THE NATIONAL DEFICIT AND INTEREST RATES

Economics is a word derived from the Greek, originally meaning "household management". Economics has to do with the production and distribution of goods and services. The overwhelming majority of those called economists know little about the basic principles involved in production. Relatively few have had any practical experience in operating a business. Prime Minister Hawke, who, along with Federal Treasurer Paul Keating, claims some expertise in "economic management", was responsible for the ACTU Bourke Street Store, Melbourne, while President of the ACTU.
The Bourke Street store finished bankrupt, which presumably is some type of a qualification for Mr. Hawke to run Australia Unlimited. On present indications, it is heading for the same fate as the Bourke Street store. The debt burden continues to escalate. The debt burden continues to grow because the "economic experts" know of no other way to operate the production and distribution system except on a financial debt basis. Most of them are philosophical Marxists in the sense that they subscribe to the doctrine of "economic determinism".

As C.H. Douglas said, if a people uncritically accept this view, then politics are governed by, and subordinate to, economics. This means the same basic political policies, irrespective of the label of the politicians. The Federal Opposition's reaction to the latest trade deficit figures is that Australian producers must become more efficient and produce more to export. But this is exactly what every other nation is attempting in order to achieve a "favourable balance of trade". It is obvious that if some nation or nations do obtain this "favourable balance", it is at the expense of other nations.

The master Marxist strategist, Lenin, observed that the inherent nature of "capitalism" forced it to strive to export its problems in order to sustain domestic economies, stressing that this manifestation of "economic determinism" would force the "capitalists" to strengthen the Soviet base for an international revolutionary movement. A close study of Gorbachev's views leave no doubt that he is a skilled Marxist-Leninist dedicated to "reform" the Soviet system so that Socialism is more efficient - but with the aid of the same "useful idiots" of the West exploited by Lenin. It is reported that Western and Japanese economic aid to the Soviet is pouring in. But whether such aid can prop up the Soviet bloc remains to be seen.

If economic policies were the servants of political policies, Western nations would be now making firm decisions to constructively exploit the internal problems of the Soviet bloc. But they are unable to do this while dominated by "economic determinism". The Australian situation provides a striking example of the nature of the problem. With a type of knee-jerk reaction, the immediate reaction to the latest trade deficit figures was a statement by economists and the banks that interest rates would have to go even higher.
At the same time a headline in The Weekend Australian of September 23rd-24th, read, "OVERSEAS FUNDS POUR IN AFTER TRADE UPSET". The story underneath said that the speculators were moving to take advantage of higher interest rates. And what was Prime Minister Hawke's reaction to the suggestion of still higher interest rates? Did he boldly state that as the political leader of Australia he was not only going to halt any further interest rate increases, but was going to reduce them? No, of course not, demonstrating that economic black magic is paralysing the political will. Opposition leader Andrew Peacock is paralysed in the same way, which enables Bob Hawke to continue treating him as some type of a joke.

BRIEF COMMENTS

We have commented on the negative response of the Victorian Government to the growing carnage on the roads, with young people being a disproportionate number of victims. Since then the Cain Government has formulated a number of measures that in essence state that generally speaking the young are not as competent or responsible drivers as their elders. The young are to be prevented from driving high-powered cars. Few will argue against what is proposed. But it was the Socialists who spearheaded the campaign to have the voting age reduced from 21 to 18. We said at the time the voting age was reduced, that this was a backwards step, suggesting that any change to the voting age should be upwards, not downwards. The 18 year-old with the political vote is far more dangerous than the same 18-year-old in possession of a high-powered motorcar. The danger would, of course, be reduced if voting was not compulsory.

Although not well publicised, the banking system writes off debt in the same way that it creates it. Sometimes a little light is shed on how debts are written off. Just to hand from Britain comes the news that the Big Four British trading banks have "made provision", as it is euphemistically put, for bad debts owed by Third World and Latin American countries totaling nearly two billion pounds (over 4 billion Australian dollars). In simple English, this means that millions have been written off without any loss to the banks or their shareholders. No other form of business can write off astronomical debts while actually increasing profits. But then no other business can create financial credit. As the Encyclopedia Britannica puts it, "Banks create credit. It is a mistake to suppose that bank credit is created to any important extent by the payment of money into the banks". Not surprisingly, some British people have reacted to the news that the banks are writing off foreign debt, by asking why cannot the same banks write off that part of the National Debt in the same way. This would save the British taxpayers millions of dollars annually in interest alone.

We agree that Mikhail Gorbachev is a remarkable political performer, but he sits on a potentially explosive time bomb. The Marxists have always claimed that Socialism in the Soviet Union had created a new historical development in which national antagonisms disappeared. But the reaction of the numerous national groups, some 100, to the Gorbachev "reforms" has graphically demonstrated that these groups, with their differing language and cultural differences, remain basically the same as when Soviet collectivism was imposed upon them. The Soviet experience makes nonsense of the concept of One World. Separate cultures insist on surviving in spite of attempts to impose uniformity.

DON'T MAKE MARTYRS OF THE RACISTS

"Anti-discrimination legislation could give respectability to 'cranks', a commissioner inquiring into racist violence warned yesterday at the Human Rights congress. - The Age (Melbourne), September 25th

Mr. Ron Castan, Q.C., the gentleman referred to (above) made particular mention of Canada, where, he said, massive publicity had made martyrs of so-called "racists" by allowing them platforms of legitimacy, such as the courts. Mr. Castan obviously has in mind the Keegstra case, the Zundel case, and the Malcolm Ross case. Each of these people have fallen foul of Canada's anti-discrimination legislation. Ernst Zundel was arraigned for "publishing false news that was likely to be injurious to the public good". His defence lawyer, the indomitable Doug Christie, fought for his client on the grounds of freedom of expression, among other grounds. James Keegstra, a schoolteacher was arraigned for communicating statements "other than in private conversation, (which) willfully promote hatred against any identifiable group" (identifiable by race, religion, or ethnic origin). Freedom of expression and speech the main defence again by Mr. Christie. Malcolm Ross, another schoolteacher, fell foul of the controlled Establishment for similar reasons. These three "cases" are reviewed in books now available. Mr. Doug Christie, himself, gives details in two of them, viz. The Zundel Trial & Free Speech (Price: $6.25 posted) and Thought Crimes - The Keegstra Case (Price: $8.50 posted). The Spectre of Power, by Malcolm Ross, is a weightier work and the headings of some of its chapters will give a resume of the contents: "Web of Deceit/The Real Holocaust and the Battle for Truth/Is There a Conspiracy/Judaism on Jesus and Christianity/The Historic Church and Christianity/The Future and You." Price: $16.00 posted.

The banks and building societies are now preparing to lift their rates for home loans to 18%. We cannot see these rates falling, at least, until shortly before the next Federal elections. Mr. Hawke will find it most difficult to win his election in an economic "climate" of punitive interest rates: he needs to be perceived by the electorate as the master of falling interest rates. We don't like his chances. Probably even the hopeless, so-called Opposition would squeak into power, under these conditions. We forecast now that Local Government (Council) rates will escalate in the next five years, and that many homeowners on fixed incomes will be forced to sell their homes.