Social Credit Views

Friday, 27 March 2015 06:21

A Brief Response to Dick Eastman

Written by M. Oliver Heydorn
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After reading Dick Eastman's recent post on Abeldanger: http://www.abeldanger.net/2015/03/populist-social-credit-or-north.html, I am left asking myself: where does one begin?

For the sake of the record, let me make it clear that:

1. I do not support a 'basic income' if such a proposal involves redistributive taxation, an increase in public debts, or any other method of conventional financing. What is needed is the creation of 'debt-free' money to help bridge the gap between consumer incomes and consumer prices and its direct distribution to consumers to spend as they see fit. This is the National Dividend proposal that was originally introduced by C.H. Douglas and has been supported by Social Crediters for the last 80 + years.

2. I did indeed attend the latest conference of the USBIG this past February in New York and while I was there I presented a paper explaining why Social Credit's National Dividend does NOT qualify as a basic income guarantee. The whole purpose of my presence was to introduce USBIG supporters to the Social Credit perspective. The paper can be read in full here:A National Dividend vs. a Basic Income - Similarities and Differences.

Academics with different perspectives go to conferences all the time where they can freely exchange diverging points view and critique each other's positions ... that's what academics do.

Eastman's sensationalistic accusations that Douglas Social Crediters may be fooled and that the "Anglo-Canadians" have now joined forces with those who are supporting a conventional North American Basic Income Guarantee in order to 'rob American economic sovereignty' are unfounded (he obviously had not read my paper), and more importantly, completely false. Quite frankly, I find the innuendo offensive. I fully support economic sovereignty for each nation and I am opposed in principle to the hegemony of international finance. I am, for example, firmly opposed to the Amero, the Euro, or any other type of international currency. 

I was not specially invited to present a paper at the USBIG conference. I submitted an abstract and it was accepted. If Mr. Eastman would like to present his ideas at the next conference he is free to submit an abstract as well.

3. It is instructive that even though he admits to knowing very little about me and my views, Mr. Eastman proceeds to categorically affirm that I am looking for a "North American Basic Income Guarantee" and that I want to do away with American national monetary sovereignty and other such rubbish.  If I were Eastman, I would be most embarrassed to freely admit my ignorance regarding someone else's views and then to immediately follow that admission up with unfounded and completely false claims. It does not cast Mr. Eastman's intellectual capacity, his intellectual integrity, or his general motivations in a positive light.

4. I would be happy to discuss in fuller detail the more technical issues that Mr. Eastman raises in his post, but until he shows some evidence of acting in good will and with a reverence for objective truth, it would seem to be a pointless exercise.

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2 comments

  • Comment Link Ross Noble Saturday, 06 April 2019 15:02 posted by Ross Noble

    I am coming down on Dick’s side in this argument.

    Douglas Social Credit does not understand that there are TWO GAPS in the economy. 1) Gap between labor’s production and what they can buy with their wages. 2) Gap between debt instrument claims and the ability of earth to pay.

    Number 2 Gap can be reduced further to the war between creditors and debtors. A debt instrument grows exponentially with compounding interest, while the “bank credit” it spawned does not grow. The gap between the debt instrument and its bank credit only mirrors at birth. With time, the debt claims grow and “gaps” away from its bank credit. Today, M2 money supply is 97% bank credit, ergo there are debt claims on virtually all of the money. The debt claims grow and grow, and the money supply cannot keep up.

    The creation of money should not be left to private creditors, to then make claims on the earth and society.
    Douglas Social Credit makes another mistake when they assume that money fluxes in an accounting cycle, as one ledger decrements another ledger increments. As much as I like Clifford Hughes Douglas, I couldn’t find any equations that showed a simple Say’s law circular flow that was independent of a time integration.

    If you introduce debt free money into the system, this particular money unit is NOT UNDER TIME PRESSURE. It is not cycling in an accounting periodicity, as it is the “debt instrument” that is making accounting claims.

    It should be obvious to a dispassionate observer of monetary history, that these polarization cycles occur regularly. Creditor plutocracies arise, where creditor has amassed the stock of money toward himself, and simultaneously owns the debt claims on that stock of money.

    Labor then desperately tries to sell their “rusting” wares or their life energy to acquire this money to rid themselves of debt slavery.

    So, it takes some sort of law to tax away rents and unearned income, to then inject back into the base of the population i.e. families, as AMERICAN social credit demands. The polarization of creditors against debtors will always happen if a private banking class of finance plutocrats own the privilege of making bank credit.

    Debt free does not move in an accounting periodicity as it is not linked to a debt instrument, it was not twinned at birth. It floats in the money supply, settling debts and consummating transactions as needed. Say’s law begins to work, and this notion seems to be not well comprehended by Douglas social creditors.

    Also, if you have a debt laden population, where debt instruments are claims on the money supply, and said money disappears when it pays down principle, then Dick Eastman is right again.

    In this type of money is bank credit world we currently live in, you have to issue debt free money into households, and then it goes on to pay down private debts. When this exogenous debt free money (from Treasury) enters into banker ledger to pay down debtors’ liability, the money and debt instrument both vanish. Both debt instrument and its credit came from nothing and return to nothing. In this case, it is exogenous debt free money issued by law, which disappears the private debt instrument as a form of jubilee.

    Releasing of these private debts then allow the economy to operate in accordance with Say’s law, as the diversion of flow to pay debts is released.

    I am less concerned about Public Debts than Dick, but he is also correct that they came into being as fraud. Public debts, like TBills, held on FED’s ledger have interest rebated to Treasury, and then Treasury re-spends. Fed rebates only after it takes its cut, and insures its primary dealer banks are solvent.

    I want to reiterate, gap 2 is growing claims of debt instruments, which make claims with mathematical precision, at a compounding rate. These growing claims cannot be overlaid with the bank “credit” hypothecated into existence, especially over time, and further debt claims cannot be overlaid with a normal economy that produces goods and services with a S curve.

    Douglas social credit does not comprehend Gap 2, and it doesn’t comprehend that debt free is independent of an accounting cycle.

  • Comment Link  Dick Eastman Sunday, 11 February 2018 05:25 posted by Dick Eastman

    While I hate and villify objective truth and while I bear unending and undiluted ill will towards you all, I will say -- but who can believe anything I say? -- that I did have a slight tingling sensation one gets when one hears good news after reading that Mr. Heydorn, does not endorse the tax financed national dividend proposal. I don't know Mr. Heydorn it is true, but I do despise his veneration for truth, which I completely lack and am glad that he does not choose to address my born of sin views of interest, deflation, debt, and economic depressions and the drain of purchasing power that must result when all money is borrowed form private lenders. I would only lie and blaspheme and misrepresent were he to do so.

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