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Tuesday, 23 February 2016 21:42

Social Credit: An Economic Model for Personalists

Written by M. Oliver Heydorn
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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. These thinkers are keen on doing full justice in their research and teaching to the nature and the dignity of the personal, especially as this reality makes itself manifest in the case of human persons.

In comparison with non-personal or impersonal beings, persons are more fully real, i.e., they occupy a higher rung in the hierarchy of being. They are not passive objects devoid of interiority, instead they are self-possessing and self-transcending. Through the powers of self-awareness and self-determination, the person consciously experiences himself as an incommunicable and unrepeatable subject, a subject who can establish various relations with other beings outside of himself.

Naturally, such a high view of the ontological dignity of the person necessarily bears moral implications. If one accepts certain ‘personalist’ ethical standards as normative (take, for example, the claim that human beings should never be treated as a mere means, but rather as ends in themselves), then it follows that there are patterns of social life that are more or less concordant with the value of the person.

In this blog, I propose to examine what a particular tradition within personalism, what may be termed ‘realist personalism’, demands, in moral terms, of the economy, and how the introduction of Social Credit would enable such moral demands to be fully and properly satisfied in practice. Unlike some of the more ‘secular’ branches of personalism, ‘realist personalism’ has evolved in close association with Christian philosophy, i.e., with reasoned reflection on Christian belief and practice.

One of the earliest thinkers within this tradition, the philosopher Emmanuel Mounier, made the following declaration in his book A Personalist Manifesto:

“A personalist civilisation is one whose structure and spirit are directed towards the development as persons of all the individuals constituting it. They have as their ultimate end to enable every individual to live as a person, that is, to exercise a maximum of initiative, responsibility, and spiritual life.” [1]

Notice that in his description of a ‘personalist civilization’, by which he means a civilization that is worthy of the incomparable dignity of each human being, Mounier explicitly includes the concept of ‘structure’. It is not enough to talk about or promote ‘personalist virtues’ on the part of individual moral agents as some personalists are wont to do. Instead, we must recognize that the very political, economic, and cultural systems under which we live will either promote the person, by respecting his dignity and facilitating his flourishing, or else they will undermine him and interfere with the unfolding of his vocation as person. For this reason, the choice of structures, of institutions, laws, and conventions, is morally relevant and ineluctable. This fact has been underscored by recent Popes who have elucidated, in their social teaching, the notion of the ‘structures of sin’ and have declared such structures to be incompatible with Christian doctrine and practice.

The bottom line is that the personalist civilization which Mounier championed cannot come into being if the existing economic order, for example, does not adequately support personalist ends. Since a personalist economic order is a necessary condition for the establishment of a personalist civilization, economic questions cannot or ought not to be ignored by personalist thinkers. Furthermore, personalists have an obligation to work in favour of positive change: whenever or insofar as economic structures treat the person as if he were an impersonal object, as, for example, mere raw material for the economic process, personalists must denounce such structures and advocate for their replacement by alternatives that are in greater accord with a personalist ethic and hence with the natural law.

But which specific economic model should personalists support?

Contrary to the doctrine of ‘economic personalism’ (so-called) bandied about by the Acton Institute, I do not think that a right-wing version of the mixed economy, one that tends toward the ideals of laissez-faire capitalism, is in any way sufficient, even when fortified by the personalistic qualities of a virtuous population, to deliver the kind of results personalists should expect from economic association.

Indeed, if we were to look at economics through a personalist lens, I think that we would have to admit – while holding any questions concerning individual ethics in abeyance – that nowhere in the Western world is the structural failure of the economic system to respect the person and to serve the authentic common good more evident than in the case of the United States. Just consider its puritan work ethic, its systematic failure to recognize (much less respect) the legitimate rights of workers, its institutionalization of the exercise of power without responsibility in both corporate and government bodies, and, indeed, its systemic consecration of the whole of society to the religion of Mammon, i.e., the pursuit and adulation of the almighty dollar as an end in itself, as evidenced by the permeation of moneyed celebrity, conspicuous consumption, and throw away consumerism as mainstays of American ‘culture’. To top it all off, there is the curious tendency on the part of many of Americans to deny the objective truth (perhaps because they have no standards of comparison); that is, to deny the reality that there are indeed serious ethical problems with what they take to be the normal way of conducting business and running the economy. From an ethical and indeed personalist assessment, the American economy, which is one of the closer exemplars we have of the laissez-faire ideal (at least in rhetoric if not always in practice), is an abject failure. Cf. America's Puritanical Obsession with Work

