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by Wallace Klinck, Canada

December 2009

C. H. Douglas opined that the central challenge that (we) face as Social Crediters and Christians is that of the Incarnation. The ‘Christian’ clergy has left what little remains of genuine Christian belief and practice as an emptied shell. They have abstracted it into a ‘spiritual’ realm and separated it from the organic affairs of humanity. They have created an artificial duality of opposing physical and spiritual realms, making the two in conflict rather than integrated, thereby causing an impotent divorce between ends and means.

Historically, I believe that this resembles what was once called the Manichean Heresy. Thus, Christian values have become subconsciously and/or consciously, in the minds of most people, irrelevant to the organic affairs of mankind in what they believe is the "real" world – (thus relegating it to) little more than an historic fable not to be taken seriously as a practical guide to life. We pay the penalty.

Seems as though we are to be, for a time at least, in a continuous pattern of jumping out of the frying pan into the fire. And Christians remain either mute or misdirected. Perhaps, when the sheer futility of present policies is fully exposed by the poisoned fruit they bear, we may hope for an awakening and reversal. Meanwhile, I believe that we have to be active as a growing "leaven" in preparation for such a time which may come progressively or perhaps as a relatively sudden crystallization.

The present dysfunctional financial system, with its underlying philosophy and unrealistic policy, contributes more than any other factor to spreading and fanning enmity among peoples.  


Finally, the CPRS bill has been defeated in the Senate, with the Coalition voting against the introduction of a massive new tax on the Australian people. What complete insanity the Labor Government was proposing for us. Now we already have Dr James Hansen, the grandfather of global warming, saying an ETS is a failure and we have to look for other alternatives.

Many people have played a part in this massive debate about this massive tax. Make no mistake about it. It is the pressure from the Australian public that changed the political complexion in Canberra. Now the Labor Party wants to bring the same bill back again. How is that for contempt for the Senate? Mr Rudd is so arrogant; he just does not understand the word ‘No’.

Because of Mr Rudd, unfortunately the Coalition and the Australian people will have to get ready to fight again. This time the people of Australia can concentrate on Labor members of Parliament and Labor Senators. So find their names, find their emails and find their telephone numbers and contact them!

We are in a new form of participatory democracy and maybe that is the one good thing that has come out of this ETS debate.
- - Senator Barnaby Joyce, The Nationals Senator for Queensland 3rd December 2009  


Jesus said – I have come that you might have life and have it more abundantly

A note from a Canadian social crediter: Thought you might find this interesting. Sort of relates to Social Credit. Our warehouse in Vaughn, Ontario is almost fully automated. It puts the product away, picks orders, sorts them on pallets and gets them ready for shipping. The technology is quite amazing.
Just go to the link below and click on watch video, and you can see the facility. >https://www.sobeyscorporate.com/en/video.aspx<

Wally Klinck responded: Do you have any idea of the reduction of manpower-needs versus the-gains in productivity which has been achieved by this project? I note that some of the technology comes from Germany. Just a glimpse of the future which is possible for mankind - and the potential for release from toil into a genuine cultural milieu.

Just think what the world could be like if we directed our efforts away from continual destruction toward such constructive activity. To her credit, Ellen Brown deals with leisure in Medieval England and the building of those magnificent cathedrals, etc., in her new book, "The Web of Debt", the embedded story of which she cleverly builds around “The Wizard of Oz”, which latter was actually a political and financial parody expressed through fantasy and mythology. She does actually mention Social Credit as a possible approach to rectifying the financial fraud - which is more than Mark Anielski allowed in his work, "The Economics of Happiness."

We need consumer dividends and compensated prices to help ‘release reality’
The recent "economic turndown" is not something to be accepted as a fact to be recognized and worked around. It is no accident or natural, inevitable event. The credit collapse is merely one of those periodic orchestrated down-cycles caused entirely by a defective financial-accountancy system - which increasingly starves the consumers of adequate purchasing-power, forcing them to "augment" their insufficient financial incomes by increasing resort to debt, until the liquidity of the financial system is eroded to the point of non-sustainability.

At this point the credit system collapses (with a little help from those who intend to benefit from it), leading to massive foreclosures on private and public assets, thereby concentrating wealth, policy-making initiative and political-administrative power in increasingly few hands. The ultimate goal is the destruction of independent nation-states and establishment of some form of centralized and pervasive world government which can only be a monstrous tyranny.

The current down-phase of the economy is no accident. It is merely part of a continuing planned and engineered policy implemented by those who use the financial system as their primary instrument in effecting what can only be called their megalomaniacal ambitions for world power.

