and only setting oneself up for pain in the long run. For countless centuries, if not millennia, the balanced ‘budget’ has been regarded as the sine qua non of fiscal prudence and ‘sound’ finance.
And yet, if we look at our economies over any given period of time, it is quite normal for individual consumers, considered in the aggregate, to spend more than they receive in income, for governments at all levels to spend more than they take in viataxes, and even for businesses, considered again as a whole, to spend more money (thanks to long-term capital investments), than they simultaneously receive as revenue. How can this be? How can we explain the conflict between the common theory (i.e., what should be the case: balanced budgets) and what we observe as a fact in the real world (i.e., unbalanced budgets)? Is it the general tendency of human beings to be congenital spendthrifts? Are humans innately vicious when it comes to the getting and spending of money?
Quite irrespective of such questions concerning human nature, there is actually a technical economic reason why consumers, governments, and business typically spend, in the aggregate, more money than they receive and do not, therefore, ‘enjoy' balanced budgets.
When one explains to the common person the proposal of a National Dividend as a state created and distributed monetary gift given to all as a credit for the nation’s total production, there is one very common objection or concern that people often raise. They think that there is a danger that this will result in inflation or a devaluing of the nation’s currency, a devaluation that may even been as bad as the hyperinflation that has recently taken place in Zimbabwe or Venezuela as a result of severe political corruption, incompetence, or foreign interference. But before one can understand why a 'debt-free' 'basic income' is not inflationary, or need not be inflationary, one must first understand something of the economic and monetary theory upon which this suggestion is based, namely Douglas Social Credit.
"The money creation process employed by the Bank of Canada is quite simple and mirrors the money creation process which, through the private banking system, is responsible for the greater majority of our money supply.Contrary to what many people assume, banks are not borrowers and lenders of pre-existing money, but are rather creators and destroyers of the money that they issue in the form of bank credit. The same holds true for the Central Bank. Whenever an auction of new government securities is held, the Bank of Canada buys a certain percentage of these securities by creating digital accounting entries in the Federal Government’s deposit account with the bank. This deposit is recorded as a liability of the bank, while the newly purchased security is recorded as an asset on the Bank of Canada’s balance sheet."
The making of markets in its broadest sense, i.e., the facilitation of existing trade, as well as the opening, invention, and conquering of new markets, is often presented as one of the prime advantages and chief features of ‘capitalism’: people with money invest in schemes to make more money by commercializing an ever-greater portion of our lives, as markets expand and offer to do more and more things for us that we were once able to do for ourselves, or didn’t even ‘know’ that we ‘needed’.This results in more, and sometimes even better, and sometimes even cheaper goods and services for the consumer, and thus we all derive some benefit. And indeed it so: the breadth and depth of what is on offer in the market of the typical Western industrialized country, and of more and more non-Western countries to boot, is astonishing and would dizzy the heads of our ancestors to no end. One feels hard-pressed to object to all of this ‘market-magic’, even if one does not personally care much for many of the particular goods and services that the market puts on offer. I submit, however, that, as with many things in life, there is a dark side to market-making. Whether, and to what extent, the ‘shadow’ of the market-making phenomenon in its present form or manifestation exceeds its genuine wonders I’ll leave it for the reader to decide.
C.H. Douglas was a British engineer who, in the 1920s, founded an international movement for monetary reform centred on his ideas which were known as "Social Credit".
Aujourd’hui je vais vous parler un petit peu de C.H. Douglas, et de ses idées pour la réforme financière et économique.
Pour commencer, je vais vous donner un peu d’historie.
C.H. Douglas était un ingénieur britannique qui, durant les années vingts, a fondé un movement international pour la réforme monétaire autour de ses idées qui s’appelait “Le Crédit Social”.
