Though Social
Credit has been labeled a "failed experiment"
and study of it has been virtually abandoned
to the glee of the
world's bankers, I think it's time that
an in-depth analysis of
Major Clifford Hugh Douglas, P. Eng.,
was done in fairness to
many who have believed he made sense.
Major Clifford
H. Douglas, a mechanical engineer who
presented the first engineering analysis
of the unsafe
design of the banking system to the 1919
World Engineering
Conference in Tokyo concluded that the
world's salvation was
going to be dependent on a war between
economists who hold us
back and engineers "who can make 200 blades
of grass grow where
one grew before." He stated that interest-free
credit should be a
social service and called his theory "social
credit."
What shocks me
are the number of people who will publicly
dismiss his work without having ever having
read any of his
literature and based only on writings
from his detractors. To
correct that problem, I'm going to post
some of the best quotes
from Britain's Major Douglas and Quebec's
Louis Even for you to
compare with writings of LETSers on different
world conferences.
It shouldn't be long before the similarities
become apparent to
most.
Credit can only
be social when there's no interest and I've
developed some equations in algebra, exponential
functions,
differential equations and Laplace Transformations
proving that
an interest-free token system, like a
casino chip bank, suffers
no inflation nor unemployment.
Though I agree
with Douglas that prices are greater than
purchasing power, I disagree on the cause
of the price rise. He
theorizes that INTEREST, taxes, material
costs, etc are part of
the problem he calls "B" costs. I say
that only INTEREST is the
problem.
HOW "MORT-GAGE" INTEREST CREATES A DEATH-GAMBLE
The word "mort-gage"
is derived from the French word "mort"
meaning "death" and "gage" meaning "gamble".
Bankers create the
money supply when they make loans. Producers
are forced to gamble
by borrowing newly created Principal(P)
to pay for production
costs and then inflating their prices
to earn back the Principal
and Interest(P+I) in sales.
Because total
goods priced at (P+I) can never be sold when
consumers only have P dollars available,
a minimum amount of
goods must remain unsold and a minimum
number of producers must
fail and suffer foreclosure. The economist
Keynes likened the
mort- gage death-gamble to the game of
musical chairs. Just as
there are insufficient chairs for all
to survive the musical
chairs death-gamble, so too, there is
insufficient money for all
to repay (P+I) and survive the mort-gage
death-gamble.
P < principle, I < Interest, i < Interest Rate, t < Time
PERCENT ALGEBRA EXP. FUNC
Production costs (principal)
100 P
1
Production prices (Debt) 100+I P+I exp(it)
Purchasable Value
100 P
1
or ratio of money to prices
----- -----
-------
or survivors
100+I P+I
exp(it)
Unpurchasable value
I I
1
or forced unemployment
U= ----- ----- 1
- --------
or non-survivors
100+I P+I
exp(it)
For U=0, let I=0 I=0 i=0 or t=0
Much can be learned
by looking not only at the purchasing
power and ratio of survivors but by also
looking at the remainder
as the loss of purchasing power and the
ratio of losers. The odds
of survival are always set by the interest
rate(i). P/(P+I)
survive, I/(P+I) do not.
DOUGLAS' "A+B" THEOREM
A < money, t > time, B < Price increases due to various causes
PERCENT ALGEBRA EXP. FUNC
Production costs (principal)
100 A
1
Production prices (Debt) 100+B A+B exp(bt)
Purchasable Value
100 A
1
or ratio of money to prices
----- -----
-------
or survivors
100+B A+B
exp(bt)
Major Douglas
had discerned that there was insufficient
purchase power in the numerator to balance
the prices in the
denominator which had grown by the sum
(B) of INTEREST, taxes,
material costs, etc.
Assuming no control
over the B factors in the denominator,
he suggested balancing the supply in the
money in the numerator
by financing a national dividend and government
expenditure and
rebating merchants through a Compensated
Discount with the
remainder.
Purchasable Value or
100+ND+CD A+ND+CD
ratio of money to =
1 = --------- -------
prices or survivors
100+B A+B
The injection
of new money (ND+CD) tries to come as close to
balance B as possible and is injected
"debt-free" with no need
for the government to tax it back. Calling
it "debt-free" has
confused some into believing that debt-money
is bad when it's
just as good as credit money as long as
there's no interest
attached.
There's nothing
wrong with debt money. Every chip taken out
at a casino on a marker is debt money
but as long as everyone is
willing to work for it and there is no
imbalance between debt and
money, there is never any problem. There
have been many
successful debt money systems. English
tallies allowed the King
to borrow tallies from the Treasury, spend
them and tax them back
to repay to the Treasury. Socreds who
believe that the difference
between prices and money are automatically
imbalanced talk of the
government issuing money without debt
but when there is no
imbalance, debt is necessary to balance
monetary emission.
This injection
of new money to balance the growth of prices
on store shelves was automatically dubbed
"Funny money" by those
with a vested interest in the current
"Not-so-Funny money"
system.
That taxes and
other factors cancel out in the denominator
is demonstrated by what I call the "splashing
in the pool costs"
versus "pumphouse" costs. It's best explained
with this example.
"A salesman goes
to a hotel in the morning and pays $50 for
his night's stay. The hotelier goes to
the butcher and pays his
$50 bill for beef. The butcher goes to
the baker and pays his $50
bill for bread. The baker goes to the
auto mechanic who pays his
$50 bill for a tune-up. The mechanic goes
to the hotel and pays
his $50 tab. The salesman comes back and
says that he can't stay
the night and asks if he can have his
deposit back. The hotelier
gives him back his $50."
Due to velocity,
the volume of money in circulation should
really be immaterial. If 10 people all
buy-in for $10 with
average $10 pots, the same chips will
be used over and over and
people will buy them from each other at
the table. If they all
buy-in for $1000, the velocity may be
reduced to once or twice.
If they all buy-in for $1,000,000, it
may be possible to use a
new chip for every bet all night with
a velocity less than 1.
Despite all three money supplies, the
players participated in
identical games with identical action
and few observable
differences. Start charging interest to
use the chips and people
will try to make do with as few chips
as inconveniently possible.
Thus the growth
of prices from activity in the economic pool
is never a problem. The problem is that
more money is demanded
pumped out of the pool than is pumped
in from the banking pump-
house. No amount of splashing in the pool
is relevant and prices
rises not caused by the pump-house are
immaterial. The problem is
the growth of prices from activity in
the banking pump-house and
in only in the banking pump-house. All
other costs are movements
of funds in the pool and they tend to
cancel. Only Interest is
the illicit cost in our productive enterprises.
So, another
solution is to, rather than compensate
for the growth of prices
in the denominator with funny money in
the numerator, eliminate
the original imbalance in the denominator
obviating the need for
any funny money compensation in the numerator.
CONTROL SYSTEMS
With the Laplace
transform, it is also possible to draw the
electrical blueprint of a bank account
in the usury banking
system (1/(s-i)):
|----------------|
| Interest = 10% |
|<---| Rate
|<---------|
| |----------------|
|
|
| Old
|
|<-----------| Balance
|
| |
+ |
+ | |
|------------| |------------|
|
Input + | Addition
| + | Addition | New |
---------->| Node
|------>| Node |--------------->
|------------| |------------| Balance
Douglas's solution
was a compensating negative feedback
loop (1/(s-b+cd+nd):
|----------------|
| Interest = 10% |
|<---| Rate
|<---------|
| |----------------|
|
|
| Old
|
|<-----------| Balance
|
| |
+ |
+ | |
|------------| |------------|
|
Input + | Addition
| + | Addition |
| New
---------->| Node
|------>| Node |--------------->
|------------| |------------|
| Balance
- |
|
|
|
| |----------------|
| Old
| | Nat. Dividend% |
| Balance
|<---| Com. Discount% |<---------|
|----------------|
Though this would
have worked with constant vigilance, there
is an easier way. Cut the original interest
positive feedback and
no compensation or vigilance to counter
price rises is necessary.
|<-----------| Old
| | Balance
| |
|------------| |
Input + | Addition | New |
---------->| Node |--------------->
|------------| Balance
LETS GREENDOLLARS
The better engineered
no-feedback design has been
incorporated into the software of the
Greendollar and Timedollar
Local Employment Trading Systems in the
United Kingdom with over
350 branches serving over 30,000 accounts,
about 200 branches in
Australia, 60 in New Zealand, dozens across
Canada and the United
States, more in the United States operating
under the software
name "Time Dollars" and starting out in
Europe and elsewhere.
Greendollars, as interest-free credits,
show us how New Social
Credit world work.
Why are Time
Dollars and Greendollars Social Credits?
1) Because all
credit system which bear no interest are
social friendly credit systems. Since
LETS is an interest-free
credit system, there's no way to deny
that lets belongs to the
generic family of credit systems which
are social.
2) Because I
travailed Canada under the banner of Social
Credit Engineer advocating monetary reform
and I financed Michael
Linton in the development of the LETS
system after approving the
design as an interest-free credit system.
As far as I'm
concerned, with the growing success of
the Greendollar social
credit system around the world, I've done
a good Socred's duty
and accomplished the monetary reform that
Social Credit has
always advocated.
The point is
that any social credit system is the anti-
thesis of the anti-social usury credit
and now that the LETSystem
is universally proven, the question is
now optimizing growth.
I'm happy to
read of systems that use no computers and no
telephonic exchanges, etc. There was strenuous
argument over
whether modified systems were really LETSystems
or not. The point
is they are all social credit systems
since the credit in all was
friendly.
Since Australia,
New Zealand and the United Kingdom have
large numbers of people who have voted
for Social Credit, it is
their political duty to join a system
they have themselves
advocated. I appreciate that their numbers
must be helping in the
present growth but there's no reason they
shouldn't be enrolled
en masse.
Finally, Douglas
made mention of a Dividend every citizen
should receive as a share of the robot
production. Douglas stated
"As the lever of technology gets longer
and longer, the work
necessary is less and less" and so people
should not have to work
for purchasing power if there are robots
to do it for us.