This situation cannot be accepted by freedom-loving peoples and must be dealt with by concentrating resources ("fire-power") in order to make a decisive breakthrough and final victory over this evil. Attempting merely to "work around" it constitutes an acceptance of evil and capitulation to it. This can only lead to ultimate societal disaster.

We don't need any inflationary "Basic Income" provided by either taxation or borrowing (debt). We need Consumer Dividends and Compensated Prices, provided without debt or taxation, to restore and ensure sustained liquidity to the financial price-system, thereby to effect a continuing ability of consumers to access the full desired output of final goods, while allowing producers to recover their financial costs.

Genuflecting before an Abstraction - Wallace Klinck continues…
I think that these words were well-chosen to give an excellent description of "money" from a Social Credit perspective - and a realistic perspective.

Money is a unit of account, a pure abstraction which allows one to place a demand, a "ticket" which one may use to make an effective claim to wealth. Thus, money should in the modern economy, where labour is rapidly being replaced by technology as a factor of production, properly be regarded as increasingly an instrument of distribution - not of exchange. It should be, as Douglas explained, a means by which individuals can draw upon the common pool of wealth produced by all factors. One cannot logically, or morally, restrict consumption only to those who directly contribute their labour when other factors not only contribute increasingly to production but also form an increasing part of financial cost and price.
G. T. has criticized the idea of "debt-free" money on the basis that money is a promissory note, being a debt owed to the holder which can be "reclaimed in value's worth" only from its issuer. What he says has an element of truth but he does not appear to understand the actual overall nature of the situation.

When Social Crediters speak of "debt-free money" the meaning is not as implied by the critic that there is an intent to issue money which cannot be redeemed in goods and services because such wealth has not been produced. The critique is clearly that issue of consumer credits to finance a National Dividend and Compensation of retail prices would inevitably cause inflation of the general price-level.

A two-dimensional craft operating in a three-dimensional world
This confusion of mind leads to a genuflection before an abstraction. Conventional accountancy has been described by Social Crediters (a group of accountants in the United Kingdom, as I recall) as a two-dimensional craft which operates in a three-dimensional world, operating within the parameters of its own limited assumptions and thus, being incapable of accurately representing the actual realities of economic processes. C. H. Douglas revealed the nature and inadequacy of this "two-dimensional" accountancy and presented an alternate remedial approach to accountancy which would take into consideration the realities of wealth production and the appropriate means of distributing it.

From a mere technical standpoint, Social Credit is primarily concerned with the financial mechanism of distribution and finds the latter defective in the context of the current financial system - defective in the sense that over time final consumer prices are generated in an increasingly larger flow relative to financial incomes, thus refuting the claim of Say's Law that the act of production always provides sufficient financial income to purchase the entire flow of consumer goods from the productive system.

"Local Exchange Systems" are primarily concerned with production and exchange and do not therefore address the problem of income deficiency and inadequate distribution, as does Social Credit. In regarding money as a means of exchange, they neglect the essential financial problem which is inherent in the modern, capital-intensive, economy operating under orthodox financial accountancy and the existing system of debt finance.

The consumer credits which are advocated by Social Credit would indeed be issued without registering as a debt repayable as such in the future to a specific lender. However, prior claims do exist against these credits in the form of consumer goods which have already been produced and are available for final purchase with financial prices attached to them. When consumers spend these supplementary and non-cost-creating consumer credits they would be exercising their right to make a claim, or issue an order, which results in the delivery of such consumer goods into their possession. In a Social Credit dispensation, "society" would issue these consumer credits as a social "I.O.U." and they would be "redeemed" when spent by the consumer.

People who have difficulty with this concept are inclined to assume, either from formal training, or innate, but misguided intuition, that the act of production liberates always sufficient financial income for the entire final output of any cycle of production (production is normally continuous in the real world) to be purchased. While this might be true in theory, it entirely neglects the element of time and the fact that this distributed income will not, and cannot, be available when the goods in question are completed and ready for ultimate purchase at some near or distant time in the future.
A large portion of this income already will have been spent, on goods produced previously, to meet the current needs of living - and cancelled thereby, as purchasing power,
Another error of the critics seems to be that they often regard money as a permanent circulating "medium" rather than an ephemeral entity which is created for production (and for consumption in more recent decades) and cancelled as purchasing power when consumers, through expenditures, return it to producers who use it, along with recovered earned incomes, to repay their bank loans, or to place it to capital reserve.

