THE STRUGGLE FOR MONEY
A Study of the struggle which is the
underlying root cause of all the world's troubles and problems, from poverty to
world-wars and the hydrogen bomb; and is quite insane and unnecessary. Who at
present owns, and who ought to own, all money and credit, asks the author--the
Banks, the Government or the Consuming Public?
BY
H.M.M.
WILLIAM MACLELLAN
240 HOPE STREET, GLASGOW. C.2
1957
CHAPTER I
THIS SORRY SCHEME OF THINGS
Ah Love! could thou and I with Fate
conspire
To grasp this sorry Scheme of Things
entire,
Would not we shatter it to bits–and
then
Re-mould it nearer to the Heart’s
Desire!
OMAR KHAYYAM
Every human heart echoes that cry
today, for in this age of ever-increasing anxiety and fear, every human being,
rich or poor, longs for peace and security and the amenities of a true
civilisation–with freedom and leisure in which to create and enjoy
them.
These are basic needs essential for
man’ continued existence and development; and his accumulated knowledge,
organised power, inventive genius, ability and industry can supply the means for
their fullest satisfaction, with increasing ease, goodwill, and the closest
possible co-operation of all sections of the community–and of the world–and can
do it now, today, provided we remove the man-made, and therefore removable,
obstacles that at present bar all approach to the Land of Heart’s
Desire.
What are those obstacles?
A fraudulent financial system and the
bogus debts it creates–Public Enemy No. I–with its by-products, false ideas
about work, trade and commerce, savings, government, democracy, and life
generally--all of which tend to paralyse the good elements in man’s make-up and
stimulate the bad; and their combined effect is appalling, being the animating
cause of all the world’s major ills, from poverty to world-wars and the hydrogen
bomb.
What is wrong with the financial
system?
Nearly everything. It is a great
invention gone wrong. Honestly run–that is, in such a way that nobody’s just and
lawful rights or interests are infringed or adversely affected in any way by its
operations–it could make Earth a heaven in next to no time. Run on its present
lines it is not only making life a hell, but will destroy the human race, and
perhaps the Earth itself, unless we change it.
How is it run at present?
Before attempting to answer that
question, let us ask ourselves another: What is the true function of the
financial system?
Surely it is to oil the wheels of
production and distribution so that every individual will get the things he
needs for a full and adequate life–and get them with the maximum of ease and
speed, and the minimum expenditure of time and energy–that and nothing
more.
To bring about that happy state of
affairs, with production speeding up automatically and willingly in response to
real consumer demand–backed with the money to pay for what is demanded and
possible–the key to the whole problem–with drudgery
decreasing and leisure increasing for everybody as machines take the place of
men in industry and increase its productive capacity–as they are always
doing–it should be obvious to everybody that the only way to satisfy
human needs and desires effectively, and create a happy, contented and
peace-loving world, is to ensure that, in every country, total personal incomes
are kept at all times level with total production costs and prices–that for
every £ in these costs and prices there is a £ in consumers’ pockets and bank
accounts to meet it; and that is purely a matter of honest and correct
book-keeping. But it is quite impossible to keep them level so long as all
purchasing power is issued to the public solely in the form of loans–bogus
manufactured debts–on which interest is charged, as at present; and no means are
provided for liquidating these loans except by creating, and lending, newer and
larger ones–larger because of the added interest–which is no liquidation at all;
and, so far as that money is personal incomes, distributes
it, not in proportion to the total costs of the wealth produced or producible,
as it should be, but only in proportion to the human labour costs and
distributed profits–which are only two of the elements in final prices, and
decreasing elements at that–and omits to provide the community with personal
incomes to cover the ever-increasing overhead charges, due to increasing machine
power costs–a defect which, in our machine age, drives a wedge of bogus debts
between total incomes and total prices, forcing them ever further and further
apart.