So that is the
theory of Social Credit, balance prices in
the denominator with new money in the
numerator. Though it's not
optimal, eliminating the imbalance permanently
is, it was
workable even if untested and difficult
to understand.
John C. Turmel, B. Eng.
---
Subject: Re: TURMEL: On Social Credit
On Aug
6 1995, one reader wrote:
:How much economics have you studied?
There are large gaps in your
:logic; you should ask a local economics
professor to review your
:ideas. If you cannot state 5 good effects
of inflation, you
:really do not understand undergraduate
level economics.
I answered:
:Why don't you post for us the beneficial
effects of keeping
:inflation and unstable money. I'd bet
none are worth it.
:How many books on money tokens do you
think I need to read
:to understand such a trivial subject.
:When one considers money from a casino
cage point of view,
:the complexities seem created for the
purpose of confusing.
:I posted to all those nations because
they all had Social
:Credit movements at one time.
:I posted to the science and engineering
fora because Douglas
:himself did a scientific analysis.
:So I'll wait to hear how the advantages
of inflation
:compensate for the disadvantages of inflation
and I'll argue
:that the disadvantages are greater.
:John Turmel
:
He responded:
:: Why don't you post for us the beneficial
effects of keeping
:: inflation and unstable money. I'd bet
none are worth it.
:
:If you were discussing mathematics and
showed a lack of understanding of
:calculus, I would tell you to study it.
I would not have to waste my time
:giving an exposition which is in hundreds
of textbooks. I might
:point out just one idea that an understanding
of calculus would
:give you. Similarly...
:
I'm not going
to go search his hundreds of text-books to
find his five beneficial effects of inflation.
All I asked him to
do was list the five he was citing.
:: How many books on money tokens do you
think I need to read
:: to understand such a trivial subject[?]
:
:Everyone thinks he or she understands
economics except
:economists.
:
Everyone who
understands Poker chips thinks he or she
understands economics except economists
who are sure they don't.
:You are clearly not an economist, so you
should get
:help from one, or else you will continue
to make basic and banal
:mistakes. To answer your rhetoric, it
would only take half a
:dozen books, depending on how intuitive
the subject is to you.
:
All I want is
to know the five beneficial effects of
inflation. I don't want to go look at
12 books for five effects.
:: When one considers money from a casino
cage point of view,
:: the complexities seem created for the
purpose of confusing.
:
:Then perhaps you should study those complexities
more until you
:understand them.
:
I'm saying that
when one considers money from a casino cage
point of view, the complexities are more
easily exposed.
:: I posted to all those nations because
they all had Social
:: Credit movements at one time.
:: I posted to the science and engineering
fora because Douglas
:: himself did a scientific analysis.
:
:At worst, you should post to them individually.
Now, all of those
:newsgroups will see much irrelevant and
erroneous commentary.
:
No. They will
see much relevant commentary. What's
erroneous?
:Conservative estimates of the cost of
storing one post to a well-
:distributed group are about a dollar
per line. Do you get the
:point yet?
:
Get real. Most
of the newsgroup host computers have plenty
of excess capacity. Telling me how much
radio air-time costs says
nothing about the air-time not sold. But
go ahead and show us
your data.
:: So I'll wait to hear how the advantages
of inflation
:: compensate for the disadvantages of
inflation and I'll argue
:: that the disadvantages are greater.
:
:Why don't you think about them or read
some academic economics
:books?
:
You read them,
why can't you tell me the five things they
say?
:If you wish to be viewed as a crank or
crackpot, continue
:to post to too many newsgroups, use nonstandard
terminology and
:reference yourself, and declare revolutionary
ideas in areas
:where you make basic errors.
:
Basic errors
should be easy for you to point out. I'll be
waiting.
:Here are some cases where your ideas fail,
in case you want to do
:some research: Poland, now; Slovakia,
now; US, late 1970's; and
:Germany, just after reunification.
:
Though I can
tell you where the LETS idea is not failing,
Great Britain, Australia, New Zealand,
Canada, United States, I
have no knowledge of Greendollar banking
systems failing in
Poland, Slovakia, Germany or the U.S.
Now you can't
expect everyone reading these messages to run
around looking for the twelve economics
books to find out what
you think the five advantages of inflation
are.
And I'd prefer
that you post your answers for the others to
read.
------------------------------------------------------
On Aug 6
1995, campbell@mdd.comm.mot.com (Duncan Campbell)
wrote:
:Gee Jon, I've seen this before too.
In fact this is a rerun of
:one of your posts from the last couple
of weeks.
:Look here. If you think Engineering
is useful as the major
:paradigm for an economic system, then
you should go have a good
:long look at the ex-ussr. They
tried the stuf you're talking
:about, *really*.
:
*Really*? Tell
us more and we'll compare it to the operation
of the Greendollar LETSystem.
:[floosh]
:
Now it's your
turn and we'll decide it there should be a
[floosh].
In article #70814
in newsgroup uk.politics,
<dave@wmnccl.demon.co.uk> wrote:
:: Credit
can only be social when there's no interest and I've
:: developed some equations in algebra,
exponential functions,
:: differential equations and Laplace
Transformations proving that...
: The types of mathematical tools
used, while showing you know your math,
:do nothing to prove whether or not the
theory fits empirical observation.
:
: I can't see why interest is so
different or inferior to other tradings.
:
With you pay
for other tradings, you get people's time,
their goods and services. With you pay
for interest, you get
money's time and money does not do work.
You are getting nothing
of substance and that's why it is different
and inferior to other
tradings.
: Example#1. My family have cleared
some land, planted crops, built a home.
:With our surplus labour, we build an
extra cabin for guests and, later, we
:rent it out to someone (in a non-money
system: in exchange for two days work
:a week in our fields).
:
Perfect, you
go positive for $100 Greendollars when they
stay and negative when they pay back with
work. This is trading
your work for someone else's. This is
not usury. This is trade.
: Example#2. As we have a surplus
of crop production, we trade it for some
:bigger & better farm machinery. Actually
this is wasted just for our needs,
:so we hire it out to our neighbour (in
a non-money system: for 2% of the
:corn he harvests with it).
:
Again, you are
trading your work for the mechanic's work and
trading some of it's depreciation to a
neighbor for 2% of the
work he harvests with it. This is not
usury. This is proper trade
: Example#3. We have a stored surplus
in some durable form e.g. stacks of cut
:timber---we don't plan to use it for
new capital goods for a couple of years,
:it will just sit there. But our neighbour
has this wonderful suggestion:
:he could develop his farm so much faster
if we traded it for the 2nd hand tractor
:he needs, so as to hire that out to him.
We get the hire charges on what we
:bought for him to use; and, at the end
of two years, the surplus value is
:returned to us in some durable form to
trade to fund our own capital purchases.
:Sure sound like lending at interest to
me.
:
Here you have
the basic decision behind interest. Remember
first that interest is the demand for
increase in live-stock
while usury is the demand for increase
in sterile gold or money.
But the question
begs:
Your abundance
could at the present time been a supply for
his want. You could have just lent him
the stacks of timber which
he would trade for the tractor himself.
After developing his farm
faster, your wealthier neighbor pays you
off and offers you the
same deal of an interest-free loan if
you
ever need it.
Or because you
have abundance will compensation be given
from those who have no abundance.
I'd prefer to
drop off my spare timber at the Greendollar
cage and have it credited to my account
and my neighbor can go
get his tractor there with the system
as a whole taking a risk on
my neighbor.
: In each case, we have accumulated
some surplus value in capital goods or
:tradeable materials, and we earn rent
/ hire / interest income for loaning
:out its use.
:
You can call
it interest for loaning out its use, I call it
payment for depreciation and owner's organization.
And payment
for work and work's depreciation is the
only payment I say is
valid. Nowhere did you mention payment
for money's time. Come up
with an example for money's time and we
might disagree on more
than nomenclature.
:: ...an interest-free token system, like
a casino chip bank, suffers
:: no inflation nor unemployment.
: Ahm, the usual reasons
given for money inflation i.e. increasing amounts
:of token money being needed to trade
for the same goods are decrease in
:supply of goods or increase in supply
of money tokens.
:
Say this again
but I state that the inflation we are
experiencing now is Shift B inflation,
the foreclosure of
collateral behind the money and not Shift
A inflation, the
increase in monetary tokens. If that were
the case, people would
have full wallets and the stores would
be empty. Today, people
have empty wallets and the store shelves
are full.
:Of course it ain't purely that simple
when the banks can "print"
:more money by allowing more loans,
:
Right you are
on how the banks create more money by allowing
more loans but wrong you are if you think
that this addition of
new loan money causes inflation. Most
new money issued by banks
through loans are based on pledged collateral,
just like casino
chips.
When you borrow
your $100 at the bank and walk around with
it for a year in your wallet, when you
return to the bank to pay
it off, the debt grew to $100 but the
$100 in your wallet didn't
grow.
It's this disparity
between money and debt that causes
inflation and now how much money is in
circulation. Velocity
takes care of that.
:and you cain't just say "I'll stop this
by supplying less money"
:(the remedy for a supply-push) when the
cause is demand-pull.
:But that's pretty much the nature of
it.
:
I'm saying "I'll
stop this by supplying less debt" so that
it matches the supply of money." Quite
different proposal so it's
not the nature of it.
: Perhaps your casino tokens
were free of inflation because no
:one was either in the business of printing
more & more of them
:to chase the same goods, or having to
offer more & more of them
:to get the same amount of goods as those
goods became in short
:supply?
:Dave Bird,
:
And if some cashier
ever did more and more of them to chase
the goods in the cage so that players
would have to offer more
and more of them to get the same amount
of goods as those goods
became in short supply, we'd fire that
cashier and call in cops.
The prime rule of banking is you can't
issue a chip out of the
cage until someone pledges an asset into
the cage. Anything else
is fraud and easily detectable.
