Social Credit

Gisborne Herald, Volume LXVII, Issue 20431, 16 December 1940, Page 10

Social Credit

Sir,—lt would seem Unit both "J. 8." and “Practical” either do not understand the rudiments of economics or if they do are using their gifts to confuse and not to enlighten. One asks for information that has been given concisely enough for any moderate student of the existing system to understand, but it seems to be beyond their capacity; so why should one proceed further with them? “J. 8.” goes on to say how lie as an individual would like to get costless credit without security, when it has been stated repeatedly that it is confined to internal government operation.

“Practical” then has the brainwave of China’s stupidity of borrowing British credit when she could use her own. Surely it is specific and plain that to monetise unmonetised wealth in one’s own country does not justify the suggested connection that it will import goods from another country by that means.

“Practical” rightly refers to. the high standard of living here. While that is true, it is also true that it is’both unpatriotic and impractical to discourage progress to higher standards. The security for costless credit is the value ,jf the unmonetised goods that its use will mobilise. These goods belong to the population as a whole. Therefore what form of credit to distribute them should take precedence to the public’s own credit. LOOKING FORWARD.

Sir, —“Practical” says lie does not favour borrowing or the incurring of debts; but unless credit is created it would not be possible for industry to function. No single industry can generate purchasing power equal to the prices of the goods, so that there must always be a gap between prices and purchasing power. Loans for capital goods, housing, national and local body works, and war commitments often bridge tiie gap, but the cost eventually becomes a debt against the people, whose knowledge, energy, and materials have been used. To charge the debt cost to them simply deprives them of the payment they received for their services. That process, is responsible for Ihe bulk of our production costs to-day. We simply propose that it be no longer a cost, and that any necessary creation of credit be debt free. As all new credit would be backed by new wealth in the form of new goods and services, all money and credit would be sound, and it would be that sound money which would be used to pay existing debt charges. W e have never so much as hinted at "social credit notes," and nothing is further from our thoughts than inflating the note issue. Man produces nothing. He simply changes the form of matlerials provided by naiurc. Those materials do not belong to tlmse who give them a money value to charge

against us as a debt and no one should be able to erect a money barrier between mankind and the abundance of God. It is not a question of sometiling for nothing, but .of the right of mankind to use all that we are able and willing to provide.

The above should answer "J. 8." except on one point. If he has assets, lie can quite easily have them converted into a debt against himself by pledging them as security for a creation of credit. Does “J. 8.” think it right that the assest of the community in the form of materials, production, etc., should be charged against the community as a debt due to those who merely wrote figures in a book to represent the amount of credit created? It is physically possible for the community 1o create and use its own credit, and it is also financially possible. E. LENIHAN.