socred

Money is not a commodity.

How do you decrease the value of money? Since money's "value" is solely determined by how many goods and services it can purchase, you decrease its value by increasing prices (i.e. inflation), or conversely, you increase its value by decreasing prices. A Social Credit system, which decreases prices, increases the value of money.

What exactly is "incoherent"?

You prove my point. The best the central banks can do is "managed inflation", which demonstrates that they have no cure for inflation.

Like I stated previously, you're confusing the technical definition of inflation, or how its measured, with what many economists think is the cause of inflation. Central banks attempt to arrest inflation through reductions in the money supply via interest rate policy. Not only has this methodology proven ineffective, as we are plagued by inflation, but the "quantity theory of money" upon which this methodology rests is a fallacy. Douglas demonstrated the fallacy in "The Alberta Post-War Reconstruction Committee Report"

I don't believe there's any question that Harper is going to win a majority government next election. Dion will probably lead the liberals to their lowest showing ever. The NDP may gain some seats at the liberals expense, but not enough to stave off a conservative majority, and the Bloc is too regional and will probably lose some seats to the conservatives. The only national party seriously able to challenge the conservatives do not have the leader to do it, and those poll numbers will swing heavily in the conservatives favour come election time.

"By an accounting method of analysis, the conclusion is reached that the value, at the current retail price-level, of goods produced far exceeds the flow of purchasing-power from permanent sources. In other words, recurring periods of business depression are shown to be the result of present financial and business policies." (C.H. Douglas, "Social Credit") In other words, business cycles do not exist because "everything goes in cycles", but are a result of present financial and business policy.

The definition of inflation is the rise in prices, and the measures of inflation are the average rise in prices. Nowhere do they measure the money supply when trying to calculate inflation. The belief that inflation is CAUSED by "too much money chasing too few goods" is based upon the quantity THEORY of money, and this theory is fallicious as I already pointed out. But if you do not believe me, I will quote from the Bank of Canada: Inflation and Price Stability INFLATION IS A PERSISTENT RISE over time in the average price of goods and services—in the "cost of living."[ Inflation and the risk of inflation encourage certain types of spending and investment decisions. A situation where inflation is low enough so that it no longer affects people's economic decisions is referred to as price stability. The most widely used measure of inflation is the consumer price index (CPI). It reflects changes in the price of a representative "basket" of goods and services sold in Canadafood, housing, transportation, furniture, clothing, recreation, and other items that Canadians buy. The inflation rate is expressed as a percentage increase in average prices over a year. For example, if the cost of the CPI "basket" rises from $100 one year ago to $102 today, the current inflation rate is 2 per cent. When the CPI rises, the purchasing power of the average consumer's dollar falls. Inflation and Price Stability It is a "sloppy" definition to add "an increase in the money supply causing a general rise in prices". The former is based upon a theory as to what causes inflation, whereas the latter is the technical defintion of inflation (i.e. a rise in prices), and that is why the Bank of Canada does not include the former, because it is "sloppy". The belief that inflation is soley caused by "too much money chasing too few goods" is based upon the fallacy known as the "quantity theory of money", which is a THEORY. No, all money is not income. But only income can be used to purchase goods and services, and income paid to individuals in any time period is always less than the total prices generated in the same time period.

Since money is essential to the functioning of our modern economy, money can also be used as a form of government, and this "government" has been centralizing its power since the creation of the Bank of England, and culiminating in international organizations like the IMF and the World Bank.

No, inflation is measured by the rise in prices. No, a general rise in prices is inflation, which may be the result of "too much money chasing too few goods". You are putting the cart before the horse. This is a tautology. Inflation is technically defined as a rise in prices. That is how inflation is measured, so of course everyone in the world should agree on inflation and its effect on prices. Inflation is technically defined as the rise in prices. Inflation is not technically defined as an increase in the money supply. Economists tend to believe that this is the "cause" of inflation, but it is not the definition of inflation. If you don't believe me, look at how the Bank of Canada measures inflation. It seems to me that you don't understand the rebate system. The retailer does not decrease his price. The retailer charges the same price that he always did. The consumer pays the retailer that price, but is "rebated" a certain amount of money which is deposited in his bank account. In the example I gave, the retailer received $100 for his good, the consumer paid $75, the difference ($25) was "paid" by the National Credit Authority by issuance of a price rebate. The amount of income being paid to individuals in any time period is always less than total prices in the same time period. You cannot just add up money and claim that all money is income. Money is a "flow": it has direction. It is created as a debt and flows from the bank through the productive system and reaches individuals by way of income (wages, salaries, and dividends) and is taken back by the productive system in the form of prices (taxes being the goverment equivalent of prices) where it is returned to the bank to cancel the debt. Money flowing back to the bank is NOT income, and cannot be accounted as income. The price rebate is recognition of the fact that the real/physical cost of production is consumption over an equivalent time period. The purpose of production is consumption (unless someone is advocating waste). The price rebate is designed to bring production and consumption into equilibrium. The dividend is recognition of the fact that technology is reducing the need for labour in the productive process. Let me give you an example of the problem. Imagine if you will that all production took place with the aid of perpetual motion robots. Obviously we are not at this stage of production, or anywhere near it, but we are moving towards it, because the goal of most technology in the productive process is to replace labour. If we lived in this world, we'd all die of starvation, because not one of us would have any income. There would be an abundance of goods and services, but none of us would have any money to buy them.

