| Subject: | Re: [socialcredit] Douglas: 1923 Ottawa - Part 1 | | Date: | Thursday, December 28, 2006 03:46:03 (-0800) | | From: | William B. Ryan <w_b_ryan @.....com>
|
| In reply to: | Message 4416 (written by Jim) |
(Bill) "As to your second point, the assumption of
the graph with straight lines is quasi-steady state
expansion."
(response) Do you mean A2=B1? Where A2 is income
from capital production, and B1 is B costs at the
point of retail?
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I believe this is from A. W. Joseph's 1934 essay,
archived in full text at
http://www.geocities.com/socredus/compendium/joseph/
and which I've excerpted below. Joseph does not
consider either steady state or quasi-steady state.
A2 are salaries, wages and dividends being paid by the
firms which are "producing either capital equipment or
goods which are incomplete." A2=B1 if "money in the
hands of the public is to be equal to the costs of
consumable articles produced..."
I want you to notice that his argument is conditioned
on what we would call labor displacement.
"Now modern science has brought us to the stage where
machines are more and more taking the place of human
labour in producing goods, i.e., A1 is becoming less
important relatively to B1 and A2 less important
relatively to B2."
But like so much in the theoretical structure of
Social Credit, it is very terse, when it deserves
book-length treatment. For example, he tells us to
whom B1 is paid, but to whom is B2 paid?
---
Excerpt from Joseph's 1934 essay:-
We can divide factories into those making consumable
goods and those producing either capital equipment or
goods which are incomplete.
Let A1+B1 be the costs in a period to time of articles
produced by factories making consumable goods divided
up into A1 costs which refer to money paid to
individuals by means of salaries, wages, dividends,
etc., and B1 costs which refer to money paid to other
institutions.
Let A2, B2 be the corresponding costs of factories
producing capital equipment.
The money distributed to individuals is A1+A2 and the
cost of final consumable goods is A1+B1.
If money in the hands of the public is to be equal to
the costs of consumable articles produced then
A1+A2=A1+B1 and therefore A2=B1.
Now modern science has brought us to the stage where
machines are more and more taking the place of human
labour in producing goods, i.e., A1 is becoming less
important relatively to B1 and A2 less important
relatively to B2.
In symbols if B1/A1=k1 and B2/A2=k2 both k1 and k2 are
increasing.
Since A2=B1, this means that A2+B2/A1+B1 =
(1+k2)A2/(1+1/k1)B1 = 1+k2/(1+1/k1) which is
increasing.
Thus in order that the economic system should keep
working it is essential that capital goods should be
produced in ever increasing quantity relatively to
consumable goods.
As soon as the ratio of capital goods to consumable
goods slackens, costs exceed money distributed, i.e.,
the consumer is unable to purchase the consumable
goods coming on the market.
-
--- Jim <jschroeder@shaw.ca> wrote:
[snipped]
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