The notion and institution of the aristocracy is often portrayed today as a class of ostentatious, exploitative, and oppressive overlords. This is the modern sung narrative spun by the established media and socio-political order. While it may correspond as a description to some individual aristocrats and monarchs throughout history, it also applies to most modern elected politicians, businessmen, bankers and other financial heavy weights of the bourgeois class that govern the world today and keep the population truly in chains with a monopoly over the creation and control of credit or money and enforce upon them a state of servility and artificial scarcity. Major Clifford Hugh Douglas made this exact point in his publication The Big Idea:
“I can imagine many readers, at this point, feeling the inclination to comment in accordance with the orthodox conception of a downtrodden peasantry rising spontaneously to rid themselves of a vicious tyranny. Like so many of these ‘all black and pure white’ pictures, this idea is more remarkable for simplicity than accuracy. Quite apart from the important truth so well put by Sir William Gilbert, that ‘Hearts just as pure and fair, may beat in Belgrave Square, as in the lowlier air, of Seven Dials’, and that, if it were not so, we ought at all costs to treasure our slums as the only school of virtue, there are three significant facts which apply to both the French and the Russian revolution. The first is that they were not spontaneous. The second is that neither of them was a peasant revolution –- that is to say, while both of them attacked and massacred the landowners, it was not the tenants of these landowners who were active –- it was town mobs and mutinied soldiers. And the third and most significant of all, is that both of these revolutions cut short a period of high prosperity”
Lately I have been reflecting on the views of the conventional economic ‘right-wing’, as represented by ‘neo-liberals’, adherents of the Austrian school of economics, ‘capitalists’, economic libertarians, and so forth. It seems that whenever someone suggests that radical changes need to be made to the reigning financial or economic model – a suggestion which, in essence, must be a plea for some kind of intervention on the part of the public authority – those who are more or less satisfied with the existing system and find themselves on the ‘right’ of the economic spectrum regard the suggestion quite reflexively as an intolerable attack on the free market and an affirmation of ‘socialism.’ I have found this attitude, and the rhetoric which often accompanies it, curious for four major reasons, reasons which I will want to outline in this article. The fourth critique that I will present is the most significant from a Social Credit point of view, but the first three are by no means unimportant. By unnecessarily muddying the economic debate, free market rhetoric often obstructs the rectification of the economy’s structural problems.
In this paper, two metaphors, that of a hydroelectric dam and of a water bottling plant, will be used to illustrate the Social Credit diagnosis of the ills that afflict the existing financial/economic order, the conventional methods that are employed to palliate its various symptoms, and, finally, Social Credit’s remedial proposals.
"One of the very first lessons in a typical introductory economics course - and rarely, if ever questioned by either teacher or pupil - is the existence of resource scarcity coupled with the unlimited desires of humanity. Students are then informed that economics is the 'science' of managing (rather than overcoming) this scarcity - and in time, they learn how to manage it in their favour at the expense of others."
In a recent paper entitled “The Scales and the Dam: Static and Dynamic Conceptions of the Economy”, Arindam Basu has introduced a brilliant metaphor that can be adapted in various ways to explain both how the economy functions under the existing financial system and how it would function under Social Credit: “A typical run-of-river hydroelectric dam, which uses a flow of water to generate a flow of electricity, may serve quite well as a metaphor for an economy that converts a flow of money into a flow of goods and services.” As Arindam notes, this analogy can be developed further in a variety of ways.
Thus far, we have looked at the whats and the whys of the financial domination of liberal democracy. It is now time that we turn to a more detailed examination of the hows.
Let us begin with the general observation that, in a society operating under the Monopoly of Credit, organized political activity, like most other activities, is largely dependent – directly or indirectly – on Finance. Money, both in the form of producer credit and in the form of income, is maintained in a state of artificial scarcity, and Finance will naturally be inclined to ration it to those who do its will and to punish those who resist by denying them access to the life-giving credit. Credit, in turn, is a necessary means for obtaining most of the material and human resources required for political action. In this way, Finance can condition political activity to the point of completely controlling it.
"If one wishes to do full justice to reality – regardless of the topic that is being investigated - it is of the gravest importance to neither underestimate nor overestimate the phenomenon in question. Accordingly, whenever this particular question of ‘conspiracy’ becomes the subject of reflection, the thoughtful individual will seek to follow a sensible middle-path in accordance with the available evidence and in full knowledge of his cognitive limitations. This will allow him to scrupulously avoid the error of those who become irrationally suspicious, i.e., paranoid, while, at the same time, avoiding the mistake of those who, by preferring to be complacently sceptical, refuse to call a spade a spade. To deny the reality and indeed even the possibility of conspiracy as an explanatory factor behind much of our socially-induced discontent is just as irrational, therefore, as to think that every negative thing that occurs in the world must be due to a conspiracy."
