|
Hi John:
You stated:
"And in politics I find it dishonest to promote something that I'm not
fully sold on because I can't guarantee it would work. I would be
delighted if you could prove me wrong in this case, but nobody has done it
yet."
Firstly, the compensated price principle has not be
tried, so of course it "hasn't been done yet". However; there's
literally millions of examples of companies reducing their prices through
competition, and like a typical politician, you seem to only be able to trust
the market when you can control it.
Please answer my question:
What prevents companies from charging as high as
price, and having as great a profit as is possible now?
Take care,
Jim
----- Original Message -----
Sent: Tuesday, November 08, 2005 10:03
PM
Subject: Re: [socialcredit] Replying to
John Rawson 1
Hello Martin.
Try a tight market resulting from the fact that people don't have enough
money to buy all the goods now. Which would change under SC.
The same thing that makes planned obsolescence profitable now whereas SC
would remove the need for it. I'll put it this way: I'd hate to be
a Candidate trying to justify this policy to an audience with a few economics
students in it. I reckon they'd at least appear to eat me.
When I was a teacher, I used to refuse to enforce any school
rule if I could not explain the need for to the pupils. Which was
rare, and generally applied to silly emotional things like length of
hair. And in politics I find it dishonest to promote something that
I'm not fully sold on because I can't guarantee it would work. I would
be delighted if you could prove me wrong in this case, but nobody has
done it yet.
Regards. John
R.
From: Jim <jschroeder@shaw.ca>
Reply-To:
socialcredit@elistas.com
To:
socialcredit@elistas.com
Subject: Re: [socialcredit] Replying
to John Rawson 1
Date: Tue, 08 Nov 2005 19:20:51 -0700
Hi John:
What prevents companies from charging as high
as price, and having as great a profit as is possible
now?
Jim
----- Original Message -----
Sent: Tuesday, November 08, 2005 2:57
PM
Subject: Re: [socialcredit] Replying
to John Rawson 1
Thanks Jim. If I can make two replies in one ...
You assume that competition will be sufficient to keep prices
down. Experience leads me to believe otherwise.
Joe says the retailer might be expected to control his profit, but I
can't see a SC government interfering in business that extent.
I suggest that it is fairly obvious why our Party has never got
enthusiastic about this concept, and expects to put purchasing power in
the hands of consumers by other means.
Which detracts in no way from the brilliance of Douglas basic analysis
and most of his other ideas. I suspect it was a logical proposal in
his time, when most retail businesses were small and industry price
setting much less important.
In any case, thanks to the Group for the opportunity to air the
subject.
Regards. John
R.
From: Jim <jschroeder@shaw.ca>
Reply-To:
socialcredit@elistas.com
To:
socialcredit@elistas.com
Subject: Re: [socialcredit]
Replying to John Rawson 1
Date: Tue, 08 Nov 2005 11:08:14
-0700
Hi John:
The theory would be very easy to put into
practice, and Bill already explained how it would be done.
"It
appears that you remain confused over what the
rebate proposal
entails. The proposal is simply to
credit the retailer a
percentage of retail sales that
he has actually made, which has the
effect of
increasing his accounted for rate of profit."
(Bill)
Competition naturally forces the rate of profit down to 0
(assuming opportunity cost on capital included in cost
with risk - i.e. the interest rate plus a risk factor). Companies
can charge whatever price they want now, but what keeps prices and
profits down is competition. The rebate would allow companies to
sell below cost and still make a profit, and competition would force
them to do this.
Take
care,
Jim
----- Original Message -----
Sent: Monday, November 07, 2005
10:25 PM
Subject: Re: [socialcredit]
Replying to John Rawson 1
Thabks, Jim. That's all very fine theory, but the
actual price of a good is what it costs the vendor plus the profit he
wants to make on it, the latter being modified by whether he can
get away with it or not. In any free society such as we
envisage.
