Douglas and the Jews

By Michael Lane
July 2002

C. H. Douglas's antisemitic reputation is an almost insurmountable obstacle to the acceptance of social credit. This reputation stems especially from his writings of the 1940s, in which he takes a critical attitude toward the role of the German-Jewish elite in the century 1850-1950.

C. H. Douglas is not a historian and not a scholar, because he is not interested in history for its own sake. Rather, he is like a physician (or quack?), for whom tracing the cause and course of illness is just a prerequisite for diagnosis and treatment. The patient, in this case, is Britain, and the illness is indicated by symptoms of cultural dissolution and the impoverishment of life. In his very first book (1919), he states that his aim was to reveal "the skeleton of the Structure we call Society" in order to "suggest sound reasons for the decay with which it is now attacked" and on that basis "to indicate the probable direction of sound and vital reconstruction."¹ Douglas never wrote a book of history, but he wrote several about the illness of Britain and its causes. In the course of analyzing Britain's dissolution, he makes many observations about events, especially the century 1850-1950.

Douglas's "history" is all about events that threaten to impose a certain structure of society, or culture, on Britain. In 1926 Douglas wrote: "The end of the eighteenth century and the earlier part of the nineteenth century witnessed a condition of general culture in England which was lower and more brutal than that existing in any other portion of the civilised world. . . . Germany before the war, or perhaps it would be fairer to say Prussia, had a culture which was not dissimilar. [In the past fifteen or twenty years in] the United States, there has arisen a culture which is markedly similar. . . . Finance and a particular type of culture, which you may call Prussianism if you wish to give it a name, have been dominant at one and the same time." Three chapters later in the same book (ca. 1928), he writes: "The problems which confront the world are not primarily geographical. So far as any one adjective will describe them, they are fundamentally cultural."²

This ties in with what was called the "history of ideas." The history of ideas was a new concept in history at this time, one that earned a great deal of attention. A landmark book was Perry Miller's New England Mind (1939). Miller analyzed "the complete thought system of an intellectual elite—the intelligentsia of Puritan New England. He reconstituted the group's logic, view of human nature, and vision of the universe. . . . All aspects of the Puritan `mind' were treated as an interrelated unit, or homogeneous mental style. . . . It was assumed that the mental life of the intellectual elite typified the thought system of the society as a whole."³ It was as a contribution to the history of ideas that in 1924, by way of critiquing a whole worldview, Douglas wrote, "Rewards and punishments . . . may be said to be the corner stones of the Semitic structure of society."⁴

What's wrong with "rewards and punishments"?

The practical difference between the theory of rewards and punishments, and the modern scientific conception of cause and effect, can be simply stated. The latter works automatically, and the former does not. . . . We do not know what is the automatic reaction consequent on the killing of one individual by another, as distinct from the non-automatic and artificial reaction involved in the trial and punishment of a murderer in a court of law. . . . If we throw a stone into a still pool of water, the ripples which result are not eliminated by throwing in a second stone, although they may be masked, and to the extent that legal punishment represents, not the ripples from the first stone, but the casting of the second, it will be seen that a complicated situation is inevitable.⁵

This is deep thinking. The grounds of Douglas's opposition to the death penalty is that its efficacy as a cure is compromised by the fact that it doubles as moral vengeance.

Douglas is against "Judeo-Christian" morality, because it emphasizes altruism, "the austere virtues," the self-sacrifice of the individual for the sake of the group. He recognizes that there was a time when the group's interests were paramount, when the tribe was all that stood between the individual and death. However, if today individuals are expected to set the interests of the group above their own, it is apparent that the "group" has become an abstraction, an emotional locus in which individuals have been induced to live vicariously. Although Douglas nowhere uses the word, it would not be inappropriate to call this an anticulture. It is a "culture" that enthralls and psychologically stunts its own members. Douglas's desideratum is the exact opposite—not the self-sacrifice of the individual for the sake of the group but the subordination of the group to the interest of the individual—nay, more, the idea that the only justification of the group is the individuals who compose it.

One who sees reality through a set of abstract, transcendental, moral values is called the "black-coated theorist." Douglas opposes, throughout history, "the attack of the black coated theorist on the pragmatist, the farmer, the sailor, the pioneer."⁶ In philosophy it is Aristotelianism, the bane of Francis Bacon; in the state it is Prussianism; in religion it is the Law of Moses.