Thus far in this series of articles exploring the relationship between Social Credit and democracy, we have seen that conventional ‘democracy’ suffers from a large number of design faults which vitiate it and render it ineffective. That would be bad enough, but Douglas goes one step further and claims that the ineffective mechanisms of conventional ‘democracy’ provide the best possible cover for the operations of a hidden dictatorship. Not only do they provide the best possible cover, but the same mechanisms which are ineffective from the point of view of fulfilling the true purpose of political association can be rendered most effective (by being cleverly manipulated) for the purpose of fulfilling an alternative policy-objective, one that is imposed by an agency that is external to the elected ‘government’.
The debt-finance system, by generating a chronic insufficiency of purchasing power, thereby requiring increased borrowing (in lieu of large trade surpluses) if economic activity is not to grind to a halt, causes the State with its great, almost unlimited capacity to borrow, thanks to its power to tax (i.e. creditors are eager to lend to it in the knowledge that it will always have a means to pay them back), to expand its role in the economy.
Thus, as society finds its purchasing power increasingly insufficient to satisfy its requirements, the State steps in, with its role becoming larger and larger as it fills the growing gap. Caught unawares by these developments, which they were utterly incapable of anticipating, economists scrambled to come up with theories explaining and indeed, justifying such extensive government intervention.
The central contention of the Social Credit critique of contemporary economic management (or rather mismanagement) is the existence of a gap between prices and incomes in the operation of any modern economy - i.e. an economy based on debt-finance and multi-stage, mechanized production. This underlying deficiency of purchasing power, makes it impossible to liquidate the costs of production without resorting to increased debt and/or a large trade surplus - since prices cannot fall below costs without putting the continued operation of an enterprise in peril, (unless it can rely on direct or indirect government support). Furthermore, the critique contends that this gap is bound to grow as the economy becomes more sophisticated - i.e. as production involves more and more stages, and use of machinery increases - entailing spiralling debt and increasing trade tensions if the necessary financial remedies are not applied.
In this second article, I will continue to examine some of the structural problems with conventional democratic political systems that Douglas had identified in the course of his writings, especially in the writings of his latter years. Beyond the particular defects in the voting system which were discussed in the previous month’s article, there are also problems with the party system and with how the voting and party systems interact with each other. Since there is quite a bit of information to cover, I beg the reader’s indulgence if the following is reminiscent of a lawyer’s seriatim brief.
Social Credit political theory readily grants what lies, perhaps, at the root of the democratic urge and which accounts, in large measure, for the popular appeal of ‘democracy’: firstly, that governments should serve the common good of the people and secondly, if governments don’t serve the common good of the people in an effective, efficient, and fair manner, the people who are affected should have the ability to sanction the government so that the quality of government might immediately improve.
At the same time, Douglas was highly critical of the conventional ‘democracies’ that have come to characterize the Liberal West, often describing them as ‘ineffective’. Not only did they fail to serve the common good to the extent that this was physically possible and desirable, they also failed to provide the people with an effective vehicle for remedying this sorry state of affairs. To make matters worse, it was not uncommon for ‘democratic’ governments to impose policies on the population which were contrary to the general will of the population. That is to say, we have been regularly treated to the spectacle of ‘democratic’ governments, so-called, introducing policies that are ‘anti-democratic’ in the deepest and truest sense of that word.
It is peculiar that discussion of governmental policy frequently proceeds with hardly a nod to the most clamant fact in the world of economics, namely the massive, and burgeoning, financial debt that hangs like the sword of Damocles over human society. The dimensions of this debt, which is growing at an exponential rate, have been calculated variously by different organizations applying themselves to its study. One such organization, the Institute of International Finance, has calculated total global debt at the end of 2016 to be $217 trillion, having risen by something approaching a quarter of this sum over just the previous decade. Even more shocking than these numbers is the fact that the aggregate debt is reckoned to be more than three times globally aggregated GDPs.
The implications of a debt-free universal dividend via C.H. Douglas’s Social Credit monetary and economic reform, a dividend that would be distributed equally to everyone, will be far more than just extra cash in one’s wallet. There would be deep and far reaching impacts in the areas of society and culture where changes would occur that would most definitely be for the betterment of mankind.
