| Subject: | Re: [socialcredit] debt is simply a financial tool | | Date: | Saturday, June 2, 2007 01:56:41 (-0600) | | From: | Wallace Klinck <wmklinck @....ca>
|
| In reply to: | Message 4831 (written by Joe Thomson) |
"Debt" is a tool insofar as pre-consumption stages of economic
production cycles are concerned. That is, where credit is issued to
initiate and carry production, the financial costs (which include
these issues of credit) of production must be met--ultimately and
finally by the consumer who occupies the last position in an economic
cycle. The necessity for consumers to incur debt, because of
inadequacy of effective purchasing-power, in order to claim what the
community has already produced and for which the physical costs
already have been met, however, IS an evil and an entirely
unnecessary, intolerable, unaacceptable and worsening evil means of
oppression and exploitation. In my youth, the taking of another
person's wealth (by borrowing for consumption) was regarded as next
to dishonest--almost certainly irresponsible. None of us knows what
the future may bring and to make promises in this context would seem
immoral. Do not tempt God.
The essential reason that the B.C. "Social Credit" approach foundered
on the shoals of inflation was that they were trying to implement
physical efficiencies within the context of orthodox finance instead
of Social Credit financial policy. This is simply the standard,
blind "conservative" approach to financial and economic processes.
Increasing production efficiency and "balanced" budgets, they
foolishly imagine, are the solutions to all things. However, in
reality, the more efficient the productive process under the present
financial regime, the more non- self-liquidating is the financial
system caused to become. Only by incurring increasing, inflationary
debt--through application to the banking system for permission to
live--can we carry on in any bearable manner whatsoever. The B. C.
"Social Credit" Government gave miniscule lip-service to Social
Credit but appeared to either know, or care, little about genuine
Social Credit policy. Perhaps they thought it was just a pipe-
dream? But perhaps a useful one for getting electoral support? Maybe
they possessed neither the inspiration, determination, nor expertise
to fight the battle for Social Credit and decided, unrealistically
(in the final analysis), to attempt meeting the exigencies of
immediate administrative duties--by which they were beset due to
election fortune--through less "radical" means. Something like
Aberhart desperately calling (despite Douglas's strong disapproval)
on J. F.Magor, the orthodox financial "expert" to assist in the
administration of the Province of Alberta and of Provincial debt in a
"Social Credit" government!
These examples would seem to justify Douglas's warning that the
financial powers would waste no time in blaming any inept government,
masquerading under the name of "Social Credit", for any problems
which might arise during their term of office. They would go to
great pains to identify Social Credit with the Party bearing that
name, while then blaming in this manner any failures on what was
falsely represented as genuine Social Credit itself. In Alberta,
Premier Manning, assisted by subservient and obsequious underlings,
quickly acquiesced to orthodoxy and became the "darling" of the press
within an almost indecently short time. In a major public address
prior to his resignation, Manning finally dismissed Social Credit as
something which might have had some application regarding the
depression conditions of the 1930s but which lacked relevance in the
more recent modern post-War era. He seemed quite satisfied with a
"full-employment" dispensation. As Douglas observed, the policies of
the Alberta "Social Credit" Manning Government were more akin to
state socialism than to Social Credit. One of the Premier's close
associates once confided to me that "Social Credit is too good for
the people!" The religious implications are obvious: the hearts of
mankind are irredeemably evil, men and women must exist under the
curse of Adam and earn their way by the sweat of their brows. At
least, until the return of Christ. (Incidentally, I thought He
returned within His generation as promised and that the Kingdom is to
be found within the hearts and souls of individuals.) I quickly
found that nothing could penetrate the invisible wall which seemed to
bar any meaningful inquiries of the "Social Credit" Manning heirarchy
as to any intended actions along genuine Douglas lines. The
impression was that Douglas was not to be mentioned--indeed, not
above a whisper and almost as an anathema. There were several
notable and courageous exceptions--almost all of whom had been
ruthlessly purged from the Alberta Social Credit League and
Provincial "Social Credit" Party, but in some cases continued to be a
thorn in their sides. As would be expected, with the departure of
the Great (Spiritual) Leader to whom the general body of ill-informed
supporters had innocently (or irresponsibly) given unthinking
allegiance, the whole edifice simply disintegrated in the absence of
anything of substance to sustain it.