Today’s borrowings from the banks have
the double, or treble task of liquidating the borrowings of yesterday in which
are re-embodied the borrowings of a long line of yesterdays, going back, some of
it, possibly to the beginning of banking in this country in 1694, when the
National Debt began its fraudulent, devastating career–pay the interest thereon
and provide the community with a living at the same time. Tomorrow’s borrowings
have to liquidate those of today–including all their re-embodied ancestors–pay
the mounting interest, and provide the community with a living tomorrow; and all
the tomorrows after that have to repeat and continue the process until the
struggle to survive under the mountains of ever-growing, irredeemable debts–all
bogus–drives the peoples of the Earth into a frantic and fruitless search for
markets, and the madness of world wars of annihilation–or shocks them into
sanity, so that, instead of killing each other, in order to earn a living, they
take their bankers and financiers by the throat–metaphorically or otherwise–and
say to them: "Stop this bogus debt racket at once, or else–!" They the hierarchy
of banks–know quite well it is a racket, and how to stop it. They don't need to
be told what to do, but given an ultimatum to do it, and do it at once. The
marvel is that they have never been indicted for treason, and possibly hanged,
for betraying the rights of the community.
To put the matter as bluntly and
brutally as our desperate plight requires it should be put, the only difference
between banking, as it is carried on today throughout the world, and
counterfeiting, is that banking is legalised robbery of the community–and the
world–by professionals, on the grandest possible scale; whereas the crime of
counterfeiting is illegal robbery of the community by amateurs; and the scale of
their operations, compared with that of their professional brethren, is as a
grain of mustard seed to a mountain.
And yet banking could be run as
honestly as the bankers doubtless like us to think it is run, and be a godsend
to the world, if those who run it were to admit openly the obvious fact that all
the financial credits they create are drafts on the community’s "real
credit"–its ability to produce goods and render services, to which the banks
have no title at all, except as a very small fraction of the community, and were
to regulate their bookkeeping in strict accordance with that fact–that is, that
all loans should be entered in their books in the community’s name as creditor,
and not the banks’; and this credit account should be written up in accordance
with all production, capital appreciation, and imports; and written down in
accord with all consumption, capital depreciation, and exports; and that free
and equal payments be made from this ever-growing credit fund to every member of
the community–in the form of a National Dividend–to bring and keep their
purchasing power–their total personal incomes, as consumers, always level with
total productive capacity and costs, so that whatever they care to produce they
can buy; and, in buying it can cancel out of existence all the formal debts
involved in its creation–instead of merely substituting new and larger bogus
debts for each one cancelled, as now.
It may be useful in this connection, as
a guide to action, to keep in mind a statement made by Lord Cecil of
Chelwood–then Lord Robert Cecil–in a pamphlet published in 1919, called "The New
Outlook." He wrote: "The close co-operation of the financial interests of the
world has led to the creation of a largely mythical figure which is supposed to
dominate world politics. Whenever I have met anyone who could be called an
international financier I have not been struck so much by his want of scruple as
by his extreme timidity. He trembles at every rumour, and so far from
controlling world forces he is the sport and plaything of every journalist and
every politician. Perhaps my experience may have been exceptional. But in any
case, whether you regard international finance as a sinister force of world-wide
power, or as a group of men timorously speculating on the uncontrollable
movements of public opinion, its importance to the prosperity of the world has
been shown by the terrible difficulties in which Europe has been placed by its
partial breakdown."
The mythical figure is very real,
unfortunately, although the trembling was probably quite genuine; and if Lord
Robert had had a world war, and the deaths and maiming of millions of men on his
conscience–to say nothing of the appalling destruction and misery that
accompanied it; and knew that he was the direct, or indirect cause of it all–and
wondered why everybody else wasn’t equally aware of the fact–as the inner circle
of bankers must know and wonder–he too would have trembled.
But the trembling never went so far as
to induce the tremblers to abandon their power and fundamental aim, which is
nothing less than absolute control of the world, its inhabitants, and all their
affairs; and they are nearer reaching their goal today than ever they were
before, although, with two world wars and the atom and hydrogen bombs on their
consciences, they have every reason to be trembling a great deal
more.
