UNEMPLOYMENT PROBLEM.

Evening Star, Issue 23325, 22 July 1939, Page 27

UNEMPLOYMENT PROBLEM.

I(> lilt' EDITOR.-’ t Sir, —Against the efforts of the poli■l fieiaus wno insist on trying to hud work,” 1 wou.d like here to quote an extract from a report on the economic crisis by the Southampton Chamber of Commerce; —“The purpose of an economic system is to de.iver goods and services as they are required, when they are required, and where they are required, by the members of the community. To this end the resources of the community should be mobilised and production organised in a manner likely to prove most beneficial to a majority of individuals. . . . The object of an economic system is not the provision of work; in fact, it has already been shown that the tendency of human progress has been to release men from nature-imposed necessity to toil. Yet wo find that national leaders are concentrating upon the problem of ‘ finding work ’ while ignoring the main consideration as to whether the economic system is adjusted to its function of making available the abundant supply of goods, and services as, when, and whore required.” And so public works go on apace, much of them-years ahead of requirements and involving increased taxation and debt on an already overburdened community. The remedy is in debt-free money to consumers to give a fillip to production, in consumable goods, sufficient to give all the people a decent standard of Jiving. _ This would render unnecessary borrowing for work that well could be delayed until the _popelation warranted it. This point involves the much-discussed ‘ New Economics, and I would like to state the Social Oredit viewpoint, given in about .500 words. It is a request that is frequently made. .. , „ The world is wealthier to-day than ever before: bat side by side with man’s unparalleled ability to provide goods and services exist unparalleled unemployment and poverty. The producers want to produce, but cannot sell. Consumers want to consume, but cannot buy. Money is the mechanism used to transfer goods from producer to consumer. Obviously, then; the only barrier is a lack of money in the hands of consumers. Therefore a new method of ' making increased productivity available , for the enrichment of life is necessary. Tinder our system of financial account- ( ancy no industry can possibly disperse sufficient purchasing power to enable all the things produced to be sold profitably. Wage-saving machinery adds to the problem. Money was at one time created by Governments, but with the invention of the cheque system this power of making money passed from the Crown to the bankers. Of the total money in existence only a small percentage consists of coins and bank notes. Governments make money out of silver, copper, and paper. Banks create it out of nothing. Mr R. G. Hawtrey, -in his, book, ‘ The Art of Central Banking, says: “ But other lenders have not this mystical power of creating the means of payment out of nothing. What..they ” fond must be money < that they jhave acquired through their economic acllvi- , ties.” Banks, by controlling the volume and control of credit, control the lives and destinies of men, and direct the policy of Governments. When a hank advances this credit it is against the security of the borrower; so in all justice the total credit of the community belongs to the community, and the control of its issue and recall must.be would involve the opening of a national •’< credit ‘ account, to which would be credited the money value of the total capital assets of New 'Zealand, and ,the commercialised value of .the population. Financial credit, being a reflection of real credit, could be sreated up to this amount. Social Credit proposals involve that this national credit shall he used to finance consumption as well as pro;ductiOn. In order to equate consumption with production consumer credits shall bo issued. This may,'be .done in two ways; (a) using the national credit to effect a reduction in the prices of goods by declaring a national discount rate, thereby increasing tbb purchasing power of money. Vendors registering under a price assistance or_ rebate scheme would agree to sell their goods at a fixed margin of profit, thus preventing price inflation; (b) b.y declaring a national dividend, and issuing money direct to individuals. All Government activities shall be financed, debt free, from the national credit, which means no more debts,- no more interest, and a rapid elimination of indebtedness and • taxation, thereby creating abounding prosperity. The real business of life is to live and move in that world where truth, beauty, and justice call us through art and science.—l am, etc., New Tunni. July 22,