Sincerely
Wally
On 1-Jun-07, at 6:25 PM, Joe Thomson wrote:
> (Bill Ryan wrote:-) Which is because, unlike government
> departments, they
> were organized as independent profit and loss "Crown" corporations and
> authorities under the rules of double
> entry accounting. It seems to me that this was a very responsible
> policy.
> The overall debt obligations continued to grow but under more
> efficient for
> profit management. Perhaps this point was not made sufficiently
> clear to
> the opposition and the public.
>
> Debt is simply a financial tool, not an inherent evil.
> ----------------------------------------------
>
> (Joe replies:-) It was indeed a very responsible policy. In most
> instances, these various 'Authorities' were formed to do a job that
> the BC
> Social Credit Government first tried to encourage 'private
> enterprise' to
> do, but could either find no interest, or the terms demanded were
> extorionate.
>
> In the case of BC Ferries, the Canadian Pacific Railway which owned
> and
> operated most of the ferries to Vancouver Island from the BC
> mainland was
> first encouraged by the Bennett government to modernize their
> ancient fleet.
>
> And ancient it was, from an era where the 'convenience' in getting
> a car on
> and off the boat in less time than it took to make the crossing was
> the
> least of the CPR's concerns! The preparations for the 2 hour
> crossing was
> like embarking on a trans-Atlantic voyage!
>
> After BC Ferries came in with modern, double-end loading 'built in
> BC'
> vessels, the President of the CPR admitted how shortsighted their
> company
> had been in not responding to modern transportation needs. For
> those routes
> were, and still are, moneymakers.
>
> It was much the same story with the formation of BC Hydro. The
> 'socialist'
> NDP Opposition wanted 'public power' as a matter of their political
> ideology. Social Credit tried to encourage private enterprise to
> build dams
> and upgrade the distribution systems outside the major urban areas.
>
> The privately owned BC Electric Co. tried to hold the Government,
> (the BC
> 'public', really), to ransom to do the job. Figuring a 'free-
> enterprise'
> regime would capitulate to what they wanted in setting rates. They
> figured
> wrong. We got 'public power' ~ not because the Government was against
> 'profit', or believed in that 'public power' was 'better', but
> because a
> job that needed doing wasn't being done by the private company,
> even though
> a good 'profit' would be gained from doing it. But it wasn't
> going to be
> an extorionate one.
>
> Talking about 'debt', a great deal of the financing for these
> 'Authorities'
> was raised in BC (and elsewhere, Wall Street quite often), through
> the sale
> of the hugely popular "Parity Development Bonds" in the name of
> whatever
> entity needed capital. These debt instruments paid a very good
> rate of
> interest, and were always cashable 'at par', and were 'guaranteed'
> by the
> Provincial Government. And were 'oversubscribed' time after time
> when an
> issue was floated.
>
> They nearly 'broke' the Government once, too, when the Courts,
> sometime
> after the fact, ruled the 'expropriation' of BC Electric Co., a
> Federally
> chartered company apparently, was ultra vires of the Province.
> Touching
> off a brief, but serious, 'run' to cash in the bonds.
>
> The President of one of the big private banks, Scotiabank if I recall
> correctly, probably figuring a nominal 'Social Credit'
> administration was
> better for BC business than a genuine 'Socialist' one would be,
> made an
> emergency loan to the Government. The bonds being cashed were
> 'covered',
> confidence was restored, and further bond issues went back to being
> 'oversubscribed'.
>
> The point about 'profit' and responsible management would have been
> lost on
> the Opposition of that era, Bill. Theirs was a 'militant
> socialism', with
> a considerable faction involved in that Party who were quite openly
> Communistic in their sympathies.
