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21 May 1999. Thought for the Week: "The sheltered liberal-minded classes of the nineteenth century - especially in Britain - gave no thought to the ultimate effects of gradual transfer of authority the anonymous impersonal collective forces massed in the great urban conglomeration created by nineteenth-century industrialisation. ... The book is not mainly concerned with economics. The motive for the seeming digression that the British Free Trade movement was not of only an economic theme, but that of a whole philosophy of life, held with religious fervor. The argument is not that Free Trade is never the best policy, but that it is only an expedient which should be harmonised with National Security and therefore with a balanced economy."
David Kelly in The Hungry Sheep
THE DESTRUCTION OF CONSTITUTIONAL MONARCHY AND THE RETREAT FROM FREEDOM
by Eric D. Butler
As pointed out by the author of Social
Credit, C.H. Douglas, in an address on "Realistic Constitutionalism",
British Constitutional developments, including Magna Carta,
were rooted in the Christian concept of the nature and purpose
of Man. English Common Law was based on the Christian view
that every individual was unique, not equal. In the famous
words of the English mystic poet William Blake, one law for
the lion and the lamb must end with tyranny. Different situations
required different answers to problems, a reality brought
out so clearly by Shakespeare in his play, The Merchant
of Venice, a play strongly disliked by supporters of the
Judaic religion, who often charge that the play is "anti-Semitic".
The truth is that the play, with its stress on mercy and forgiveness,
reflects the traditional Christian view of law.
Centralisation of power is contrary to the spirit of British Constitutional and political development, which governed the development of government in Australia, first in the Colony and later the Australian Federation. The development of British Constitutionalism was organic and accepted that the nature of reality was Trinitarian. Harmony in government requires that it consist of three parts: A House of Commons reflecting the general will of the electorate.
But the House of Commons might grow into a tyranny unless subjected to the right of veto by the House of Lords. The members of the House of Lords were both the Lords Temporal and Spiritual, who because of their backgrounds reflected the permanent features of the nation's history. Such a view realistically accepted the view that tradition was essential for the preservation and extension of the wisdom of the past. One of the few current members of the House of Lords is expressing his reservations about the Blair Government's legislation to abolish the hereditary Members of the House of Lords, stressing that he and his forbears had served the Crown over a number of generations and had made a distinctive contribution to the life of the nation. All this would be lost if hereditary peers were to be eliminated.
The tragedy is that relatively few understand the long-term significance of what is happening, primarily because of a defective educational system. The question of the Senate and its future is related to what is happening. John Howard indicates that he has little enthusiasm for a Senate, which produces a traditionalist like Harradine. Although he pays lip service to the beneficial effects of the Constitutional Monarchy, he maintains what is basically a neutral stance. In his famous poem, Dante says that those who maintain a neutral attitude in the times of great crisis are doomed to take their place in the hottest place in hell.
A traditionalist who believes that the future of Australian families is more important than financial statistics has effectively brought John Howard's career to a stop. Brian Harradine will be remembered long after John Howard has passed from the Australian political stage.
by Jeremy Lee
By and large, forecasters and economists have lauded the Budget. It is both economically and politically correct from the globalist point of view. The figures tell a different story. Total income tax will increase by 5.7 percent, from $104 billion to $110 billion. Indirect taxes will increase by 3.5 percent, from $31 billion to $32 billion. Overall, direct and indirect taxation will increase by 4.9 percent, from $141 billion to $148 billion. Averaged out across a population of 18 million, Commonwealth taxation (direct and indirect) now takes over $8,000 for every man, woman and child. For the average family of four, this totals the incredible figure of $32,000! (Total government revenue now exceeds $9,000 per head.) And remember - State taxes and Local Government rates come on top of these mammoth totals!
Most areas of government expenditure have increased; the biggest cut in expenditure being in agriculture, forestry and fisheries, with a 15.7 percent drop. C.H. Douglas, in his masterly "Dictatorship By Taxation", made the point that all taxation is inflationary, and must ultimately be costed into the price of goods and services. Treasurer Costello budgeted for a surplus of $5.4 billion. Immediately following the Budget, $1.5 billion of the surplus was pledged to further "sweeteners" aimed at enticing Independent Senator Brian Harradine to vote for the Goods and Services Tax. The surplus, of course, is the extra taxation taken over projected expenditure. Running a "surplus budget" is regarded by the International Monetary Fund as the height of responsible management.
Veteran economists, on the other hand, who see some connection between Budgets and the prosperity or otherwise of ordinary people, have long argued that a surplus at a time of unemployment and unused capacity in industry is exactly the wrong policy. A number of commentators suggested there had been a "turnaround" in Asia, and that Australia's exports to the region could be expected to grow in the months ahead. The evidence says otherwise.
The Australian Financial Review
(5/5/99) gave this more realistic picture: "...Consider the
following anomalies. Hong Kong's economy experienced a 5 percent
contraction in 1998 and is expected to contract by another
3.5 percent in 1999 while unemployment rates rise with each
passing day. Nonetheless, the Hang Seng Index rose by 85 percent
over the last three months of 1998.
