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25 July 2014 Thought
for the Week:
AUSTRALIA’S ETERNAL POLITICAL CRISIS
by James Reed
The League has been saying this and more for some time, indeed, a long time. The political system has got increasingly worse and basically has ceased to function as it was intended to do. Clearly we are at the “crossroads” and we may have to accept that “Australia” as we knew it is now dead for us and that we need to start building anew. It’s like an old orange tree that my folks had. The tree died, but some time later a new tree sprang up and grew around the old dead wood. The old wood eventually was no more.
NATIONALISE THE BANKING SYSTEM ALONE? A FATE WORSE THAN DEBT!
by Betty Luks
That article sparked a significant debate between economists and bloggers, both for and against the idea of stopping banks from creating money. Of those against, many critiques either misunderstood the proposals or simply made claims without providing evidence. To respond to some of the common objections, we've revised the paper that outlines our proposals. 1) NEW Paper: Creating a Sovereign Monetary System…” Can be downloaded from here… https://www.positivemoney.org/our-proposals/creating-sovereign-monetary-system/?mc_cid=ef8d32536a&mc_eid=bdd71201b”
Bank Nationalisation in the 1940s: How many Australians are aware the Australian League of Rights ‘cut its first teeth’ on the Bank Nationalisation issue way back in the middle 1940s? Eric Butler recalled those years in “Social Credit Opposition to Bank Nationalisation” in The New Times, October 1995 (found here…https://alor.org/New%20Times/index.html)
The most devastating criticism of the Chiﬂey government’s policies came from the controversial former Labor Premier of New South Wales, J.T. Lang, who had been elected to the federal parliament - as an Independent at the 1946 elections. Lang correctly pointed out that bank nationalisation was but a logical step in an ongoing programme to destroy the federal Constitution. Lang vividly recalled that back in the Great Depression era, Chifley had, as a Minister in the Scullin Labor govemment, been a strong supporter of the infamous Premiers’ Plan, imposed at the insistence of Sir Otto Niemeyer of the Bank of England, who was accompanied on his 1930 visit to Australia by Professor Theodor Emanuel Gregory, a member of the teaching staff of the London School of Economics at a time when one of the dominant influences at this Fabian-created institution was Dr. Harold Laski, a dedicated Marxist pro-Zionist Jew who openly expressed his detestation of Christianity.
Laski had strongly influenced large numbers of students from around the English-speaking world. Numbered among these were Pierre Elliott Trudeau, Canadian Prime Minister, who openly boasted that he was taking Canada down the Fabian Socialist road; John F. Kennedy, USA President; and Dr. H.C. Coombs, who was a key adviser to both Labor and Liberal governments at Canberra. Laski said that Coombs had been one of his best students.
Dr. H.V. Evatt, Australian Attorney-General, who was the major driving force behind the thrust to destroy the federal Constitution, spoke glowingly of the advice he received from Laski, who lamented the defeat of Evatt’s 1944 powers referendum.
Chairman of the British Labour Party during Attlee’s Labour government - which was stacked with large numbers of London School of Economics products - Laski visited Moscow in 1946 to meet with Soviet dictator Joseph Stalin. Laski made the historically significant statement that he had pointed out to Stalin that while he and the British Socialists were travelling on separate roads, Stalin on the Marxist-Leninist road, and the British government on the Fabian-Socialist road, they were travelling towards the same objective, both inspired by Karl Marx's famous 1848 Communist Manifesto, which included Marx’s ten steps for communising a State. These steps were all designed to centralise all power. Marx advocated the establishment of a State Bank monopoly. It is not too much to say that Harold Laski was one of the most influential Marxists of the twentieth century, reflecting Shakespeare’s famous observation that “The evil that men do lives after them, the good is oft interred with their bones”.
TEN MOST IMPORTANT QUESTIONS: 1933 ADDRESS BY MAJOR DOUGLAS
Please note: This document was prepared from a rather poor copy of what appears to have been a type-written draft of Major Douglas’s address to the Social Credit Council. The document was found in the personal papers of the late Leslie Denis Byrne who was a close confidant of Douglas. Wednesday, 4th October, 1933:
“I would like to begin by saying that I am very much impressed by the Questions submitted. It would have been very difficult to draw up ten questions which seem to go more to the heart of the matter than these do.
Question 1. “Are you in favour of the Nationalisation of the Central Bank, i.e., the control and issue of all forms of money by the Crown?” *
This question is one of the most important which can be asked of anybody making pretensions to understand [the] bearing of [the] money problem on social conditions. Extraordinarily subtle question - requires good deal of technical experience to assess its importance.
