Page 15 - Michael Journal 2019 August

u 4. What is the 'Credit Authority' or 'National tem of accounting, whereby the National Credit Of- and expanding industrial system, it does not neces- ity, durability and suitability for breaking into small
Credit Office'? fice would calculate increases in the nation's real sarily match with present circumstances. A sensible measurable units have determined what a particu-
Any change in the money-creation process wealth – its ability to produce goods and services. course of action would be to examine how and why lar society has selected as its medium of exchange.
would have to be endorsed in statutory law. Not- By endorsing the creation of new finance credit, the the system operates as it does at present. If financial Money represents a claim to the wealth of society.
ing the existence (at the time he was writing) of a National Credit Office would liberate producers and debt is found to be unduly restrictive in social policy The history of money is a fascinating story in it-
National Debt Office, Douglas suggested a National consumers from finance-dominated decisions about determination, it should be possible to introduce a self, and there are many books on the subject. Round
Credit Office might provide a means to keep account their use of resources. debt-free money system. Nothing is set in tablets of coins made from metals have been around since at
of the nation's real wealth. By carrying out detailed Under the present system, money is created stone. Relatively simple alterations to the credit-ac- least the twelfth century BC, and various forms of
assessments of the nation's real assets and poten- and then lent out for a fee by the banks and financial countancy system could ensure that the task of the card and paper promises to pay have appeared with-
tial to create wealth, the National systems which currently domin- banker is limited to bookkeeping of the nation's pro- in the last millennium, increasing in frequency since
Credit Office would calculate the ate economic policy formation. duction and consumption under conditions of eco- the seventeenth century.
nation's real credit available for Complex calculations take place nomic democracy. 12. What is the common cultural inheritance?
allocation to projects and to in- all the time. However, they are 9. What is money, and how is it created? No individual can rightly claim a share of the pro-
dividuals. based purely on the financial vi- Money has become central to virtually every ceeds of society because of the land, labour or capital
5. What is the 'national divi- ability of transactions, bearing form of social interaction throughout the UK and they happen to own. This is because all production
dend' and why might it be desir- only a very tenuous relationship across the world. Nevertheless, although it is so im- is social and collective. The basis of a community's
able? with the living world of nature portant in society, it has become almost a heresy to wealth lies in a combination of naturally given resour-
The payment of a national and the community which sup- ask what money is, and how it operates. In economic ces and its common cultural inheritance which flows
ports the financial system and all
dividend, or basic income to all economic relations. As a result, theorising the amount of money in the economy is from the imagination, insight, invention, discoveries
regardless of past, present or fu- prices are set on grounds of fi- assumed to be fixed. According to orthodox theory, and learning built up over past generations, coupled
ture employment, would enable nancial viability, based largely banks do not create money: they merely store sav- with present collective effort. At best, the effort of an
every citizen to claim a birthright on the necessity to recoup past ings deposited with them by their customers, lending individual might amount to 5% of the total value of
share of the common wealth of financial costs. The system ac- out those savings to firms in search of investment. the output they create through their work. The other
the community. It would be paid counts energy and materials Hence interest is charged by the banks in respect 95% represents the value of the common cultural in-
to all, rich and poor, employed consumed as added wealth or of the loans they make for investment, and interest heritance without which there would be no output.
or unemployed, as is presently value. payments may be made to savers for the money they One individual may turn out a cog for a machine,
the case with child benefits. have saved and deposited. In this scenario, a govern- using a machine already designed, in a building al-
Whatever their circumstances, 7. Is it possible to adapt the ment can regulate the economy through central bank ready built, having eaten bread already produced,
all would have a basic income financial system? adjustments to interest rates. However, examination and so on. No single item is of value without the total
security. Clifford Hugh Douglas Another way of looking at the of encyclopaedias and banking literature leads to sum of items, designs, science, technologies and
It would carry several major financing of economic activity is the conclusion that in real life money is created as skills. The inheritance from the past belongs to the
advantages. By eliminating means tested benefits, to regard it as a 'ticket system' designed to allocate debt by the banks, for purposes determined by the whole community, and cannot rightly be 'privatised'
grants, subsidies and various periodical payments, existing wealth to those who need it. The aim is to local bank manager. Created by the banking system, by individuals or firms seeking to benefit at the ex-
bureaucracy would be vastly reduced, saving much regulate production according to consumer demand money is a purely social construct representing ac- pense of the common good. Furthermore, the com-
time, frustration and stress. The technologies al- without causing inflation. By regulating the flow of cess to society's wealth. mon cultural inheritance only yields wealth through
ready exist to produce a sufficiency of goods and buying power in relation to the flow of actual and po- 10. Is money created by people going to work? the 'increment of association'.
services for all with minimal labour inputs. Never- tential production, people are enabled to act as eco- Real wealth is created through work. It takes the 13. What is meant by 'the increment of associa-
theless, the financial necessity to 'work' for a wage nomic agents without the need for ever-expanding form of goods and services which may be used by tion'?
or salary requires a constant stream of production economic growth punctuated by cyclical booms and the maker or exchanged for money. However, work Production is a collective activity. There is no such
and consumption, no matter how environmentally slumps caused by the debt-finance system. Instead, does not create money. A field may be planted up thing as the solitary hunter providing for all his needs
wasteful, in order that incomes can be generated. finance is advanced for local production through lo- with potatoes and tended during the summer. When from the cradle to the grave. We are human because
Income security would offer the possibility of pro- cal Producers' Banks. the farmer lifts the potatoes s/he will fill the sacks we work collectively, rather than on a series of separ-
ducing and consuming fewer goods while enjoying Nationally, the total buying power available is with potatoes, not money. If the sacks of potatoes ate desert islands. If we were to attempt to provide
greater leisure and greater satisfaction at the chosen matched to the total prices of goods ready for sale are exchanged for money, that money must already all our own food, clothes, fuel, shelter and so on, our
forms of work. through calculating costs of consumption of energy have been brought into existence by somebody else. standard of living would be poor indeed. The survival
A national dividend or basic income would be and materials, and depreciation, a task undertaken The farmer has not created it: that task is undertaken of even the most materially simple societies is found-
technically feasible, and could be introduced tomor- by the National Credit Office. Local Producers' Banks by bankers and financiers. ed on the 'increment of association' whereby tasks
row, given the political will. It would not, however, and the monitoring of prices through the 'just price' 11. What, then, is money? are shared and undertaken collectively. All members
be acceptable under the financial status quo. replace the necessity for new investment to be con- Virtually anything can be used as money so long of society benefit from the cultural knowledge with-
6. Where would the money come from? stantly created through debt finance so that wages as it is widely and generally accepted in exchange out which possessions, tools and machinery would be
and salaries can be paid out to consumers in each worthless. As technology has become more sophis-
Although the national dividend would be paid successive period. for goods and services in a particular society. Cow- ticated, many of the physical labouring tasks such as
over and above any wages or salaries being earned, 8. What changes would Social Crediters recom- rie shells, cattle, cigarettes, beads, stones, feathers, the 'hewing of wood and the drawing of water' have
it would not be derived from a tax on those incomes, mend? precious metals, paper notes and blips on computer been taken over by machines. However, machines do
nor would it be drawn from indirect taxation. The screens have all been used since ancient times in not receive wages. v
present system would be replaced by a new sys- The financial system is inherited from the past. the settlement of exchange. As well as acceptabil- Frances Hutchinson
Since it evolved to meet the requirements of an early

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