eListas - My Lists: socialcredit: Messages

Hi Joe:

I'll post some comments and respond in turn in red.

(Joe) A 'debt' is still a 'debt', whether it has interest appended to it or not. It is a 'call' by the lender upon the borrower for that borrower to 'do' something, and as such is an external means of control over one individual by another.

(Jim) But a bank loan isn't just a debt, it's also a credit. Let's look at a mortgage. When you buy a house, the bank loans you $100,000, say, and the house become collateral for that loan. The "loan", or the money loaned, is owned by you and the bank. When I buy the house the money is 'owned' by the seller. Less any amount of it he may still owe on the house. I 'own' the house, my name is on the title. And the bank 'owns' my loan. Secured by a charge on that title. If I don't repay as I've contracted to do, the bank will 'own' my house. And my 'equity' in it, such as may initially be required as a 'down payment' nowadays, plus any payments on the principle I've made in the interim, will be lost.The bank creates it as as debit (debt, or iou), and a credit (deposit). The actual house is owned by you, and can only become the property of the bank if you fail to meet your loan repayment schedule. Now the new money has value because it's attached to some asset - the house. But as the house depreciates over the course of it's existence, then the money for the loan should be paid back over the "life" of the house, so that the money in existence has something tangible to back it up. And how is this to be determined? How does anyone know what the actual 'life expectancy' of any house is going to be? The factors involved in making such a determination would be impossible to quantify accurately. This would be a logistical nightmare to try to determine for each individual dwelling. Which would need an 'individualized' repayment schedule, in some cases stretching out over 100 years. Who's going to be around that long to keep up the payments? In other cases, with the way some homes are being built here nowadays, the life expectancy might be shorter than what mortgages are usually taken out for. It often would be in my view anyway. How could any bank ever keep on top of all that? And then there's the change in 'property values' themselves to consider.

When the house ceases to exist, so should the loan. So the home'owner' will never be out of debt? There will be no incentive for him to pay off his house, to save interest charges, so he'll just let the debt ride? Many, no doubt, would like that nowadays. But how, in any practical sense, could this ever be accomplished? I can see the 'administration' costs, just keeping track of the 'life expectancy' of every house, and at what rate the 'loan' against it should be amortized so that both 'disappear' together, being absolutely horrendous. Who pays for that? And how? However; more loans can be made to "spruce up" the house to extend it's life span. However; as I've always stated, the loan itself, or who owes who, is a question of ownership, and not a question of balance. I agree that banks can exert alot of control via their power to create money at will. As I've already stated, a 'debt' is still a 'debt'. Under such a scheme as you've described above, it is a furtherance of 'external' control over the individual by an organization. Something I believe is incompatible with 'true' Social Credit. Something that should be the exclusive control of the government acting on behalf of the citizens within that community. How do you know the 'government' is going to act that way, Jim? Just because a 'debt' is owed to the 'government' instead of a 'bank' doesn't make it any less a 'debt', does it? Social Credit, at least as far as I understand it, seeks to 'de-centralize' the powers of 'government' and 'banks'. Not combine them, and make them absolute.

This reminds me again of the type of deductive reasoning expressed in 'Zeno's problem'. You may not have seen it, Jim, so I'll reproduce it here. Maybe you can see the similarities.

A classic example is the problem of Achilles and the tortoise.
In its classical form, with the classical pre-suppositions, the problem is insoluble.
As stated by William James, the problem, or paradox as it is usually known, runs:
"Give that reptile ever so small an advance and the swift runner Achilles can never overtake him, much less get ahead of him; for of space and time are infinitely divisible (as our intellects tell us they must be), by the time Achilles reaches the tortoise's starting point, the tortoise has already got ahead of that starting point, and so on ad infinitum, the interval between the pursuer and the pursued growing endlessly minuter, but never becoming wholly obliterated,"
The modern mind can "see through" the problem at once because we are the possessors of new points of view to encompass such paradoxes; the problem has in fact vanished, and we concern ourselves with the more practical problem:
"Given that the tortoise and Archilles have such and such speeds, and start with such and such a distance between them, how long will it take Achilles to overtake the tortoise?"

Actually I'll respond as I did to Bill. It's a non-sequitur in regards to what I'm saying. I'm saying that because of usury, the debt is achilles, and the credit is the tortoise. Because of interest, the only way to pay back loans is by access to more loans, but those other loans also have interest, and it is because of this that the rate of growth of the debt is greater than the rate of growth of the money supply. Douglas himself saw this, although perhaps he did not see the logical conclusion when he states, " The debt differs in nature from the debt created by private finance in exactly the same way that a debt to foreigners differs from an internal debt-its repayment actually takes money out of the country. If a rise of prices has occurred, it is repaid twice over, once in increased prices and again on redemption. Secondly, there is no provision in this method of financing for the money required to pay the interest on the debentures, which, in fact, can only be paid, if it is paid, by the issue of fresh money to pay it, which, under existing circumstances, comes from the same source, that is to say, the financial system." The facts speak for themselves Joe, because of usury, the debt is 2.5 times the money supply, and as time goes on, this figure will get worse because debt is growing faster than credit, and this is a result of usury.But this is so even if there were no 'usury'. As soon as a loan of bank-created credit is called back, and 'cancelled' by the bank; or 'sold' to the public in an exchange for 'pre-existing money' for securities of some type; PREMATURELY, while there are still COSTS that same sum of money originally created still outstanding on anyone's books, those COSTS can't be met. Without a further debt being incurred, or 'money' supposedly being 'imported' from another credit area through 'exports' or 'foreign investment', or a write-off of these costs somehow, as in a bankruptcy. All things which add to the overall problem. 'Usury', detest it though we may, has no direct bearing on this problem. It would exist even if there were 'interest-free money'. And it will get worse as incomes through wages are increasingly displaced by technology. And those incomes, as a percentage of overall costs, are diminishing and less and less able to amortize overall debt. Interest might make this debt grow faster when the principle isn't being paid, but it isn't the CAUSE of the problem. And 'eliminating' it, won't cure it.

We might say that 'interest' and 'profit' are synonomous. They are necessary in our present system as 'inducements' to produce. If we did away with either, in our 'imperfect', actual world, the alternative to them would be stark 'compulsion'. The triumph of the power of 'fear' over the power of 'love'. Neither interest nor profit should be particular problems when Social Credit is properly applied. And if either were, they could be easily dealt with. It is in the pre-mature return and cancellation of 'bank-created' credit while the 'costs' it created haven't been fully liquidated that the larger problem lies.

Since it's Bill Ryan's 'accounting proof' you take such exception to, would it not be better to at least allow him a chance to respond, too?

Two points Joe. 1) It's actually not Bill Ryan's proof, it's a "proof" offered up by the banks, and I've seen it long before I met Bill Ryan. 2) I've had this debate with Bill before, but instead of debating me, he resorted to ad hominem attacks, and I have no interest to engage in any discussion about anything with Bill Ryan.

You, on the other hand, I like and respect very much. And will debate anything with you, or any of the others on this list.Thanks, Jim. It's too bad that we all can't talk to one another in a civilized and respectful way, and not have to engage in juvenile name calling when there isn't agreement. My hide is thick, maybe my skull is too, so it doesn't really bother me too much if someone calls me names. (I get far worse every time the price of lumber goes up a few cents!). You know the old saying, "To err is human, to forgive divine." Even Richard Nixon, who should know, said words to the effect that ''Hate always hurts the hater more than the hated". Well, you'll all do as you please, but real progress would be far better served by open discussion in my view.

Best wishes,

Joe

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