>
> It was quite a 'Golden Age' while it lasted, and ironicly , for a
> 'Social
> Credit' (nominally, anyways) regime, it was 'inflation' that
> eventually did
> it in.
>
> Joe
>
> ----- Original Message -----
> From: <william_b_ryan@yahoo.com>
> To: <socialcredit@elistas.com>
> Sent: Friday, June 01, 2007 1:12 PM
> Subject: [socialcredit] debt is simply a financial tool
>
>
>> "(Joe replies:-) Our first 'Social Credit' government
>> here in BC tried to do that. So far as the Province
>> was concerned, they did stop borrowing 'directly' very
>> shortly after assuming office. We were supposed to be
>> on a 'pay as you go basis' from there on in. A lot of
>> needed infrastructure was financed by transferring
>> 'ownership', to Crown corporations or various Crown
>> owned 'Authorities' ~ BC Ferry Authority, BC Hydro and
>> Power Authority, etc.
>>
>> "These 'Authorities' were set up like a private
>> business. They 'borrowed' the money needed to build
>> the infrastructure in THEIR name, and the loan was
>> 'guaranteed' by the Province of BC. So seven years
>> after taking office Premier WAC Bennet could claim the
>> Province was direct debt free.
>>
>> "For what his various Crown owned creations were
>> borrowing was on the Province's books as 'contingent
>> liabilities'. The Opposition continuously ridiculed
>> this idea, since the overall debt obligations of the
>> Government of BC as a whole continued to grow all
>> through his tenure.
>>
>> "The idea was these 'Authorities', if managed
>> properly, could liquidate their own borrowings from
>> the revenues they brought in. By and large they did.
>> Some of them, BC Ferries for instance, on some of its
>> 'non-profitable' routes to various islands, as well as
>> on its two main 'profitable' routes to Vancouver
>> Island, received an annual 'grant' from the government
>> equal to roughly what would've been spent on the
>> upkeep of roads or bridges, had they existed, over the
>> same distances. This allowed it to keep its fares to
>> the travelling public quite reasonable, and still make
>> a small profit.
>>
>> "The key was that these enterprises were quite
>> well-managed in that era..."
>> ----------------------------------------------------
>> -----------------------------------------------------
>>
>> Which is because, unlike government departments, they
>> were organized as independent profit and loss "Crown"
>> corporations and authorities under the rules of double
>> entry accounting. It seems to me that this was a very
>> responsible policy. The overall debt obligations
>> continued to grow but under more efficient for profit
>> management. Perhaps this point was not made
>> sufficiently clear to the opposition and the public.
>>
>> Debt is simply a financial tool, not an inherent evil.
>>
>>
>> ----------------original message--------------
>>
>> (John Rawson wrote:-) In NZ, the Party has taken a
>> somewhat different stance, (and you will disapprove).
>> But I'll give the line of reasoning, all the same.
>>
>> We would stop completely (eventually, it can't be done
>> immediately) all Government and Local Govt. borrowing
>> from private sources.
>> -----
>>
>> (Joe replies:-) Our first 'Social Credit' government
>> here in BC tried to do that. So far as the Province
>> was concerned, they did stop borrowing 'directly' very
>> shortly after assuming office. We were supposed to be
>> on a 'pay as you go basis' from there on in. A lot of
>> needed infrastructure was financed by transferring
>> 'ownership', to Crown corporations or various Crown
>> owned 'Authorities' ~ BC Ferry Authority, BC Hydro and
>> Power Authority, etc.
>>
>> These 'Authorities' were set up like a private
>> business. They 'borrowed' the money needed to build
>> the infrastructure in THEIR name, and the loan was
>> 'guaranteed' by the Province of BC. So seven years
>> after taking office Premier WAC Bennet could claim the
>> Province was direct debt free.
>>
>> For what his various Crown owned creations were
>> borrowing was on the Province's books as 'contingent
>> liabilities'. The Opposition continuously ridiculed
>> this idea, since the overall debt obligations of the
>> Government of BC as a whole continued to grow all
>> through his tenure.
