Page 13 - Michael 2024 January

But they can accomplish this purpose only if national economic and military conflicts;
the State first makes the money system subserve f) The development of the banking policy of fi-
industry by legally directing this money system to nancing capital equipment to provide consumers
keep the products of the community’s industry (as with money to purchase some of the otherwise un-
producers) distributed for use to the community (as saleable surplus of consumers’ goods;
consumers). g) The gradual breakdown of this device, owing
It is the duty of those commissioned to teach partly to substitution of machinery for human and
and to rule, whether in Church or in State, not only wage-paid employment, and partly through the
to formulate sound practical principles for the guid- capital equipment becoming excessive and lying
ance of men in their social, political, and economic idle (through lack of consumer’s incomes which
relations, but also to study the actual conditions would purchase its ultimate products).
prevailing in those relations, so as to be able rightly
to apply the principles to the facts, for the elimina- The true remedy
tion of abuses and the amelioration of conditions. The governments wanted to remedy these situ-
Society has been robbed of its credit ations through various palliatives, through public
works, or direct aid to the most destitute.
The banking system alone has and exercises de And the governments can get the money neces-
facto the power of creating and cancelling money. sary for these remedies only by two ways:
The value, validity, purchasing power of this a) Through taxes, taken on the already insuffi-
money rests ultimately not on gold, but on the Na- cient incomes of the consumers;
tional Credit, i.e., the community’s potential rate of
real wealth production compared with consump- b) Through loans from the banks, new money
tion. created by the banks, but which must be repaid
Therefore, the community should not be forced with the interest.
to pay a perpetual money levy to private creators The failure of these remedies is obvious. They
and issuers of money on its creation and issue. The will leave the consumers with a bigger debt and
community is forced to pay such a levy, and this less purchasing power...
in money which not the community, but only the To solve the problem, it is clear that the govern-
bankers can create. ments must:
This payment of interest by the community to a) Take back their prerogative, and exercise
the banking system for money newly created (and themselves the control over the volume of money
costless) is on a wholly different footing from inter- required for the population;
est charged on already circulating money by indi- b) Base the money on the productive capacity
viduals who have earned and saved this money, of the country;
and invested it in (or lent it to) industry. c) Issue new money, no longer as an interest-
Consequences bearing debt to the bankers, but debt-free;

The consequences of this failure of money to d) Give a national dividend to each citizen.
discharge its essential function are disastrous and At the same time, in order to prevent automatic-
cumulative: ally any inflation or deflation of prices, and to main-
a) Cut-throat competition to recover propor- tain a perfect and constant balance between prices
tionately the greatest sum in prices in return for the and purchasing power, prices must be subjected
least volume of goods sold; to a national discount, set in accordance with the
statistics of production and consumption. This dis-
b) A steady stream of bankruptcies (of the weak- count will be calculated so as to fill the gap between
er and less ruthless producers) as an inevitable re- prices and collective purchasing power. v
sult of the mathematical impossibility of recovering
for the banks more money than exists in the com- Father Peter Coffey
munity;
c) The replacing of competition by monopolistic Make sure MICHAEL moves when you move.
rings to raise prices; If you have recently moved, or are about
d) The growing accumulation of an unsaleable to, send us your new address. You will save
surplus in each capitalist country; us money because when mail is undeliver-
e) The forced export of this surplus and conse- able and is returned to us, we pay extra costs.
quent struggle for foreign markets, ending in inter- Thank you.

www.michaeljournal.org MICHAEL January/February 2024 13