SOCIAL CREDIT AND INFLATION

Otago Daily Times, Issue 22568, 11 May 1935, Page 7

SOCIAL CREDIT AND INFLATION

TO THE EDITOR Sjr— The purpose of " Inquirer." it seems to me, is not to learn about Social Credit but, by constant reiteration, to leave the impression in the minds of the people that inflation would result from the adoption of the Social Credit proposals. He skilfully evades the necessary examination of the actual costing system, which makes his repeated test nonsensical and divorced from the actual facts. The peonle. being without this, also are left with the impression that in some way Social Credit would have the evil effect fo Constantly suggested by "Inquirer.' Your correspondent's position is testimony to his ability as a strategist, but not to his honesty of purpose. The position to-day, under the present system, is simply that banks have the sole right to create the necessary money to carry on our civilisation, and, as.they lend it only at interest, it follows that they have also to create the interest' by someone going into debt to the banking system. For £IOO borrowed we have interest, which means, say, the repayment of £lO5. Used in the production of goods, the £IOO. produces goods which, owing to the A plus B theorem, are priced at an amount greater than the original sum used in their production —say, a total of £2OO. Under the present system that extra sum can be obtained only by the community as a whole going further into debt to the banking monopoly. Under Social Credit the national dividend would supply that necessary amount of " debt free " money, and it would be, since it was a " cost," cancelled in the purchase of goods and

would go out of existence. The system now requires that we go deeper and deeper into debt to carry on, and its final result is the present state of affairs. Social Credit offers the only way out by the payment of a national dividend of " free " money. But, I forgot, " Inquirer " does not want to learn. He asks only for opportunity to discredit by ridiculous reiteration. —I am, etc., Reader. May; 10.

TO THE EDITOB Sib, —With your permission, I shall endeavour to explain to " Inquirer," who appears to have no imagination, how the •'millions of money" could be cancelled in a Social Credit State. Having received the statistician's report, the National Credit Board will decide what amount of dividend New Zealand can afford to pay to her shareholders during the ensuing 12 months. The board will, perhaps, decide that the sum of £lO4 can be paid to every person over 18 years of age and £52 to every person under 18 years. All unemployment levy books will be recalled, and as each person hands over his book he will recieve in exchange a dividend cheque book. Arrangements will, of course, be made for those who do not pay the levy to collect their cheque book. The cheque books will be printed on the principle of the levy books, with detachable portions and corresponding counterfoils. The books will contain 52 cheques, and will be divided into quarterly parts of 13 cheques or 13 monthly parts of four cheques each. Each cheque in each division will be a different colour, and' all divisions will be alike except in regard to date. The "Receipt of Unemployment Levy" counters -at the post offices will be "changed to counters for the " Issue of Dividend Cheque Books," and greatlyextended. Large numbers of clerks will be required. Cheques will not be negotiable, but in another department each person will cash his cheque, and the latter is immediately cancelled as a bank cheque is cancelled on payment to the bank. I am sure the above fully answers " Inquirer's " question, and I hope it will help him to see daylight. There is an old saying, "There is none so deaf as he who won't hear." There is certainly none as dense as he who will not understand. I do'not wish to earn a reprimand from you, Sir, concerning the length of my letter, otherwise I would trace those dividends throughout their course until the time when the r\ext dividend, or, I should say, the next instalment of the dividend, becomes due.. I must draw your correspondent's attention to the important fact that there will be a transient period, during which the change-over must be made. Were we to try to do everything at once things would become so "messed up" that much valuable time and real wealth would be wasted before New Zealand, Ltd., got its affairs into efficient order again. I am writing in an unofficial capacity; in fact, I have not heard any Social Creditor or other person give the above solution to what is such a dreadfully painful problem to the opponents of Social Credit. There are other quite simple ways in which " money" could be cancelled. Perhaps " Inquirer " will discover one if he will climb out of the bog.—l am, etc., Old Pioneeb.