TRY IT ON THE DOG!
by James Reed
|Consumer control of production
|Contracting out mechanisms
OBJECTIVE: Social stability by the integration of means and ends.
INCOMPATIBLES: Collectivism, Dialectical Materialism, Totalitarianism, Judaeo Masonic Philosophy and Policy. Ballot-box democracy embodies all these.
BALANCE IN SOCIAL CREDIT
Geoffrey Dobbs in "Balance in Social Credit", "The Social Crediter" 11th April, 1953 represented Douglas' thought in three simple diagrams:
|Consumer control of production
|Contracting out mechanisms
New Testament Philosophy
Old Testament Philosophy
Social Credit policy
SOCIAL CREDIT AND CHRISTIAN PHILOSOPHY
Dobbs goes on to state in his article "What
is Social Credit?" that social credit is, in two words "Practical
Christianity", but that of course begs the question about what
Christianity actually is. Douglas said of Christianity that it "is
either something inherent in the very warp and woof of the Universe,
or it is just a set of interesting opinions." There are Social
Crediters who believe that Christianity does correctly describe the
"ultimate reality of the Kingdom of God" and not merely fleeting
social conventions as the politically correct mainstream churches embrace
of homosexualism, feminism, internationalism and other collective nonsense
"Religion" is a word which comes from the Latin re meaning 'back' and ligare meaning 'to bind'. Thus social credit philosophy is a mechanism for binding back to reality. Dobbs points out that "social credit" is present in all societies because it is the credit (or trust or faith) which acts as the glue holding societies together.
Social credit is maximised in societies where the Christian religion is practised and minimised in atheistic materialistic communist societies. This is what Dobbs meant by calling social credit applied Christianity.
Douglas in many publications, including The Approach to Reality 1936, The Brief for the Prosecution 1954, The Big Idea 1942, and Eric Butler more recently in The Moral Implications of Centralised Power published by The Australian Heritage Society 2003, have pointed out that the Christian philosophy of Love, is quite incompatible with the philosophy of Collectivism. Collectivism treats individuals as a means to an end (and a fast "end" at that); Christianity and Social Credit treat individuals as ends in themselves, as of value in their own right.
ACCUSATION: "NOT A CHRISTIAN PHILOSOPHY"
The accusation has been made that social credit
is not a Christian philosophy because it has primarily communistic roots.
In his article "Is Social Credit Christian?" (FACS Report,
Vol.5, No.5, May 1986) Ian Hodge makes a number of such claims to discredit
First he claims that social credit is inferior to the neo-classical economic theory of Boehm-Bawerk and Ludwig von Mises, now the standard economic theory indoctrinated to students at our universities.
Second he takes Major Douglas to task for saying that the ideals of the Old Testament are in conflict with those of Christianity. Hodges' position is that God is the author of both books so necessarily they must be consistent.
Finally after mentioning the League of Rights' opposition to socialism ("or at least the socialism originating in the USSR") Hodges goes on to claim that Social Credit is a form of socialism.
The Nature of Socialism and Capitalism
Leaving Hodges for a moment, let us consider the nature of socialism and capitalism.
Socialism in all its forms involves the removal of private property from the individual and its concentration into the hands of the collective, typically the State. It is a form of Monopoly.
Global Capitalism does almost the same: It is an economic system where the ownership and benefits of capital are also appropriated by a small number of people (Global Capitalists) to the exclusion of the many whose labour made the capital productive. It is essentially a system of the autonomous rule by Money. As a form of Monopoly, it too is contrary to genuine democratic principles.
Hodges takes Douglas to task for his scheme of the National Dividend, which Hodges believes is just a dole by which "the productive in society will subsidise the lazy and inefficient."
The claim that Social Credit is inferior to orthodox economics will be dealt with later in this essay as will the claim that the National Dividend is "socialistic". For the moment it is sufficient to say that the idea of distributing a fundamental "living wage" to all people so that the majority can participate in having 'private property" rather than being wage slaves is not socialistic at all. Socialism and capitalism are intrinsically monopolistic systems; the very aim of Social Credit is to break down such systems of centralised power.
Hodges, like many other critics has seized on a few quotations from Douglas, quoted out of context and jumped over logic to his conclusion.