Before jamming
my mail-box, anakin@pinc.com (Rajiv K.
Gandhi) contributed:
:Hey John, I have to say that I disagree
with 100% of everything
:you have written in here.
:
And if he can
explain it in more than 2 lines, the world
should know.
I'm still waiting
for those who like to think of Social
Credit as a failed experiment to speak
up. I say it would have
worked even if today we have a better
way of doing it.
John C. Turmel, B. Eng.
---
Subject: Re: TURMEL: On Social Credit {-I know I shouldn't but...}
On Aug 9
1995 in article #71398 in sci.econ,uk.politics,
SDobney@acorn.co.uk (Saul Dobney) wrote:
:In article <DCvHxz.LDr@freenet.carleton.ca>
johnturmel@yahoo.com (John Turmel) writes:
:
:: The word "mort-gage"
is derived from the French word "mort"
::meaning "death" and "gage" meaning "gamble".
Bankers create the
::money supply when they make loans. Producers
are forced to gamble
::by borrowing newly created Principal(P)
to pay for production
::costs and then inflating their prices
to earn back the Principal
::and Interest(P+I) in sales.
:: Because total
goods priced at (P+I) can never be sold when
::consumers only have P dollars available,
a minimum amount of
::goods must remain unsold and a minimum
number of producers must
::fail and suffer foreclosure. The economist
Keynes likened the
::mort- gage death-gamble to the game
of musical chairs. Just as
::there are insufficient chairs for all
to survive the musical
::chairs death-gamble, so too, there is
insufficient money for all
::to repay (P+I) and survive the mort-gage
death-gamble.
::
:
:This is confused. Costs, prices
and budgets are mixed up. A cost is what a
:company has to spend to produce a good.
A price is what a company charges
:for a good. Prices > Costs (in
general). Prices are not necessarily a
:function of costs. The discussion
which followed failed to make this
:distinction.
:
I'm not talking
about splashing in the pool. I can
liquidate a $500 debt to you with a $50
bill if I can find one of
your creditors who owes me $500. I pay
you $50, you pay him $50, he pays
me $50, I pay you another $50, you pay
him another $50, he pays
me another $50, I pay you another $50,
you pay him another $50, he pays
me another $50, etc, ten times and splashing
funds in the pool
can trade our profits to each other in
this way.
I'm talking about
the cost of credit to the pumphouse. I
don't care how many profit enough splashing
in the pool to pay
off the pumphouse cashier, but there will
always be a shortage.
So I'm not taking
into the equation the splashing in the
pool which cancels out but I can therefore
reduce the equation
down to the actual flaw. And it's not
profits.
:If a company chooses to produce then they
make the assumption (very
:simplistically) that:
: Demand
* Price P > Sales * Costs
:
at price P
:
Define your units
and throw in an example with numbers.
: Demand
is budget capped.
:
And that says
nothing about whether prices are larger than
budget capped, does it?
:If there is not enough money (surplus
of production) to be made the product
:will not be produced. The cost of production
also includes a capital
:(upfront) cost.
:
Sure, I'm not
going to pay for the depreciation of the
capital (upfront) costs of my enterprise
if there's no profit
left over. The same criteria applies in
both a system with no
interest costs and a system with extra
interest costs.
:Which leads to the question: For
optimum social utility shouldn't:
: [snip]
: Or Price P =
Cost?
:
Yes. Whenever
Price P = Cost, you have stable money.
:ie the owner of the capital should not
take any benefit from
:delivering the product to the market.
This is effectively
:communism or socialist economics.
:
No. The owner
of the capital should take benefit from
delivering the product to the market.
Therefore, you should
conclude that it is effectively not communism
or socialist
economics. Yet, letting everyone be a
capitalist by basing his
credit to get into the game of production
with a killer rake-off
does seem to represent the better aspirations
of communism and
socialism. But just because everyone benefits
doesn't mean it is
necessarily socialism or any other "ism."
Capitalism can be a
fair game too.
:Removing the incentive to create the capital
(ie the surplus of production
:in the first equation) nullifies any
production and technological innovation
:as there is no driver to create new products
or production methods (because
:there is no money in it) and requires
a managed society with a centrally
:determined demand and supply (as otherwise
capital is always facing a net
:expected loss).
:
I never said
I don't want money earned in production. I say
production is where money should be earned.
I'm saying I don't
want money being made in money-lending.
Please do not
equate capitalistic profit with interest from
money-lending. Capitalistic profit comes
from production of
energy while interest from money-lending
has traded no work and
has resulted in no new energy production.
I do not think
that the incentive to create capital would be
reduced by not getting interest on your
money at the bank. Your
pile of inflation-free chips at the cage
grows as you work and
save and that should be incentive enough
to keep making your bank
account grow through your work. But it
won't grow or shrink by
itself.
:If you allow capital to earn money from
the supply and demand (ie products
:you sell are charged that the value to
the customer which is more than the
:cost to make them) then producers are
willing to take risks to generate new
:products to fill new and various market
needs.
:
That's exactly
what I propose to do. That's exactly what
the Greendollar system is facilitating
now. There are 350
Greendollar branches in Britain serving
30,000 interest-free
accounts. They don't seem to have lost
incentive to trade their
time for that of others.
:The effect is that capital itself earns
money by funding innovation and the
:creation of new products and bringing
them to the relevant markets and
:benefiting from the surplus (demand*price
- sales*costs). Interest is
:ultimately the payment for the risk of
innovation.
:
Yes, profits
from splashing in the pool are fine but I don't
equate interest as a legitimate cost for
the risk of innovation.
Profits already do that. The middle-men
don't deserve to make 10
times the money the guy who built your
house made. Think about
that. The workers made $20,000 profit
while your banker makes
$200,000 on your 30-year mortgage for
credits from his computer.
Bankers make not bad profit for a few
clicks on the keyboard and
the services of their collection branch.
:If we pay zero interest (and so gain no
benefit from ideas which
:work)
:
How does paying
interest help you gain benefit from ideas
which work? Doesn't paying the principal
buy the ideas which
work?
:we end up with a net expected _loss_ over
time, as some ideas
:will not work.
:
Where losers
can repay their negative score from future
enterprises.
:[Expected return = sum
(return * probability of return),
:
all investments
:since no return is >0 and some returns
are <0 with probability >0, the net
:expected return is negative]
:No-one will invest if the expected return
is not positive.
:
Again, you're
only looking at the net expected _loss_ over
time of the ideas that will not work.
You also have to add the
net expected _win_ of the ideas that do
work.
I'm saying that
there will be more winners than losers
without the interest rake-off.
:The government, by borrowing money at
a given interest rates to cover the
:costs and capital expenditure of running
the country, sets the base cost of
:interest.
:
And how stupid
of them to give the license to create money
to private banks and get in line when
they used to use Treasury
money in the past. Being a Brit, you must
have heard of the Tally
system used between 1100 and the late
1600s. You didn't see those
wise British kings sucker up to the money-lenders
for a loan.
They used wooden Treasury Tallies for
over 500 years.
Unfortunately,
since the late 1600s, the Royalty of Britain
have been in financial bondage to the
world money-lenders. That
you could find a King who could give you
an interest-free
computer Tally system is my wish for you.
He could use the same
software being used in all the LETS Greendollar
bank branches
sprouting around you.
:If the interest rate from the government
is low, more money will
:be spent on funding innovation.
If the interest rate is high, more money
:will be given over to the government,
and less for investment.
:
The interest
rate "from" the government is low? Government
doesn't set the interest rates, the global
money markets do.
Central bankers jerk rates up and down
to suit money-market
decisions. Please, true money hasn't come
"from" your Royal
Family in 300 years.
:Now if we are profligate in our use of
funds then the tendency will be to
:fund too many speculative ideas which
do not work (cf South Sea Bubble).
:
You can't fund
too many speculative ideas. Period. Whether
they work or not, you cannot exert more
entrepeneurial activity
than there are people and resources available.
You can't do more
than you can do and you can't properly
fund more than you can do.
:Low government interest rates encourage
(more) profligate use of funds and
:so make more money available in the economy
- the money supply and the
:circulation of money increases.
:
And zero interest
would encourage not only (more) but the
(maximum) use of funds.
:The government can also increase the amount
of money available in the
:economy by printing more - which also
raises the money supply.
:
No, the British
government can't print more money. That what
they used to do with their tallies but
since the, banks print the
money and the Government borrows it. If
they printed it, they
wouldn't be in debt like everyone else.
:However, by
:increasing the money supply, the number
of internal demand/supply
:market transactions increases therefore
increasing the apparent level
:of demand in the country. Since
demand and supply are matched (in a
:total sense) this only leads to an increase
in prices and costs. Hence
:inflation.
:
I draw a distinction
between price rises due to free market
demands and price rises due to interest.
But knowing that your
tokens are based on a certain value of
collateral in the
cashier's cage eliminates the inflation
due to interest and other
price rises I call supply and demand and
not inflation.
:But, if more money is available and so
more speculative ideas are funded,
:there is an increased likelihood of any
individual investor losing money.
:
And the increased
likelihood of winning investments too.
:Which is why poorly managed economies
swing from boom-bust -
:investors move from over-eager to over-cautious
and back again.
:
:Where interest rates are too high we
will overprice the availability of
:capital for innovation (as the costs
are too great to develop new ideas).
:Development and investment will reduce.
The number of demand/supply
:transactions will decrease, leading to
greater levels of unemployment.
:
Right. That's
what my math says too. Interest rates create
greater levels of unemployment.
:In traditional banking, the bank acts
as a clearing house matching
:investment capital to development opportunities.
:
This is false.
Banks do not lend out their depositors funds.
Take a look at the bank piping for a pictorial
description of
where funds for new loans come from.
:Interest is charged to non-producers to
cover the lost
:opportunity to gain by investing in something
else.
:
That's the cover
story. But how does it apply when banks do
not lend out their depositors funds?