As the old point of view is associated with Aristotle in philosophy, the new is associated with Francis Bacon, who finds Aristotle "only strong for disputations and contentions, but barren of the production of works for the benefit of the life of man."⁷ And as the old, reactionary point of view is associated with Prussianism in the state, the new is associated with domestic life as the justification of the state (the Jeffersonian ideal). As Chesterton brilliantly puts it in connection with a program to control lice by cutting poor girls' hair short, "It is only by eternal institutions like hair that we can test passing institutions like empires." And as the old point of view is associated with the God of Wrath of Exodus, so the new one is associated with the Incarnation, Christ's Humanity: "One of the root ideas of the pre-Christian era, is in respect of [the] dethronement of abstractionism. That is the issue which is posed by the Doctrine of the Incarnation." More poetically, "The jewelled cope is triumphing over the black gown."⁸

Douglas associates what he calls "the Semitic structure of society" with "monotheism," that is, the theocracy of the ancient Hebrews as the common background of Judaism, Christianity, and Islam. It is the same idea that Thomas Robertson labels "the Myth of External Authority" and Daniel Neyer, the "savage God" problem or "Calvinism." The gist of it is a sense that the laws of the universe are alien to the soul, imposed from the outside. Ultimately springing from the Old Testament, this idea easily crisscrosses racial and religious boundaries. The opposite idea Douglas calls "immanent sovereignty," the idea that the soul and the universe speak the same language. While for Douglas, the latter is the true teaching of Christ, nevertheless, the Myth of External Authority entered Europe via a conflicted Christianity and is the stuff of "Sunday School" morality.⁹

Had Douglas left it at this, there would have been little to object to. It becomes more complicated, however, because in his 1940s writings he takes a critical attitude toward the role of German-Jewish elite in the century 1850-1950, based on circumstantial evidence. The German-Jewish elite were the elite of Jewry as a whole; and, like Miller on the Puritans, Douglas assumed that the "elite typified the thought system of the society as a whole." It doesn't help matters that Douglas (not a historian, as has been noted) makes no attempt to sound evenhanded but prosecutes his case with some verve: "That Jewry as a whole has a permanent policy which aims at establishing the individual Jew as a member of a `chosen', superior, dominant and ruling class in every country and over the whole world, is the charge, and it appears to me to be established by a consideration of the part played by Jews in both general and economic history so far as I am familiar with it." Douglas further clarifies "Jewry as a whole" by saying, "It is a racial and not a personal indictment."¹⁰ Now you have the worst of it.

Douglas seldom uses the word race, but when he does, it is always in the sense of the group as against the individual, the group that has taken on a life of its own at the expense of the lives of its individual members—hence always negative. This helps us make sense of Douglas's introductory sentence to this chapter, "A satisfactory reformation of the monetary and political system would be fatal to the aspiration of the Jewish race, although it is vital to its best interest," that is, to the best interest of its individual members (ibid.). The "race" gives way to the free association.

"Jewry as a whole" thus brings us back to the history of ideas, the "Semitic structure of society," and the Myth of External Authority. Douglas's thesis is therefore not, in spite of superficial appearances, a conspiracy theory. It is a theory that the theocracy of the ancient Hebrews still works powerfully, not least among Jews who, like most of the German-Jewish elite he mentions (Jacob Schiff being the rare exception), repudiated it. Thus, the "policy which aims" that Douglas speaks of is not the conscious policy of individuals but "the policy of the dead" perpetuated in cultural institutions. German Jews frequently complained about their own heritage in similar terms. To take but one example, the heroine's mentor in Emanie Sachs's novel Red Damask (1927) advises her, "If you ever get a personality instead of a stone tablet handed down from Sinai inside you, just telephone, will you?"¹¹

Now the circumstantial case that gives rise to this thesis as an explanation of the events of the century 1850-1950 is partly borne out by a surprising source, the Encyclopedia Judaica:

It was not until the middle of the nineteenth century, however, with the arrival in America of a large German Jewish immigration that Jewish banking houses on the European model came to exist in the United States. [They] not only freely utilized their widespread European connections . . . but created a chain of interlocking associations and directorates among themselves which enabled them . . . to compete successfully with gentile firms several times their size. Not only was it common for the children and relatives of a given firm to marry each other, but marital alliances frequently occurred as well among different Jewish banking families, as was the case with the Loebs, the Kuhns, the Schiffs, and the Warburgs. Frequently too the children of such families married into the families of large German Jewish companies, . . . and the latter would proceed to raise capital through the banking houses which they had [thus] joined. Socially, the result of such commercial and kinship ties was the creation of a German-Jewish banking aristocracy based in New York City whose descendants continued for over a century to play a dominant role in the financial, cultural, and political life of . . . the nation at large.¹²

What Douglas proposes, then, is that this "German-Jewish banking aristocracy" became the vehicle by which the Myth of External Authority was propagated in our economic and political systems via financial policy—a policy that I have elsewhere characterized as economic Calvinism. If there was such a policy in the past, it has long since ceased to have a specifically Jewish character, for there is no longer any such thing as a Jewish bank. This should make it possible for even Jews to give Douglas a hearing today.