Major Douglas did not deny the Old Testament's truth in the sense that atheistic philosophers might do. In speaking of "conflict" he was saying that the philosophy of Love of the New Testament conflicts with the extreme Zionism of the Old where the tribal God of the Jews leads the "Chosen People" in rampages of genocide of innumerable peoples.
In the Realistic Position of the Church of England
C.H. Douglas said:
"Speaking for myself, I should reject the so-called Old Testament as containing little which for the purposes of contemporary religion, is not purely negative - a warning. Its connection with 'the Chosen People" myth has distorted any usefulness it might have, and if it is to be retained, it requires treatment in a highly critical spirit, completely divorced from reverence. It is only necessary to observe the extent to which the world tragedy is complicated by Zionism to recognise its vicious effects. The Jewish question is a mass of untruths, half-truths, and fake materialism, and one of the essentials of any solution is to strip it of occultism which is its chief ally."
Janine Stingel in Social Credit: Anti-Semitism, Social Credit and the Jewish Response, (McGill-Queens University Press, Montreal 2000) says that Social Credit is "wholly dependent on an anti-Semitic conspiracy theory". This claim is only true under a high re-definition of anti-Semitism where any criticism of Jewry is by definition anti-Semitic, which of course is what the term now means in the present politically correct climate. But closing off important aspects of reality from analysis and criticism merely constitutes another form of totalitarianism - a totalitarianism of thought, and like all such totalitarianism, it will ultimately unwind.
With these groundless criticisms still in mind it is worthwhile to consider the words of some of the Popes on the same issues which Douglas addressed.
Pope Pius XI affirmed the same principle accepted by Douglas of the decentralisation of power:
"It is an injustice, a grave evil and a disturbance of right order for a larger and higher organisation to arrogate to itself functions which can be performed efficiently by smaller and lower bodies."
Pope Pius XI said in a radio address of 1st June 1941:
"Material goods have been created by God to meet the needs of all men, and must be at the disposal of all of them, as justice and charity require. Every man indeed as a reason-gifted being, has from nature, the fundamental right to make use of the material goods of the earth, though it is reserved to human will and the juridical forms of the peoples to regulate, with more detail, the practical realisation of that right."
Pope John Paul II in Encyclical Solicitudo Rei Socialis 30th December 1987 recognised the perils to freedom posed by the money power:
"Among the actions and attitudes opposed to the will of God, the good of neighbour and the "structures" created by them, two are very typical: on the one hand, the all-consuming desire for profit, and on the other, the thirst for power, with the intention of imposing one's will upon others."
This is problematic for the same reason that Douglas thought it was, as Pope John XXIII said on 15th May 1961:
"The Church's teaching on social matters has truth as its guide, justice as its end, and love as its driving force The cardinal point of this teaching is that individual men are necessarily the foundation, cause and end of all social institutions."
SOCIAL CREDIT AND ECONOMICS
The claim was made earlier by a critic of social
credit that neo-classical economics is superior to social credit and
is more "Christian". Let us look briefly at the basic textbook
model of "rational economic man" and see how truly unchristian
and materialistic rational economic man is.
Mainstream Economics a 'Religion"
The textbooks generalise so that their model is an abstraction from reality - and this is so as rational economic man lacks all of the essential moral and spiritual ingredients that make one human. Rational economic man is a utility maximiser: "It" acts so as to produce the maximum happiness and pleasure for "itself". Rational economic man is thus purely selfish: the philosophy of hedonistic utilitarianism.
Although the technical details cannot be sketched here, from this flawed philosophical conception of human nature a model of microeconomics can be devised - with, for example forward-sloping and backward-sloping supply and demand curves, respectively. Macro-economic aspects - that is the "big-scale" phenomena of the capitalist economy such as the theory of the firm are also based on this same utilitarian framework. Thus a firm's primary reason for existence is (short-term) profit - maximisation.
The problem with this theory of capitalism is that it is based on axioms and principles which are known to be wrong: established by a group of Cambridge economists under the critical leadership of Professor Joan Robinson. There are a large number of technical books detailing these flaws (e.g., M. Hollis and E. Nell, Rational Economic Man 1975), but the standard economic degree ignores these criticisms. The reason is, that mainstream economics is not a science but an ideology or a religion, the religion of capitalism. Thus the "criticisms" and "paradoxes" are matters for professionals to ponder after hours, not in the course of doing "real" economics.
