Good day folks, Three of my favorite posters to list Social Credit; Wally Klinck, Michael Bindner, and Bill Ryan in their e-mails of 08-26-03 have provided a conceptual framework that invites me to explain my understanding of what C. H. Douglas meant by Social Credit. Michael's inquiry is copied below, and includes Wally's original message concerning the "paradigm shift" required to establish a Social Credit "economic democracy." Bill Ryan, in his message "Aberhart links" presents a history of Social Credit in Alberta Canada during the 1930s in the form of excerpts from several authors.
What caught my eye was the $25/month "basic dividend"
for every citizen proposed by William Aberhart's Social
Credit League which won 56 of 63 seats in the 1935
provincial election. That $300/year "basic dividend" is the
first real number I have seen on the social credit list postings.
If we consult Bob Bronson's 1870 to 2001 profile of the US
Consumer Price Index, which is Fig10d.gif on the URL below,
the "basic dividend" translates to $4,615/year at 2001 prices.
My $65/month subsistence allowance, as a 1946 student on the
1942 G. I. Bill, also fits on the profile, and shows that Uncle Sam
can be a "Compassionate Conservative" when in the right mood.
To answer Michael's question below, "who gains and who
(if anyone) loses," the best place to look is at Fig8.1.gif on
the URL below. While Fig8.1 is drawn with a $5,000/year
"basic dividend" for each US citizen, that is close enough
to the Canadian $4,615/year to assure a paradigm shift in
both nations, if the tax payers of either nation were bold
enough to adopt C. H. Douglas' cure for the English Disease.
Who would gain? A "basic dividend" for every citizen
would expand the lower edge of "discretionary income"
(purchasing power of the workforce) down to the "x" axis
of the chart, and end the century old defect of omission
in public policy that keeps the English speaking nations
in the mode of the "Washington Consensus" with 4 to 10%
unemployment, a 2.3%/year "Natural Rate of Inflation,"
and a 3 to 5% of GDP shortage of purchasing power with
a corresponding deficiency of capital investment
opportunities.
The business community would enjoy a larger domestic
market, without the cutthroat competition and inflation.
Our Neo-Conservatives might be worried that the
workforce will lose its "Work Ethic," but that is just what
is needed to conserve water, energy, and the environment.
Our Jesuits, Republicans, Zionists, Democrats, and members
of Congress may worry that "setting the workforce free" may
be too much decentralization and not enough government
regulation. But, cost will probably decide the issue.
To illustrate the cost and benefits of the three components of
a "basic dividend," let me use the figures for the US economy:
* A GDP of $10,000 Billion/year.
* A population of 285 million persons.
* A life expectancy of 77 years. (Canada is 79, per World Bank)
* A basic dividend of $5,000/year per citizen, as in Fig8.1. gif.
Using sixth grade arithmatic we find the following:
First component, 0 to age 18. Cost = 285 X 18/77 X 5,000
= $333
Billion/year
= 3.3% of GDP
Second component, 19 to age 65. Cost = 285 X 47/77 X 5,000
= $869.8
Billion/year
= 8.7% of
GDP
Third component, 66 to age 77. Cost = 285 X 11/77 X 5,000
= $203.6
Billion/year
= 2.0% of GDP
Notice that the first component of the "basic dividend" will
secure nearly all of the benefits of a universal "basic
dividend" for all citizens. It leaves the adult part of the
population with only one dependent each (themselves) to
support, so the "work incentive" for parenting households
would be no less than the "work incentive" for gay, lesbian,
and celibate households. Equally important, the break
even point for all households is reduced to $5,000/year, so
the number of households requiring "welfare payments"
will be reduced. But more important, the first component
of the "basic dividend" adds $333 Billion/year of purchasing
power to the local economy to correct the shortage of
purchasing power which has cursed the US for more
than a century, in exchange for a 3.3% increase in the
total tax rate, about half of the average US State sales tax.
Our present system of welfare for the 66 to age 77
component (the social security program) collects about
13% of all income below $76.000/year and zero% of all
income above $76,000/year. It makes one wonder what
the US economy would look like today if President
Franklin D. Roosevelt had implemented the first
component of the "basic dividend" in 1935, instead of
the third component. Again, one might wonder why
people promote the universal "basic dividend" as the
keynote of Social Credit, at a cost of 14% of GDP, when
all of the benefits can be recovered by installing a
Children's Allowance only, at a cost of 3.3% of GDP, just
as Japan and Germany did after World War II.
If we can't find the will to discuss and practice "Nation
Building" at home, how can we hope to convince the
world that we are serious about "Nation Building" in
Afghanistan and Iraq?
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]>.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
On Tue, 26 Aug 2003 07:16:26 -0700 (PDT) Michael Bindner
<[EMAIL PROTECTED]> writes:
> Perhaps it would be helpful to describe how social credit would work
> using one annual cycle. Give us the who, what, when, how and why
> and pay special attention to who gains and who (if anyone) loses.
>
> Michael Bindner
>
> "Wallace M. Klinck" <[EMAIL PROTECTED]> wrote:
> To all Members:
>
> Social Credit aims for a consumer-motivated economy in the greatest
> possible sense. The Social Credit conception of "economic democracy"
> lies in exercise of maximal, effective consumer choice ("money votes")
> rather than in the ownership and/or administration of productive
> enterprise. It does not aim for any state-directed, restrictive,
rationing
> policy such as represented by Food Stamps. My understanding is that
> the new consumption credits are to enter the money flows in an
> entirely transparent and undifferentiated ("fungible" as Bill has said
> on occasion) manner and I have no reason to think otherwise.
>
> Social Credit aims to promote optimal individual, local, provincial (or
> state), and national sovereignty and it is assumed that under normal
> circumstances this involves a shift which maximizes power and/or
> independence away from central authority toward the individual.
> Social Credit stands for national sovereignty among nations and
> the right to assert authority over its internal matters.
>
> I think Douglas indicated that restraint might have to be put on the
> activities of currency speculators and I hoped that his essay on "The
> Gold Standard" (posted recently) would introduce some realism into the
> issue. I am somewhat surprised that there has been so little response
> (only one) on Topica, even from Bill. Of course, some on the group
> discussion are not seasoned Social Crediters and others sometime
> appear even to have their own agendas, or are simply still trapped in
> orthodox views.
>
> As Munson and others have stated, when approaching Social Credit, it
> is best to wipe away the old cobwebs of thought and start from a clean
> slate. As Douglas said, we are attempting to step out of one type of
> civilization into a new type of civilization. To me this involves, in
> modern jargon, a real and not an apparent "paradigm shift." For some
> minds, this is just much too "radical" or unfamiliar to accept--or even
> to fathom.
>
> Sincerely
> Wally
>
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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