To: Sincere reformers on my copy list. Dear Bill,
I have been worrying since July 03 about the opinions you
expressed in the subject e-mail, which is copied below with
my questions or comments inserted in the format
[WSB comment or question. WSB].
My experience with economic systems seems to be quite
different from yours, Bill. In 1950, the instructors in
General Electric's "Advanced Engineering Classes" used
Kirchhoff's two laws as rules for writing valid equations
of motion for the flow of any medium through a network
of interconnected nodes. The "rule on nodes" reminded
the students that all flows, in or out of the node, must be
measured and accounted for in the equation for the
particular node and the sum of the flows must equal the
measured change of inventory within the particular node.
The "rule on closed loops" within the network reminded
the student that all potential drops between nodes along
the closed loop must add to zero. I never could solve the
set of simultaneous equations which resulted from
considering each and every loop or node in the network,
but the "Advanced Course" discipline helped me to think
of whole systems without losing sight of the individual
parts of the system.
That discipline may explain why no one has attempted
to refute the eight visual-aids on the US economy drawn
between 1969 and 1994, which are now posted on
W. Curtiss Priest's web site in the signature below. Curtiss
is a charter subscriber to "The Optimum Policy" list
<[EMAIL PROTECTED]> and like your self, Bill, has never
commented, one way or the other, on any one of the eight
visual aids on his web site. But nothing is forever.
Several other subscribers to the list responded to my
June 8, 2003 note, "Without the Whole Law ---," concerning
the various versions of the three Mosaic Tithes, taught by
our five western religions, and one subscriber wrote
as follows:
"Shalom Wes,
You were right about the tithes and our disagreement on
them. It is just "the whole law" that perked my interest."
I may be reaching too far, but that statement confirms my
understanding that the congregations of all five western
religions (Judaism, Catholicism, Islam, Protestantism, and
Deism) have been uniformly misinformed and kept in the
dark about the necessary mutual obligations between a
government and its citizens: as expressed by Karl Marx,
as reduced to practice by the three Mosaic Tithes, and
as illustrated on Fig7-9.gif
But you are quite right, Bill. "Kirchhoff's Laws are
irrelevant to economic analysis," as performed by
credentialed economists during the 20th century, with the
possible exception of Wassily Leontief whose 1966 book,
INPUT-OUTPUT ECONOMICS, defined C. H. Douglas' A flow
as 100% of GDP and C. H. Douglas' B flow as 150% of GDP.
That ratio of A to B is illustrated by the "real economy"
shown on Fig4-3.gif attached to this note. Only
un credentialed and unfunded reformers, it seems, dare
to appeal to "the laws of nature and of Nature's God" to
backup their economic analysis. The politically correct
approach, since Henry Carter Adams published in
Volume I of the "American Economic Review," has been
to backup the economic analysis with more words, but
without the laws.
--------- Forwarded message ----------
From: "William B. Ryan" <[EMAIL PROTECTED]>
To: [EMAIL PROTECTED], [EMAIL PROTECTED]
Cc: [EMAIL PROTECTED], [EMAIL PROTECTED]
Date: Thu, 03 Jul 2003 08:57:17 -0700
Subject: Re: Communication problem with Maj. C. H. Douglas.
Message-ID: (Deleted by Wes Burt)
[Wally] I think you will find that it is faithful to
Douglas's ideas but presented in a more direct style
intended to clarify various aspects for the average
reader.
--------------------
[W. B. Ryan] I do not believe it is faithful to Douglas's
ideas at all. The 1935 essay was much better than the
one from 1957. I think it will be useful to go through
them point by point and compare them to each other
as well as to Douglas. I think we can learn from the
discussion much to help us understand why the social
credit movement failed as it did, and what can be
done to revive it.
[WSB If social credit had contained a complete and
technically valid general theory of human development
(GToHD), surly C. H. Douglas would have won public
acceptance of it. Certainly the public needed social
credit more urgently in Douglas' day than it does today.
Japan, Germany, and most of the western European
nations adopted the cure for what ails the English
speaking nations after World War II, and the US corporate
capital plant still covers the earth like a coat of paint.
It will be easier to teach the public the technical
requirements for stabilizing and optimizing the US labor
market if we would point to how our corporations have
stabilized the world market on attached Fig4-3.gif WSB]
[Wes] At the macro level of economic analysis, there
is no deficiency of financial income. Say's Law
still holds! Kirchhoff's Laws still hold!
(Kirchhoff, Gustav Robert, 1824-1887, patron saint of
electrical engineers).
--------------------
{W. B. Ryan] I am quite familiar with Kirchhoff's laws and
they are irrelevant to economic analysis. We are dealing
in the domain of social not physical relationships. We are
modeling the flow of social relationships as they evolve
through time, not electrons.
[WSB Social relationships and human nature are the same
now as they were when the Republic was founded. We are
modeling the flow of money, because it is the measure of
all other things. Some things cannot be measured directly
and must be evaluated by the democratic process of a
market in which people are "free to choose," informed
about their options, and with enough purchasing power to
buy what they produce. By definition, the "English Disease"
is a shortage of purchasing power among parenting
households and an excess of purchasing power among the
wealthy, healthy, intelligent, and powerful folks ( WHIPs). WSB]
[W. B. Ryan] If you want to use metaphors from electrical or
electronic theory, you would be better served by
adapting them from the theory of semi-conductors
rather than conductors. Think of "holes" that have
no tangible existence, yet are real.
[WSB I have all I can do to think clearly about money (M1)
of which about $1,200 Billion has been out standing since
1994 to run our present $10,000 Billion/year GDP economy
by disbursing the $25,000 Billion/year of Douglas' A plus B
flow from the capital plant to households and government
in 26 payrolls each year. The A plus B flow of $25,000
Billion/year divided by 26 = $961.5 Billion in circulation as
the "medium of exchange," leaving $238,5 Billion of M1
(2.4% of GDP) as idle balances in the hands of the WHIPs
looking for the highest returns from the speculative
transactions shown above the "real economy" on
Fig4-3.gif. WSB]
Credit is an intangible.
[WSB Credit becomes very tangible if you don't have it. WSB]
It is moreover a social not a physical construct.
[End W. B. Ryan message of 03 July 2003]
Thanks again, Bill, for keeping this discussion open and
for attracting to list social credit the recent constructive
comments from Aart R. de Lange, Ekky Irion, Wally Klinck,
Jessop Sutton, Ken Palmerton, Michael Blinder, and
Victor Bridger. There is only one serious systemic defect
of omission in the US economy, but it is now more than a
century old. Its most obvious symptom is the 2.3%/year
"natural rate of inflation" shown on Bob Bronson's
log/linear profile of the US Consumer Price Index, 1870 to
date, shown in Fig10d.gif, but the short falls in money,
jobs, human development, and profitable investment
opportunities are acknowledged by one and all.
Look at Fig8.1,gif to verify that the "Children's allowance"
part of Douglas' universal social dividend is by far the most
important part, and was reduced to practice by the first
Mosaic Tithe, 3474 years ago. We need a valid conceptual
framework of an industrial economy, comprehensible to
8th grade readers, to give the public a way to cure what
ails the US economy. Either the framework in the signature
below is adequate, or a better one must be proposed by
some one else. I would like a better one! This one is getting old.
Kind regards,
Wes Burt
To further explore "The Optimum Policy" illustrated
at URL <http://www.epie.org/cyber-soc/default.htm>
please join me at list <[EMAIL PROTECTED]>.
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