Social Credit Founded on Rich Christian Culture
This situation contrasts sharply with the philosophical basis of Social Credit. Social Credit is founded on the rich theological and philosophical foundation of Western Christian culture. The individual in social credit is not the soulless atom of neo-classical economics, but a person with a soul, morality and culture.
Neo-classical economics by stripping the person of all their essential spiritual qualities readily allows collectivist entities such as corporations to dominate individuals. This conventional economics sees corporations as more real than individuals since corporations are the ultimate causal agents of capitalism.
Neoclassical economics, as a form of reductionism (a theory that all complex systems can be completely understood in terms of their components) has also been unified with the ultimate materialist reductionist theory - socio-biology - which sees individuals as nothing more than masses of chemicals at the mercy of "selfish genes" which aim at self-replication.
Social Credit does not see economic reality as dominated by "economic laws" as orthodox economics does. Rather economics is, to use contemporary jargon "a social construction", a series of social conventions. This applies especially to the financial system. If money is a reality for the orthodox economist, as fundamental as the electron is for the physicist, for the social crediter, money remains only a convention, a representation of the 'effective demand".
In The Use of Money 1934, Douglas said:
"The financial system is nothing but a ticket system". Money differs from railway tickets in being universally accepted in exchange transactions.
Douglas belongs to a long tradition of thinkers and actionists who opposed the monopoly of the money power and proposed that nations should control their own credit issue (the national credit).
Thus Abraham Lincoln said:
"The money power preys on the nation in times of peace, and conspires against it in times of adversity. It is more despotic than monarchy, more insolent than autocracy, more selfish than bureaucracy. It denounces, as public enemies, all who question its methods or throw light upon its crimes."
Lincoln also said:
"Money is the creature of law, and the creation of the original issue of money should be maintained as an exclusive monopoly of the national Government. The monetary needs of increasing numbers of people advancing towards higher standards of living can and should be met by the Government. Government, possessing power to create and issue currency and credit as money, and enjoying the right to withdraw both currency and credit from circulation by taxation and otherwise, need not and should not borrow capital at interest as the means of financing Government work and public enterprise. The privilege of creating and issuing money is not only the prerogative of Government, but it is the Government's greatest creative opportunity. Thus money will cease to be master, and become the servant of humanity. Democracy will rise superior to the Money Power."
Creation of credit has been monopolised by the Money Power at least since the existence of the modern nation state, and earlier when goldsmiths learned that they could issue credit notes without having the same reserve of gold in their safes, provided that not everybody called on their reserves at the same time.
The United States, before the American Revolution had bucked this monopolistic trend and had issued their own money - Colonial Scrip - which was issued, in the words of Benjamin Franklin "in the proper proportion to the demands of trade and industry".
The social reformer Robert L. Owen had noted that the Money Power was soon to hear of this:
"It was not very long until this information was brought to the Rothschild's bank, and they saw that here was a nation ready to be exploited; here was a nation that had been setting up an example that they could issue their own money in place of the money coming through the banks.
The Rothschild bank caused a Bill to be introduced in the English Parliament, therefore, which provided that no Colony of England could issue their own money. They had to use English money. Consequently, the Colonies were compelled to discard their "Scrip" and mortgage themselves to the Bank of England in order to get money. For the first time in the history of the United States our money began to be based on debt."
Benjamin Franklin said that it was financial manipulation, rather than the tax on tea that lead to the American Revolution.
Major Douglas was well aware that the money power controlled the fates of nations; indeed as M.A. Rothschild had once boasted: "Let me issue and control a nation's money and I care not who makes its laws." Douglas saw that the system of fractional reserve banking - where the private-based money power elites controlled credit creation, being able to lend out or extend credit whilst only maintaining a fraction of the reserves, was a form of economic and financial parasitism. By this system, money is created as a debt to the banking system. Circulated money is a loan and must be paid to the bank - with compound interest.