To give you a sort of picture of the thing, I am going to ask you to dismiss from your minds the whole idea of money. Try and put yourselves in a state of mind which you would be in if you have never heard of money, and there was none. Imagine that you had an unlimited supply of water, supplied in unlimited quantities from the clouds and the rivers, and that the whole problem was one of the distribution of water. Substitute for it, the idea of a water system.
Problem is the distribution (administration) of the Water: Imagine also that you had a conception in your mind of a reward for service and that the people who were responsible for the satisfactory distribution of this unlimited supply of water - which was absolutely vital to every member of the community - were going to be remunerated for their services by a share of the water. Remember also that the amount of water is fundamentally unlimited. The problem is that of the distribution of the water.
Under these conditions you will see that the question of whether the state should undertake the distribution of water, or whether you should have a state of affairs in which a local organisation undertakes this distribution, is simply a problem of administration. Fundamentally the question is, which of these possible organisations will distribute the water most satisfactorily?
Your personnel is likely to be the same in both cases. Therefore ultimately it becomes a question as to how you can transmit the desires of the general population to those people in control of the distribution of water. If the desires of the population are not satisfactorily represented by the administrators, what will be the most easily flexible form of pressure to bring upon them to bring them back into the ways of rectitude, e.g., the successful translation of the desires of the general population in regard to the distribution of water?
Amount of water is a side issue: Remember that the question of the amount of water that these people get themselves is a very side issue. There is a lot of water - more than you can possibly use. They can have – if they want it - a great deal more water than they themselves can possibly use. If you assume as a postulate, that the amount of water is not limited, this question as to how much administrators get is a side issue. The important thing is that everybody should get enough water.
Let us imagine that you have a state organisation in connection with the water system which is immune from public pressure - as public servants are supposed to be and as civil servants actually are - the only way in which you can bring public pressure to bear upon the organization is by the extremely cumbersome way of Democracy and the Ballot-Box - a very long and complicated process.
Suppose you have in your village a couple of shops, both selling the same sort of cigarettes. In one of them, when you go in, you get courtesy and instant service, and in the other you are met by the announcement, “I will give you your pound of tea as soon as I have washed up," (or done some other thing), you immediately apply effective pressure by going to the other shop.
In my own opinion the first thing to recognize is that it is secondarily a problem of administration and that so far as it is a problem of administration, all the evidence we have is in favour of private competitive administration, which is much more amenable to pressure than is nationalized administration which is only a changed administration and has no relation whatever to policy.
What is the policy in regard to the money system? This can be answered by saying that the whole question at issue in regard to the policy of the money system is “Does the effective demand represented by money, belong to the banking system or to the public?” That is the whole issue of the money question. It is only secondarily a question of administration at all. Whether it is administered by the civil service or by the joint stock banks is not the point of issue at all. I have no doubt whatever that to transfer money power to the Government before you have altered the money system that it cannot be an additional source of tyranny, as it is at the present time, is simply to concentrate your tyranny. I have no doubt whatever that to nationalise the Bank of England at the present time, would not only be one of the most cardinal errors that could take place, but would make impossible any changes in the money system as such, without an armed revolution.
Question 2. “Do you advocate the abolition of the Gold Basis?"
Question 3. “What Basis do you advocate?”
This is a very highly technical question. The short answer to it is that the proper basis for a money system is the ratio of production to consumption. There is no such thing as a “standard of value” at all. The whole idea of a standard of value is a complete misapprehension of reality or anything else. All values are relative. They do not bear any relation to gold as such, because gold is no more a standard in this sense than anything else is. For example, every time you may conceive of yourself as inventing a new use for gold, you obviously alter the relative value of gold to everything else. What you can do is to generalise all production and all consumption, not in regard to some perfectly arbitrary thing like gold, but in regard to each other. In this way you have a flexible standard which takes into account from second to second all the changes that take place in production and consumption. These changes are what is important in regard to the answer to the next question.
Question 4. “What should be the purpose of money?"
In many places there is a complete misapprehension as to the use of [a] money system at the present time. In the first place all the vocal orthodox economists are quite obviously and honestly unaware of any change whatever in the reasonable functions of money and in the economic system in the last 300 or 400 years. For example, I saw a letter attacking me in 'The Listener‘ from someone who said that my views on Economics had been exposed by Sir Francis North in 1641! To my mind that is one of the most completely damning things that could be said. Anything I can contribute is based on the conditions which have come into prominence within the past fifty years.