:The amount of interest charged is also
subject to a
:supply-demand model and so relies on
what the customers are willing to pay,
:and is available according to whether
this exceeds the lost expected value
:of investing in something riskier.
:
The problem is
that usury creates a risk all by itself
independent of the risk of success or
loss from the investment
opportunity itself. I call the risk you're
talking about Risk #1
and I call the risk I'm talking about
Risk #2.
There has been
some discussion of this risk in the sci.econ
and alt.conspiracy newsgroups if you'd
like to catch up.
:As banks are in effect dealing in risky
transactions where there is the
:possibility they could lose money (eg
Barrings), the Government acts as the
:"bank of last resort" to enable banks
to overcome short term liquidity and
:temporary losses (though loss coverage
is rare).
:
The Government
does not act like a bank of last resort in UK
or anywhere else other than Guernsey Island.
The government is
nothing but another borrower from those
to whom they have
licensed the power to create the money.
:In this way the Government sets the interest
rates for the
:economy as a whole (as the banks will
always charge more than
:the government would charge them).
:
Again, the government
not only does not loan out any money,
it does not set the interest rate either.
:By setting interest rates, or by managing
the money supply, the government
:
Everything that
follows is incorrect if the government does
not set the interest rates as you say.
:The problem with your casino model is
that it makes the tacit assumption
:that the economy is closed, and that
it cannot grow - the number of chips
:in the casino is a fixed amount matching
the amount of initially invested
:capital. The money in the casino
actually does nothing save move from one
:pocket to another.
:
Again, you seem
not to understand that a casino can never
run out of chips. Therefore, there is
no tacit assumption that
the economy is closed and cannot grow
because the number of
chips is fixed to collateral. Though the
number of chips can't
grow, the amount of collateral can and
ergo, so will the chips.
:In a real economy, innovation and investment
actually increase the value of
:the money in the economy. If you
are considering this from the point of
:view of a casino it seems extremely odd
- there is only a fixed amount of
:money available.
:
Same error again.
A casino never runs out of liquidity.
:But in an economy, the money actually
creates something
:- value can be added to a commodity.
For instance a lump of steel becomes a
:car - the price of the steel in the car
shape is higher than the price of
:the lump of steel. The net resources
in the economy have not increased, but
:the addition of labour and innovation
to the lump of steel have increased
:its value. Business spends its
time looking for areas to innovate and add
:value.
:
And as that new
human energy is added to the products, new
chips should be issued to both reflect
that added value but to
make sure that the initial chips retain
theirs.
:Inflation also has a demand side effect
- it's not entirely manageable from
:the supply side. As the range of
products and services entering the market
:increases the prices of the goods in
the economy have to adjust to
:continually meet the changing levels
of demand.
:
And if the products
and services entering the market were
matched with new chips issued into circulation
as those new
products and services are pledged to the
cage, the prices
wouldn't change. Prices can never change
from demand when prices
equal demand as a rule of issuance.
:Supply sides of economics are far, far
easier to model than demand side. It
:is working out how to match demand and
supply which makes economical
:measurement an art and not a science.
:
That's the problem.
If supply is matched to demand from the
start, it's not art, it's science.
:Demand is not manageable and only predictable
in the short term
:(for instance, consider the effect of
the weather on the demand
:for ice-cream).
:All investment is therefore risky as
the demand-side cannot be wholly
:predicted or managed. Interest
rates are the price paid to meet this risk.
:
That's the cover
story. Again, this is Risk #1 which I
accept while I'm objecting to Risk #2
generated by the interest
rates themselves which I do not accept.
You should check
out the topic Banking Systems Engineering
Analysis in the other conferences for
a fuller explanation of the
math behind an interest-free casino-style
Greendollar banking
system.
Lab.User@anu.edu.au (Lab User) wrote:
:your scheme was tried by mr lang in 1934
and failed then .. take
:it from an old timer
:
Who is Mr. Lang
and what did he do in Australia that failed?
And why aren't Greendollar systems failing
in a similar way.
And finally, rxc@bcwcs20
(Ruth Civil) objects to our
discussing this material by repeatedly
jamming my mail-box with
copies of our discussions.
I've never heard
her contribute anything of her own but
objections to our making our contributions
to our discussions.
You'd wonder
why she just doesn't leave our discussions
alone.
Hey, Ruth, if
you're reading this, why don't you tell us
what it is you object to in our discussing
Social Credit?
John C. Turmel, B. Eng.
---
Subject: Re: TURMEL: On Social Credit
On Aug 10 1995 tenhove@chip.itron.com (Ron Ten-Hove) wrote:
:My recollection of history is a little
hazy, but didn't the
:Social Credit government of Alberta implement
some of Major
:Douglas's policies during the Great Depression?
Yes.
I've read up
several books on Aberhart and Douglas and it's quite
a good story. Now, remember, I've read
these books knowing not only
where they're going wrong but where they're
going right. It's an
interesting interplay of personalities.
There had been
much agitation about Major Douglas's monetary
theory which promised people freedom from
their depressing lack of
currency. Nothing stood in the way of
manpower, a wealth of materials
and engineering capacity but a lack of
paper money.
Major Clifford
Hugh Douglas from Scotland had noted that prices
were always more than the money you had
to spend. That's why there
were so many products on the store shelves
but no money to buy them
with. He reasoned the price to money differential
was an essential
problem that had to be overcome by adding
money in the numerator to
match the prices in the denominator by
having Government spend the
difference without debt -- that is not
having to tax it back like a
loan -- or dividing it up so everyone
gets a National Dividend.
Economists have
been trained to scream "inflation" any time they
hear "new money." But if the price differential
can be eliminated at
the source, there would be no need to
give everyone money because
everything could be sold with what they
have. So, there would be no
economists screaming "inflation" because
we're not increasing the
money, we're decreasing the debt.
It seems that
Bible Bill Aberhart was a star all his life. A star
pupil, a star athlete and eventually a
star high-school principal.
After the suicide of a former start student
over the poverty of the
Depression, he was introduced to Social
Credit. He was also a star
radio-Bible thumper, one of the first
and flamboyant speakers listened
to by tens of thousands every week. You
never forgot Aberhart once you
heard him. The Bible is loaded with anti-interest
and anti-loanshark
verses and he used them effectively. Though
his weekly radio show,
Bible Bill started his oratorical opposition
to the Usury Slavery
Money System and eventually a star politician.
He was a winner all the
way.
Conversely, Major
Douglas, an engineer, was quite stiff and a
very sedate professorial speaker. The
first time they met, they were
both to give speeches that night. For
some reason, they didn't hit it
off too well. I think Douglas gave the
first speech and bored them
intricate instruction on how to measure
how much money will be needed
to balance the prices.
Aberhart had
told them about their $25 a month Dividend and
that's what they wanted to hear about.
Not an engineering analysis,
just the pay-off. These people were there
to hear about the hope of
financial relief. A $25 dividend would
go a long way. They wanted to
hear bankers bashed, those who had done
this to them. They were
desperate and they were excited about
the prospects of debt-free
living. Social Credit was their way out
of the clutches of the Eastern
Money boys who were foreclosing on all
their farms.
The crowd got
restless. Douglas spoke for 2 hours! Who can blame
them? They started getting noisy and some
started to demand Aberhart.
Eventually, he came on to thunderous applause
of his supporters and
that might have certainly hurt Douglas.
I know I'd be hurt.
Social Credit
organized study groups in everybody's kitchen. Up
till the provincial election, Aberhart
had said he didn't want to
enter politics, he only wanted the politicians
to provide a social
credit system. When they wouldn't, he
called his supporters to order
and they mounted a quick campaign in 1935.
Big Money mobilized
against them. The major newspapers, the
politicians, the Boards of Trade, laughing
at the poor rubes who
thought they could understand esoteric
economics and get a $25
dividend without causing inflation. The
nay-sayers got front pages.
But with the mass of Paupers having a
vision of a better way, no
amount of false propaganda got through.
Social Credit swept all the
old parties out of office capturing around
90% of the parliamentary
seats.
Douglas wired
"Congratulations. There may be many social credit
governments but only one first." And only
one last. Aberhart cabled
back to Douglas "Come help us set up a
social credit system."
But Douglas never
came.
Since Douglas
was working on a numerator solution, adding money
to balance prices in the denominator,
he needed information on prices,
expected values, etc. and this may be
one reason he didn't go. Not
enough info. I find that hard to accept.
Politicians had given him the
go ahead to test out his theory and I'm
stumped why he didn't go and
fix it as best he could. Maybe balancing
the errant system from the
numerator looked like more of a task than
he was willing to face?
So Aberhart tried
to pass legislation to help the poor. Anti-
foreclosure legislation. Struck down by
Ottawa. Provincial
Greendollar legislation. Struck down by
Ottawa. Any piece of
legislation which would have in any way
financially benefited the
victims of the banks was opposed and defeated
by the Supreme Court of
Canada. They were looking for numerator
solutions and the Govt said
"You can't fudge with the numerator. The
government has given the
licence to manufacture and lend money
to the private banks and no one
else creates numerator money.
I could do the
research about how many pro-poor-people bills were
defeated but Aberhart was a Prince of
the Paupers, an extraordinary
man who came to understand the 1/(s-i)
money system's deadly effects
and became a champion to poor people.
Social Credit in Alberta could
truly be called the first rise of the
Paupers to power.
If you understand
what banks do and you want to read an inspiring
book about the rise to political power
of a bunch of ordinary people
who had been pauperized by larger financial
interests, the story of
the rise of Social Credit in Alberta is
truly inspiring. If poor
people get to vote in heaven, I know where
Bible Bill is sitting.
:Alberta had at
:that time a largely agricultural economy,
so the parallels with
:todays mixed, service-industry oriented
economy may be shakey.
:
We're not talking
the economy here, we're talking the tokens. I
don't care if you're playing Poker or
Baccarat, the game has no
effects on the tokens. Similarly, a sound
money system is not affected
by what type of economy it is.
