DOUGLAS CREDIT SCHEME.

Evening Star, Issue 21510, 7 September 1933, Page 6

DOUGLAS CREDIT SCHEME.

TO THE EDITOR. Sir,—lll your issue of September 6 appears a letter in support of the Douglas Social Credit Scheme, written evidently with the idea of combating your leader of the previous night. Ido not think it can bo said that 1 am in favour of orthodox ideas in general or the banking institutions in particular; but in the case of Douglasism I am certainly in entire agreement with the orthodox economists. The scheme seems to have created something of a stir in New Zealand and Australia. We are apparently a simple people and easily taken in by the extravagant promises that, while retaining the essential features of Capitalism, Douglasism will give bountifully to all those who suffer from the present social conditions. The whole theory of Douglasism arises from the inability of Douglas and his apostles to understand the functions of money; they are subject to “ money fetishism.” By means of printing and issuing “ tickets ” (money) everyone will be able to share in the banquet (social production), and money will be regulated according to the value of the mass of commodities to ensure that production will be equated by adequate provision for consumption. The class struggle will disappear from society, and_ all sections—owners and workers —will receive a just share and be happy and contented. For the benefit of the Douglas Credit apostles 1 must state a few elementary facts which do not support their misconceptions. Commodities exchange according to the amounts of socially necessary labour power which they contain. _ Money is that commodity which is universally accpted as the equivalent for nil other commodities. Money can function thus only because it contains labour power, like nil other commodities. Experience over a long period has resulted in gold becoming the money commodity because of its special qualities; it is durable; it comprises a relatively large amount of labour power in a small quantity (compactness); it can be divided and reunited at will without loss. In its capacity as a means of circulating commodities gold can ho represented by tokens, including paper money; but unless real money is in existence there could not exist" its representative, paper money. The amount of money in circulation is determined by the total sum of prices of goods exchanged divided by the average number of times each piece of money serves in exchange. Should the rule that paper money must serve as a representative of money be broken, paper money be thrown into circulation, then we have inflation (decrease in the value of currency expressed by a rise in prices). To humour the Douglas Credit apostles let us assume that such a stage is reached. Who suffers? All those depending on money incomes, particularly the wage workers, are impoverished. To humour them further let us then put forward the proposal that the class of owners would be prevented by law from raising prices; that the Capitalist class would bo compelled to exchange goods possessing certain quantities of labour for amounts of money representing much lesser quantities of labour. Then, disregarding the fact that the Capitalist class is the State, the makers of law and constitution, the controllers of police and prisons, the army, and navy, wo arrive at a stage when the Capitalists would stop production, as Capitalist production is carried on for profit and not to satisfy social needs. If more humouring is required, then I suggest measures to compel the Capitalists to continue production ; this, of course, will meet with resistance. The workers who have listened to the promises of a peaceful solution will again arrive at the point of violent class struggle—class struggle which will end only with the seizure of political power by the workers and the taking over of industries to bo run on a Socialist basis. Then, and then only, will more leisure and greater purchasing power for the masses bo possible, with the elimination of poverty, want, and unemployment. The evils of Capitalism arise not from money hut from the social relations. It is the social relations which must bo changed. The Douglas Social Credit “ dope ” peddlers belong to that great army of Capitalist lackeys who swarm amongst the workers, seeking to divert their minds from the class struggle, which alone can lead to their emancipation. The Douglas Social Credit proposals are thoroughly anti-working class.—l am, etc., M. O’Rouke. September 7.