There is a debate going on beneath the nonsense of mainstream economic discussion. The contenders are agreed on one important point; that a better distribution of wealth is the solution to our economic woes and the road to a more functional society. As Martin Luther King said ‘it is now incontestable that the wealth and resources of the United States make the elimination of poverty absolutely practical.’ This is true throughout the industrial world and could be true everywhere.
Redistribution is pretty easy to understand because it is a mere extension of what we already have. The redistributists, seeing the wealth of some and the crushing poverty of others, believe the thing to do is to take the surplus of the wealthy and redistribute it so that a reasonable, more reliable income may be provided for all. Various mechanisms are put forward as to how this is to be done from nationalisation of capital to a ‘fairer’ tax system but for the redistributists a general flattening of wealth is the answer.
The distributists (not necessarily of the Belloc/Chesterton school but we’re working on these folks) on the surface may appear close to the redistributist position but the difference and the devil hides in the details. Distributists understand that the problem is not a lack of fairness (though there certainly is that) but a shortage of money or credit. There is an imbalance between the prices on products and the incomes made available by industry to pay them and therefore a great deal of existing and potential production is not being distributed. We say therefore, the answer is to actually make more money and just give it to people so the product of the machine can be consumed in total. There would be no penalising of the rich, in fact the rich would also receive their share of the extra dough. So just to be clear, the issue of the national dividend which would distribute the profit of a nation to its shareholder citizens, would not be funded by taking it from some citizens and giving it to others, but would come directly from the creation of new credit.
If we are right, and we are, then redistributive taxation that could only spread around already insufficient dollars is not going to solve our problem because to fill the price/income gap you have to add more. If you don’t have enough butter for your bread you don’t satisfy your desire for it by spreading it more thinly. You have to get more, and that is just the thing we aim to do.
The Social Credit plan to properly distribute the wealth of this country by means of an issue of credit is more about power than about money. It is a battle on a higher plane. We are trying to take away from irresponsible groups illegitimate power over peoples' lives. The most invasive power over people is financial power and there is a good case to be made that the monkeys that throw shit at each other in parliament are primarily there to distract us from this fact. We have to dismantle the mechanism that allows financial oligarchs the power over the economy and, by extension, our lives. The Social Credit remedy is just the key that would achieve this purpose.
The creation and distribution of consumer credit in line with Social Credit technique would begin the process of establishing economic equilibrium. It would remove the incentive for useless and wasteful work. Machinery would finally be allowed to fulfil its intended purpose of decoupling work from survival and freeing the wage dependent masses from this thinly disguised system of forced labour.
At least two factors are converging that will probably insist fairly soon on a change in how things are done. Firstly, automation is shifting up a gear making labour of decreasing importance as a factor in production. As manpower is displaced by machine power growing numbers of people become marginalised by poverty and insecurity. Secondly, the financial system is in crisis because the conventional way money is made is not working anymore. You see money is made when banks lend and people are so indebted they are just not willing to borrow anymore. If people aren’t borrowing the economy fails because the money dries up when it returns to banks in the form of repayments. These are the two main ingredients of the crisis.
It can go in two directions.
The shrill notes of scarcity and the myth of work propagated by bought economists, politicians and the media is maintained, underpinned by a financial system that refuses to allow sufficient money to reach consumers. As unemployment increases and economic activity stagnates for want of credit the disparity between rich and poor becomes starker, leftist jingoes spruiking equality give credence to calls for increased taxation and debt to prop up declining services and welfare programs. Dependency is the key note of this progression. The nation’s economy will remain dependent on the banks for its money supply, increasing numbers of the un- and under employed masses will remain dependent on government for periodic handouts confiscated from working people who remain dependent on a decreasing number of large employers. As the financial dysfunction accelerates family and community breakdown it is the state that people will look to for solutions. State power will advance only as far as people are made to depend on it. The redistributist intention to do nothing about how the financial system operates and turbo charge state power to tax or control industry appears to me a logical next step in a process that leads to total servitude of the masses to a supreme state.
The alternative is considerably brighter and, but for power, much more easily arrived at. The price/ income gap would be addressed by a creation of credit distributed directly to everybody, rich or poor. The amount of money distributed would not be decided by government decree but pegged to the productivity of the economy. This would ensure sufficient credit is available to consume what is produced and, at the same time, provide a stable market for producers making things that people want. The machine would finally be able to fulfil its intended purpose as a tool for the liberation of labour who would do better with more leisure and the security assured by the dividend. This security would enable people to move away from unnecessary work forced by the need for an income and thereby remove the incentive for economic waste and sabotage. Above all the idea would not be to give people employment but to give them their lives back.
If you read Douglas’ account of the Great Depression (a few posts back) you will see that that whole catastrophe was orchestrated so that banks could retain their power of credit creation. The priority of international finance today is no different and their ruthless talent for ingenuity undiminished. In facing this crisis our focus needs to be the locus of power. Will how we address the dilemmas we face empower our community to form freely chosen associations that strengthen organic society or will we accept a false remedy that allows central command to grow bureaucratic control in its eternal pursuit of the work state? To distribute or redistribute. Freedom or servitude.