But this critique of American-style capitalism is not to suggest that personalists should therefore embrace socialism, as if this were the only other alternative. In his book, Jobs of Our Own, Race Mathews notes the following regarding the economic views of two of the earliest personalist thinkers: “Maritain and Mounier in particular - adherents of the personalist school of philosophy - saw both capitalism and state socialism as being incompatible with personalist values.” [2] Indeed, a full-blown socialism, with its centralization of control over economic initiative, its subordination of the individual to the group, and the limitations it puts on genuine economic independence and freedom is arguably even more at odds with human dignity than the depersonalization of the capitalist economic order.

In place of these two systems, which form the bookends of the conventional economic spectrum, and in place of any mix or compromise position between them, Mathews also notes that the personalist concerns of Mounier and Maritain seemed to imply something along the lines of distributism: “The personalist teachings of the prominent French Catholic philosophers, Jacques Maritain and Emmanuel Mounier, were widely seen as being supportive of distributism.” [3]

Whereas capitalism concentrates private ownership of productive property in the hands of the few, and socialism wishes to replace private ownership with public or collective ownership of one kind or another, distributism seeks the decentralization of private ownership, that is, to make as many people as possible owners.

The organic connection between distributism and personalism lies in the fact that ‘property’ is proper to the person. It is appropriate (i.e., fitting) and even in some sense necessary for each person to own property, especially productive property. Hence, a personalist economic system would naturally seek to enfranchise the members of an economic association with property. Ownership bestows on individuals the economic independence, security, and freedom that fits or corresponds to the metaphysical nature of persons as self-aware and self-determining beings. Distributism is thus the only type of economic system that aims, in its very institutions and conventions, to do full justice to the nature and dignity of the person, just as personalism, on the philosophical plane, seeks to do full justice to the person in its investigations.

The instincts of our French personalists were, I believe, certainly correct: distributism, personalism, and Catholic social teaching are all of one piece.

One of the basic problems with classical distributism, however, is that it is a do ut des system. There must always be a something for a something and never a something for a nothing. In other words, it is assumed that all economic benefits must be earned by somebody somewhere working very, very hard and that there is, in consequence, no such thing as a free lunch (unless this free lunch were a form of economic rent and hence entirely illegitimate). Indeed, all existing economic systems and all alternative systems with which I am familiar are ‘do ut des’ systems … in complete opposition, I might add, to what Christian doctrine regarding the reality and necessity of unearned grace in the spiritual life would seem to imply for the economic organization of a truly Christian social order. [4]

Thankfully, there is an alternative. The Social Credit Economic Model, developed by the late British engineer, Clifford Hugh Douglas (1879-1952), distinguishes itself against all comers by embodying a principle of gratuity as part and parcel of what both distributive justice and the conditions of the possibility of equilibrium demand of the modern, industrialized economy. The recognition of the necessity of economic ‘grace’ as part of the financial system is but one of the reasons that Social Credit has been referred to as ‘Practical Christianity’.

How is this apparent miracle of economic grace possible? Ironic though it may be, the present financial system does do a good job of monetizing, as a component of price-values, those contributions to the productive process that are made by the common factors of production. We are referring here to such things as natural resources, the unearned increment of human association, and the cultural heritage. These common factors, in virtue of which each individual can make a claim to a share in society’s productive output, may be regarded as being represented (however unintentionally) in the gap between prices and incomes, a gap that is largely due to the existence and use of real capital under standard rules of industrial cost accountancy. That gap exists precisely because, while the present financial system inadvertently monetizes the common factors of production as price-values within the pricing structure, it simultaneously fails to monetize, in the form of a corresponding flow of consumer incomes, the earnings that should accrue to these common factors.

The genius of Social Credit is its proposal that, instead of relying, as we currently do, on additional debt to fill the gap, it is both just and expedient for the gap to be monetized via the creation of a sufficient flow of ‘debt-free’ credit. This compensatory credit is to be issued, both indirectly and directly, for the chief benefit of consumers. Accordingly, a portion of this compensatory credit would be used to lower retail prices in conformity with an economy’s consumption/production ratio, while another proportion would be distributed as income to each citizen, whether he be employed or not, in the form of a National Dividend. The currently obscured reality to which this dividend (the purchasing power of which would be enhanced by compensated prices) would give concrete effect is this: “due to the far greater productivity which modern technology makes possible, it is simply not necessary to insist that every able-bodied adult must work before he can be granted access to goods and services.” Indeed, the notion that ‘all wealth must be earned’ is not merely inappropriate as a necessary condition for economic participation, it becomes an impossibility when machines are doing more and more of the work.