The first thing to be clear about is that the idea of money as a medium of exchange is, if not obsolete, so rapidly becoming obsolescent it is really not worth considering [i.e.,] the idea of an economic system carried on by isolated craftsmen or farmers exchanging their products with each other on a basis which will ensure that the products are in fact, exchanged. The modern economic system is not in least like that. It is a system in which you have a central pool of production through enormous industrial organisations in which by far the most important factor is real capital - machines, power, etc., and the problem is not to exchange between these institutions. It is to distribute from them to people who fundamentally have nothing whatever to exchange. They are simply standing on the outside line of an organisation which is productive, and the problem is to get the goods over from the organization to these people - not to exchange at all.
The idea of a money system as a means of exchange is only applicable to a small and diminishing fraction of the total production of the world. Therefore, it is of the most fundamental importance to enquire what is the purpose of money. It is that it is first of all an effective demand - a ticket system - a valid demand for goods and services. Consequently, it is the most extraordinarily flexible voting system which the mind of man can conceive. Every time I go into a tobacconist's shop and buy a pack of Black Cat in preference to Gold Flake, I vote for Black Cat in preference to Gold Flake. Every time I buy Cadbury's cocoa in preference to Fry's, I vote for Cadbury's. This preference is transmitted day by day to the companies concerned and they know whether or not their goods are meeting with public approval. This is the whole essence of the economic system. The problem is to produce what the public want and to get it over to them. The fundamental purpose of a proper money system is first to give the most rapid and flexible indication to producing organisations as to what the public want, and secondly to see they get it.
Question 5. “In what form do you consider money should be put into circulation?"
This does not matter. My own opinion is that ultimately something like the cheque will supercede all other forms of money. (Remember Douglas was speaking in 1933.ed) It is anyway not a matter of the slightest importance.
Question 6. “Do you consider that a standardisation of currency or of values is necessary?"
From my point of view, this question is meaningless, though it is important to make this clear. It is in the phraseology of an outworn type of thought. The first essence of appreciation of the problem is to divest yourself from the classical type of thought. Standardisation of currency, does not mean anything, for example, a standard weight. The whole idea of relating this problem to the physical idea of standards is a complete misconception. It is one on which more people have fallen down than anything else, and it is being used at the present time by orthodox financial people with the greatest success. (For example, Strakosch at a recent meeting of engineers pointed out the absurdity of taking a tube of mercury, which altered with every movement, as a standard.) To ninety-nine people out of one-hundred, this sounds like a conclusive argument. It has nothing to do with the problem whatever.
The problem of the distribution of the products of production is not an ethical problem or one of measuring what has been produced. It is primarily a problem of estimating what can be produced and is desired shall be distributed. The actual rate of production of the machinery of the world changes from minute to minute and from day to day. Every time you have a new invention it may add five per cent or six per cent to the productive capacity of the whole world, in regard perhaps to every other machine that has previously been invented.
The idea of standardization is one which has to do with a particular type of thought, all mixed up with “justice” and "equity" and these sorts of things. Take this question of justice. Supposing you had ten men who were crossing the Sahara Desert in a caravan and had a limited supply of water, and a long journey to take. Quite obviously the exact distribution of that water is not merely a matter of justice but one of efficiency. There will not be enough to go around unless you measure it out, a certain amount every day. You will create friction if one man gets more than another. But if you take the men out of the Sahara and put them by the shores of Lake Superior, is it reasonable to go on ladling out teaspoons full of water when there is so much they can drown themselves in it if they want to? All these ideas may have been sound when there was a genuine scarcity. At the present time the problem is to distribute abundance and not to measure the scarcity.
Question 7. “What method of international exchange of goods do you propose?"
This is a highly technical question. The short answer is that the Bill-of-Exchange is a perfect mechanism under premises of ideas discussed this morning.
Then suppose that by some process, next week, I reduce the general price level from a price level of one-hundred to a price level of fifty. Immediately, the Frenchman is prepared to pay two-hundred francs for every pound because with one pound he can buy in England what he can buy in France for two-hundred francs.