And the last part of your message suggests the "just price"
mechanism to control prices, which I have been told is not what is
envisaged. But if it is, I simply can't imagine the army of
clerks needed to set "just" prices for every article and service,
modified by geography in many cases to allow for distance of transport
etc. It would be a bureaucratic nightmare, even if it did bring
full employment, mostly by the government.
Obviously the other method is the one considered, and I can not see
how it would stop prices rising.
Refgards. John
R.
From: Jim <jschroeder@shaw.ca>
Reply-To:
socialcredit@elistas.com
To:
socialcredit@elistas.com
Subject: Re: [socialcredit]
Replying to John Rawson 1
Date: Mon, 07 Nov 2005 17:10:48
-0700
Hi John:
Well, I'm certainly glad to hear that
you are receptive to the idea of a compensated price.
The logic is as follows:
1) The true cost of production is
consumption of all production over an equivalent time period.
"For example, the real cost
under all conditions of growing an ear of corn is the seeds from
which it grows." (The Nation's Credit)
2) Therefore; the real price of a
good is:
Price*
consumption/production
Consumption is the mean consumption for
a given time period, and production is the mean production for a
given time period. Capital depreciation is included in
consumption statistics, and capital appreciation is included in
production statistics. Since consumption is less than
production, the real/just price of a product is less than it's
monetary price by the ratio of consumption/production.
This cannot be inflationary because
prices are falling.
"No
legal compulsion would be necessary. Retailers who would not accept
the JUST PRICE scheme would be free to sell at the ordinary
financial price, but in that case they would receive no money from
the State and would have to try and sell their goods in competition
with others, who had accepted the JUST PRICE and were in a position
to undersell them." (The Nations Credit)
Take care,
Jim
----- Original Message -----
Sent: Sunday, November 06,
2005 10:13 PM
Subject: Re: [socialcredit]
Replying to John Rawson 1
Greetings, Jim.
Many, many years ago, my elders, betters and mentors explained
a "Just Price Discount". The principle was that any retailer
who sold at an agreed fair or "just" price, had it topped up by
funds from the Credit Authority or whatever. Those who sold at a
higher price did not get it and therefore had a hurdle to overcome
if they wanted to charge more, and thus prices would be controlled
from rising. When I noted, later, that setting fair prices
for all goods etc. in every part of the country would be a
bureaucratic nightmare, I was told that this concept was all
wrong. The C.A. would simply refund the purchaser a certain
percentage of his payment on receipt of dockets proving purchase,
regardless of price.
Now I need someone to explain to me how this would work without
simply subsidising increasing prices and thus fostering
inflation. And please don't hand me "competition" in a time
when it is becoming less and less effective. And could be
much less so in a Socred economy without a shortage of purchasing
power. Also tell me how to put this across to the public
without it simply looking like pure "funny money".
Clinch these points for me and I'll start yet another crusade,
for the Party to adopt this principle. But let's have some
practical data, not just reference to the time Douglas spent
promoting it. Even the most brilliant people are not right
every time.
Regards. John
R.
From: Jim <jschroeder@shaw.ca>
Reply-To:
socialcredit@elistas.com
To:
socialcredit@elistas.com
Subject: Re:
[socialcredit] Replying to John Rawson 1
Date: Sun, 06
Nov 2005 17:22:04 -0700
The compensated price principle is
probably the most important aspect of Douglas' economic
analysis. The replacement of the wage with a dividend is
secondary. I find it odd that any "Social Credit" Party
would focus on the latter, but ignore the former, when Douglas
spent most of his time explaining the former.
Jim
----- Original Message -----
Sent: Sunday, November
06, 2005 2:01 AM
Subject: Re:
[socialcredit] Replying to John Rawson 1
Sorry, Joe, not biting. All I was doing was stating
fact. It seems nobody has ever convinced the Party of
the practicability of the price discount in action, and that
includes me.
Regards. John
R.