But I would argue that the introduction of a principle of gratuity as a distributive principle is not only called for on the basis of strict justice (as paradoxical as that may sound), and on the basis of functional necessity, such a principle is also a personalist requirement.

If a personalist economy is to be an economy of the people, for the people, and by the people (people understood here as the aggregate of individuals and not as an abstract mass), it must treat people, well, as people, and not as commodities or as mere means for the attainment of an impersonal economic end, whether that goal be employment as an end in itself, the maximization of monetary profits at any and all costs, or the centralization of power in the hands of an oligarchic elite.

But something else is called for beyond these proscriptions. For personalists have perceived that the only proper or adequate response to the person, i.e., the only way of fully treating people as people, is through the gift of love. By ‘love’ I don’t mean any soft sentimentality or even the more noble affective responses with which that word is sometimes associated, but rather the affirmation of another in his nature and the promotion, via concrete actions, of his well-being: ‘Love is willing the objective good of the other.’

If this is so, then it follows that the economic gift, the something for nothing, is also necessary if persons are to be treated on the economic plane with the dignity that is their due. Social Credit and Social Credit alone seeks to make the economic gift a real feature of our social arrangements. The National Dividend in conjunction with the National Discount would, in the words of Mounier, ‘enable every individual to live as a person, that is, to exercise a maximum of initiative, responsibility, and spiritual life.’ They would provide each citizen with economic security, independence, freedom, and, perhaps most importantly, with the opportunity for leisure. It is for this reason that Social Credit should be of great interest to personalist thinkers.

The necessity of the economic gift as the due response to the person was recognized by no less a personalist than Jacques Maritain in his book Humanisme Integral:

“It is an axiom of the bourgeois economy and the mercantile civilization that one gets nothing for nothing … On the contrary, at least and in the first place where the primary material and spiritual needs of the human being are concerned, it is fitting for him to receive the maximum number of things possible in exchange for nothing. (…) That the human person be served in this way in his primordial necessities is, after all, the preliminary condition of an economy that does not merit the name of the barbaric. The principle of such an economy would lead to a better appreciation of the profound meaning and the essentially human roots of the idea of heritage. (…) in such a way that any man, upon entering this world, may effectively enjoy, in some fashion, the condition of being an heir of preceding generations.” [5]

This alternative personalist civilization to which Maritain looked forward, a civilization providing persons with as much as possible in terms of goods and services in exchange for nothing, but rather on the basis of their cultural heritage, is the same objective towards which Social Credit is the effective means:

"What are we aiming at? What are we trying to get?
Well, now, I will put it in a very large general form, as I see it from one point of view.
We are endeavouring to bring to birth a NEW CIVILISATION. We are doing something which really extends far beyond the confines of a change in the financial system.
We are hoping by various means, chiefly financial, to enable the human community to definitely step out of one type of civilisation into another type of civilisation, and the first and basic requirement as we see it, of that, is absolute economic security." [6]

Indeed, in comparison with this vision, the prevailing do ut des economic order is nothing less than barbarism.




[1] Emmanuel Mounier, A Personalist Manifesto (London: Longmans, Green & Co, 1938), 167.

[2] Race Mathews, Jobs of Our Own (Irving, Texas: The Distributist Review Press), 181.

[3] Race Mathews, Jobs of Our Own (Irving, Texas: The Distributist Review Press), 5.

[4] As a direct result, the sad reality is that the ‘free gift’ is not structurally embedded in the present economic order at all. Everything must be earned for oneself or else taken by force (by redistributive taxation) from those who are lucky enough to earn an income. Even gifts of charity that might be made by one individual or group of individuals presuppose costs that must be deducted from someone’s labour or capital earnings.

