I believe it is time to summarise key points that have emerged over the course
of long discussions:
In terms of Douglas analysis of individual
businesses, this must be taken as factual. Were it not, someone would have
shown the data to be fallacious long ago.
When it is applied to the whole economy, because other factors may come it, the
model becomes theoretical. But many points of evidence suggest it is more correct
than the orthodox theory, none the least being the fact that banking systems in
modern times have increased money supplies comparatively astronomically without
causing the equivalent disastrous inflation that orthodox theory would predict.
It has only occurred at a lesser level.
EFFECTS. Douglas predictions that the tendency towards a deficiency of
purchasing power would cause periodic financial collapse, struggle for markets
and even war appear to have been justified.
1. A system of national accounting for each country, to determine how much new
money would be required over a following period carried out by a government
agency, (note small "g"), a national credit authority, independent of political
institutions, which would also create the necessary credits and distribute them
a. Subsidies (if this word grates, please provide an equivalent within present
accepted lantguage) to reduce the cost of all comsumer goods (?and services),
local or imported, at retail point, without any price control mechanism, and,
b. A national dividend, its value obviously dependent on the state of the
economy as per the national balance sheet, to be paid equally to every adult
Presumably the authority would decide the proportion to go each way.
It is accepted that no retailer will raise prices to higher levels, despite the
fact that they would continue to be subsidised at any level. (Because we say so,
It is also accepted (I believe reasonably) that sufficient people
will desire to better themselves by working to produce goods etc., or will simply
work for the good of the community because they enjoy so doing.
No new credits will be issued to central or local government agencies, which
will continue to rely on present methods of finance:
1. Taxing, i.e. taking back
from the people money distributed as above, and/or,
2. Borrowing, (leaving the
lending institutions able to dictate at least some aspects of policies), and/or,
3. Shedding their responsibilities to private enterprise so that a "user pays"
system operates. With divisions of standards of education and health services
betwen rich and poor, and situations such as already exist in Britain and this
country (NZ) where patients risk infection (and death) because hospital cleaners
now exist to show a profit rather than to clean hospitals.
If I have erred in facts quoted, please correct me. Undoubtedly the inferences
based on them will occasion debate, but please, lets iron out any factual detail
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