And I would argue some are full of nonsense. Karl Marx was not a Christian, nor did he advocate religion. His philosophy was based upon dialectical materialism. As far as Tommy Douglas is concerned, I think he was "misguided" in the belief that socialists help the poor. Socialists love the poor so much that they want to make everyone poor. I believe that if Tommy Douglas had understood C.H. Douglas, Tommy would have become a Social Crediter. Socialism is the elavation of the state over the individual, and as such, is anti-Christian. I agree. Even the ASCP, which says they are influenced by it, promote something quite different. Prices also rise due to the rising cost of production, which is caused by the "capitalization" of industry and leads to "B payments" rising relative to "A payments".

Hello Jerry! We meet again. I hope you have a happy new year.

It is a guiding philsophy, but that does not mean that one need to be a Christian to live in a "practical Christian" society. It is a simple recognition of the fact that the culture that western civilization is based upon over the last 2000 years has been Christian (with the exception of maybe the last 40 years, since socialism has begun to take over). Douglas believed that the expression of "practical Christianity" can be found in the Magna Carta. It is the belief that the individual should be given the maximum amount of freedom possible. Practical Christianity does not seek to impose a theology. "Systems were made for men, and not men for systems, and the interest of man which is self-development, is above all systems, whether theological, political or economic." (C.H. Douglas, "Economic Democracy") That is the essence of Social Credit. I was a VP for the Alberta Social Credit Party, and I was disgusted by party politics. The people in power in the Party wouldn't know Social Credit from Socialism. There were endless debates over nonsense that was everything but Social Credit. The people who get involved in politics represent the worst philosophy known to man, which is the "will to power" (Social Credit is the embodiment of the will to freedom). I choose to remain anonymous in these threads, because there is alot of "nutballs" out there, and I don't want to be harassed. I do post in some areas with my name. I post on these threads to spread a message. People really don't have to understand all the technical details of Social Credit to force politicans to implement it. If anyone wants to understand the technical details, that is what I'm here to put forward. Until it is implemented, we will continue to see rising prices, rising taxes, and increasing debt. Perhaps the system will finally have to collapse before people get interested. I hope not.

Social Credit does not push any faith based idea upon anyone. There are reasons Douglas identified Social Credit as practical Christianity. One would be the following: "It is not too much to say that one of the root ideas through which Christianity comes into conflict with the conceptions of the Old Testament and the ideals of the pre-Christian era, is in respect of this dethronement of abstractionism. That is the issue which is posed by the Doctrine of the Incarnation. " (C.H. Douglas, "Social Credit") It should be noted that you should not confuse "practical Christianity" and "Judeo-Christianity" for they are not the same thing. Well, we could get into discussions about how much of the "scarcity" of oil is contrived scarcity by OPEC, but it does not matter. What matters is that consumers pay less for gasoline at the pump. Also, part of Social Credit is the recognition that leisure is one of the primary outputs of industry. As technology decreases the amount of labour necessary for production, individuals should be able to work less. This is the goal of the dividend. I don't know about you, but I consume most of my gasoline going to and from work. Indeed, Social Credit is a movement, but it is not a political party, and I would argue that the Social Credit political parties have done the movement more harm than good.

