[P2P-F] Fwd: Christopher Social Credit & Grace -

Michel Bauwens michel at p2pfoundation.net
Sun Dec 13 03:00:55 CET 2015

---------- Forwarded message ----------
From: Chris Quigley <cmqesquire at gmail.com>
Date: Sat, Dec 12, 2015 at 7:17 PM
Subject: Fwd: Christopher Social Credit & Grace -
To: Michel Bauwens <michel at p2pfoundation.net>


Thought this article might be of interest.

Kind regards,



*Economic grace of ‘Social Credit’: national dividend and compensated
retail prices to facilitate consumer goods distribution in an age of

Posted on July 20, 2015
 by Carl Herman <http://www.washingtonsblog.com/author/carl-herman>

*by guest author Wallace Klinck*

*“The unacknowledged, but obvious, truth is that unnecessary work, imposed
by either edict or contrived financial legerdemain, is slavery and
servitude—totally irrational and immoral.  Every engineer worthy of the
name is trying to eliminate the need for human effort as a factor of
production while every witless or hypocritical politician, pressured by the
financial powers above and an insecure and uncomprehending population
below, is professing, at least, to promote policies designed to ‘put people
back to work.’” (from the below article)*

Five minute video of Major C.H. Douglas, founder of Social Credit (1934):

Because of its deleterious impact on personal freedom and initiative,
centralization of both economic and political power is the critical issue
facing society. The primary obstacle to reversing this growing
concentration of power is an almost universal ignorance of the manner in
which the existing financial system renders the price-system increasingly
non-self-liquidating, making impossible the recovery of industrial
production costs through sales. Institutions and individuals attempt to
resolve this problem by resorting to bank debt, thereby obtaining access to
the products of industry by the self-defeating expedient of mortgaging our
future–i.e., transferring these costs as an exponentially growing debt
charge against future cycles of production–and by engaging in an orgy of
wasteful and destructive activities, effectively culminating in continuous

Their monopolistic proclivities disincline both Finance-Capitalism
operating under the Monopoly of Credit and every form of collectivist
organization (e.g., socialism, communism or fascism) from grappling with
this problem.  The solution must entail an appropriate modification of the
existing financial-credit and price system so as to properly facilitate
distribution of the immense output of modern technology-based industry, in
the context of expanding leisure.

Nearly a century ago this emergent challenge was studied in depth by the
British engineer Clifford Hugh Douglas, who not only analyzed the defects
of the existing price system as it functions under present financial and
industrial cost-accounting conventions, but also put forward realistic
remedial proposals.  Between and for a period after the World Wars,
Douglas’s ideas, which he named “Social Credit”, attracted large numbers of
adherents and spawned many political movements in countries around the

Douglas recognized that life is more than bread alone and that in order to
attain his full stature man must be released from unnecessary material
concerns in order to make time for matters of the Mind and Spirit. This
clearly was inherent in certain much-neglected aspects of the message of
Jesus, who explicitly stated that lack of faith is the reason for our
obsession with toiling our own way to material survival. Jesus asked how we
could doubt that God, who provides for the fish and birds and the beasts,
knows our needs and will provide even better for us. On more than one
occasion Jesus unconditionally distributed loaves and fishes to crowds that
had gathered to hear him. To indicate how reality operates outside of
puritanical human notions of morality, Jesus pointed out that his heavenly
Father causes the sun to rise on the evil and the good, and lets *rain fall* on
both the *just* and the *unjust*.

An aspect of this divine caring is the ability we have been given to
accumulate understanding of natural laws, which has resulted in an endless
extension of “mechanical advantage”—termed by Social Crediters the Unearned
Increment of Association—from which has emerged our amazing modern
technology with its outflow of material abundance. Through learning how to
associate effectively in the areas of both human endeavours and material
resources, we have multiplied our productive capacity many thousands, if
not millions, of times over.  The historical aggregation of Unearned
Increments has provided the vast Cultural Heritage upon which we all so
greatly, if unconsciously, depend.