The fly in the ointment of this theory is that the Exchange Brokerage is a closed corporation. If you want to buy a large number of francs you will come ultimately to six or seven people all of whom are international brokers and have control of the exchange. They can raise or lower exchange, or refuse it altogether in which case an impasse is reached very shortly. If they raise the exchange of a country, e.g., England - if they put a premium on sterling, they would penalise our products, but at the same time it enables this country to buy a great many imports much cheaper. These two things off-set each other to the extent that we make the necessary arrangement to absorb imports without creating an internal economic situation. If they take the opposite line - to hammer the exchange down - immediately they create a tremendous pressure on export and if any change in the economic system occurs at all we are put in a very advantageous position to capture foreign imports. People can buy sterling at a low rate and therefore can buy British products at a low rate. This is a very serious problem to exchange brokers.
Question 8. “Are you in favour of an international currency?”
No. There is no necessity for an international currency and you never solve any problem by making it bigger. One of the very strongest lines of defence of the international financier is this curious idea which has been inculcated in people's minds that you do solve a problem by making it bigger. They desire to get people to believe that although one state cannot solve its problems or one town, if you make the town subservient to the state, that will solve the problem. But it will only defer the solution of the problem.
It is a military problem: This problem of currency can be solved nationally - not because theoretically it could not be solved on a much smaller scale, i.e., a municipal scale - but it is not a theoretical problem; it is a military problem. What you have to do is to decide the unit of population which can effectively challenge the measures brought to bear on any state or town which departs from those rules favourable to high international finance. Wherever this problem is effectively challenged first, the whole weight of World International Finance will be brought to bear on this spot. The only question is what can they do? And how can it be resisted? I think this is a very large bogey. If you get to the point when you get to action, international finance can probably do very little. The problem must be made smaller and smaller and smaller till you have got it under control.
Question 9. "What is your method of getting and continuing control?”
Constitutional pressure. The real problem is not a technical problem. Having once got the ideas clear, the ideas can be pigeonholed away. Ultimately it is a military problem.
Question 10. “Will your system ensure economic freedom for the individual so that each is free to express his own life in his own way, providing that it does not interfere with the welfare of the community?"
Yes. There will be a very large number of things that will still want doing in the world when the financial problem is satisfactorily settled. But I am absolutely certain that none of them can be done till the problem is settled. It is a problem of priority. When you have the individual free from all the artificial stresses which are brought to bear on him by the control of the press, the constant pumping into him of ideas not grounded on fact, when you have the B.B.C. controlled by the Bank of England, you cannot hope to solve any problem. The problem is not even stated, with any hope of its being understood. This financial problem is so difficult because it is not humanly possible for any but a small number of people to understand it. When the financial problem has been solved, you will be at stage One in which the provisions of this Question will have reasonable hope of fulfilment.
* It has been brought to our notice that some folk don’t have a clear understanding of what the term “The Crown” means in the United Kingdom. The term does not refer personally to the reigning King or Queen. "The Crown is a term used to mean, in effect, the state. It is a symbol of the power of the state, which was formerly vested in the monarch. Thus, for example, the prosecution of crime is said to be on behalf of the Crown."
WHOA! BIG BANKS HIT WITH MONSTER $250 BILLION LAWSUIT!
Ellen Brown in America reports:
In June, however, the banks may have met their match, as some equally powerful titans strode onto the stage. Investors led by BlackRock, the world’s largest asset manager, and PIMCO, the world’s largest bond-fund manager, have sued some of the world’s largest banks for breach of fiduciary duty as trustees of their investment funds. The investors are seeking damages for losses surpassing $250 billion. That is the equivalent of one million homeowners with $250,000 in damages suing at one time.
The defendants are the so-called trust banks that oversee payments and enforce terms on more than $2 trillion in residential mortgage securities. They include units of Deutsche Bank AG, U.S. Bank, Wells Fargo, Citigroup, HSBC Holdings PLC, and Bank of New York Mellon Corp. Six nearly identical complaints charge the trust banks with breach of their duty to force lenders and sponsors of the mortgage-backed securities to repurchase defective loans. Why the investors are only now suing is complicated, but it involves a recent court decision on the statute of limitations. Why the trust banks failed to sue the lenders evidently involves the cozy relationship between lenders and trustees. The trustees also securitized loans in pools where they were not trustees. If they had started filing suit demanding repurchases, they might wind up sued on other deals in retaliation. Better to ignore the repurchase provisions of the pooling and servicing agreements and let the investors take the losses—better, at least, until they sued.
Beyond the legal issues are the implications for the solvency of the banking system itself. Can even the largest banks withstand a $250 billion iceberg? The sum is more than 40 times the $6 billion “London Whale” that shook JPMorganChase to its foundations.
