SOCIAL CREDIT LEAGUE

Press, Volume XCIV, Issue 28051, 20 August 1956, Page 14

SOCIAL CREDIT LEAGUE

“ONLY NUISANCE VALUE”

CRITICISM BY NATIONAL PARTY PRESIDENT

“The Press" Special Service AUCKLAND. August 18. The Social Credit Political League, had only a nuisance value, because New Zealanders had too much sense to place their welfare in the hands of impractical theorists, said Mr A. McKenzie in his presidential address to the National Party’s conference today. Social credit, he said, was not in operation in any country in the world. Alberta and British Columbia had governments of that name, but no social credit theories were being applied. Both provinces were quite orthodox in all financial transactions. If the average citizen in British Columbia or Alberta was asked what social credit had achieved, he would reply that if the governments tried to implement such ideas, they would be lout. Those facts did not stop social credit advocates in New Zealand from extolling the benefits of social credit as evidenced in Alberta. Enormous oil and mineral wealth, and increased prices for primary produce, were entirely responsible for Alberta’s prosperity. If one could judge from its advocates the policy at the last election, social credit, in simple language, would result in inflation, or the “watering” of the currency—the problem that every country was struggling to avoid to hold down the cost of living, Mr McKenzie said.

From surveys made before and after the last election, Mr McKenzie said, approximately 50 per cent, of the social credit vote was-a protest one. Many of the reasons given were without justification. It was a safe assumption that if any one of the remaining 50 per cent, was asked what was social credit not 5 per cent, of them would have a clue.

The social credit advocates, by repute. were people of good intent, and entitled to respect as such, but their good intent was greater than their good sense, knowledge of finance, and economics, as evidenced by their members who appeared before the Monetary Commission, Mr McKenzie said. Witnesses contradicted each other; they were ill-informed on vital economic questions; and they disagreed with statements made by their leader, Mr W. B. Owen, in his published work, and in addresses made during the last election campaign. Certain advocates of monetary reform claimed that the trading banks were in effect “private mints,” with unlimited power to create credit, Mr McKenzie said. That was quite erroneous. The capacity of the trading banks to add to the supply of money in circulation was subject to the overriding control of the Reserve Bank. The Reserve Bank was a State institution, and through it there was public control of credit.