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John Rawson wrote:-) "I am glad I pushed this question
because I finally accept it might be practical policy if needed."
(followed by:-) "For many years milk, butter and bread
were subsidised at fixed prices."
(and then:-) "Helped the industries as well,
of course."
(Joe asks:-) I'm glad you "pushed this question",
too. But I think perhaps you're inadvertantly making our case for a
CPD here, John.
Even though the method used in the past to
finance this limited price 'subsidization' was "orthodox", was
this policy "needed"? If it wasn't, then why would your government have
implemented it?
Did your economy "blow-up" as a result of its
implementation? Or benefit from it? Did "competition" to supply milk, butter,
and bread vanish just because the producers of these things were receiving a
subsidy in aid of cost?
Even if milk and butter were supplied under a "quota"
system to prevent overproduction, and "keep the price up", were there still not
some farms and dairies that were more 'profitable' than others in the supply of
these products? Did some not go ahead, while others went out of
business?
And obviously there must have been more than
one bakery, and some baker's breads must have sold more readily than others,
just as a matter of customer preferrence?
(John continues:-) Our first Labour Govt. used Reserve Bank
credit (issued, not lent) for some infrastructure, to finance our (then
critical) dairy industry at 1%, and to build (high standard) state rental
houses etc. In other words some Govt. expenditure came from this source,
and NZ started to come out of the slump before most other nations as a result.
(Joe replies:-) Of more importance in your coming out of the "slump" was
the Ottawa Agreement for "Imperial Preference", which was of immense importance
here as well. It enabled a 'protected market' for your, and our,
products in Britain, and throughout the Empire. Much more
could be said about this, but it's the idea above that this Reserve Bank credit
was "issued" and not "lent" that I'd like to focus on.
Regardless if this were so, which I strongly suspect it was not, such a
policy could not help but "raise prices". The fact that your government
had to "subsidize" prices to Consumers for certain foodstuffs should be proof of
that.
Now with the rise in prices would certainly come a rise in 'profits', but
the purchasing power of those "profits" is also being constantly
diminished. All you are doing is working with bigger figures. There
is an "illusion" of "prosperity". But the reality behind the mirage is
"inflation". While your 'standard of living' may well be advancing, your
'cost of living' is advancing faster, and "debt-growth" is still funding the
difference.
Regards,
Joe
----- Original Message -----
Sent: Wednesday, January 07, 2009 11:29
PM
Subject: RE: [socialcredit] Looking For
Info
Thanks Wally. I am sure you understand that the level of
National Dividend would depend on the state of the economy, as worked out by
the Credit Authority. While I am not happy to deal with contentious internal
matters too publicly, I will simply say that, while the term used is
"Guaranteed", some of ours seem to think fixed sum should be paid to all.
Which is why I used the term "Universal". Part of the good old SC way of
grossly overestimating the "Gap", I believe.
The original "guaranteed"
income idea was, as you state, to be paid to those in need until the economy
had reached the stage where the national dividend would replace it. Even
though we have a reasonable Social Security system in this country (we
pioneered it under the first Labour Govt. which used some SC principles),
we now have, in this land of food-producing plenty, people in trouble and
kids with malnutrition. If you think we should leave them to starve until we
have sorted out our economic problems, forget it. That is not our NZ way. We
must have interim policy in place to handle a transition period.
And if you
are saying that we must conform regardless to every exact dictum made 80 years
ago, no matter how brilliant the author, then again I am sorry. I refuse
to become brain dead. We are faced with massive debt that didn't exist in
Douglas' time that must be paid off. Yes, we might be able to play a few of
their own tricks back on the banks, but basically it must be repaid. Yes, we
do need to get rid of "exponential debt growth" as afirst priority. We
have a welfare system that must be maintained for the mean time. We have needs
in health and education etc. that must be met. And please don't suggest we
pass them to private enterprise and just give the people the money to pay for
them. While we have nothing against people who wish to pay for that sort of
thing out of their own pocket, we are not good on elitism in this country. The
poorest Kiwi deserves the best health service available and the best education
his kids are capable of gaining. And it would have taken an immense Nat. Div.
payment to cover the heart surgery and other medical care one of our activists
here has received in the last few months. Getting close to
$100,000. An unemployed Maori would have got the same.