Not at all. Douglas referred to money as a "ticketing system". The following is a question, taken from Douglas' testimony before the Alberta Agricultural Commission, in regards to Social Credit and whether the amount of money (or tickets) created would be unlimited: "Q. Would the number of tickets be unlimited, or would that be regulated by the actual production of potential production of goods and services? A. Quite obviously there is no sense in having a ticket for something that does not exist. There is equally no sense in having something existing for which nobody has a ticket." In other words, quite obviously there is no sense having money for something that does not exist. There is equally no sense in having something existing for which there is no money. The purpose of the debt free money introduced in a Social Credit economy is to eliminate the gap between income and prices Douglas identified in his A+B theorem. You can't have inflation without a rise in prices. Prices would decrease in any Social Credit system, so it is not inflationary. Are you claiming that B payments were incomes disbursed in the past? If so, I address this point in the essay I wrote which is the first post in this thread. In truth, orthodox economists don't fully understand inflation, and that is why we are forced to live with "managed inflation". Douglas realized that the only way to combat inflation was a price subsidy at the point of retail with money created debt free and that did not run through the productive system (i.e. costless money). The real cost of production is consumption. B payments represent previous consumption which has been "capitalized". We are quite rightfully charged with capital depreciation, but we are not properly credited with capital appreciation. In reality, we are building capital at a much faster rate than it is depreciating. That is why the National Credit Authority would first calculate a national capital account. Any business has a right to charge for their capitalized costs in their price to consumers, but consumers should not pay it. The difference is made up by the National Credit Authority by issuance of debt free credit. I agree. Most Social Crediters believe that Keynes was the socialist response to Douglas. Keynes recognized the gap between income and prices as well, but proposed to close that gap by increased capital production (i.e. investment) or increased government spending. Not only are these methods inflationary, but they cause increased debt, because the money created is still issued as a debt, which means it creates a cost, and inflates prices. Also, tying to close the gap with this methodology never fully brings consumption and production into equilibrium, as Douglas pointed out with the following taken from his book entitled "Social Credit": The condition which is produced by a policy of restricting the amount of money in circulation can be grasped without difficulty, if it be remembered that it must involve a numerical decrease in both the total figures of cost and the total figures of price for a given period of production. The only portion of the total costs which can be decreased without loss to the producer are those represented by wages and salaries, the remainder being fixed charges based on the capital costs already incurred. Wages and salaries costs are purchasing-power, and collectively are much less than collective prices. Imagine both collective wages and collective prices to be diminished by an equal amount x. This may be written: Costs = purchasing-power. Costs are < prices. Costs is < 1 Prices Costs - x Costs is < Prices - x Prices An addition to both the numerator and denominator of the fraction, such as is brought about by a rise of wages, accompanied by a rise in price, has, of course, the opposite effect; it brings the ratio of purchasing-power to prices nearer, though never to unity, with the result, seen in Germany in the inflation period, of immense, though unstable, economic activity, accompanied by great hardship to the professional and rentier classes, both of whom have claims to consideration, and a most undesirable concentration of economic power, resulting infallibly in the enslavement of the artisan. C.H. Douglas, "Social Credit" It's not simply "adding credits". It's rectifying an accounting flaw which Douglas identified in his A+B theorem.

Why?

C.H. Douglas also said Social Credit was "practical Christianity", and I tend to agree with him. Social Credit is much more than monetary reform. I don't think orthodox economists understand inflation, and that is why it is systemic in our debt based monetary system. In fact, the best economists today hope for is "managed inflation". This misunderstanding is due to their adherence to the fallacy known as "the quantity theory of money". Money has direction. It is either creating costs, or cancelling them. If the increase in the money supply is used to cancel costs, which is the idea behind the price rebate, then an increase in money can decrease prices to the consumer. Why would you need to? Consumers don't buy crude oil. The price rebate occurs at the point of retail. It is a rebate given to the consumer. That's because you've been taught to believe that an increase in money will automatically cause inflation. Even if you adhere to the quantity theory of money, which states that money*velocity of circulation= prices*output an increase in money does not necessarily increase prices, it can increase output without an increase in prices and this is using the quantity theory of money, which I maintain is a complete fallacy. Douglas exposed this fallacy in his report to the ALBERTA POST-WAR RECONSTRUCTION COMMITTEE REPORT OF THE SUBCOMMITTEE ON FINANCE I wasn't sure if you were talking about physical capital, or financial capital. I can't see any reason why Americans would not want to invest in Canada if it adopted a system of Social Credit, but even if they didn't, so what? Do you think that Canada needs numbers from the U.S.? Do you not think that our banks can't create those same numbers? Banks create money with each loan. There is no necessity to import capital. No industry would be "protected" in a Social Credit system, including banks. They would all compete like they do now. The only difference would be that consumers would receive a rebate upon purchase of goods and services, and individuals would receive a dividend, both of these would be financed by the National Credit Authority through debt free money created by the Authority for that purpose. The size of the rebate and dividend would depend on aggregate production and consumption statistics, and the ratio of capital appreciation to capital depreciation. According to the constitution, money and banking is under federal jurisdiction, so it could easily be implimented federally. Provincially may cause a battle, as was witness previously. The party member did not know what he was talking about. Any political party can implement Social Credit. Do you need a Keynsian political party to implement Keynsian economics, or a monetarist political party to implement monetarist economics. Douglas did not advocate Social Credit Parties. "Social Credit Parties There is at the present time an idea that we should have a Social Credit party in this country. I can quite understand and sympathise with that idea, but it is a profound misconception. It assumes that the government of the country should be a government of experts. Let me show you that it does assume that. If you elect a Social Credit party, supposing you could, I may say that I regard the election of a Social Credit party in this country as one of the greatest catastrophes that could happen. By such an election you proceed to elect, by the nature of it, a number of people who are supposed to know enough about finance to say what should be. done about it. Now it is an axiom of experience that no layman can possibly direct the expert in details, and in normal things no layman is fool enough to try to do it. If you had a Social Credit government, it would proceed to direct a set of very competent experts - the existing financial authorities, for example - how to do their job. The essential thing about that situation would be the responsibility for what was done. Now no set of 500 or 600 men whom you could elect in this country could possibly know as much about finance as the people they would presume to direct. You know, in all that I have said about financiers, I have never at any time said that they were incompetent, nor are they, within the limits of their own philosophy. But to elect a Social Credit party in this country would be to elect a set of amateurs to direct a set of very competent professionals. The professionals, I may tell you, would see that the amateurs got the blame for everything that was done." The Approach to Realityby C. H. DOUGLAS