This is the background of why Social Credit came to be perceived by its
leading thinkers as “practical Christianity”. Although Douglas did not set
out to design it as such, ongoing development of Social Credit thought has
revealed it to be uniquely consonant with and revelatory of the assurances
given by the founder of the Christian faith.

This realistic perception of our situation is absent from the major
ideologies of our time.  For example, Libertarians promote the notion that
the individual must “make it on his/her own”. No one today (apart maybe
from individuals lost in the wilderness) is doing this; all have the
benefit of the Cultural Heritage, which ties us in a web of dependencies
not only with our contemporaries but also with previous generations.

Socialism, which calls for State ownership and administration of the means
of production—the central planning of the economy and of human
activity—similarly endeavors to alienate people from their heritage.
Besides specifically attacking the very principle of inheritance,
Socialists force the energies of the members of society into mandatory
employment in projects prescribed by the State. Suppression of individual
initiative is an inevitable result of this constraint of access to the
possibilities afforded by the richness of the Cultural heritage. This
observation applies to all forms of “socialism”, whether national or
international in nature.

Social Credit is the inverse of socialism and a negation of finance
capitalism.  Many persons have it in their minds that a sharing society
necessarily is socialistic; i.e., power centralizing. Presumably they think
this way on the erroneous assumption that the sharing will be accomplished
by redistributing existing wealth by means of various confiscatory forms of
taxation.  However, Social Credit, uniquely, stands not for redistribution
of earned incomes, but rather for distribution of consumer goods at source
as they emerge from the production line.

Douglas enunciated and stressed the truism that production without
consumption is sheer futility and waste.

The fundamental task of economic policy is to match and balance the cycles
of consumption and production.  Producers’ costs cannot be recovered
without money received from consumers, whose incomes alone provide business
its means to liquidate all financial costs of production.

In order to effect this balance, Douglas recommended that National
(Consumer) Dividends and Compensated (lowered) Prices at point of retail
sale must be provided and financed by a Government Agency (created or
existing, whatever is most efficient and convenient) with funds not derived
from taxation but drawn down from a properly constructed National Credit
Account.  This would be a continuously updated actuarial accounting of the
nation’s real credit, being an inventory of all those resources which are
available to be used for production and which, if so used, may result in
the making of financial prices.

Unfortunately, the public are conditioned to reason from the false
assumption that the economic “pie” is limited to the financial incomes paid
out in production, and hence they perceive this as the only possible source
of funding. This assumption includes the erroneous corollary that the
price-system is self-liquidating; i.e., that incomes paid out as wages,
salaries and dividends are not only equal to, but available to meet, the
total financial costs of production. That this is a major fallacy is
readily proved by the enormous accumulation of inflationary private and
public debt created as loans by the banking system, which allows goods to
be purchased after a fashion but does not liquidate their financial costs
of production in a synchronized fashion.  As a kind of stop-gap expedient,
these loans merely transfer these costs into the future, to be liquidated
with income derived from later cycles of production unrelated to the cycles
in which they were incurred.

The physical (i.e., real) costs of production are met as production
takes place. Obviously, if this were not the case, production could not
proceed.  This is self-evident and axiomatic. When goods are produced in
finished form they are meant to be used and should be immediately available
to the overall consuming public *in toto* and without entailing any
residual financial debt.

This universal piling-up of debt is bogus and is required only because
price increasingly includes, as real capital replaces labor as a factor of
production, allocated charges in respect of real capital which are
not distributed as income in the same cycle of production. Consumer income
is cancelled prematurely, leaving a growing deficiency of income relative
to the total prices of goods awaiting purchase. In other words, the flow of
final prices increasingly exceeds the flow of effective financial
purchasing-power. Purchasing-power is prematurely cancelled in respect of
still existing real capital, whereas it should be cancelled only at the
rate of actual physical consumption or depletion.  Money should be issued
at the rate of production and cancelled at the rate of consumption

In the face of this predicament, we can simply forgo acquisition of these
goods, leaving the producer no option but to warehouse or destroy them and
go bankrupt—making his endeavors a mindless exercise in futility. Or we can
ensure that, while required, remaining actual “workers” (i.e., recipients
of remuneration from others for services rendered) continue to have the
benefit of their earnings, all citizens, workers included, have access to
the full output of industry by being provided adequate aggregate
purchasing-power to make this possible.