:Never-the-less, didn't the Socreds eventually
depart from Major
:Douglas's advice, and adopt more conventional
strategies to
:battle the effects of the depression?
:
As I said, Douglas
wouldn't come and Ottawa killed every
important bill he presented until he found
a loophole and did pull off
some actual financial relief. The province
issued Alberta Prosperity
Certificates which provided an alternate
medium of exchange to deal
with. They couldn't call it money but
somehow got around the law by
making people put a stamp tax on each
bill every month. Hence the name
"funny money." But do people who have
no money, it did the job of
money and interest-free. Sounds like a
sound interest-free service-
charge-only (1/s) token system to me.
They opened bank branches and
started on their way out of the Depression
before the rest of the
country.
Aberhart died
unexpectedly and the premiership was passed on to
his "right-hand-man" Ernest Manning, another
Bible thumper. That's
when they got away from monetary reform.
The Province quickly became
quite wealthy due to oil finds. With the
bankers turning on their
printing presses to finance the war years,
Manning effectively negated
any more work towards monetary reform.
He may not have delivered on
monetary reform and may even have sold
out the ideal but he never had
one financial scandal in his cabinet while
he was premier. He was
rewarded with a Bank Directorship and
a Senate seat for having done
such a good job. The questions is which
good job and who was happy.
His son Preston,
a former Socred who learned his Social Credit at
the feet of his father, is now leading
a new political called Reform
which offers every reform but monetary
reform.
:One lasting legacy of Social Credit in
Alberta: to this day,
:bankers are about as well liked as skunks!
:-Ron
:
Nothing's changed
but the lack of similar desire of the Paupers
to do something about it.
rbrown@blues.uucp (R. Brown) wrote:
:After converting to Social Credit in the
30s, the radio evangelist
:William ("Bible Bill") Aberhart managed
to win the first victory in
:the history of Social Credit. He never
fully understood Douglas's
:political theories (but then neither
has anyone else)
:
Not a fair comment
after I spent so much time detailing the
differences between Douglas's version
of Social Credit and the new
version of Greendollar social credits.
I wonder what opinion the
people who have studied his books have
of my understanding of his
engineering analysis.
:and broke with Douglas during the campaign.
Even the Social Credit
:policies he did try to put in place (still
remembered as
:"Funny money") were impossible to implement
because (as he had
:been repeatedly warned) Social Credit
made even less sense
:than it otherwise might at a provincial
(rather than federal)
:level.
:
Not a fair comment.
Anyone who has studied his legislation can
attest that it was not impossible to implement
because it didn't make
sense but because the Supreme Court of
Canada restrained them from
doing anything in the monetary reform
area, a federal-only
jurisdiction. Engineers learn that you
can't say something is a failed
experiment when it was never tried.
:Canadian Social Credit swung sharply right
after that
:initial victory, but, despites its _long_
dominance of Alberta
:politics and its success in B.C. and
to some extent as a
:Federal party in the 60s, it never had
a coherent policy of any kind.
:
Of course, Chinese
seems incoherent to someone who doesn't know
Chinese. To the many of us who found his
solution quite coherent, your
failure to see what we see is quite revealing.
Unless, of course, you
haven't yourself read any of his work
and are assuming your economics
professor is right?
jim@styx.equinox.gen.nz (Jim McCaughan) wrote:
:New Zealand came out of the Great Depression
quicker than most other
:countries because the Labour Government
of the day used Social Credit
:ideas to get the economy moving again.
Unfortunately they then moved
:away from these ideas and eventually
were put out of office.
:
I and another
reader are interested in details.
:: One lasting legacy of Social Credit
in Alberta: to this day, bankers
::are about as well liked as skunks!
:Not only in Alberta.
:Jim
p.walker@econ.canterbury.ac.nz (Paul Walker) wrote:
:I *must* go and re-read my NZ econ history!
But in the meantime I look
:foward to
:
::New Zealand came out of the Great Depression
quicker than most other
::countries
:
:the evidence to back up this statement,
and
:
::because the Labour Government of the
day used Social Credit
::ideas to get the economy moveing again.
:
:precise details as to what these social
credit ideas are and the evidence
:that the Labour government of the day
accepted social credit thinking.
:Paul.
:
I'll tell you
one great idea by a New Zealand Socred that would
have worked wonders had it been adopted.
I've been saying that the
best Greendollar system is one where the
government also has an
account. Any Greendollars spent by government
would have been used as
"rates vouchers."
I recently read
that Bruce Beetham, the first really influential
Socred leader in Parliament, while he
was mayor of Hamilton, had
wanted to finance municipal projects with
interest-free "rates
vouchers," tax-credits, but couldn't even
get it on the agenda of the
Hamilton city council who were too busy
passing a 20% tax increase.
That's the essence of social credit, government
paying for its
expenses with its own paper, not bank
paper.
When he later
got elected to Parliament, he organized a large
barter trade with Fiji island but Prime
Minister Muldoon scuttled the
deal preferring to borrow money and pay
interest to international
banks. Talk about having the banker's
interest at heart.
:PS: Read Hayek!
:
Please, don't
ask us to read your books. Why don't you tell us
what he had to say that applies to these
discussions.
From: olwen.williams@welcom.gen.nz (Olwen
Williams)
Newsgroups: nz.general
Subject: Re: TURMEL: On Social Credit
Date: Mon Aug 14 03:08:00 1995
: -=> Quoting Paul Walker to All <=-
: PW: precise details as to what these
social credit ideas are and the
: PW: evidence that the Labour government
of the day accepted social credit
: PW: thinking.
: I understand that the ideas referred
to are the use of Reserve Bank
: Credit (the so-call funny money policy).
:
Correct. Governments
and banks or people should borrow directly
from the Reserve Bank which should be
operated on a service charge
basis under a Greendollar or casino chip
accounting software.
:I understand from family
: hearsay that my grandfather, Morgan
Williams, M.P. for Kaiapoi from
: 1935 to 194? in common with other Labour
members had a letter from
: Social Credit saying that they would
never stand a candidate against
: him because he supported their policy.
:
And of course,
since Old Socreds were talking about "printing
money" to balance the prices in the denominator,
the "inflation" scare
word was always in the way. But it's evident
that your grandfather may
have found what he heard quite coherent.
It's evident
Douglas's social credit solution was feasible and
it's evident that Bruce Beetham saw the
way to eliminate the growth of
the debt in the denominator. Mr. Beetham
may be out of office and
though he may not have ever been on a
winning team, he was one of that
select minority who were part of the winning
idea.
Phil Kerry <pkerry@fieldeng.demon.co.uk> complained:
:Listen, no-one objects to you discussing
Social Credit at all ! What
:we do object to is you discussing it
in inappropriate newsgroups !
:I read THIS in sci.engr.safety, which
has nothing to do with social
:credit ! Followups set elsewhere !!
:Phil Kerry
:
So Douglas's
engineering analysis presented to the 1919 World
Engineering Conference in Tokyo on the
unsafe engineering design of
the monetary system doesn't belong in
sci-engr.safety? I disagree.
Money is the common denominator control
system that affects
everybody's lives. My whole point in bringing
Douglas's analysis to a
discussions group for safety engineers
is to point out that it is the
duty of engineers to reassert jurisdiction
over this last wayward
mechanical token and faulty software system.
Douglas, the
engineer, has been laughed at long enough. What
engineer would deny Douglas his hearing
before his latest peers.
This is a real
problem. Since money affects everyone and
everything, people tell me to take it
to "politics," "economics"
"Christnet" "barter." Anywhere but there.
Because they don't see
relevance, they assume no one else does.
I see relevance
to discussing Social Credit in engineering fora
and until someone gives me a good reason
why Douglas doesn't deserve
to be considered here, here I'll be staying.
Finally, I'll
tell you a little of my Social Credit roots. I was
born in Quebec Social Credit country.
My grand-dad Adelard Turmel was
stalwart supporter of Quebec-style Social
Credit since the early
1930s. He is most proud of having gone
against with his many Blue and
Red brothers to be the only person in
the poll to vote Social Credit.
He couldn't say he was proud of being
on the winning team, because he
wasn't, but he knew that the true victory
to be proud of was being
part of the winning idea.
I had figured
out that there was something wrong with the money
chips before I found out about Social
Credit and the fact Adelard had
been fighting against the banks all his
life. Was he proud of me for
having assaulted the banks in mid-stride
during my first election --
I'd originally run to legalize gambling,
that first election and the
last 38 times I've run for large-database-office,
fixing the banks has
always been number one priority with both
of us. And was I proud of
him.
And there are
a lot of you out there who had older relatives who
voted for FRIENDLY CREDIT. And no matter
how much they were laughed at
for complaining about the interest-bearing
UNFRIENDLY CREDIT, and how
much they wanted their FRIENDLY SOCIAL
CREDIT, I say they weren't
stupid at all. They just saw that simpler
could be better while those
who assumed it has to be complicated just
couldn't see it at all.
Adelard Turmel
needed to say only one thing for me to understand
that he understood Money Madness in the
same way.
"MONEY HAS NO
BABIES."
So even though
technology is such that the problem positive
feedback loop in the current banking system
can be eliminated, Douglas
had devised a valid patchwork jury-rigged
feedback loop in the control
system to balance the positive feedback
in the prices with the
positive feedback in the purchasing power.
In lay terms,
a positive feedback makes the right wheel on your
two-wheel cart inflate while the left
wheel stays stable. There are
two engineering solutions. Douglas's solution
is to balance by
inflating the left wheel. Today's software
solution is to eliminate
the imbalance in the accounting in the
first place.
I must admit
that in Douglas's day, there wasn't the
international banking technology which
would allow for the upgrade of
the world money software from the 5,000
year old Usury Slavery version
to the 1995 LETS Greendollar version overnight.