Thank you, that was an interesting article with which I agree.

How do you propose a free market would work better for this purpose?

I don't know where I stated that the value of an good is placed in the currency? Perhaps you show me where I stated that? Increasing the money supply is not the bare bones definition of inflation. Inflation is the increase of prices, and that is how inflation is measured. You are merely assuming that by increasing the money supply, there will be an increase in prices. I demonstrated the fallacy of this belief in my previous post. The assumption that the producer will charge more money if people have more of it assumes that the producer is not subject to competition. It also assumes there is a 1:1 correspondence between income and prices; something which Douglas demonstrated was false in his A+B theorem. The issuance of the price rebate and dividend is to give the consumer enough money to cancel all the costs of goods and services coming onto the market. Also, there is the assumption that production is at the levels of capacity. The alternative is that the producer will produce more goods and services if people have more money. Competition tends to eliminate profiteering. I find it odd that those who champion the free market and the benefits of competition are often the first to abandon it. Printing money does not make us rich. The only thing that can make us rich is the production of goods and services which we desire. Money is not wealth, nor did I claim it was. The issuance of debt free money is to rectify an accounting flaw which Douglas elaborates upon in his A+B theorem: “In any manufacturing undertaking the payments made may be divided into two groups: Group A: Payments made to individuals as wages, salaries, and dividends; Group B: Payments made to other organizations for raw materials, bank charges and other external costs. The rate of distribution of purchasing power to individuals is represented by A, but since all payments go into prices, the rate of generation of prices cannot be less than A plus B. Since A will not purchase A plus B, a proportion of the product at least equivalent to B must be distributed by a form of purchasing power which is not comprised in the description grouped under A.” (C.H. Douglas, “The Monopoly of Credit”) I agree with you in regards to economists being "econometricians" rather than understanding theoretical economics. I would also claim that economists have very limited understanding of accounting, and accountants themselves are merely technicians, who do not understand the philosophy behind their trade. Douglas was an engineer and a cost accountant. As to your comments in regards to Social Credit and socialism. The National Credit authority would not control the money supply. Banks would still create money as they see fit, and the amount of money created debt free by the National Credit Authority would be calculated based on the consumption and production habits of individuals.