From: Joe Thomson <thomsonhiyu@shaw.ca>
Reply-To:
socialcredit@elistas.com
To:
socialcredit@elistas.com
Subject:
Re: [socialcredit] Replying to John Rawson 1
Date:
Sat, 05 Nov 2005 08:49:18 -0800
Without trying to bring down
any 'new controversy', or add to any old ones, how in the
world can the NZ Democrats be ''bound by constitution to the
Douglas analysis and the National dividend" WITHOUT also
having a 'compensated price discount'? Is that
analysis not primarily concerned with
'consumer' incomes and their relationship with
'consumer' prices, or am I missing something in my
reading of Douglas and others on here and elsewhere who've
been interpreting him?
Seems to me you're not trying
to "build up, from the individual", but rather "down, from
the State". Why not look at and offer what the man
originally proposed? If you're determined to go the
'politcal party' route could you do any worse with the
electorate by that than in going the way you've
gone? Why do you people so 'fear' the empowerment of
'consumers', and yet profess to believe that 'democracy' is
the ability of the individual to "choose or refuse one thing
at a time"? Or is that 'one thing at a time' as
envisioned by the Democrats drawn from a list of things
only pre-selected by the annointed?
And where is the difference
between the 'government' using the central bank to finance
some of its expenditure, and private industry borrowing from
private banks to finance theirs? Do not both 'inflate'
the money supply and dilute the general purchasing
power by raising prices of 'consumer' goods almost
exactly the same way? Oh, I know, you're going to save
"all that awful interest", and that just makes it so
worthwhile. But can't you see you're
trading a smaller problem for a bigger one? How long
will it be after the 'infrastructure' that might be
necessary and desirable to have is completed before the
purpose of that 'infrastructure' will be perverted into the
all-too-familiar, "Now if we only financed another hydro
scheme, port facility, railway, whatever, the same
way, just look at the potential for 'capturing' new
'export' markets and all the 'jobs' we could create.
Not to mention how much 'easier' it will be to pay for what
we've already done"? Where does that ever end?
Are you not right back to 'guns before
butter'? Where is the "Douglas analysis''
you're ''constitutionally bound to" in that
regard?
And what difference does it
make how much of the money supply is in 'notes and coins'
versus electronic blips that transfer figures from one
account to another everytime someone uses a debit card or
receives their income by direct deposit? The 'money' in
your account and accessible to you that way is no different
than coin or cash in your pocket providing it will be
accepted as effective demand for goods and
services. And is it not that 'effective demand' we
should be concerned with? And does not that 'effective
demand' have as much to do with CONSUMER PRICES as it does
with distributing incomes?
Regards,
Joe
----- Original Message -----
Sent: Friday,
November 04, 2005 9:16 PM
Subject: Re:
[socialcredit] Replying to John Rawson 1
Thanks Martin. And also thanks (belatedly) for
the material in your submissions which I consider
brilliant.
Our NZ Democrats are bound by constitution to the
Douglas analysis and the national dividend
concept, but have never really adopted the price
discount one. And contrary to Douglas, we consider
that so little modern money is notes and coins (M0) that
it is the government's duty to use central bank credit for
some of its expenditure, if only to restore a past status
quo. As was done very successfully by our 1935
Labour govt. before that Party lost its principles.
I am not seeking to bring a whole new controversy down
on my head (again) by noting this; just stating our
current thinking for your information.
Regards. John
R.
From: Martin Hattersley
<hattersleyjm@interbaun.com>
Reply-To:
socialcredit@elistas.com
To:
socialcredit@elistas.com
Subject: Re:
[socialcredit] Replying to John Rawson 1
Date:
Fri, 04 Nov 2005 16:21:21 -0700
>I think
you are right, that "100% money" doesn't really provide
a
>practical way of making the economy work in an
optimum way.
>
>The problem is that "The
cunning device That all costs enter price
>Ensures that the price can't be
paid".
>
>That is the argument for a Just
Price discount, paid for from an
>external
source, such as newly created "fiat"
money.
>
>The essence of the problem
identified in the A+B theorem is that
>capital
spending, if fiinanced by borrowing new bank credit,
leads
>to the community paying, through
inflation, for the privately owned
>asset so
created. A Just Price discount, which can be
administered
>with no more difficulty than
existing sales taxes, would repay the
>community
for this sacrifice when new production comes on the
>market, and correct any inflation of prices that
has taken place.