It all comes
together in LETS. LETS is the proof that FRIENLY
CREDITS work. Socreds should be overjoyed.
No more need to bug the
government to get you an interest-free
bank account, there's a
Greendollar one open down the block. And
if there isn't, like credit
unions, form your own Greendollar Credit
Union. Greendollars are just
like forming Credit Unions with no real
money, only your worth valued
in "play" money.
So, though I
think there is a better way than Douglas's way, I
will still defend that his was would have
helped immensely if not
completely.
I'll soon post
some of Douglas's best quotes on money.
When I was with
the party, I used to sign myself:
John Turmel, the Social Credit Engineer.
---
Subject: Re: Social Credit
I noted a perfect
example of Orwell's "double-think" in one of
the articles. Double-think was defined
as the ability to
simultaneously accept two contradictory
points of view as both true.
On Aug 24 1995, wfhummel@netcom.com (William F. Hummel) wrote:
:A bank loans money that it receives from other depositors...
In the next paragraph, he says:
:The money supply increases whenever a
bank creates a new loan, and it
:decreases when the loanee pays off the
loan.
Can anyone else see the double-think here?
John C. Turmel, B. Eng.
---
Subject: Re: Social Credit
I must point out
that several people have complained about our
topic's distribution. The following posts
were made to 23 various
engineering, economic, politics and general
newsgroups:
119. Re: Social Credit
Levant Tinaz
122. Re: Social Credit
Frangois Mottier
123. Re: Social Credit
NDF130000-FarleighSEDR9818)226
124. Re: Social Credit
Roger M. Wilcox
128. Re: Social Credit
Gary Forbis
134. Re: Social Credit
Michael Burke
135. Re: Social Credit
Ken Zagzebski
136. Re: Social Credit
Eric Muetterties
137. Re: Social Credit
Eric Muetterties
139. Re: Social Credit
Nick Rossi
140. Re: Social Credit
Lynn Prentice
141. Re: Social Credit
James Hess
143. Re: Social Credit
Undergrad Student
146. Re: Social Credit
Joe Thornton
147. Re: Social Credit
Peter Sulc
148. Re: Social Credit
Susan Garvin
149. Re: Social Credit
Matt McLeod
150. Re: Social Credit -- watch the Newsgroups:
line
TJ Nye
151. Re: Social Credit
Peter Sulc
152. Re: Social Credit
Undergrad Student
153. Re: Social Credit
Susan Garvin
157. Re: Social Credit (Original Post)
John Turmel
159. Re: Social Credit (Original Post)
David Moss
The complainants
feel that some of our newsgroups are not
relevant and should be removed.
:From: tjnye@calum.csclub.uwaterloo.ca
(TJ Nye)
:Subject: Re: Social Credit -- watch the
Newsgroups: line
:The Newsgroups: line of this thread seems
to be returning to its
:Turmel-esque proportions (i.e., 17 groups):
: Newsgroups:
: tor.general,ont.general,can.general,can.taxes,can.politics,
: alt.conspiracy,sci.econ,nz.politics,sci.engr,aus.general,
: ncf.sigs.business.freedata,sci.systems,sci.philosophy.tech,
: sci.math,sci.engr.safety,sci.engr.control,alt.politics.economics
:
:I wonder if posters could keep an eye
on the Newsgroups: line when they
:follow-up articles, and trim accordingly.
For instance, the current
:thread isn't topical to any of the sci.*
groups except sci.econ.
:Tim
On Sep 10 1995, I received a message which said:
:This has nothing to do with sci.engr.control
or sci.math. Please delete
:those newsgroups from your responses.
SoCred is of great interest to
:some Canadians, so why not specify "ca"
rather than world... please.
:
I answered him:
:Social Credit was an Engineering Analysis
of the Monetary Control
:System presented to the World Engineering
Conference in 1919.
:After all the pillorying Major Douglas
received at the hands of
:orthodox economists, I think he deserves
a chance to have his
:work judged by his peers in Engineering.
Would you deny this
:joked-about engineer his chance at scientific
approbation?
:That's why I include these discussions
of Social Credit
:engineering in the menu offered engineers.
:
Having received
no response, I hope that he has rethought his
original impression that Social Credit
Monetary Engineering design
should not be considered by people who
frequent sci. newsgroups.
After all the
discussion of Control Systems Analysis, Laplace
Transformations, differential equations,
exponential functions, and
algebra, I find it hard to treat objections
to the analysis being
included in sci newsgroups worthy of serious
consideration.
Of course, the
boo-birds are causing problems with complaints to
the news administrator of my freenet whose
recent unilateral and
surreptitious cancellations of my posts
has forced me to reduce the
number of newsgroups to 10.
Here's a typical
complaint about our discussions from a person
who has never commented or participated
in our discussions:
:Date: Sun Sep 10 00:03:24 1995
:From: anakin@pinc.com (Rajiv K. Gandhi)
:Subject: Re: Social Credit (Original
Post)
:To: johnturmel@yahoo.com (John Turmel),
postmaster@freenet.carleton.ca
:
:(A copy of this message has also been
posted to the following newsgroups:
:tor.general,ont.general,can.general,can.taxes,can.politics,ncf.general,
:alt.conspiracy,sci.econ,alt.christnet.philosophy,nz.general,nz.politics,
:sci.engr,aus.general,aus.politics,uk.misc,uk.politics,
:ncf.sigs.business.freedata,sci.systems,sci.philosophy.tech,sci.math,
:sci.engr.safety,sci.engr.control,alt.politics.economics)
:
:To John Turmel: You posted this article
to TWENTY THREE newsgroups. This
:is yet another gross violation of USENET
ETTIQUETTE. I have forwarded a
:copy of this posting to your postmaster.
:
:TO THE POSTMASTER: I wish to register
this as a formal complaint. John
:Turmel has consistently posted material
to an excesive number of
:newsgroups, often to non-relevant newgroups.
He has been informed about
:the concept of netiquette by many,
and has been given numerous
:suggestions as to how to preven such
flagrant abuses in the future. He has
:responded to each with nothing but indignation
and a dogmatic refusal to
:cooperate. The Usenet survives only by
cooperation.
:
:Again, for the record, the article which
follows was posted to the
:following newsgroups:
:
:This cannot be tolerated.
:
:I do not wish Mr. Turmel to be prevented
from posting entirely to the
:newsgroups. I do recognize that what
he says may have some validity and
:appeal to a group of people. However,
by the same token, Mr. Turmel must
:be properly and formally educated as
to the rules of conduct on the
:Usenet.
:
:I would like some form of action to be
taken against Mr. Turmel in order
:to prevent him from repeatedly spamming
the Usenet. I would suggest that
:Mr. Turmel's account at NCF be temporarily
suspended, until such time as
:he can demonstrate that he is willing
to follow the rules of conduct.
:Perhaps, if it is permissible per the
NCF Charter, MR. Turmel could be
:required to enroll in and complete an
introductory course about the
:internet which will teach him what is
considered proper and what is not.
:
:I would like to make it clear that I
do not wish either Mr. Turmel or the
:content of his postings to be censored.
I want him to understand and to
:learn that his material should be disseminated
only in a responsible
:manner.
:
:The Usenet is a collective effort between
people to exchange ideas,
:opinions, and information. It is a valuable
source which cannot be, and
:should not be, abused.
:
Notice that this
complaint is from a guy who has never made an
effort to exchange ideas, opinions, and
information with us. I hope
you notice that there was no complaint
about others who had been
cross-posting to the same 23 newsgroups
while I was off-line. Only
when I joined the topic and posted my
first response to the same
newsgroups did we start getting feedback
from people who don't even
participate in our topic.
Unfortunately,
these members of the "bandwidth patrol" cause so
much trouble with nothing better to do
than to criticize the
communications of others that I have no
choice but to ask you to help
decided which newsgroups we're going to
have leave.
I've tried to
explain that posting to extra newsgroups doesn't
involved posting the whole article but
an entry to an index page with
a pointer to the article but it just hadn't
sunk in how little
bandwidth cross-posting really uses.
Yet, the danger
in continuing posting to all the newsgroups you
started with is that the news administrator
of my freenet recently
cancelled all my posts to all topics without
notice and cancelled
everyone else's responses too.
In order to avoid
his cancelling our articles again, we're going
to have to reduce the range of our discussions.
I'm still going to
post this to the 23 newsgroups to elicit
feedback but I'd ask you to
be quick with your responses in case my
news administrator decides to
cancel all our posts again. If you participate
in the discussion from
can.politics or aus.general, please speak
up and we'll keep those
conferences. It would be funny to receive
responses from more than 10
newsgroups though.
I'd especially
challenge the boo-birds to suggest which
newsgroups are not relevant and which
are. And perhaps they could tell
us why.
Now on to responses to many of your submissions:
*** On Aug 18 1995, levant@isgtec.com (Levant Tinaz) wrote:
:Are there any social credit (charging
0% interest) banks in Canada
:that could give me an interest free mortgage?
:
The only interest-free
banks I know of in Canada are LETSystems
which issue Greendollar social credits.
:If I have to earn more to pay for my home
:due to a mortgage with interest, don't
I have to work harder and earn
:more and thus contribute more to the
economy?
:
Not to the economy
that spends it. You contribute more to the
"already-have-too-much" class who can't
spend it.
:On another note, doesn't the profit made
by lenders from charging
:interest eventually get spent on goods
and services and thus
:contribute to the economy?
:
Most of the profits
to those who already have more than they need
are not spent but re-loansharked. I like
Francois Mottier's Aug 22 1995
answer:
:Owning the money is what gives them pleasure.
Spending money just does
:not enter their mind. So, rejoice in
the knowledge that you are
:privileged to contribute to the joy of
a collector!
:By the way, the lenders are the only
ones that are not working,
:everybody else has to work hard to feed
the joy of the lenders.
:
It's the difference
between earning your income and not earning
your income. Unearned income is the theft.