We have abundant evidence of their
rapid march towards supreme power in the setting up of Central Banks all over
the world, to control banking policy in their respective areas, with a
Super-World-Bank now in existence to exercise control over the National Central
Banks, and through them the activities–all needing to be financed!–and lives of
all nations, peoples, and governments. The general good has no place in their
policy except incidentally and accidentally.
Disraeli is reported to have said that
"Governments do not govern, but merely control the machinery of government,
being controlled by the hidden hand;" and he knew what he was talking about–so
it should be the first concern of every country and people to see that their
elected governments have the guts to control the hidden hand of finance. Their
second concern–and quite as important should be to devise constitutional
machinery for controlling and curbing their governments–Public Enemy No. 2–and
limiting their power, already far too great, and habitually used to the
community’s disadvantage and detriment.
To use the financial system as an
instrument of government, compelling or bribing people to do the will of the
controllers–whether they are the banks or the government–instead of doing what
their own natural instincts, needs, desires, and feelings incline and induce
them to do–as is done today–is the essence of tyranny and the negation of
Democracy.
That it is so used was frankly admitted
by Mr. Oliver Lyttelton, then Colonial Secretary, when addressing the
Conservative Society at the London School of Economics on 23/2/53. He is
reported as saying that "one of the great merits of trying to regulate economic
trends by use of the financial rather than the physical instrument, was that the
former could be regulated by a handful of men. It does not require a horde of
officials, a myriad forms, tons of paper, snoopers, questionnaires, sometimes of
a most intimate description, and intrusion into the kitchens and bedrooms of
every house in England, to carry out the policy."
One can agree heartily with his
objections to the physical instrument, and yet condemn more emphatically still
the use of the financial one, as an infinitely sinister, harmful, and dangerous
instrument of tyranny and oppression to be in the hands of any handful of men;
and it is disquieting to learn that one of our elected servants should glory in
such a misuse of power. If the trends these handfuls of men seek to influence
are in the nation’s interest, surely they would want the nation to know what
they are doing, and why, instead of pulling convenient, but hidden, strings
behind the scenes?
Sir Winston Churchill had more than an
inkling of what was, and is, wrong when giving his Romanes Lecture
–"Parliamentary Government and the Economic Problem"–at Oxford, on 19/6/30. He
said: "The classical doctrines of economics have for nearly
a century found their citadels in the Treasury and the Bank of England...
Whatever we may think about those doctrines... we can clearly see that they do
not correspond to what is going on now... It is certain that the economic
problem with which we are now confronted is not adequately solved, indeed is not
solved at all, by the teachings of the text-books, however grand may be their
logic, however illustrious may be their authors...
"If the doctrines of the
old economists no longer serve for the purposes of our society, they must be
replaced by a new body of doctrine...
"Beyond our
immediate difficulty lies the root problem of modern world economics; namely,
the strange discordance between the consuming and producing power... Who would
have thought that it would be easier to produce by toil and skill all the most
necessary or desirable commodities than it is to find consumers for them? Who
would have thought that cheap and abundant supplies of all the basic commodities
should find the science and civilisation of the world unable to utilise them?
Have all our triumphs of research and organisation bequeathed us only a new
punishment–the Curse of Plenty? Are we really to believe that no better
adjustment can be made between supply and demand? Yet the fact remains that
every attempt has so far failed. Many various attempts have been made,
from the extremes of Communism in Russia to the extremes of Capitalism in the
United States. They include every form of fiscal policy and currency policy. But
all have failed, and we have advanced little further in this quest than in
barbaric times. Surely it is this mysterious crack and fissure at the basis of
all our arrangements and apparatus upon which the keenest minds throughout the
world should be concentrated. Lasting fame and great advantage would attend the
nation which first secured the prize...