[5] My translation. ''C’est un axiome pour l’économie « bourgeoise » et la civilisation mercantile qu’on a rien pour rien…Bien au contraire, du moins et d’abord pour ce qui concerne les besoins premiers, matériels et spirituels, de l’être humain, il convient qu’on ait pour rien le plus de choses possible. (...) Que la personne humaine soit ainsi servie dans ses nécessités primordiales, ce n’est après tout que la première condition d’une économie qui ne mérite pas le nom de barbare. Les principes d’une telle économie conduiraient à mieux saisir le sens profond et les racines essentiellement humaines de l’idée d’héritage. (…) en telle sorte que tout homme, en entrant en ce monde, puisse effectivement jouir, en quelque façon, de la condition d’héritier des générations précédentes.'' (Jacques Maritain, Humanisme Intégral (Éditions Montaigne: Paris, 1946), 197.

[6] C.H. Douglas, Major C.H. Douglas Speaks (Sydney: Douglas Social Credit Association, 1933), 84.

Last modified on Sunday, 11 February 2018 21:48

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  • Comment Link  Martin Ant Sunday, 11 February 2018 21:51 posted by Martin Ant


    While recognizing certain positive elements which can be found in the personalist doctrine, this philosophy as a whole, however, suffers from a essentially distortive perspective of the correct relationship between the social common good and the true liberty of the persons in the political community.

    One of the collateral effects (and temptations) which accrued from the criticism of the contemporary totalitarian regimes was an absolutisation of the "liberty", the "rights", and the "dignity" of the human person, in the lines of the way in which this terms has been conceived since the French Revolution –something that has brought the "Christian" personalists to the absurd conclusion that such Revolution contained Christian truths which had been discovered for the first time and, therefore, had to be incorporated to the Church Magisterium (or which represented the authentic interpretation of the catholic doctrine).

    I´m afraid that Jacques Maritain (which changed his mentality since his work “Integral Humanism”) is one of the most contributors of the current confusion in the Church (in fact, his new and revolutionary doctrines of demo-christianism were introduced in the Church via the II Vatican Council).

    It is very easy to refute the apparent dichotomy which the personalists establish between liberty and a catholic order, because the History demonstrates that it is in the catholic order of Christendom in which flourished the true liberty of the human persons and of all the society (all the limitations to the political power which arose from the organic constitution of society: free guilds, free universities, free peasantry, free Church, free municipalities, common or consuetudinary law, authentic representation in Courts or Parliaments with vote against taxes of the King, etc…).

    The personalists separate the public sphere and the private sphere, and then, they say that it is unnatural to found or restore a catholic political order, because that would go against the “liberty” and “dignity” of the human person. They come to this conclusion because they have previously “totalitarized” the personal conscience, and then, they have attributed to this totalitarian conscience, absolute rights and absolute dignity (for example, a personalist would go against the claim of Pious XII that a murder can lose his dignity because his crime, and, therefore, he could be punished with the capital penal; and a personalist would oppose this Pope´s claim, because he regards his “right of life” as an absolute thing).

    That is, the “New Christendom” which the personalists (and Maritain, in particular) promoted, was no essentially different of the totalitarianism conception of the person which have liberalists and existentialists, and, paradoxically, is compatible with the estate totalitarianism.

    One of the most important works refuting the personalist philosophy was that of the Canadian tomist Charles de Koninck, titled “De la primauté du bien commun contre les personnalistes. Le princicipe de l´ordre nouveau”.

    I think that Social Credit Economic Model is in consonance with the political philosophy of ancient Christendom, and it is the way in which the ancient liberty can be re-established today. Obviously, it is impossible re-establishing the ancient Christendom (that would be the position of irrealistic romantic integrism), but it could be re-established the same spirit and socio-political principles which informed its constitution with the –indispensable– aid of the Social Credit Economic Model (in the other words, it is not necessary, for example, re-establish agrarian peasantry, per se; but it must be re-established, by other means, the effective liberty and independence of the ancient peasantry, which was a socio-political principle of the ancient Christendom).

  • Comment Link  Martin Ant Sunday, 11 February 2018 21:50 posted by Martin Ant

    I personally think that everyone should do their fair share of the labor. The businesses of the world should open their doors and allow everyone to work if only 12 to 14 hours each week.

    Let's face it. There are people who love to be working. Some, not so much. Others, not at all. Working a few hours each week though would enable them to feel that they are contributing to the economy as a whole and not letting others do all of the labor. I am sure companies could work out a payment system for the labor which would be agreeable to everyone.

  • Comment Link Steve Sunday, 11 February 2018 21:50 posted by Steve

    Bravo Oliver. Excellent post.

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