THE BANKS AND SOCIAL CREDIT

Otago Daily Times, Issue 22718, 2 November 1935, Page 25

THE BANKS AND SOCIAL CREDIT

TO THE EDITOR. Sir, —" Measure of Value" asks for further elucidation as to the meaning of the term "social credit," and it appears that I have not been sufficiently explicit. Possibly he regards the national credit as the amount of money made available by the banks at any particular time for lending to the people of the nation, while I should define it as something detached from money or banks and originating in the strength and genius of the people themselves. The former definition would make the nation's wealth depend upon the various moves in the money game which is played so skilfully by the experts, while the latter traces it to the only source from which credit or wealth can come —the people working in association.

But in any definition of social credit emphasis must be placed upon its cooperative nature, for it is the association of individuals in a community that makes their productive efforts yield such infinitely greater results. If 1000 men were set to work separately making shoes, their total production would ptobably not be more than one pair per man per day, whereas by working in co-operation in a large factory with the latest machinery and the newest processes they could possibly turn out as many pairs per man as tli e whole of them could do in the .same time working separately. Now the daily wages of the men in these two illustrative cases would be the same; yet how much greater is the productive value of the latter! The difference is the result of association, and includes the wages of the machine, together with the heritage of science and invention that has been handed down from the people of former generations, and, when applied to the whole nation, is a source of wealth sufficient to provide every individual in the community with a higher standard of life and a greater degree of leisure. " Measure of Value asks how 1 would arrive at the value of labour and its products, and what the value is of a promise to pay. These questions have all been answered incidentally in what has already been said, and the answers can be found by reading between the lines. As to the remaining question, it is difficult to say how the value of gold is arrived at in those times of high gold values and low commodity prices. Possiblv it is the result of supply and demand, or, is decided by the cost of winning it. More probably, however, its price is arbitrarily fixed by its owners. But while these are matters of conjecture, it is, nevertheless, certain that if the illusion so sedulously fostered by its owners that. gold is at the back of all money and gives to money its value were dispelled, gold would then be worth only what it would fetch for ornamental and scientific purposes, and the reason for keeping it lying in the vaults of the central banks would disappear.—l am, etc., S. November 1.