All things considered, however, it seems to me that Douglas's circumstantial case is one-sided and that the policy of which German-Jewish banking was the vehicle never had a specifically Jewish character. The researches of Carroll Quigley and Anthony Sutton (not, of course, available to Douglas) suggest this. Only one member of the Round Table, Alfred Beit, was Jewish. Montagu Norman was not Jewish, nor was Hjalmar Schacht; nor, of course, were Morgan or Rockefeller.¹³

Therefore, Douglas's circumstantial case regarding the German-Jewish elite in the century 1850-1950 may be valid as far as it goes, but it is only part of a bigger case. Just as a conflicted Christian church and "Sunday School" morality is the most obvious route of the Myth of External Authority into Europe, so in the century 1850-1950 and beyond, the financial policy carrying that myth was conducted by men of Christian culture like Morgan, Rockefeller, Norman, and Schacht. If men of German-Jewish culture had similar policies, it is not surprising, for in the history of ideas they were ideological cousins.

It may be argued that the reason Douglas's thesis is one-sided is that an unfortunate obsession with Jews prevented him from seeing the other side. With all the enormous respect I hold for Douglas and giving him the benefit of every doubt, I am still forced to acknowledge that there is some truth to this. Consider his negative treatment of Alfred Mond, for whom he cites the biography by Hector Bolitho. In the last speech of his life (as quoted by Bolitho), Mond said:

You suddenly have the phenomenon of several million people for whom you have no jobs. That has been created by the very improvements you have been effecting. . . . I think we want to strip some of our old ideas, and at last to get in the position we have not been in now for over a century, and that is that we are not slaves of the machine, but we are its master; that the office is not for us to work in, but to provide a living. When I say `a living', I mean something more than going to an office. That machinery is there to provide us with leisure and not to give us more work; that transportation is there to give us more time, and not less.¹⁴

That sounds a lot like Douglas, does it not? At the end of his life, Mond had learned something. Without unsaying any of his charges against Mond, Douglas could have quoted this. Why didn't he?

The solution, however, is not to throw out the Douglas thesis tout court in a fit of moral indignation. This would be a grave—a fatal—mistake. The only way of advance is to take Douglas's partial case and build on it to complete the picture. It is as true today as it was when Douglas wrote it in 1940 that "a satisfactory reformation of the monetary and political system . . . is vital to [the] best interest" of Jews. We—all of us—ignore social credit at our peril.

Notes

1. Economic Democracy, p. 7.

2. Warning Democracy, pp. 65-67, 110; my italics.

3. Dictionary of Concepts in History, s.v., "intellectual history, history of ideas."

4. Social Credit, p. 44.

5. Ibid., pp. 14, 31f.; cf. Monopoly of Credit, p. 84f.

6. Brief for the Prosecution, p. 15.

7. Spedding et al., Works of Francis Bacon, vol. 1, p. 4.

8. Social Credit, p. 22; Development of World Dominion 11.

9. "Whose Service Is Perfect Freedom," p. 39.

10. Ibid., p. 7f.

11. p. 46.

12. s.v. "bankers and banking"; my italics.

13. An attempt to corroborate the Douglas thesis for Russia finds that Jacob Schiff indeed contributed to the overthrow of the czarist government; but it was Morgan and Rockefeller interests who, in the midst of the Russian Civil War—when the Red Army was not the only one on the field and the Bolsheviks were engaged in a program of terror to shore up their fragile power base—swiftly gave the Bolsheviks their support (Triumph of the Past, August and September 2000). An attempt to corroborate the Douglas thesis for Germany finds that the Warburgs indeed participated vigorously in the rebuilding of German industry from 1924 and in Hitler's rearmament program from 1934 to 1938; but so did National City, Standard Oil, IT&T, General Electric, Ford, and General Motors (Triumph of the Past, November and December 2000).

14. p. 353.