SOCIAL CREDIT.

Waikato Times, Volume 112, Issue 18805, 29 November 1932, Page 9

SOCIAL CREDIT.

(To the Editor.) Sir,—One of the most amazing developments in recent months is the manner in which the Douglas social Credit movement has spread like wildfire throughout the Dominion. Interest and enthusiasm in the movement as.its objects and possibilities become known are increasing so fast that it is certain to sweep through and capture the whole political field in the very near future. People are fast realising the fact that society is breaking down at the point of distribution. The lesson is being driven home that “stone age’ economics oannot possibly establish relationship between production on the one hand and consumption °n the other. A number of men of science and engineers have studied the problem of consumption, and have made valuable contributions to our knowledge of the subject. Without question the most thorough analysis of the situation is that of an English engineer, Major C. 11. Douglas, and the lines suggested by him for the remedy are the most completely in accordance with facts and are the only lines upon which a real filling of the gap is possible. He sums up the requirements as follows: — 1. That the cash credits of the population of any country shall at any moment be collectively “equal" to the collective cash prices of the goods for sale in that country, and such cash credits shall be cancelled on the purchase of the goods for consumption. 2. That the required _ to finance production shall be supplied, not from savings, but be new credits relating to new production. 3. That the distribution of cash credits to individuals shall be progressively less dependent upon employment. That is to say, that the dividend shall progressively replace the wage and salary. These three points need very careful thinking over; they are the essence of the Major Douglas Credit Scheme, generally known as Social Credit. No one will deny that it is just as easy to issue a credit for consumption as it is for production, as is done at present. There is a very wide gap between production and consumption. The "just price" fills that gap. Briefly, then, A is the just price—the actual cost of production; B is the actual price plus overhead oharges, plus a reasonable profit to the producer. The producer sells at the just price—■ a £4 article for £3. When he shows his sales voucher at the national or State credit office he is reimbursed accordingly. Owing to the fact that the labour or time-saving machine is taking the place of hand labour, In spite of a reduction in the hours of labour, even then many will be out of regular employment. Hence the necessity of the national dividend. Whence will it come? Allow me to try and explain. Supposing there are £80,000,000 worth of goods on the market for sale; there will be that amount of money in circulation. By way of a further explanation, then, supposing only £60,000,000 worth of goods are sold, the balance, £20,000,000, is termed the national dividend. It is distributed as additional buying power. We of the New Economics treat money simply as a medium of exchange—at present it is looked upon as a . banker’s ware. Hence we get inflation and deflation, but never “equation.” Also with us the free issue of credit (money), in “relationship” to production, must take the place of the interest-bearing banker’s loan.—l am, etc., HARRY WOODRUFFE. 199 Eden Terrace, Auckland.