Conventional schemes for financing a Universal Basic Income tend to take the existing financial system as a given and to assume that there is nothing fundamentally wrong with it. But what if that system is, in fact, deeply flawed? What if it does not operate in full service to the public good, in full service to the common good? What if, through the type of monetary reform known as Social Credit, the provision of an unconditional and basic level of income for every citizen could be secured without taxes and without increasing the public debt?
Freedom is undoubtedly a very great good. It is indeed one of the key objectives and one of the main fruits of any successful social order. But the greatest problem in saying, within the context of association, that one is ‘in favour of personal freedom’ is that ‘freedom’ has come to mean so many different things to so many different people and the various definitions are by no means compatible.
'Are people hopelessly stupid—or do they take some perverse and sick pleasure in being slaves?'
Arindam Basu examines some of the false economic teachings that keep us locked in a pattern of social and economic dysfunction.
“… Social Credit policy is traditional Tory-ism or genuine conservatism expressed in terms applying to industrial capitalism. In a world in which liberal, socialist, and other “left-ist” policies are dominant, Social Credit, as an expression of genuine conservatism appears revolutionary in nature – as indeed it is. A free society rooted in the Christian ethic, which is the goal of traditional conservatism, can be achieved only by bringing to birth a new civilization involving a fundamentally changed viewpoint of human relationships with the nation.”
As today is Remembrance Day, I thought it would be appropriate for us to consider one of the implications of Social Credit theory with respect to war:
"(...) the financial system (...) is, beyond all doubt, the main cause of international friction. Since, as we have seen, no nation can buy its own production, it is inevitable that there will be a struggle for markets in which to get rid of the surplus. The translation of this commercial struggle in a military context is simply a matter of time and opportunity. "
Jordan Peterson, the now famous Psychology Professor from the University of Toronto, has sometimes identified himself as a Classical Liberal. With his rise as an internet phenomenon, the social philosophy of Classical Liberalism and the political/economic systems inspired by it appear to be receiving a fresh impetus (or is it merely a final breath of air?) as the modern society in which we live, a society originally based on the principles of Classical Liberalism, sees itself falling deeper and deeper into a post-modern Marxist tyranny, both economic and cultural.
"A hair divides what is false and true." - Omar Khayyam
One of Jordan Peterson’s central ideas is the notion that human beings, like lobsters, are naturally disposed to arrange themselves socially in ‘dominance hierarchies’. The fundamental claim is that, based on ‘competence’, human beings, and men in particular, compete with each other to determine who will get the greatest rewards, material and otherwise, that a society has to offer, including the ‘right’ to mate and reproduce. Peterson appears to be keen to emphasize the naturalness and indeed the biological and evolutionary rootedness of this behavior because he thinks that it can serve as an unanswerable argument against the Cultural Marxists who despise the very idea of hierarchy and who would wish to see their idol of a totalitarianizing ‘equality’ ruling everywhere.
The basic needs of every human being are critical in understanding what must be adequately fulfilled in order for individuals to achieve a state of well-being. With Maslow’s principles still very relevant to the daily functioning of every human being, it’s no wonder the world population is struggling to fulfil these needs.
From the outset, Social Credit Economics (SCE) demonstrates that it is a well-thought-out, thought-provoking tome for thoughtful individuals. The cover itself aptly sums up the central contention of Social Credit, namely the existence of an imbalance between financial credit (represented by the coins) and real credit (represented by the globe) with the resulting hegemony of finance over the real economy constituting the root cause of the majority of our contemporary misfortunes. SCE goes on to prove this claim and to provide the solutions to the problems it highlights.
Isn’t it about time that we had a financial system that worked for all Americans? The Social Credit proposals of the engineer, Clifford Hugh Douglas, explain the kind of monetary reform that needs to be implemented in order to fix our current dysfunctional debt system.
In our modern, fast-paced society that holds servile work and the fanatical pursuit of money to be the primary aim of our very existence, every adult man and woman must have a paid ‘job’ in order to survive and feel ‘dignified’ lest they suffer the curse of unemployment and the poverty and stigma associated with it, and this despite, or perhaps because of, the paltry and condescending ‘dole’ payments the state may hand out to them.
The modern, industrial system possesses an enormous productive capacity, both actual and potential, to meet our legitimate needs for goods and services. With every technological advancement we can produce more and/or better with less resource consumption and less human labour.