>>
>> The idea was these 'Authorities', if managed properly,
>> could liquidate their own borrowings from the revenues
>> they brought in. By and large they did. Some of
>> them, BC Ferries for instance, on some of its
>> 'non-profitable' routes to various islands, as well as
>> on its two main 'profitable' routes to Vancouver
>> Island, received an annual 'grant' from the government
>> equal to roughly what would've been spent on the
>> upkeep of roads or bridges, had they existed, over the
>> same distances. This allowed it to keep its fares to
>> the travelling public quite reasonable, and still make
>> a small profit.
>>
>> The key was that these enterprises were quite
>> well-managed in that era, (later on, after the BCSCL
>> government was voted out, and then still later as a
>> 'Party', came back in again, such was not the case.)
>>
>> It also helps when you're government in an era when
>> the world is beating a path to your doorstep for your
>> 'resources'. And you have, as we HAD then, lot of
>> undeveloped ones to draw on. Some of them, like our
>> best timber and various minerals then in demand, were
>> very competitive with anything anyone else had to
>> offer at that time.
>>
>> There were also a number of 'artificial' advantages,
>> like the USA's ''Jones Act", designed to insure there
>> would always be an American merchant marine, but which
>> gave our BC Coastal lumber producers a tremendous
>> shipping cost advantage in waterborne cargos over our
>> Pacific Coast US competitors. We could ship lumber to
>> the US east coast from BC ports using 'flag of
>> convenience' foreign vessels crewed by 'dog-leg'
>> labour, (Lascars, Phillipinos, Goans, Greeks, etc.),
>> and the US mills were stuck with using US registered
>> vessels, with 'unionized' American crews and
>> progressively disappearing subsidies from the US
>> government.
>> -
>>
>> [Rawson] That would mean that superannuation schemes
>> etc. would have to invest elsewhere, and that
>> elsewhere would have to be industry. And here we
>> agree with just about any political faith; the
>> wellbeing of the people depends on the real wealth
>> produced for their enjoyment and use. We are a Party
>> that believes in private enterprise, and also
>> cooperative enterprise.
>> -----
>>
>> In regards to pensions, or 'superannuation' as I guess
>> you call them, I believe Douglas made the suggestion
>> once that the Bank of England be 'de-nationalised',
>> and its shares distributed to British citizens as "a
>> basis for pensions".
>> -
>>
>> [Rawson] And we see nothing wrong whatever with
>> people investing in order to get a profit. The side
>> we object to is the banks investing at little real
>> cost to themselves, and taking first priority in any
>> returns. ("The volume of money is increased ... when
>> a bank purchases an asset ...") I.e. they create
>> money to invest.
>> -----
>>
>> But on who's behalf? And what happens to 'prices'
>> when that volume of money is increased? You say
>> you're not going to have your government borrow any
>> more money from 'private banks'. So then you really
>> have only the choice of taxation or borrowing from
>> your Reserve Bank. Or a 'favourable' balance of
>> trade. But you've got to be pretty careful there, for
>> your trading partners will be on the lookout for
>> anything that looks like a 'subsidy' to producers.
>> And I doubt you're in the same favourable position BC
>> was once in in regards to our supplying things other
>> countries were lining up to buy.
>>
>> What do you have other than 'taxation' to keep this
>> 'new credit' from your Reserve Bank, which you're
>> going to use to build 'infrastructure', from raising
>> consumer prices? Or are you thinking like the current
>> crowd that governs BC seems to think, that a rise in
>> prices must mean 'prosperity'?
>>
>> Regards,
>>
>> Joe
>>
>>
>>
>>
>>
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>
> ---------------------------------------------------------------------
> Some introductory materials to the discussion topic of this list
> are at
> http://www.geocities.com/socredus/compendium
> You're subscribed to this list with the email wmklinck@shaw.ca
> For more information, visit http://www.eListas.com/list/socialcredit
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