*** On Aug 24 1995, rogerw@cisco.com (Roger M. Wilcox) wrote:
: When you need to borrow money
from a bank, and that bank doesn't
:have enough money lying around to lend
you, the bank can turn around
:and, for a lower rate, borrow the money
it's going to lend to you from
:an organization called the "Federal Reserve".
: Although the money "lent"
to the bank by the Federal Reserve
:eventually has to be paid back with some
interest, the Federal Reserve
:doesn't actually have a "stockpile" of
existing previously-circulated
:money lying around that they use for
lending to the banks.
: What they do is, they print
it.
: Every time a bank borrows
money to loan out, the Federal Reserve
:puts more money into circulation.
When that happens, there are more
:total U.S. dollars in circulation, so
every existing dollar is worth
:slightly less. This is what causes inflation.
This assumes that
the only source of new money in the economy is
the FED and when the FED issues new money,
it dilutes the old.
It is not necessarily
correct to say that "because there are more
total U.S. dollars in circulation, so
every existing dollar is worth
slightly less." Economics fails to note
the relationship between the
increased collateral pledged and the increased
liquidity issued. Just
because there are new chips issued into
circulation in a Poker game
does not mean that the value of the other
chips necessarily goes down.
It would only go down if there were no
new collateral pledged at the
casino cage.
*** On Aug 24 1995, wfhummel@netcom.com (William F. Hummel) noted:
:Borrowed money is the life blood of the
economy.
:
Money is the
life blood of th e economy whether the tokens are
"borrowed" into circulation or the chips
are "bought into"
circulation. The problem is that the life
blood put into circulation
is infected with financial leukemia, the
cancerous growth of debt by
usury.
*** On Aug 25 1995, forbis@cac.washington.edu (Gary Forbis) noted:
:If I borrow x dollars and am required
to pay back x+y dollars how can
:this not be inflationary? Where
am I to get these extra dollars. If
:all the dollars were repaid to the banks
there would still be a debt
:owed to the banks, that is unless the
feds have been spending dollars
:without accounting for them as a debt.
In my usual analysis,
I use Principal (P) instead of "x" and
Interest (I) instead of "y" for the debt
owed (P+I) from the loan
of (P). I'll soon republish the Mathematics
of Usury for you going
into further detail.
But notice the
answer Gary received to his question about where
the Interest is going to come from.
*** John Monroe aw486@FreeNet.Carleton.CA wrote:
:The y dollars you pay the bank is for...
Without dealing
with the fact that you're asking where you are to
get the y dollars from, he spends most
of his post telling you what
the bank spends it on.
:In this way the interest
:you pay the bank finds its way back into
the economy, just as the
:rent you pay on a car or the money you
pay your house painter.
:
Though some or
even much of the interest does find its way back
into the economy, I think we've previously
explained how many of the
people who receive interest are not able
to spend it back into the
economy since they already have too much
to spend in their and their
family's life-times.
*** wfhummel@netcom.com (William F. Hummel) suggested:
:: If I borrow x dollars and am required
to pay back x+y dollars how
::can this not be inflationary?
Where am I to get these extra dollars.
:
:Your first question appears to assume
that the money supply has
:increased as a result of the interest
charge (y) on the loan (x).
:It also assumes that an increase in the
money supply automatically
:results in inflation.
:
No. I read his
question as assuming that the prices he had to
charge for his product have increased
as a result of the interest
charge (y) on his loan(x). I did not hear
any mention of the money
supply in generating inflation but noted
that the increase in the debt
he had to pay results in a price rise
which had only to do with the
interest (y) and nothing not the mass
of money (x).
:I'll address both points separately.
:Say you need a short term loan of $1000
and a friend offers to lend it
:to you to save the bank interest charge.
You accept his offer, but
:when it comes time to pay him back you
include a gift of $50. Where
:did that extra $50 come from? Obviously
it came from the same source
:that the $1000 came from, namely your
paycheck.
:
You and Gary
are on an island and he lends you his $1000. You
accept, pay him back and include a gift
of $50. Where did the $50 come
from? We had to assume another source
of money on the island from
where he could obtain the lacking $50.
If you're going to have another
player on the island, you should specify
not only much your boss has
but also how much more interest he owes
too.
::If all the dollars were repaid to the
banks there would still be a
::debt owed to the banks, that is unless
the feds have been spending
::dollars without accounting for them
as a debt.
:Was the money supply
:increased by that gift? No, it
was just a transfer of money from you
:to your friend rather than to the bank.
:
No. the money
supply was not increased by the gift. But it was
increased by the assumption of another
source we had not originally
taken into account or defined. Nevertheless,
Gary's point is still
valid. Assuming everybody pays back their
principal with the principal
they initially borrowed, it's obvious
that everybody still owes their
interest.
:The question of what causes inflation
is not nearly as simple. But it
:is definitely not proportional to the
size of the money supply.
:
And again, Gary
was pointing out that it seemed that the
inflation was proportional to the interest.
My calculations predict
that the expected minimum inflation generated
by a demand for "y"
interest is "y/(x+y)" representing the
ratio who fail so others can
survive and who lose their collateral.
:The
:idea that inflation is caused by too
many dollars chasing too few
:goods is simplistic. The price
of a single commodity, like coffee,
:will certainly rise when the SUPPLY is
reduced. But will it rise
:because there are more dollars in circulation?
Only if there is a
:very substantial and well-recognized
increase in the money supply.
:
Again, this always
looks at monetary increases independent of
collateral base. Using a casino as a model,
any substantial increase
in the token supply is always matched
with the same increase in
collateral base. That Economics studies
the liquidity mass independent
of any relationship to collateral pledged
is overlooking the most
important relationship of sound money.
:Inflation, as it is usually defined, means
an increase in the average
:price of a basket of goods and services
over time.
:
And if you double
Gary's interest rate for his industrial loan,
that increased manufacturers' cost will
be recovered in higher prices.
:Its causes are far
:more complex than too much money chasing
too few goods. According to
:the Keynesian vew, the primary cause
of inflation is wages rising
:faster than productivity.
:
Not a word is
mentioned about the price of money which affects
every facet of economic activity.
:The fluctuation is related to the business
cycle. When business is
:very active, it borrows heavily and increases
the money supply.
:
So businesses,
like Gary, borrow the Principal and have to repay
both the Principal "x" and the Interest
"y". Since loans are the only
way for new money to get into circulation,
this means that for every
dollar borrowed and used in production,
"x+y" has to be charged in
prices for that business to survive.
Aggregate industrial
borrowings are X and aggregate industrial
prices are X+Y. Since there is insufficient
aggregate money in
circulation to purchase the aggregate
prices, some businesses must
fail so that others sell and survive.
The fraction who fail and are
foreclosed on is "y/(x+y)." Again, see
the Mathematics of Usury.
:Conversely, in retractions the money supply
decreases. But inflation
:does not go up and down in synchronism
with the size of the money
:supply.
:
Once again, that's
because the inflation is not a function of the
money supply but a function of the interest
demanded on that money
supply.
:Your last point about the Fed being involved
in adding the "missing"
:money to pay the interest on the bank
loan is, I think, answered above.
:
Actually, it
isn't. Gary wondered if the missing money "y" was
issued by the FED to balance the missing
money "y" he needs to pay his
debt of "x+y". It's a logical question.
And it happens
to be the original Social Credit solution. Socreds
have always proposed that Government simply
spend whatever money is
necessary to balance the debt that Gary's
trying to pay off with the
sale of his product. And having Government
expand services with new
money to balance the interest demanded
would work. Only it wouldn't
work with the greatest ease.
The easiest way
to balance the money and the debt is to stop the
growth of debt with interest by paying
bankers with a service charge
(and if someone says they see no difference,
I do). The perfect
monetary models are the Greendollar-Timedollar
systems now spreading
around the world.
If Gary considers
his predicament, his only way out is to out-
sell his neighbor and get some of his
"x" principal. That's why the
name of the game of who pays off their
"x+y" where everybody only got
"x" is called mort-gage from the French
words for 'mort" meaning death
and "gage" meaning gamble. If ever there
was a device that was
properly named, it was the enslavement
contract bearing usury called
"death-gamble."
*** forbis@cac.washington.edu (Gary Forbis) pointed out:
:In what other industry is the exchange
made in the media's denomination?
:I don't exchange my labor for so many
houses painted or cars. I exchange
:my labor for dollars.
:
Good point. There
would be no problem if banks did accept the
interest in products or if there were
a collateral based chip system
which would facilitate payment to the
banks. They end up spending
their interest on products anyway, don't
they? So why force everyone
to go through a middle-man?
:I engage in economic activity at the whim
of those who control access
:to the media in which my labor is valued.
:
Which has been
the fate of those enslaved by usury throughout the
ages of civilization.
*** Scott Walker <73134.3463@compuserve.com> wrote:
:Do you think they really "print" this
money? I doubt it. More likely
:in todays age they simply "create" a
fund transfer to the bank. All
:money is fictional and merely a marker
after all. When the money is
:paid back is can be removed from circulation,
or "deleted".
:
When you were
little, did you ever dream of printing cash?
Of filling up your wallet with some money
in a flash?
Creating money
accurately means TO HAVE THE PLATES,
The stamping of some paper into notes
best demonstrates;
Or stamping metal
into coins; or blips computerized,
Into your bank account deposits, checks
now authorized.
So whether paper,
metal, volts of electricity,
TO HAVE THE PLATES is printing money,
absolutely free.
*** ericm3@ix.netcom.com (Eric Muetterties) wrote:
: When I bought my first
home with a mortgage (Var. 10 % I think it
:was) I received a loan for $ 72,000 after
30 years I would pay back $
:250,000 total. Now if I were to make
40,000 a year I would net after
:all taxes about $20,000 - 25,000 which
would take up 10 to 12 years of
:my full complete income to pay off what
would take 3 - 4 years if I
:could save that amount up first. In other
words I am BOUND or ENSLAVED
:by my signing that paper for 7 -8 years
of work. Of course it costs me
:to live during this time.