Who Will Pay - the Banks or the Depositors? The world’s largest banks are considered “too big to fail” for a reason. The fractional reserve banking scheme is a form of shell game, which depends on “liquidity” borrowed at very low interest from other banks or the money market. When Lehman Brothers went bankrupt in 2008, triggering a run on the money market, the whole interconnected shadow banking system nearly went down with it.
Congress then came to the rescue with a taxpayer bailout, and the Federal Reserve followed with its quantitative easing fire hose. But in 2010, the Dodd Frank Act said there would be no more government bailouts. Instead, the banks were to save themselves with “bail ins,” meaning they were to recapitalize themselves by confiscating a portion of the funds of their creditors – including not only their shareholders and bondholders but the largest class of creditor of any bank, their depositors. Theoretically, deposits under $250,000 are protected by FDIC deposit insurance. But the FDIC fund contains only about $47 billion – a mere 20% of the Black Rock/PIMCO damage claims. Before 2010, the FDIC could borrow from the Treasury if it ran short of money. But since the Dodd Frank Act eliminates government bailouts, the availability of Treasury funds for that purpose is now in doubt.
When depositors open their online accounts and see that their balances have shrunk or disappeared, a run on the banks is likely. And since banks rely on each other for liquidity, the banking system as we know it could collapse. The result could be drastic deleveraging, erasing trillions of dollars in national wealth.
THE ASIAN CARGO CULT
by Richard Miller
The “excitement” among the elites was that they hoped that the Japanese will join the Chinese in buying up the resources sector, agribusiness and retail because we Aussies don’t have the “magic” “investment”. The Chinese and Japanese have this “magic”. We are too inept to function, so we must be bought up. For some reason we never get this “magic”. All of this is nothing short of a national disgrace. That our own traitorous “Leaders” have never looked outside of the conventional financial square for the means of financing projects for nation building. Our so-called leaders actually want our country, race and people to be dissolved. Surely they can’t be that stupid?
by Richard Miller
Commenting on all of this pro-immigrationist Bernard Salt (“Asia Drives Continental Drift”, The Australian 27 June 2014, p.6) said: “The Anglos still have an extraordinary head start – it will take a lot to overtake them, but at some point in the 2020s I think we will see the second-largest group in Australia will be either the Chinese or the Indians”. My guess is that by that time the Anglos will be a minority. The time for dealing with this issue is fast running out.
Asia Australia means no Social Credit, no CIR, none of our favourite values being preserved. There is good chance of runaway immigration after a certain point of white decline where Asian MPs push for open borders. We need to do more than gauging public opposition to immigration. There needs to be a party to fight this as in Europe.
DR DAVID EVANS’ NEW SOLAR CLIMATE MODEL
by Brian Simpson
The model itself is computer-based and employs advanced Fourier analysis, - based on the work of French mathematician Joseph Fourier (1768-1830) - breaks a wave form into component waves of different frequencies and amplitudes. The modelling is based upon solar radiation and explains past warming on the basis of the influx of solar radiation. It predicts that there will soon be a radical fall in temperature, whereas the CO2 theory predicts an increase, as all scientists accept that CO2 levels are rising, but they disagree about whether this causes global warming or not.
The sun’s current solar activity is the weakest it has been this century, and it is this activity, or lack of it, which is essential to the heating of the Earth, not carbon dioxide. Consequently this model means that there is no need to cut back on industrial activity and consumerism and all of things which gives us the comforts and softness of modern life. I take comfort in that explanation as my fire burns away on this bitterly cold night.
From Joanne Nova: Finally! Carbon Tax Gone - Australia gets rid of a price on carbon “The Australian Senate passes the carbon tax repeal bill. All cross-benchers present voted for the repeal. This is an excellent, long awaited development. Finally, the choice made by Australian voters is recognized. I am indeed very happy about this news. Delighted! Now we need to turn off the tap to all the other green gravy rent-seekers who ignore the evidence…”
Man Made Global Warming Disproved - Joanne Nova and Anthony Cox
They don’t predict the past. How could they predict the future?
Observations from every angle point to a similar conclusion
Continued faith in flawed models breaks central tenets of science
New Social Credit WebsiteFrom Oliver Heydorn
I would like to bring your attention to the new website of "The Clifford Hugh Douglas Institute for the Study and Promotion of Social Credit": https://www.socred.org/ The institute is a formally registered Canadian not-for-profit organization. Those who are curious as to what Social Credit is all about should read the inaugural blog entry: https://www.socred.org/blogs/view/what-is-social-credit-all-about
Sincerely, Oliver Heydorn, Ph.D.
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