DOUGLAS CREDIT

New Zealand Herald, Volume LXX, Issue 21533, 3 July 1933, Page 13

DOUGLAS CREDIT

Sir,—l rcfuto tho claim that Major Douglas was tho discoverer of the fact that wages and dividend would not purchase the output. It was known by my student generation of 25 years ago and the evidence that it was known at least 100 years brick is to bo found in the library of tho British Museum. This "phenomena," to give it a name, could bo recognised by any book-keeping student, but would be passed by without unduo prominence because in due time tho cause would be apparent. It was left to Major Douglas to give it a patent "formula" and to form a new cult; a cult with all tho make-up of quackery. To confirm his discovery, Douglas was supposed to have examined the books of quite a large number of firms. This, however, is too much for me to swallow, for if you know the firms of tho Old Country as I do, .you will realise that even the most influential havo no chance of paining access to such sacred things as ledgers. Anyway, there is absolutely no need for any such procedure, for when this "phenomena" is pointed out and you understand book-keeping, you know at once that it must run through all trading where you buy to sell. A young student came to me with tho book "Monopoly of Credit," which he had bought as it seemed to contain the Macmillan report. It was not until you got well down into tho reading that you realised it was nothing else but Douglas Credit doggerel. Why the camouflage? It cost the lad 4s Cd and was absolutely worthless. Wading through tho trash between the covers, you find Douglas has a cheap sneer over "inexorable economic laws" and the "human element." Long years of study under the best masters and comprehensive commercial c.'r--ienoe where theory is worked into •> i ivv i't, only one con-

Cue < deny fnav •;>.» ivr-lim clfj.-no.u in affairn is the test mystery of all tin:os ar/u tho greatest problem of the proton I: deprei •.'•ion. If I have any knowledge* of nature, I would sa." the sneer & sop to his conscience, as if Douglas had a sneaking idea of these great truths, but, had to betray them for the sake of the theory and the cult. The final question to tho "new economic cult" of ono day's standing is when you read a book or a report on economics, ho;v do you know it is right? How can you analyse? How can you interpret? 1 expect tho reply to be evasive und to bo told I am old-fashioned. Just so. I was taught to think for myself. The old adage "a little learning is a dangerous thing" aptly describes tho present state, for what these people lack in knowledge they make up with aggressiveness.

Cambist.

Sir, —T have to thank Mr. Bones for the advice he lias tendered me, even though it be misapplied, for he appears to be more in need of it than mj'self. He has distorted my letter, reading into it a meaning which could be found there by no other people. I neither stated nor suggested that money, in itself alone, reproduced and increased. What I said was: "That in the past we were deluded into the belief that money embarked in industry reproduced and increased to provide, etc." The money was absorbed in the industry, providing for all costs, including those enumerated by Mr. Bones, again reproducing and increasing in the commodities produced by that industry, which were converted into money in excess of what was originally put in. In the industry, under discussion, which was the, growing of corn, the £IOO enabled the grower to meet all costs and carried , him over the period necessary for the corn to grow. Assuming that the grower is not a • Douglas credifcite, he planted the corn with the expectation that it would reproduce and increase to the extent- that it would repay the £.IOO, representing all costs, leaving enough over to give him a profit. Mr. Bones states that I do not know the meaning of "worth" and "value." Now, if they mean anything, then, if the corn grown was of such quantity that three-quarters of it realised £IOO, the worth and valuo of the total corn appears, to the deluded, to be £133 6s Bd. This is not the "A.8.C." of Douglas credit; it is the A.B.C. of common sense, which, of course, is anathema to Douglas credit. Give a community 100 per cent common sense and Douglas credit could never havo raised its ugly head. Mr. Bones' statement: "Therefore the corn which cost £IOO to produce is worth £100" surely must have been written as a joke. Would anyone outside the Douglas credit movement grow corn merely for pastime, as his statement suggests? ' Although the practical (inance of the Douglas credit exponents is fairly crude, their skill as anaesthetists is simply amazing. Sandi.