The financial system is
entirely man-made. It is not, like the weather systems, subject to
external forces. Humanity watches as poverty rises amidst plenty,
alongside ecological degradation and social deprivation, whilst
senior economists remain dumbfounded. Parents are encouraged to be
working-for-wages outside the home, whilst benefits are denied to the
sick and the age of retirement is raised "because the economy
cannot afford to pay out pensions". The general public know no
better than to accept the make believe tales put forward by political
economists.
It was not always so.
During the 1920s and 1930s, across the globe, bodies of intelligent,
socially committed individuals read, studies, taught and discussed in
local groups, wrote books, pamphlets and articles, broadcast,
campaigned and achieved political representation on the theme of the
history, theory and practice of finance, with specific reference to
Major Clifford Hugh Douglas and his Social Credit economics.
And in 2010 Brian
Leslie, long-standing Editor of the Green Party Economics Newsletter
Sustainable Economics, reviewed my latest book, Understanding
the Financial System: Social Credit Rediscovered ( Jon
Carpenter.) Copies circulated across the UK to local, regional,
national and European Green Party campaigners and elected
politicians.
Understanding the
Financial System is available electronically on the Douglas
Social Credit website https://www.douglassocialcredit.com/ .
BOOK
REVIEW by Brian Leslie
Understanding
the Financial System: Social
Credit Rediscovered Frances
Hutchinson (Jon
Carpenter Publishing, 2010)
This book was of great
interest to me [Brian Leslie], as I was introduced to its subject
matter in my childhood in the 1930s, by my parents, who were active
campaigners for Social Credit, and I attended the last few meetings,
after WW2, of the Social Credit Party, with its leader, John
Hargrave. I read Douglas's main boo .‹s and those of som.e other
advocates of SC, such as C Marshal Hattersley's This Age of
Plenty, in my youth. The post-war corporate wiping from history
of the ideas and movement for SC was illustrated to me when, in 1952,
I heard on the lunchtime BBC radio news, of the landslide victory for
it in British Columbia in the Canadian elections. This was
accompanied by a few sentences about the aims of SC; but in that
evening, in the 6 o'clock and nine o'clock news, not even the tact of
the election result was mentioned!
My parents met as
Esperantists, and were advocates of libertarian education,
introducing me to the ideas of AS Neil, practiced at his Summerhill
School. Thus I absorbed in my childhood ideas of the unity of
mankind, as well as of the distinction between the real. economy and
the financial one, which dominates and shapes the real.
I was aware that
conventional economics confuses physical and financial capital, and
that the potential abundance due to the application of technology to
production was turned to waste by the grossly unequal distribution of
the results of the 'common cultural inheritance' and the 'increment
of association'. These are the concepts CH Douglas introduced as
justifying Social Credit's advocacy of 'National Dividends — or
Basic Incomes — lack of which makes wage-slaves and/or debt-slaves
of almost everyone.
In all of this time, I
found no suggestion that SC, or the wider movement for monetary
reform, was in any way anti-Semitic — in fact, some of the closest
colleagues of my parents in their campaigning were Jewish!
Thus I am, perhaps,
biased in favour of the theme of this book, which is exposing both
the history of the widespread and rapidly growing support for SC,
despite the hostility to it in the public media, in the period
between the World Wars, and the distortion of history to discredit it
and to minimize attention to it, since WW2, with virtually complete
elimination of its ideas from the teaching of economics— and the
use of accusations of anti-semitism to stop any discussion of the
issue.
While I had
foreknowledge of much of the book's contents, I found this
considerably expanded by the detail it contains. It contains many
extracts from material both for and against SC, and lengthy
discussion of its origins and related ideas, from Guild Socialism,
the writings of Thorstein Nreblen, and Rudolph Steiner's conception
of the Threefold Commonwealth — the three related spheres of
society: cultural, political and economic. In all, it shows how
tragic was the failure to introduce reform of the system of money
creation and distribution in the 1930s.
Douglas argued that the
aims of everlasting economic growth and 'full employment', despite
the growing use of machinery to replace human labour, were
unrealistic and unsustainable. He predicted as early as 1920 that, if
the creation of money remained in the power of private banks and
distribution of purchasing power through National Dividends was not
instituted, with adequate money issued into existence to end 'poverty
in the midst of plenty', then worldwide depression would result, and
lead inevitably to WW2. National Dividends would introduce 'economic
democracy) and establish the 'sovereignty of the individual'.
Douglas noted that
while money was in desperately short supply in peacetime, it was
created as freely as required in time of war.
He did not propose any
detailed way to change the way money should be created, but argued
that it should be for public benefit, not private profit. Subsequent
experience amply confirms his views. 'He who pays the piper calls
the tune', The banks are the 'piper', and they 'call the tune' of all
other institutions, including governments.
It was clear to me in
the early 1960s, when Prime Minister Harold Macmillan proclaimed that
'we've never had it so good!', just how much better we could have
'had it', but for the distortions of the 'economy' due to the
dominance of debt-money'; we could have had leisure, and far less
waste of materials and effort.
Although the most
senior economists of the day debated with Douglas, both in print and
on public platforms, none found any genuine flaws in Douglas's
analysis of the true relationship between the material economy and
the financial system. Since the financial system was man-made,
Douglas argued it could be studied and reformed to suit the wishes
of the people. In his view, if given a choice, the people would
prefer a secure sufficiency. rather than everlasting growth and
uncertainty.
This is a book which
should be widely distributed and studied. It carries an extensive
bibliography and lists of references for each chapter. It exposes the
disastrous domination of the real, productive economy by the
financial interests, and their power over the institutions of
government, education, commerce, and public media. The recent
near-collapse of the financial system under the growing weight of
unredeemable debt — which threatens worse to come — should help
to open people's eyes to the need for reform, along the lines
outlined so long ago. Read the book, and then use the internet to
join and spread debate on this vital issue.
Brian Leslie,
Editor, Sustainable
Economics Green
Party Economics Newsletter 2010
Taking
up the baton again where Brian Leslie leaves off, from 2010 to the
present there has continued to be no focal point for the continued
discussion of alternatives to a money system that is wrecking the
earth. The only thing we have to hand is the Douglas Social Credit
website, douglassocialcredit.com\ which has become an archive of the social, political,
economic history of the broad school of guild socialist literature,
of which social credit forms a part.