"Economic problems, unlike political
issues, cannot be solved by any expression, however vehement, of the national
will, but only by taking the right action. You cannot cure cancer by a majority.
What is wanted is a remedy. Everyone knows what the people wish. They wish for
more prosperity. How to get it? That is the grim question...
"Parliament is upon its trial, and if
it continues to show itself incapable of offering sincere and effective guidance
at this juncture, our Parliamentary institutions, so admirable in the political
sphere, may well fall under a far-reaching condemnation." Sad to say, it didn’t
seem to occur to him that, having stated the problem so clearly, and emphasised
its seriousness, it was his duty to seek a remedy himself, and not merely exhort
others to find one. Had he done so he would have discovered that ten years or
more before he delivered his address Major C. H. Douglas had analysed the
problem into its basic elements, and devised a solution for it that fitted all
the facts, and was watertight in every particular; that this solution was widely
known if little understood by those who should have made it their business to
understand it–our politicians–and that if he had adopted and applied it when he
came into power he would have won for our country–and for himself–the lasting
fame and great advantage he said would attend the nation which first secured the
prize–and the whole world would have shared that advantage–and he himself would
have stood infinitely higher in the records and estimates–and estimation–of
posterity than he is ever likely to do now.
His own words should have indicated to
him clearly the real nature of the solution required. How else can it be easier
to produce commodities than to find consumers for them, except by wrongfully
keeping these would-be consumers short of purchasing power?
The chief stumbling-block to the
acceptance of a genuine remedy–Sir Winston’s "right action"–by those in the
strongest position to apply it, is that it would destroy the power of the banks
to dominate the economic scene, and lessen the power of Parliament to
participate in that domination; and would transfer it where it properly
belongs–to the people themselves–the individuals constituting the community, who
are its animating source.
When any proposal is made that
Parliament should spend even a comparatively small sum of money on some
admittedly worthy object, the Government of the day can usually be depended on
to turn it down–regretfully, of course–if it gets the wink from the Treasury, or
the banks, by reminding its advocates that the national purse is, unfortunately,
not bottomless; and with a National Debt outstanding of £26,582,602,000
(31/3/54)–or whatever fantastic figure it may be at the given moment–on our
hands, we simply can’t afford it. That shuts everybody’s mouth and ends the
matter. The fact that the country may be physically able, and willing, to do all
that is required, being in possession of all the necessary elements required for
carrying through the project–raw materials, intermediate products, plant and
machinery, skill and labour, etc.–and Nature’s illimitable powers– combined with
the other undeniable fact that "what is physically possible is financially
possible" (C. H. Douglas)–finance being merely bookkeeping–weighs not at all in
these matters, so little do our legislators understand the workings of the
financial system, as it is, and as it could and should be.
But when the Money Lords decide to
finance world wars, or work connected with the production of unwanted atom
bombs, money and credit appear out of the blue, as if by magic, and flow like
water, without either Parliament or the country being consulted in the matter.
We have Sir Winston’s word for that. On 23/10/52 he was reported as saying–in
connection with work incidental to the production of atom bombs–"As to the
cost–I have said before, as an old Parliamentarian, I was rather astonished that
something well over £100,000,000 could be disbursed without Parliament being
made aware of it." But while the whole world’s irredeemable bogus debts are
piling up on every hand, at compound interest, and raising the level of prices
at the same time, its income–which should be on the same
scale if these debts are ever to be liquidated and the world get the full
benefit of all its work and toil–does not mount up correspondingly. When it is
spent it is gone for good–most of it within a week or two of receipt, leaving
behind it a debt–a bogus debt; an intolerable burden of ever-growing bogus
debts–riveted round the world’s neck; and its renewal, which is imperative for
the life of the world, and depends on fresh borrowing by somebody, at no time
re-embodies, as income, any of the money spent. That has to be earned anew, by
fresh labour and fresh production; and all fresh earnings are fresh irredeemable
debts.
THE END
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