"If domestic conditions do not warrant these increases in stock market valuation, what is behind them all? The interest rate cuts by the US Federal Reserve and the European Central Bank, its most recent in April 1999 from 3.0 to 2.5 percent, created the additional liquidity for investors to play the markets in the developing and developed world "
CRACKS IN THE DAM WALLS OF CENTRAL BANKING
Two Professors at Princeton University in the US - Sheri Berman and Kathleen McNamara - in a three page article in The Australian Financial Review (14/5/99) have challenged the totalitarian nature of Central Banking, with particular reference to the European Central Bank established under the Maastricht Treaty.
"In January, a new leading actor strode onto the world stage. More powerful than most national governments and responsible for helping to set the economic and political course for 280 million people and almost a quarter of the global economy, the European Central Bank is notable for something more sinister as well - its almost complete freedom from democratic oversight and control"...In a secular version of Lent that is now the rage from Europe to Latin America to the post-Soviet bloc, democratic governments are proving their faith and virtue by giving up something dear - the ability to control their countries economic destinies... "By turning over monetary policy to unelected and often unaccountable technocrats, countries surrender much control over their economic fates... "In both developed and developing countries, more and more people see globalisation as a threat and believe they are paying too high a price to satisfy the demands of international capital and finance... "European integration has so far been primarily driven by elites. European publics have been sceptical about losing sovereignty and about the generally undemocratic nature of European institutions
The authors of this rarely publicised point of view gave plenty of examples of the inefficiency and incompetency of Central Banking in the scheme of things. The Australian Financial Review should be congratulated in presenting an all-too-rare alternative viewpoint. The Australian people have never agreed to alter the Constitution in order to sanction the move by politicians such as Prime Minister Howard to surrender financial control to international bodies.
SUPPORT FOR HARRADINE, CALL UPON THE DEMOCRATS
Although Senator Harradine is not known as a drinker, it is doubtful that he could buy himself a drink in any Australian pub this week, and be allowed to pay for it. If he is not swamped with congratulations and expressions of support for his decision to vote against the GST last week, we will be amazed. Not only did Harradine perform Australians a singular service in making such a decision, but he also demonstrated the value of the Australian Senate as a vital House of Review, and vindicated the League's long-held claim that the Senate is essential to representative government in Australia.
As we pointed out last week, Harradine is not the only Senator who could ensure that the GST legislation would be rejected. There are 37 others who could have done as he did last Thursday, but lack either the courage or good judgment to do so. In our view, every Australian owes a vote of thanks to Senator Harradine, and should consider sending him a message of support to that effect.
But what now? As Prime Minister Howard surveys the wreckage of his taxation dreams, he faces the prospect of trying to tempt the Democrats to support the legislation in some 'satisfactory' form. But it should be stressed in the strongest possible terms that Mr. Howard has no "mandate" for the GST. Although both he and Treasurer Costello claim it, the "mandate" argument is a mirage that does not withstand close scrutiny. The fact is that the Coalition lost significant support at the last election, and lost significant seats in the Parliament. The GST and the sale of Telstra were weighty electoral baggage, and Mr. Howard can thank the ghost of Paul Keating that voters were not tempted to flee the Coalition, and risk a term of dodgy government under Beazley, although the ALP were clearly not fit to govern.
FOCUS ON THE DEMOCRATS
The Australian Democrats can just as
legitimately claim that they have a "mandate" to block the
GST in the Senate. Indeed, at the last election, the Democrats
increased their Senate presence from 7 to 9 seats, running
on a platform of not selling Telstra, and against the GST.
Thus, their Senate presence rose from 9% to 12%, and when
the new Senators take their seats on July 1st, it is the Democrats
to whom Mr. Howard will need to appeal for his GST.
In our view, the GST campaign should now focus on the Democrats. They object to a GST on food. But as Harradine asked in February, "why are we concentrating on food? Housing costs, transport, fuel, power, and clothing represent 40% (of household budgets for the poor). None of those at the moment are subjected to wholesale sales tax, or any other sort of tax, but they will be subject to a 10% GST". (23/2/99)
The Democrat Senators presently in the Parliament are: Meg Lees (leader, South Australia), Natasha Stott Despoja (SA) Vicki Bourne (NSW); John Woodley (QLD); Andrew Bartlett (QLD); Lyn Allison (VIC); and Andrew Murray (WA).
The Harradine question should be put to all these Senators - why are we concentrating on food...? This is a pernicious tax, so please follow the Harradine example; just say NO!
RURAL PAPER GIVES THE FACTS
Those who know something about money, and how fractional reserve banking works, are resigned to the distortions and omissions in the national media on this important but misunderstood issue. It is unusual to find an editor who considers the matter important enough to write about - but that's what the closure of another bank branch has stimulated in The Wimmera Mail-Times (12/5/99).
After pointing out the huge inconvenience
to the citizens of Natimuk when the Commonwealth closed the
last bank in town, the Editorial went on: "... Too few people
are aware of how our banking system works with many believing
the quaint notion that banks lend out money deposited by other
customers. In fact banks operate on what is called a fractional
reserve system, which means that a bank can lend out far more
than it actually possesses. Generally speaking they only need
to actually have about 10 to 15 percent of their total loan
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