Besides being a practical necessity, such an arrangement recognizes the
share all have in the almost fantastic Cultural Heritage of Civilization.
In a Social Credit dispensation, Inheritance would be generalized.

In stark contrast is the socialist attitude, which is that inheritance is
evil and should be abolished.

Social Credit stands most definitely, unashamedly and unabashedly, for
a sharing society—and as labor is increasingly reduced by technology
it would become more sharing with the passage of time. Unlike Socialism,
which in reality has always been more about centralized control than about
sharing, Social Credit does not involve State ownership, planning or
administration of the economy or of social organization as such. By giving
people as individuals full access to the ever-increasing abundance made
possible by technology and to concomitant economic independence, it is in
fact highly decentralizing.

The rational purpose of technology is to eliminate inefficiency, and “jobs”
concocted merely for the sake of distributing incomes are
precisely that—mere wasted energy and materials.  The solution to the
problem of economic insecurity in the modern age of super-production does
not lie primarily in “making” work, but increasingly in facilitating
distribution.  Those who clamor for “jobs” actually visualize a model along
the lines of fascist and communist states, which give and demand of
everyone endless work throughout their lifetime, in accordance with the
rather suspect dictum that “work will make you free”—but not *until* you

The unacknowledged, but obvious, truth is that unnecessary work, imposed by
either edict or contrived financial legerdemain, is slavery and
servitude—totally irrational and immoral.  Every engineer worthy of the
name is trying to eliminate the need for human effort as a factor of
production while every witless or hypocritical politician, pressured by the
financial powers above and an insecure and uncomprehending population
below, is professing, at least, to promote policies designed to “put people
back to work.”

Frankly, if I desire “work”, then I want to do it by my own choice and at
my own leisure, increasingly freed from the enforced conformity and
servitude of the existing system.

We should not be striving to provide more, and more, human work but rather
more technological productive efficiency with augmented effective
consumer purchasing-power capable of eliminating consumer debt
and liquidating industrial costs in a timely manner.  Let robots do the
work.  Tirelessly and without complaint, they perform the vast majority of
it better than people can.

You want more work?  Then let’s have another war—or, better yet, continuous
wars until we end up destroying the whole planet or all life upon it.

Indeed, the flaws in the current financial system provide a constant
incentive for military war, which normally is just an extension of economic
war. Unbalanced international trade is driven by the increasing inherent
orthodox need to export—not to receive an equivalent of real wealth in
return, but to capture financial credits from other nations to compensate
for the internal intrinsic deficiency of consumer purchasing-power that
exists in the domestic price-system of every nation.

Anyone who does not understand this compulsive destructive dynamic of the
modern financial-economic system is totally unqualified even to comment on
our economic position.

The abundance that technology makes possible should set men and women free
from physical want, increasingly enabling them to choose independently
and without duress their preferred activities in life. As opposed to the
ubiquitous Keynesian, cognitively dissonant, counterfeit socialist concept
of “economic democracy” as a centralized administrative proletarian
Work-State, Social Credit gives real meaning to the concept of economic
democracy by favoring a consumer-motivated system of production.

C. H. Douglas stressed the importance of understanding policy by
tracing its pedigree.  From a metaphysical standpoint, Social Credit would
be a practical, physical incarnation of the Christian Doctrine of Salvation
by Unearned Grace—in contradistinction to the prevailing
hyper-materialistic conception and system, of Salvation through Works. The
current financial system is predicated upon a unchriatian philosophy
characterizable as “*do ut des”,*  meaning “this for that”

in other words, that nothing can be obtained except it be earned, that, as
the saying goes, “There is no free lunch”. It is the underlying principle
of the madness-inducing doctrine of “Salvation through Works”.