At the very heart of the modern economy we find this thing called ‘finance’. Finance is to the economy what an operating system is to a computer. For it is the financial system which allows an economy’s ‘hardware’ (i.e., its raw materials, labour, machinery, etc.) to be actualized in the service of specific ‘software applications’ (i.e., production programmes). As far as the formal economy is concerned, it is true to say that finance is the essential interface and animating principle.
The idea of a family is that of a social unit of human beings which has traditionally been composed of: two adults, one male and one female, and then children or offspring that are biologically begotten by the adult male and female living together in union, in the form of a formal, exclusive, and life-long marriage bond. This family structure may also include extended family with grandparents and grandchildren and their own begotten children living together.
From something a Distributist once said to me about the primacy of the moral in economics, I wonder if the following might explain Distributism’s reticence where Social Credit was concerned.
Just last week, Equifax Canada, a credit reporting agency, revealed that the average outstanding consumer debt per adult person in Canada (excluding mortgages) had increased 3.6% over the course of a one-year period to 22,081 CDN.
As a follow-up to my recent blog entry "Social Credit and Mass Migration", I thought it would be instructive to examine the various issues that are at play in a more concrete fashion.
The world in which we live can seem like a strange and incoherent puzzle.
For those that take more than a passing interest in world affairs we have before us an array of pieces. We see the problems of poverty and social unrest and we lament the damage that we are doing to nature.
The financial system, that is, the banking, cost accounting, and tax systems, can either serve the common good, or else it will serve an oligarchic elite at the expense of the common good.
We live now in an age of mass migrations and of rumours of mass migrations. With the term ‘mass migration’ we are referring, of course, to the movement, not merely of large numbers of people, but of whole groups of people, who constitute various racial-cultural gestalts, en masse from one nation or region to another.
What is Social Credit? I have often been asked to explain it in a nutshell. So, as far as the purely economic aspects of Social Credit are concerned, here it goes
Clearly the satisfaction of citizens’ material needs is not the objective of the present economic order. Australians will be painfully aware that the purpose of economics is ‘jobs and growth’ or, in other words, compounding economic activity.
As I explained in my first article for The Distributist Review, the economic proposals of Social Credit aim at the establishment of a widespread distribution of private productive property ownership through the means of monetary reform.
As every distributist knows, there are three basic economic systems. The first upholds private ownership of the means of production but concentrates it in the hands of the few...
In the period between the two world wars, a British engineer by the name of Clifford Hugh Douglas (1879-1952) developed a highly original economic theory.
One of the axioms of the existing economic order is the policy of ‘Full Employment’ (FE). Everyone must work for his daily bread or be dependent on those who do when he is unable to work or when insufficient work is available.
One of the more worthwhile currents in contemporary philosophy is the school of thought known as ‘personalism’. Whereas other philosophers might ponder on the nature of knowledge, of morality, or of ultimate reality, personalist philosophers take a special interest in personal being as the central object of their preoccupations.
When Vice President Joe Biden made his 10th appearance at the annual World Economic Forum (WEF) in Davos, Switzerland, to address the forum’s central 2016 topic: “The Fourth Industrial Revolution,” he communed with assorted elitists to salute the coming of age of automation and robotics.
At the end of Mass last Sunday, we were treated to an urgent appeal on behalf of the community food drive. I find these appeals incredibly annoying.
I dislike charities, all charities ... and it is not because I am not a charitable person.
The foregoing poem is widely, and quite probably falsely, attributed to the great Persian poet Hafez (1325/26–1389/90 AD). Be that as it may, “The Sun Never Says” successfully highlights the reality...
The following article (including the foreword) was written by the late Victor J. Bridger, a long-standing Social Crediter from Australia. Mr. Bridger, who had attempted in various ways to popularize Social Credit, had been involved with the Social Credit movement for over 50 years.
Last month’s blog entry explained what Social Crediters mean when they speak about the ‘monopoly of credit’. In this entry we will examine why the ‘monopoly of credit’ is a problem and what Social Credit proposes to do about it.
In perusing Social Credit literature, a phrase that one encounters quite frequently is the “Monopoly of Credit”. Indeed, The Monopoly of Credit was the title of C.H. Douglas’ last major technical work dedicated to the exposition of Social Credit economics. Since the phrase is often employed without being precisely defined, and since some Social Crediters use it without being conscious of its exact meaning...