Pseudo-morality involving false assumption
A further error of the critics is to become confused by pseudo-moral issues involving the false assumption that the individual is only entitled to consume by "virtue" of his or her direct contribution to production. The motivation for this attitude is largely a fear of scarcity of real wealth induced falsely by a shortage, not of actual or potential goods and services, but rather of effective "money", which shortage gives the illusion of actual scarcity.

The critics of Social Credit appear to be locked into a view that human activity must be constrained by available money, wrongly assuming that collectively the latter is always adequate to finance all possible human economic aspirations. This makes money, a mere abstraction, the master of mankind.
Social Credit asserts that money should be the servant of mankind and not the master - that it should be merely a system of accountancy that records, but does not restrict, what we choose to do physically and have the material and psychological resources so to do.
The critics do not appear to apprehend the nature of the justifiable claim of capital to replace itself, and the manner in which this adds to consumer prices without providing the purchasing power required, to allow consumers to draw fully on final production with current incomes.

Look simply at nature
One way to visualize this matter is to forget money entirely and to look simply at nature. In nature the conversion of energy to material and vice versa is a continuous dynamic process. Interactions among forces and organisms lead to various results and organisms merely draw from these results as they are required. Consumption by an organism is not dependent upon its direct contribution to "wealth" required for maintenance or survival. Each organism, by virtue of its very existence, is entitled automatically to draw upon its general environment for sustenance. This entitlement is not constrained by any artificial system of accountancy or pseudo-morality.

There, currently, is no provision for such automatic and dynamic access to the general pool of wealth in human society - operating as it does under the constraints and limitations of a financial system that issues money "tickets" for consumption only, through prior, direct, individual participation in the act of production.

We have, therefore, abstracted ourselves from natural law by submitting to the dictates or requirements of the present distorted financial accountancy system based upon debt - a system which prevents us from drawing on the national real credit, in a socially beneficial manner, without incurring waste and debt.

Because all the physical costs of production are fully provided when consumer goods are completed and ready for final sale, we are violating natural law by insisting that such goods must be paid for by additional work - or financial debt charged against future production.
Mankind cannot realistically consider themselves to be anything other than a part of nature - albeit a complex form. To do so is an attempt to flout natural law and can only result in inevitable and inescapable disastrous consequences. We observe these all around us.


C. H. Douglas: “Social Credit” January 17, 1936

At the inquest on Alfred Morris Baker, aged 52, a solicitor, of Rock Close, Kington, who was found shot, a letter was read in which the deceased had written that "Insomnia has at last got the best of me, and the inspector of taxes at Ludlow has driven me mad with worry ... Now that the tax people have completely murdered another breadwinner, perhaps they will let my wife and children have peace." It was represented at the inquest that, the tax inspector had been scrupulously fair. (Daily Telegraph, January 7, 1936.)
In a considerable number of the cases of suicide so constantly recorded, a somewhat similar complaint of worrying by the Taxation Authorities may be noted.

Mulcting the Public
When the history of these times comes to be written, it will be regarded as almost incredible that the population of this or any other country making any claims to civilisation should have permitted the continuous levy in favour of financial institutions which now passes under the name of "taxation." To what amount the British public is mulcted per annum is difficult to estimate, since the direct taxation, including rating, in favour of such institutions, which is certainly not less than two hundred and fifty million pounds per annum, by no means tells the whole of the story

The debts which form the basis of the claim were, of course, created by the loan of bank-manufactured money, just as the interest on them is for the most part payable only in bank-manufactured money. Where taxation is levied upon producing firms they are compelled to include it in the price of articles produced. As a result, either the price level is raised, thus reducing the purchasing power of all incomes, or, alternatively, production is strangled and the unit cost of production is raised by an excessive ratio of overhead charges to direct charges.

Fraudulent Taxation Methods
But the intolerable nature of the modern taxation system is by no means confined to the economic depredation which it now carries on, almost unchecked by Parliament or even by public opinion. The business methods which are employed in connection with the assessment and collection of taxation would, if employed by an ordinary business firm, result either in its rapid liquidation or the appearance of its proprietors before the Court upon a succession of charges of fraud.

• No business firm would dare to send in a bill for three or four times the amount owing to it, leaving its clients to prove that it was incorrect. But this is done as a matter of course by officials of the Inland Revenue. No business firm would consistently charge three or four times for the same article, but this is the essence of the division of Income Tax into Schedules, so that a charge may be repeated in a disguised form.
• No business firm would consistently dare to charge for articles which had never been received. But there are hundreds of thousands of people in this country who are paying Tax upon an Income which they have never received.
• No business firm, while owing large sums to a client, would insist on the payment of smaller sums which he owed to them. But the Inland Revenue Authorities are constantly doing this.

