| Subject: | Re: [socialcredit] monetary "reform" confusion | | Date: | Saturday, June 16, 2007 08:51:55 (-0400) | | From: | Joe Thomson <thomsonhiyu @....ca>
|
| In reply to: | Message 4878 (written by Peter) |
(Peter wrote:-) Secondly the issues are the same that is dealt with by
Douglas here as with
his other works and his proposals.
(Joe replies:-) Agreed.
>
(Peter, quoting Douglas, continues:-) "There are many ways of doing this,
and perhaps one of the simplest would be the automatic writing up of the
bank-credits of any limited company to correspond with the increase in its
fixed assets, as certified by a chartered accountant during a given
accounting period."
(Joe replies:-) This is a very interesting statement, and I'm not really
certain just what Douglas envisions here as to the sequence of what takes
place. Perhaps those with a greater understanding of the accounting involved
might be able to fill us in further.
As I understand it, the 'fixed-assets', which, Douglas tells us in the
earlier part of the "Warning Democracy' Chapter this is taken from, are
'given' to the Bank as security for a 'loan' of bank-credit. And I would
suppose these are the firm's presently owned 'existing' fixed assets.
But if my experience with banks is any guide, the Bank would also likely
have a real estate or chattel mortgage or other charge on the 'fixed assets'
the firm was acquiring. Douglas doesn't seem to suggest here that the money
to acquire these new fixed assets just be 'given', (debt-free), to the
firm.
Rather they still have to 'borrow' it, as now, but there is, after the
assets are in place and productive, to be a 'writing-up' of the bank-credits
of the firm to correspond with the increased productive capacity the new
assets have enabled. This, I would take it to mean, there has been an
increase in 'capital appreciation' over and above normal 'capital
depreciation'. And he is going to 'credit' the Firm with it, in the
expectation that in a 'competitive environment' the Firm will pass it on to
Consumers through lower prices.
There seems to be some concern, though, that it actually WILL be passed on.
As he says below:- "The
effect of this, so long as the result was not defeated by rings of prices,
would be to lower prices by enabling competitive concerns to get a
proportion of their overhead charges out of prices charged for their
product."
But then he says:-" It would undoubtedly strengthen the hand of the
manufacturer, and
in itself would do little to meet the twin difficulties of forced exports
and decreased human labour per unit of production, both of which are vital
to a comprehensive solution."
In other words, there is a danger that we are replacing 'bank' control over
'credit' with 'manufacturer', (or Firm), control over 'credit', and still
not achieving the desired result of 'Consumer' control over 'credit'. Also,
without the 'discount', (the CPD), the issue of 'forced exports' due to lack
of internal effective demand can't be stopped, and lacking the 'dividend'
(ND and other 'dividends' from industry), the issue of 'labour displacement'
remains unsolved.
Then he writes:- "But it would at any rate deliver us from the
mismanagement of the financial hierarchy, and in so doing would stimulate
the initiative of the class which appears to have the right type of mind
for the attainment of a more permanent solution."
I would take this to mean he doesn't regard his suggestion as a 'permanent'
solution in the form in which it's been made. But rather something that
will (or would have) temporarily stopped the serious decline then taking
place in the British manufacturing base.
>
(Peter:-) . I appreciate that Douglas may have made some
temporary suggestions in the case of Aberhart at some other time but hardly
likely to make the same approach regards the British party in government
which wasnt trying to reform the systems. The phrase " a more permanent
solution" that Douglas used doesnt sound very temporary to me.
(Joe replies:-) "..a more permanent solution", to me, means something like
the CPD and the ND. Where credit control is in the hands of 'Consumers'.
(Peter:-) The
quick-fix- temporary solution for Britain was for the international bankers
to take their foot of the throat of the manufacturers, that is, stop the
deflationary policy. Since both Britain and the US were subjected to this
policy in the early twenties and then in the US they switched to
inflationary policy which boosted the US above Britain being destroyed as
the leading industrial trading nation, I fully expect that many politicians
and pundits would have been demanding the British be treated the same as
the
US.
>
(Joe replies:-) Agreed.
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