In other words,
theories are great, but when you are faced with just exactly what you will do
in the first 3 months after becoming government, and in the next 6, and so on,
there comes in a massive "get real" challenge.
And, of course, you are
thinking "Then don't go political." If that approach had shown any chance of
success anywhere in the world, I would agree.
However, thanks, Joe and
others. I am glad I pushed this question because I finally accept
it might be practical policy if needed.
Our first Labour Govt. used
Reserve Bank credit (issued, not lent) for some infrastructure, to finance our
(then critical) dairy industry at 1%, and to build (high standard) state
rental houses etc. In other words some Govt. expenditure came from this
source, and NZ started to come out of the slump before most other nations as a
result. For many years milk, butter and bread were subsidised at fixed prices.
And every school kid got a small bottle of milk every school day, plus an
apple each in season, right into the 1960's. Helped the industries as well, of
course. Didn't hurt our sports teams some of them grew into
either!
Regards.
John
R.
From: wmklinck@shaw.ca
To: socialcredit@elistas.com
Date: Wed, 7 Jan
2009 17:53:00 -0700
Subject: Re: [socialcredit] Looking For Info
Joe--many thanks for your detailed and laborious exposition. --
Wally
John,
Your say that a National Dividend is your [Party] policy and that it is
written into your Constitution. Yet you say that you have opposed the
"universal income idea" which is "socialistic" and the presence of which in
your policy has "embarrassed" you. The Social Credit National Dividend
IS intended to be universal. It is the proposal for a guaranteed basic
(or annual) income that is not universal and is NOT a Social Credit proposal.
The National Dividend goes to all citizens as an unconditional right by
inheritance. The guaranteed basic income is politically determined and
goes only to those designated by political policy. Do you understand the
difference? It is fundamental.
As to the Compensated Price, I think that Joe has done a competent job in
clarifying what it is and how it would be implemented. It would be
applied to a transaction and therefore to all items in the transaction.
I don't know where you got the persistent notion that it would be
calculated separately for each individual item sold. We certainly would
not have any army of bureaucrats poring over prices of every individual item
of consumer goods in attempt to determine its individual "Just Price."
You should also be aware that the taxation system, alone, would be
drastically simplified, thereby cutting an existing massive bureaucracy.
I think that you should be aware that a system of price discounts was
implemented quite practically and successfully even under the existing
financial regime to keep down the price of foodstuffs in Australia during the
last Great War. Unlike consumer bank credit issued today as debt which
does not cancel production costs but passes them on as charges against future
production, the consumption credits proposed by Social Credit create no new
debt and become available to the producer to cancel his production costs and
production loans. Which do you think is most likely to be a contributor
to inflation?
We are, in fact, looking toward a "Just Price" for every article--for all
articles. But not determined individually. We are talking about a ratio
to be applied to all production which subsumes all items, obviously. In
any case, you still are not willing to "risk" implementation of the
Compensated Price because of the fear that it will cause massive inflation
despite the restraints placed on inflation by competition, the pressure on any
vender to enter the arrangement when his competitors are subscribing to the
arrangement, when in appropriate circumstances 'there is a limit on
profit on turnover as Joe has described, and the producer who violates
his undertaking faces decertification and removal of the benefit of
belonging to the program. The escalation of prices which you describe
below did not occur in a Social Credit dispensation but in a Social Debt
system and the two cannot be compared as equivalent in effect. Anyway,
in final analysis, you apparently do not support basic Social Credit policy as
stated. You are not willing to risk it and you do not propose any
alternative so by inference, you must be satisfied with the existing system.
This seems to raise some rather obvious questions, does it not?
