The Grey River Argus WEDNESDAY, August 18, 1937. ALBERTA’S CREDIT POLICY.

Grey River Argus, 18 August 1937, Page 4

The Grey River Argus WEDNESDAY, August 18, 1937. ALBERTA’S CREDIT POLICY.

Whatever the immediate outcome, the attempt of the Alberta Provincial Government to implement its policy of State credit control will have evidently some lasting effects. The Canadian Prime Minister has announced an important inquiry into the operation of the Dominion Constitution, which is expected to lead to far-reaching changes in the relationship between the Dominion and Provincial Governments, Presumably, these will be in the direction of enlarging at least some of the provincial powers, while other matters may be brought more directly under national control. This issue has been raised in several provinces, but in none so pointedly as Alberta, where the Aberhart Government is still struggling against banking and other commercial interests in the endeavour to establish a system of social credit. One point made aganist the attempt is that in so restricted an area it must come in any case into, conflict with the order outside. Spokesmen for the Administration have assured the public that they can safely leave the introduction of the next measures to experts, who are working on the lines of the thesis of Major Douglas. Under any monetary system, of course, much must depend upon the mentality of the controllers, but in all countries there has been a reaction against the monopoly of credit control which has been maintained by the banking magnates, and even in New Zealand the State has legislated to make banking and credit more subject to public interests and less subject to private interests than it formerly was. It cannot be said that the public have found that alternation anywise inimical. Alberta, of course, proposes to. go much further, as it would have State currency issues based on public credit. * The latest step toward this objective has been the decision of the Aberhart Government to license all private banks in the province, fixing the license fee at no more than five hundred dollars for each bank, with the sole exception of ' the Canadian Reserve Bank, which is under an Act of the Dominion Parliament. A Credit Board is to be set up with the power to issue licenses. The Bill proposes that companies dealing in mortgages, trusts and insurance shall all be licensed. Although it is being argued that such a measure would be unconstitutional, one significant point is to be noted. Australia some time ago set up a Banking Commission, whose report recommends the licensing of all the private trading banks in the Commonwealth, such licenses to be issued by the Federal Treasurer, and every bank to be compelled, in qualifying for a license, to carry out certain conditions. The Commission suggests legislation to make it unlawful to carry on the business of banking in Australia without a license, which would be terminable in the event of any wilful or persistent failure to comply with the provision of the Statute. The Federal Treasurer also would be empowered to | order the Auditor-General to investigate the affairs of any bank, and to report upon any matter which the Treasurer might direct. This recommendation, as well as the advice of leading financiers, has been before the Alberta Premier in drafting his licensing measure, and it should carry weight when the opposition interests appeal to the Canadian High Court to. outlaw the bank licensing legislation. The Alberta Government is pledged not to disturb the property rights of any individual tax-payer. The Premier says that it is his intention to liquidate the State debt and to

lift from the province its burden of interest. He maintains that j the natural resources of Alberta . are sufficient to warrant the issue , of adequate credit for the (level- < opment of State industries and' ' for the payment of the social dividend which is part of . the ■ Social Credit plan. The private banks are urging the Lieutenant , Governor of Alberta to refuse asent to the bank licensing legislation on the ground that it will I conflict with the Federal Act, giving tlie Federal Government control over banking. There is also a plan to work up in Alberta a constitutional crisis, so as _ to replace Mr. Aberhart by a regime under Mr. James McFarlane, former dictator of the Canadian Wheat Pool, who exercised autocratic power. If this plan fails, Air. McFarlane may lead the Opposition and attempt to win the support of disaffected . Social Credit supporters. On his part, Air. Aberhart maintains that the licensing of banking is valid as being with the commercial powers of the Province, and he points to the fact that “Aew Deal” legislation on the part of the Dominion Government, assuming certain new powers over the provinces, was outlawed by the House of Lords. With the letter of the. Alberta legislation there may be disagreement, on technical and other grounds; but the spirit and object of the movement to prevent private monopoly of public credit is steadily gaining . support. ’ -■