Tyranny of Experts
There is, of course, a sense in which taxation is right and proper. We all obtain certain services which we do not pay for directly and which involve consumption, and this consumption requires to be provided for communally. There is, in my opinion, however, little doubt that the present abominable tyranny of taxation arises not only from the magnitude of the taxation (although that is wholly inexcusable), but also from the fact that it is arbitrarily imposed in accordance with the ideas of a body of experts, generally anonymous, who provide the Chancellor of the Exchequer with his Budget scheme.

Taxes, of course, under the existing organisation of society must be paid in money, and since practically all money is created by financial institutions it is quite obvious that the ultimate beneficiaries of all taxation must be those institutions, chiefly in the form of visible and undivided reserves, rather than dividends. They are, in fact, the only institutions which can in no circumstances effectively be taxed, since the greater the monetary taxation imposed upon any country the greater is the necessity for the services of those institutions which alone can make the money with which to pay the taxes.

Attempts to Justify Taxation
The principle which is employed to justify taxation is, I think, twofold. In the first place, the common and general ignorance of monetary matters makes it easy to suggest that taking money off Mr. Jones, who has five hundred a year, is the only way that a Dole can be paid to that excellent fellow Bill Johnson, who is out of work. There is, of course, not an atom of truth in this. Taking money in taxation off Mr. Jones merely means that Mr. Jones buys less.

If the money were transferred directly to our friend Bill Johnson, which, most certainly, it is not, Bill Johnson would not buy the things which Mr. Jones was prevented from buying; he would merely buy some of the things of which there is already a surplus, and the surplus would be transferred to those articles which Mr. Jones has not bought. But, in fact, at least 30 per cent of the money which is taken off Mr. Jones goes into sinking funds of various kinds and into reinvestment. In the case of sinking funds, it causes an additional shortage of purchasing power, and in the case of reinvestment it produces a surplus amount of capital production for the output of which there is no market.

The second principle which is involved is the capitalisation of the less attractive emotions of human nature. The peculiar form of sadistic Puritanism, which is humorously called "Temperance," has been used to justify on "moral" grounds the raising of the price of whiskey for about half- a-crown a bottle, which is several times its cost of manufacture, to twelve and sixpence. This provides about ten shillings a bottle directly or indirectly for the Exchequer, of which banks and insurance companies ultimately get about five shillings, directly or indirectly.

Taxation the Instrument of Mammon
Agitation on the Land question, for the most part completely unintelligent, has been made the excuse for punitive taxes frequently paid directly to insurance companies as premiums on insurance against Death Duties. These have transferred the eligible land in this country from the hands of private administrators, who had a sentimental, as well as material incentive to proper administration, into the hands of soulless corporations, whose works are evident by ribbons of jerrybuilt houses, punctuated by magnificent corner edifices raised in the honour of the Religion of Mammon, displacing the churches in which, on occasions, unpleasant things were said about the money-changers.

The realities of taxation could, of course, be met by a very small rise in a price level which had been adjusted much below that existing at the present time, taxation in its present sense, with its horde of officials and its worries, being abolished.
But that would take away what is called the "power of taxation," and thus remove one of the major obstacles to economic freedom. In other words, the present taxation system is not primarily an economic device, it is a device for exercising despotic pressure.

Until we recognise that self- government is better even than good government, just so long shall we have an increasing number of catastrophes similar to that of Mr. Baker.

Further reading:
"The Just Tax" by Geoffrey Dobbs

"Globalisation: Demise of the Australian Nation" by Graham Stachan $15.00 plus postage.

Further viewing:
DVDs: Now is the time to place your order for “Fall of the Republic”
– Special price for over two hours of viewing: AUS$12.00 posted from Heritage Books, P.O. Box 27 Happy Valley South Australia 5159.
American folk have produced over two hours of viewing. They warn the viewers the one-worlders will dump the American dollar when they think the timing is right – with resulting hyperinflation, thus wiping out the American (and Australian) middle class.
The issues facing Americans are the same as those facing Australians… global governance (read world government), climate change scams, climate cops, political, corporate and financial corruption, a rising ‘police state’ - and much more.

“Apocalypse - No!” filmed at the Climate Change Symposium. We have just received from the Minnesota Free Market Institute a one-and-a-half hour DVD of Lord Monckton’s speech on 14th October, 2009. Vital viewing! Special price AUS$10 posted. This issue is not going to ‘go away’.

© Published by the Australian League of Rights, P.O. Box 27 Happy Valley, SA 5159