>
>As I see the present
situation, monetary policy of providing very
>low
rates to borrowers to encourage investment, is promoting
>excessive capital development at the expense of
the ecology, also
>speculation and continuous
inflation. This distributes incomes
>through
employment on capital projects, but leave a trail of
debt, a
>concentration of economic power, and a
growing gap between the
>"haves" and the "have
nots" both domestically and between
nations.
>
>Not good.
>
>Martin
Hattersley
>1970-10123-99 St. Edmonton AB
Canada
>Phone (780)423-2081; Fax
(780)425-5247
>e-mail:
jmartinh@shaw.ca;
>hattersleyjm@interbaun.com
>
>
>-----
Original Message ----- From: "William B. Ryan"
><w_b_ryan@yahoo.com>
>To:
<socialcredit@elistas.com>
>Sent: Monday,
October 24, 2005 3:48 PM
>Subject: Re:
[socialcredit] Replying to John Rawson
1
>
>
>>Hatterley's proposal was
based on Frederick Soddy's
>>one hundred
percent reserve proposal, called "pound
>>for
pound" in Britain and "dollar for dollar"
in
>>America. It was also called the "Chicago
Plan." It
>>was precisely this proposal that
Douglas was correctly
>>arguing against in his
1933 letter to Denis Byrne
>>previously
cited:
>>http://www.geocities.com/socredus/compendium/douglas-byrne-1933.txt
>>
>>In
a true one hundred percent reserve system
there
>>could be no
loans.
>>
>>What is usually called one
hundred percent is a legal
>>fiction where one
hundred percent reserves are
>>required against
"checking" deposits, and something
>>less than
one hundred percent are required
against
>>"saving" deposits, or some variation
thereof.
>>
>>So something less than
one hundred percent is required
>>against the
totality of deposits.
>>
>>The
difference between the quantity of reserves
and
>>the quantity of deposits is inevitably
bank created
>>credit, whatever you want to
call it.
>>
>>Loans create deposits;
there's no getting around
it.
>>
>>Period.
>>
>>What
you would have in reality is a system
perhaps
>>more tightly regulated that the one
we have today, but
>>still very much fractional
reserve.
>>
>>Otherwise, no modern
economy could
function.
>>
>>
>>
>>---
John G Rawson <johngrawson@hotmail.com>
wrote:
>>
>>Joe, surely you know the
"line" of the orthodox
>>economists as well as
I do. "All inflation is a
>>result of too much
money ....". They admit to the
>>phenomenon of
cost push inflation, but then proceed
to
>>ignore it. Even now, when we have inflated
prices
>>caused by high oil costs, our RB (and
I think others)
>>are considering the
ridiculous remedy of raising
>>interest rates
to control the volume of money in
>>crculation.
But, of course, increased interest rates
>>tend
to increase bank earnings, and the central
banks
>>tend to serve the banks, not the
nations.
>>
>>But apart from all these
asides, what I am looking
>>for, IF we decide
to take away from the banks the
>>right to
create our money, (as the Movement
has
>>preached loudly in this country from when
I was a
>>child), HOW can we do
it?
>>
>>And despite some opinions,
obviously it CAN NOT be
>>done by manipulating
reserve ratios, which, when
>>applied, relate
to deposits, not advances. (For once
>>I am
trying to be very precise, for the benefit
of
>>those who persist in avoiding the main
point and
>>picking up side issues.) I still
think the Hattersley
>>(apologies for previous
mis-spelling) approach is the
>>only reasonable
one I have encountered
yet.
>>
>>Regards, John
R.
>>
>>
>>
>>__________________________________
>>Yahoo!
FareChase: Search multiple travel sites in one
click.
>>http://farechase.yahoo.com
>>---------------------------------------------------------------------
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introductory materials to the discussion topic of this
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at
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subscribed to this list with the email
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>>
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