This interest was not created by the bank and was not created by the debtor. As it is impossible to pay back that which does not exist, debts accumulate at an exponential rate. The public debt thus is an impossible contract that governments can never repay. It is impossible to escape debt when all the money to pay off the debt is created by creating a debt.
"CONTRADICTION" OF CAPITALISM
Douglas went much further than the "national
crediters" in his critique of Capitalism - and Socialism for that
matter. Douglas saw the banking fraud, "that the money that they
create is their own money" as a "tyrannical fraud" (Dictatorship
by Taxation 1937). Nevertheless the core problem of the financial system
was the maintenance of a condition of financial scarcity in the midst
of an abundance of production produced by technology. Consequently individuals
must work harder and longer hours rather than enjoy the leisure and
creativity of an advanced civilisation.
Douglas' "A"+ "B" theorem is a proof that there is a fundamental gap between purchasing power and prices. Let Group "A" payments in an economy represent the rate of distribution of purchasing power to individuals in the form of wages, salaries and dividends.
Let Group "B" payments be all payments made to organisations for raw materials, bank charges and other external costs. "A" represents the rate of flow of purchasing power to individuals. All payments go into prices. Therefore, the rate of flow of prices must be greater than or equal to "A" + "B".
For a non-zero "B", "A" will be less than "A" + "B", so "A" will not purchase "A" + "B". Hence a proportion of the product of at least "B" constitutes a form of purchasing power that must be filled in the same period by a purchasing power other than wages, primarily by loan credit (bank overdrafts) or export credit. Put another way, industry as a whole creates prices at a faster rate than it distributes money to pay for them. Additional money must be obtained from some source outside of the industrial system.
Douglas proposed that the gap between prices and purchasing power be the financing of consumption by means of a National Dividend distributed to every citizen as well as an automatic regulation of prices according to the ratio between total production and total consumption. This National Dividend is a way of giving private property back to individuals and thus decentralising power because financial freedom is the foundation of all freedom.
The National Dividend is not a dole or a charity but is given to each person by virtue of their membership in the community. Productive capital is only productive because of the background of the community inheritance of "social capital" which enables capital to exist at all. That which is produced using the common cultural heritage of a community rightly belongs to the community as a whole, and the National Dividend is a reflection of this.
Would Solve a Number of Pressing Socio-Economic Problems
It is not too difficult to see how social credit proposals would solve a number of pressing socio-economic problems. For example in Australia one in four workers are employed as casuals and Australia has the highest casual workforce of any nation. Elisabeth Wynhausen in an article in the Weekend Australian 5-6/3/05, states that "millions of Australians are still scraping by on a minimum wage of $467.40 a week, less than double median weekly rent of a two-bedroom unit in Sydney or Melbourne."
She has recently published a book, Dirt Cheap: Life at the Wrong End of the Job Market (Pan MacMillan, 2005) which describes this journalist's 12-month undercover work in low paid domestic and cleaning jobs. The book is an eye-opener about how exploitative work relations are at the lower end of the scale and of how much worse they will get. The National Dividend will lift such people from the poverty trap in which they are in.
Most importantly, social credit represents a mechanism for revitalising national economies and disarming economic globalisation, which as Graham Strachan brilliantly describes in his book 22 Steps to Global Tyranny (available from the League Book Services) is destroying the foundations of Western Christian civilisation.
Guest Workers to 'Prop Up' Economy
The Weekend Australian 5-6 March 2005 contains a lead article with the above heading. The article begins:
"Hundreds of thousands of unskilled foreigners are propping up the economy as pressure mounts on the Howard government to create a contentious new short-stay visa category to allow migrant workers to fill growing job vacancies." Needless to say, social credit policies will never allow this form of national and racial suicide to flourish, as it now does.
This paper has been only a brief 'cook's tour' of the philosophical foundations of Social Credit, but having a theoretical answer to our problems gives us hope that we will find the right strategies to make theory a reality. The League offers a comprehensive range of books on Social Credit, including all of the major works by C.H. Douglas and our own Eric Butler. A good starting point for beginners - and more advanced readers wanting a different perspective - is an excellent series of books by Anthony Cooney: Clifford Hugh Douglas 1996, Social Credit:Asterisks 1995, and his more recent Social Credit: Obelisks 2003.