SOCIAL CREDIT PLAN

New Zealand Herald, Volume LXXII, Issue 22197, 26 August 1935, Page 15

SOCIAL CREDIT PLAN

THE ALBERTA CAMPAIGN ORIGIN AND NATURE MAJOR DOUGLAS' CRITICISM The form of social credit which captured the electors at the recent election in the Canadian province of Alberta is discussed in detail in the Economist of June 29, in an article contributed by the Canadian correspondent of the paper. Alberta has a population which is predominatingly agricultural, the only two cities of any size being Calgary and Edmonton. Consequently it has been particularly hard hit by tho collapse of farm prices, and the public authorities have been struggling with many baffling problems. These were the circumstances in which William Aberhart launched his crusade. A native of Ontario, of German descent, he moved into Alberta at the beginning of the present century. He became the very successful principal of a high school in Calgary, was known as a man of sincerely religious temperament, and first entered the public eye as an advocate of prohibition. Presently Mr. Aberhart began to develop a distinctive line of religious teaching. He used selected texts from the Bible as a basis for his own interpretations of past events and prophecies of things to come. At first ho operated from the platform, but soon resorted to broadcasting to reach a wider audience. Growth ot Following Very soon Mr. Aberhart acquired a considerable following in Alberta and with the help of his admirers erected in the main street of Calgary an establishment called the Prophetic Bible Institute, provided with excellent broadcasting equipment. Here ho continued his career as a prophet and a commentator upon public affairs. At first he gave a good deal of his time to religion, but when it appeared that a large proportion of his audience was more interested in monetary and economic questions, he decided to concentrate on them and emerged as a propagandist for social credit. "He accepted as his own the basic theories of Major Douglas," the article proceeds. "But he rehashed them in a form which could scarcely fail to have a popular appeal, and he becamo the assiduous proponent of a social credit scheme for Alberta, under which he promised to guarantee every adult inhabitant of the province 25 dollars per month. He has remained distressingly vague about the practical application of his scheme. But the fundamental idea which he expounds is that the farmer will not get the world price for his product, but a 'just price,' which is to be fixed by a provincial commission. Universal Dividend "This 'just price' will be substantially higher than the world prico and in order to enable people to buy at the higher prices lie proposes to issue 'social credit' certificates on the basis of 25 dollars per month to every citizen. He describes such issue of certificates as the dividend of 'our cultural heritage.' And in a community which has for several years past been afflicted with drought, grasshoppers, and other agricultural plagues, which has seen its market in the United States almost completely closed, which has seen the price of its chief products fall to pitiably low levels, and which is harassed with a tremendous burden of public and private debts, impossible to liquidate at the present price levels, the prospect of an assured income of 25 dollars per month is more than ordinarily alluring." In such circumstances the movement spread with great rapidity. Conventions were called at Calgary and Edmonton, the decision to enter the election as an organised party was reached. Mr. Aberhart decided not to be a candidate himself, on the ground that to do so would cramp his range of action. He ran the campaign autocratically, being given authority to select candidates with the aid of a small committee, while his word was law about party strategy. Government Alarmed "So efficacious is his propaganda." the correspondent proceeds, "that early in the spring the leaders of the United Farmers' Ministry of Alberta became seriously alarmed at the outlook. . . . Eventually they hit upon the idea of importing Major Douglas himself, the parent of social credit, to confound Mr. Aberhart. The pair had met some years ago when Major Douglas appeared before a committee of the Alberta Legislature to expound his doctrine of social credit. On that occasion Mr. Aberhart had publicly derided Major Douglas' plan, and rejected it as hopelessly inferior to his own scheme of social credit. Major Douglas seemed to the Alberta Government just the man to show what a dangerous r<nd foolish fellow Mr. Aberhart was; and accordingly the Government employed him to come to their aid as 'reconstruction adviser' on the promise of a generous fee." On arrival Major Douglas stated publicly that ho thought it quite possible to establish a workable scheme of social credit in Alberta. While he and other intellectuals might bo able to evolve a scheme, it required the services of an expert propagandist like Mr. Aberhart to win popular support for it, and pave the way for the necessary legislative measures. Rival Policy Sketched Subsequently, in letters written to the Premier, Mr. It. G. Keid, Major Douglas dismissed Mr. Aberhart's plan of social credit as completely impracticable and accused him of failing to grasp the fact that "social credit involves the creation of additional purchasing power for the purpose of enabling the consumer to obtain more goods for a given amount of money in his possession as defined by the Douglas plan." He also declared that Mr. Aberhart's explanation of the "just price" failed to correspond with that put forth in "responsible social credit literature." and that ho appeared to contemplate a fixed prico regardless of costs, which ho assumed to bo constant and to include something "labelled the unearned increment."

Major Douglas still held that it was both possible and desirable for a social credit system to he initiated in Alberta. But he stated that before he could advise the Government on its establishment he must have some tleeision about its general policy. Therefore he recommended that a Coalition Government shoulrl be formed to seek a mandate for certain objectives which could only lie obtained by access to control of "local" credit."

The four fundamental objectives he outlined as desirable were: —(1) A drastic reduction of taxation, particularly upon property. (2) A maintenance dividend as of right, probably small at first, and graded so as to be at the maximum after middle age. (3) Measures designed to produce a low price level within the Province with adequate remuneration to the producer and trader. (4) Development of internal resources, based upon "physical capacity rather than upon financial considerations."