: Consider that for
a moment... 7-8 years of my productivity goes to
:some bank in the form of usury. Hmm!
I willingly am a slave...
:
Considering you
pay $250,000 in 30 years, 8,333.33 a year, if the
loan had been in interest-free Greendollars,
you'd have paid the
$75,000 off in 9 years, $72,000 for the
house and $3,000 for the
bankers' service charges. So you don't
lose 7-8 years to usury, you
are enslaved to your usury chains for
21 years.
: 7 -8 years of saving
that 20,000 - 25,000 = about 140,000 to
:200,000 for the original sum of 72,000
would do a lot for me if I were
:to keep it. I could own 2-3 houses!!
:
That's right
which means that those few who manage to survive and
keep what they've won have 2/3 to 3/4
of their estates wasted on debt
service.
*** In another article, (Eric Muetterties) adds:
:break the debt cycle that enslaves us
and our estates would be twice
:or thrice what they are...
:
And we have to
realize that it is not the debt that's the problem
because debt is necessary for those who
are starting out, it's the
positive feedback growth of debt due to
usury which creates the
problem.
*** voyager@eskimo.com (Nick Rossi) wrote:
:Debt allows individuals to own things
they couldn't otherwise own and
:allows many companies to get off the
ground. It's not harmful unless you
:don't pay it back...
:
Just because
it seems good for the winners doesn't mean it isn't
really bad for the losers, the Y/(X+Y)
ratio who fail to sell to an
economy with insufficient money. Actually,
credit is really only
dangerous when it comes infected with
the cancer of usury.
:>In other words I am BOUND or ENSLAVED
:>by my signing that paper for 7 -8 years
of work. Of course it costs me
:>to live during this time.
:
:Why not rent an apartment then?
Choose not to be bound or enslaved if
:you don't want to be - if that's how
you look at it.
:
But you are still
paying the interest on the housing except that
the landlord is the one who takes the
death-gamble. Whether your
landlord pays interest or you are your
own landlord who pays interest,
the banks are still getting the interest
on the housing so there's no
escaping interest slavery. It's just that
some people don't bother to
try and others don't have the means to
try to play death-gamble.
:You're forgetting that every dollar you
put into the house gives you
:more equity in that asset.
:
As he explained,
of the $250,000 that went into the house, only
$72,000 of it was for the house payment
and the other $178,000 was for
the debt slavery payment.
:If you chose the house wisely, it will
appreciate
:in value beyond the amount you borrowed.
:
And even though
any pygmy can explain that the older his hut
gets, the less it's worth, even he can
see that if you value his hut
in so many sea-shells at the time of construction
and somehow later
value the sea-shells at half their former
rate, that it would seem to
him that his older house is going up in
value. I hope he'd be astute
enough to realize that there must be something
wrong with a sea-shell
system that keeps telling him the older
his house is getting, the more
it's appreciating in value and if so,
I'm sure he'd find it funny how
our civilization can use our devaluating
sea-shells to make ourselves
believe that our huts are appreciating
over time.
:If it appreciates faster percentage-wise
than the interest rate on
:the loan, then you come out ahead. There's
no guarantee of that, of
:course, but there are no guarantees in
life...
:
So if your money
loses its value faster than your house really
depreciates, then you come out ahead.
I don't know if I'd call that
coming out ahead.
:: Consider that for
a moment... 7-8 years of my productivity goes to
::some bank in the form of usury. Hmm!
I willingly am a slave...
:
:To be a slave means to be forced to work
without compensation. a) you
:weren't forced to buy the house, and
b) the house is your reward for the
:work.
:
To be a slave
if to work under compulsion and end up without
compensation. Don't the majority of Earthlings
work all their lives
under compulsion of financial need and
end up with nothing? Aren't
chains of hunger and deprivation enough
to force them to their labors?
:> 7 -8 years of saving
that 20,000 - 25,000 = about 140,000 to
:>200,000 for the original sum of 72,000
would do a lot for me if I were
:>to keep it. I could own 2-3 houses!!
:
:But in the time it would take to save
up that money, inflation will have
:eaten it away to the point where you
could only own one house again, unless
:you have it invested - and a house is
one way to invest it.
:
If you look at
it that way, it seems that there is no way out.
But if you compare your situation with
an interest-free Greendollar
loan for your housing, what Gary says
is correct. Interest will rob
him of 75% of his estate and only the
price of the money is the cause.
:'tis better to own a house than to rent,
in the long run...
:
Not if you're
going to be one of the losers included in the
Y/(X+Y) group. I doubt if the ulcers and
financial devastation of
being ruined and losing everything is
worth the death-gamble. I think
admitting it's a rigged game with a fixed
number of losers out of all
who try makes it a pretty unattractive
gamble. All you have to do is
get sick or lose your job and you lose
everything. Until the money
system is fixed, I'll have no unrealistic
hopes and I'll rent.
*** Joe Thornton <jthor@freenet.calgary.ab.ca> wrote:
:On Tue, 5 Sep 1995, Undergrad Student
wrote:
:
:> Economics is the science
of allocating scarce resources. Scarce
:> resources are allocated by the price
that you pay. Having a 0 % interest
:> rate means there is no cost to borrow
money, which implies money is not
:> scarce. As you can see Social
Credit economics will not work.
:
:Hate to differ but the above is not the
best example of Social Credit
:Economics although its an interesting
thought akin to Islamic Banking
:which does work in those countries.
:The whole scope of Social Credit Economics
is instead at the Government
:level where government initiatives should
be totally financed by the
:issuance of currencies designated for
that purpose. As it stands now, a
:government issues a Bond which is sold
to Institutional Investors or
:banks both domestic and foreign.
This means that indeed the same amount
:of money is available to spend by the
government as if it had actually
:issued "real dollars", only problem is
that the country now has to pay
:interest on the bonds sold off to the
investors. If the same amount of
:funds were released to pay for the project
in hard currency the citizens
:would soon reach a need for nearly zero
taxation......
:
Well answered.
I would further
point out that the problem with Islamic banks is
that most of them are not banks of issue
but are more piggy banks.
Though they are interest-free, they are
dependent upon interest-
bearing money from the interest-bearing
banks of issue.
I would further
point out that scarcity of liquidity is not
necessary for it to be valuable. If one
day I enter a casino and see
few chips on the tables and on the next
day see many chips on the
tables, I don't think that because they're
not scarce they're not
valuable. Again, if one's understanding
of money is divorced from the
collateral backing it up, then it might
seem that it's the scarcity of
the money that makes valuable rather than
what you can get for it.
Trying keep money
scarce to give it value is purely dependent on
the notion that money is not linked to
collateral and that inputs of
new money result in inflation. This is
not necessarily true.
Finally, to conclude
that because money would not be scarce in a
Social Credit financial management system
means that it wouldn't work
is certainly not true. Given a chance,
it would work though with much
more supervision than necessary than either
Green or Time dollar
systems.
*** setInPrefs@cs.auckland.ac.nz
(Undergrad Student)
:
:In article <42nplk$pn0@nyx10.cs.du.edu>,
psulc@nyx10.cs.du.edu (Peter
:Sulc) wrote:
:
:> If economics is the "the science of
allocating scarce resources", what,
:> pray tell, is the science of allocating
abundant resources?
:
:The _entity_ that allocates scarce resources
is the free market (sorry I
:did not make it clear). And
the freer it is, the fairer it is as
:everyone has a chance to participate.
:Vin Reft
:
*** 100026,2150@compuserve.com (Eric
Stevens) wrote:
:setInPrefs@cs.auckland.ac.nz (Undergrad
Student) wrote:
:
:>The _entity_ that allocates scarce resources
is the free market (sorry I
:>did not make it clear).
And the freer it is, the fairer it is as
:>everyone has a chance to participate.
:
:Clever! Neat!!
: ... but you still have not answered
the question.
:" what, pray tell, is the science of
allocating abundant resources? "
I agree that the
question still remains valid. There is no
science of allocating abundant resources.
The gas gauge was designed
to register only scarcity and can't handle
abundance. So it destroys
the abundance which it fails to register.
With no money to purchase
all the abundance, it must be destroyed
so that only enough products
are left to draw whatever money is available.
Sick, actually.
*** adm@ccadfa.cc.adfa.oz.au (David Moss) wrote:
:It will take me quite a while to digest
the content of this detailed
:posting but in the meantime a comment
on the feasability of interest
:free credit.
:I understand that lending money for interest
is illegal under Islamic
:Law. In certain Muslim countries banks
are regularly set up to provide
:interest free loans between Muslims.
I understand that these banks
:regularly fail losing the principal "invested"
by the depositors.
:It would appear that social credit has
already been tried and failed
:in practice in these countries.
:
Again, before
you take the Islamic banking system as the model
for interest-free credit, I'd point out
that Major Douglas was trying
to correct a problem in the banks of issue.
I'd further urge
consideration of the LETS Greendollar or
Timedollar systems or casino banks as
ideal interest-free models.
*** sef@rebecca.dr.att.com (NDF130000-FarleighSE(DR9818)226)
Scott E.
Farleigh wrote:
:Just remember, Jesus used a whip to chase
the money lenders out of the
:Temple.
*** mburke@pcug.org.au (Michael Burke) added:
:And look what happened to him.
*** zagz@ix.netcom.com (Ken Zagzebski) noted:
:Yeah, but that was just a momentary set back.
*** matt@toaster.hna.com.au (Matt McLeod) added:
:Was it? So who is winning now?
:(I'll give you a hint - it ain't Jesus)
:
His system may
not be winning now but it's coming on strong. As
I'm fond of pointing out, the LETS software
is also chasing the money
lenders out of the temple by giving people
an opportunity to join an
interest-free outlet.
In my next post,
I'll go over my previous question on Economic
Double-think with respect to the real
source of bank loans.
John C. Turmel, B. Eng.