Hence, the existing financial system issues money only as debt
for production and never for consumption, except in the latter case as debt
which must be acquitted by future work This policy of issuing money only
for work might have had some basis in equity in the primitive economy where
production was primarily due to human effort. It makes no rational or moral
sense whatever in the modern highly technological economy where non-human
factors of production predominate and human intervention becomes
increasingly a mere, although essential, catalyst within a vast productive

Social Credit coheres profoundly with the Christian philosophy of Salvation
through Unearned Grace–Grace being an outright gift from God. Spiritual
Grace has, or should have, a physical counterpart, or incarnation, in the
economic or material realm. Thus, from this philosophical standpoint access
to consumer goods and services should increasingly be justified not by work
alone but rather by the individual’s share in an inalienable inheritance of
the communal capital that has accumulated over the ages.  The effect of
growth of our historic Cultural Heritage has always been to advance the
potential for faster, more diversified and less wasteful productivity, with
an accompanying potential for enhanced human leisure.

Christian philosophy holds that it is a major sin to make an end of a
means. The rational purpose and end of production is consumption, not to
create work (a means). An economic system should provide goods and services
for mankind as efficiently as possible with minimal trouble and effort for
all concerned.

One might ask how it is possible for a nation such as the United States
of America, professedly predicated upon Christian principles, to base its
entire economy and social structure upon a financial system that is a total
inversion of those principles. A clue to this strange contradiction may be
found in Douglas’s observation that Finance and the Established Media
are concentric. As a result, he said, society has been hypnotized, with the
consequence that only a drastic de-hypnotization can save it.

If society can pursue a continuous, destructive, malevolent and
malignant policy of devastating the continents and populations of foreign
nations, then surely we can easily pursue instead the civilized alternative
of providing (Consumer) Dividends and Compensated (lowered) Retail Prices
to support a secure and leisured life for our citizens.  Under the existing
iniquitous financial system we are driven to deliver those potential
Dividends to other nations in the form of bombs.  This would appear to be
insanity by any rational criterion, but it satisfies the overarching
irrational one of providing plenty of “jobs” and “incomes” (not to mention
“profits”)—albeit at the additional cost of stupendous physical waste,
human suffering and a massive, exponentially expanding financial mortgage
burdening our future.  This too would appear to be insanity, but apparently
not to members of the banking fraternity, which finances it all with
conspicuously detached equanimity.

Surely the time is long past when individuals and nations should have
stopped “fighting” amongst themselves and instead concentrated their
intelligence, energies and talents on demanding reality-grounded financial
and economic policies.

I hope that the above commentary may help to clarify some of the
major questions and issues often raised about Social Credit.

Dr. Oliver Heydorn has recently published a major informative book,
comprehensively incorporating C. H. Douglas’s essential ideas. Refer:

See also:






The author was born during the so-called “Great Depression” when in 1935
the historic election of the world’s first “Social Credit” Government in
the Province of Alberta, Canada startled the pundits and alarmed the global
financial powers.  In later years he became acquainted with several Cabinet
Ministers of that Government.  His close mentor was Mr. Leslie Denis Byrne,
O.B.E., a British actuary and technical expert in Social Credit who was
sent, with a colleague, from Britain by C. H. Douglas to advise the
fledgling new Provincial Administration. The author holds baccalaureate
degrees in Arts and Education. In Arts, he majored in political science,
and minored in economics. In Education, he majored in social studies,
secondary route.

Appreciation is expressed to Robert E. Klinck, M.A. for his considerate and
patient assistance in editing this essay.

Check out the Commons Transition Plan here at: http://commonstransition.org

P2P Foundation: http://p2pfoundation.net  - http://blog.p2pfoundation.net

http://twitter.com/mbauwens; http://www.facebook.com/mbauwens

#82 on the (En)Rich list: http://enrichlist.org/the-complete-list/
-------------- next part --------------
An HTML attachment was scrubbed...
URL: https://lists.ourproject.org/pipermail/p2p-foundation/attachments/20151213/67eaa86e/attachment-0001.htm 

More information about the P2P-Foundation mailing list