Can we rediscover ourselves? Could we then discover each other? Whether these questions are as crazy as they may seem at first sight is the subject of this essay.
"The unacknowledged, but obvious, truth is that unnecessary work, imposed by either edict or contrived financial legerdemain, is slavery and servitude—totally irrational and immoral. Every engineer worthy of the name is trying to eliminate the need for human effort as a factor of production while every witless or hypocritical politician, pressured by the financial powers above and an insecure and uncomprehending population below, is professing, at least, to promote policies designed to ‘put people back to work'.”
“Subsidiarity” is the name given to the principle that a central authority should have a subsidiary function, performing only those tasks which cannot be performed at a more local level.
The latest encyclical, Laudato Si, is generating a great deal of heat both inside and outside of the Catholic Church – and more heat than light I am afraid. Instead of discussing the various and, in some cases, quite serious scientific, philosophical, and theological concerns that a number of commentators have raised in reference to it (consider, for example, the following interview with Chris Ferrara:
Imagine this situation. Your neighbour’s dog keeps you awake at night with its relentless barking. You go to your neighbour, tell him the problem and ask him what he is going to do about it. His response is to tell you there is no dog and hence no problem, have a nice day.
It is the purpose of Social Credit proposals regarding finance to make the figures fit the facts. In other words, the subordination of finance to reality.
In the modern world money is simply accountancy. It's issued by banks for production. Producers distribute it as effective purchasing-power as wages, salaries and dividends which are a part of industrial costs and prices. Industry must recover its costs through sales to the consumer and the money is then cancelled until reissued for a new cycle of production. Thus is created an endless cycle of money creation and destruction. Money is not a store of value and is increasingly a means of distribution rather than a means of exchange.
After reading Dick Eastman's recent post on Abeldanger, I am left asking myself: where does one begin?
For the sake of the record, let me make it clear that...
The opening lines of Douglas’ The Monopoly of Credit, first published in 1931, say:
"It cannot have escaped the observations of anyone interested in the welfare and orderly progress of society that, more especially in the years which have intervened since the close of the European War and the present time...
Social Credit refers to the philosophical, economic, political, and historical ideas of the brilliant Anglo-Scottish engineer, Major Clifford Hugh Douglas (1879-1952).
Social Credit is the brainchild of Major C. H. Douglas. During World War l, he was asked to sort out some problems at an aircraft factory in Farnborough and came across a discrepancy in their books. The factory generated costs at a much greater rate than it made available incomes to people. Thinking this curious, Douglas investigated a hundred or so British companies to discover that this imbalance was a general feature of modern industry. Wages, salaries and dividends paid to people by a factory, or other productive undertaking, were nearly always only a portion of total prices for goods made available by the same factory. This perplexed him because it guaranteed a quantity of goods that could not be sold, and what was the point of expending energy on making something that couldn’t, for financial reasons, be consumed?
Systems that aim to organise people can be placed into one of two groups; systems that limit peoples' freedoms and those that increase them. The latter philosophy is the foundation of the Social Credit movement conceived by the Anglo-Scottish Engineer Major Clifford Hugh Douglas.
Just last year, the Bank of England openly admitted that the private banks are responsible for creating the bulk of the money supply out of nothing. This is significant, because although the truth about the bank creation of money has been floating around in the public forum for at least the last one hundred years (largely due to the efforts of C.H. Douglas and others), some bankers and economists have denied this reality (while others, like Reginald McKenna, have been quite open about it) . Even today, there are many people, including many politicians, who are blissfully unaware and/or seriously misinformed regarding the origin of our money supply.
At the height of the Great Depression, the founder of the Social Credit movement, Major Clifford Hugh Douglas (1879-1952), described the proposal for a National Dividend in the following terms:
Over the course of the last few years, the Greek people have had first-hand experience of the fact that the modern financial and economic systems do not work. They may not know, however, why they do not work and what can be done in order to fix them.
A key component of the philosophy, or the 'conception of reality', which underlies Social Credit is the idea that the universe is governed by laws that are automatic and inexorable. These laws exist independently of human cognition and human preference.
As I tried to show in my recent blog entry on “Social Credit and Usury”, the claim that usury, defined as the charging of interest on loans, is THE problem and that Social Credit means nothing more than “usury-free money” is a serious but all too common misrepresentation of the Social Credit diagnosis and remedial proposals.