Every critic who has said it would lead to inflation has not understood it. It's people who believe that increases in money must necessarily lead to inflation. This assumption is at least implicitly derived from the fallacy known as the quantity theory of money. The following was written by Geoffrey Dobbs in the introduction to Douglas' book "The Monopoly of Credit": "Another result of this treatment of money as if it were a simple 'quantity' is that the polarity in respect of time which is introduced by its creation, not as a simple quantity addition, but always as a repayable loan, is ignored. Although individuals and businesses have to balance their debits and their credits, when it comes to the economy as a whole, units of account are totted up whether they are coming or going, on the plus or minus side of the debt ledger, whether they are cancelling costs or creating them. Thus, when economists have added up all the borrowed mortgage-money paid out to maintain witless, useless, redundant, unwanted, destructive, or simply irrelevant "employment", they find there is 'too much money chasing too few' of the miserable trickle of wanted and needed goods and services actually produced and allowed to reach the consumer. They cannot understand how permanent and progressive inflation, quite as much as deflation of the 1930's, is a sign of a progressive time-lag in the generation of incomes as compared with prices, which can be neutralized only by a direct issue of credit to the consumer (whether by dividend or price discount or both). However much it is sophisticated, the argument is essentially the simple one that, if inflation is due to too much of a homogeneous quantity called 'money', to add more 'money' will make it worse. But 'money' is not a homogeneous entity, it is a loan, which is travelling outward, creating debt, or inward, cancelling it. The best analogy is, perhaps, a chemical one. A state of inflation might be compared to one of corrosive acid poisoning, due to a gross excess of (positive, hydrogen) ions. The urgent need is to neutralize these with a base, i.e. by adding negative, basic, ions. The argument that, since the damage is due to an excess of 'ions', to add more 'ions' would make it worse, is quite analogous with that used by economists who reject Douglas' analysis and proposals as 'inflationary'." (Geoffrey Dobbs, Introduction to "Monopoly of Credit") I don't know any Social Crediter claiming Social Credit is "managed inflation". Are you talking about members of any "Social Credit" Party? The Supreme Court ruled that it was unconstitutional for Alberta to establish a system of Social Credit, since money and banking fell under federal jurisdiction. They did not rule that Social Credit was unconstitutional. I'm not certain what you mean by the statement "I still think that there would be a limit of capital ", so perhaps you could elaborate? I don't know why the WTO would penalize any country for establishing Social Credit, so perhaps you could elaborate on that thought as well?

It seems to me that "multiculturalism" is a socialist tool designed to destroy western Christian culture and replace it with socialist culture based on dialectical materialism. Communists are notorious for their "cultural revolutions", and socialism is merely an evolutionary form of communism. The first step is destroying a culture is to claim that there exists "multi" cultures within a community. This only creates division, and the strategy is divide and conquer. I have no problem with people from other cultures coming to Canada, but I have a problem when they don't respect the established culture that has built this country and made it great. If the culture in the Middle East or Africa or Asia is so great, why are people fleeing those countries as refugees to seek refuge in our country?

"money is any medium which has reached such a degree of acceptablility that, no matter what it is made of, and no matter why people want it, no one will refuse it in exchange for his product." (Professor Walker) Money is created by the banks as a debt which must be repaid. Banks have been centralizing their power over the last few centuries starting with the Bank of England, and culminating in international organizations like the IMF and World Bank. One only look at the temples we erect to understand the power of money in the modern world. Walk into any downtown sector, and you'll find the majority of high rises are owned by banks or insurance companies. Instead of money being a tool, it has become our master, and "golden calf worship" is alive and well in the modern age.

I don't see how it would be inflationary. Prices would be falling. In the above example, the price of the good fell from $100 to $75 by virtue of the price rebate. The increase in money would go directly to the reduction of prices, and there would be no money created via the rebate unless it was used to reduce prices. There certainly would be no limit on consumer credit or choices. People would pay for things as they do now, except they would get money back from the National Credit Authority. And producers would be free to produce whatever they wanted, and charge whatever price they can receive. Every place in the world can chose to operate on this system or not. And people can move from any country operating within this system. That is their choice. However; once they move, they will no longer receive the price rebate or the dividend. People would also be free to move into the country operating on this system, but would have to wait to receive a dividend. The price rebate would be automatic.

The price rebate system actually lowers prices to consumers, as it is a price subsidy. For example: Let the ratio of consumption to production be 3/4, and let the price of some good be $100 (for mathematical simplicity). By virtue of this example, the price to the consumer would be $100*3/4=$75, which is $25 less than the original price, so the price of the good fell by $25. The consumer would pay the retailer $100, so he would receive the full price of the good. The customers bank would credit his account by $25, and the National Credit Office would credit the bank's account at the Central Bank by $25. The price of the good fell from $100 to $75. The retailer received the full price for his good, so he continues to cover his costs, and make a profit (if he can sell above cost). The consumer is credited back $25 so he only pays $75 for the good: the difference between what the retailer receives and what the customer pays ($25) is created by the National Credit Office debt free. I don't see how it would effect the mobility of people at least within any country operating on this system. If a person chose to leave the country, and reside in one not operating on this system, then they would forfeit their dividends and rebates. However; once the system was operational, I'm sure most, if not all, countries would adopt the same system. Registration into the system would be completely voluntary (i.e. if you don't want a rebate or dividend, you are not forced to take them). Again, I doubt people will refuse money. The problem with not adopting this system is that credit from an extraneous source is needed to cancel the current costs of production. Consequently; with an entirely debt based monetary system, we are forced to ever increasinly mortgage the future in order to consume current production. This means that we are sliding further and further into debt. Eventually, we will not be able to meet the interest payments on that debt (public and private).