Dutifully but wearyingly patient
Wally
On 6-Jan-09, at 1:34 PM, John G Rawson wrote:
Thanks, Joe. That has
made more sense than anyone else has come up with so far. We are not looking
at a "just price" for every article, but a "just profit" for every
business. That would certainly reduce the "paperwork"
considerably. However, I can not go along with the "competition"
angle. It didn't work with our recent housing "bubble" and we had no
shortage of properties in this young country loaded with willing (and
ravenous,and preyed on by inefficient local Councils) developers. Once there
is enough money to buy all the goods in any field, competition becomes a
myth. So OK, I can't prove that last point, but neither can you prove
yours. So it comes down to an assessment of risk, and personally I'm not
prepared to risk something as important as possible blowup of the whole
economy. Regards. John
R.
From: thomsonhiyu@shaw.caTo: socialcredit@elistas.comDate:
Tue, 6 Jan 2009 11:00:03 -0800 Subject: Re: [socialcredit] Looking For
Info
(John Rawson wrote:-) "Would you like to tell me whether we would
have an army of bureaucrats enforcing "just prices" for every article, or
alternatively, what is to stop the discount scheme simply subsidising rising
prices? Nobody else appears to be able to."
(Joe replies:-) Since John and I
have had many 'off-list' exchanges on this subject, as well as others
in this forum, I don't feel that I am pre-empting any answer Wally might
give on the questions John's asked above by replying to them. I hope
Wally and others will also attempt to further address them, for they are
pertinent questions that do deserve answers.
John, there is one thing which is absolutely,
positively, 100% certain. There will be NO "army of bureaucrats"
enforcing "just prices" for every article. There is NO need for that,
nor would it be practical, nor was it ever anything Douglas ever envisioned
or proposed.
I believe, from what I have read, that the conception
of that kind of utterly inane price regulation originated from Aberhart's
initial mis-interpretation of Douglas's proposals. Or what he may
have read into someone else's attempts to explain them when he was first
introduced to Social Credit.
The whole conception of a National Dividend and a
Consumer Price Discount is that they are "macro-economic" accounting
corrections, necessary to increase EFFECTIVE DEMAND available to
Consumers in their day-to-day transactions in the
"micro-economy".
We are not particularly concerned about whether the
nominal price of one article or another rises or falls. Free market
competiton, if it is present, and it generally is, will regulate that very
efficiently. It already does.
Where it isn't present, in situations where there is
a natural 'monopoly', such as in the provision of electricity, for
instance, we can regulate prices by having a Public Utilities Commission or
some similar authority, to whom the case for any price increases must
be put. These agencies already exist in many jurisdictions,
regulating the few things which are best operated as
'monopolies', and they function quite effectively.
What any merchant who agrees to participate in a
Consumer Price Discount scheme is agreeing to do is that he
will:-
(a.) keep an additional entry in his books
showing his actual periodic 'profit' on
turnover,
(b.) make this information available to a National
Credit Office, or other such agency administering the CPD when required,
and
(c.) agree to try to maintain an 'average' profit on
turnover, with the
assistance of the CPD in place, at an amount he deems appropriate
for the type of business he is in.
He knows, or should, that if ALL his product
would just sell, the amount he has to make in profit to
enable him to feel it's worthwhile still being in
business.
With the CPD in place, the amount of volume EVERY
participating business should do will increase, if there is any REAL demand
from Consumers for the products being offered. Whether there is, or
not, is up to Consumers. If there is not, then those products will not
be made in future, for there is no sense in producing articles no one
actually wants.
Through the CPD, product for which
there may well be a very REAL demand, which could already be made
in greater quantities, but cannot currently ALL sell (without further
recourse to debt) for lack of EFFECTIVE demand is thereby enabled to be
sold. Without that further recourse to debt.
There is NO NEED to raise prices to 'profiteer' with
the CPD in place, since the increase in sales volume enables a greater
profit. The same as it does now. You're spreading your 'costs'
~ your 'overheads' ~ many of which are relatively fixed in every
business, over a greater volume of sales. Increasing your
profit. Without raising your prices.
In my opinion, with the CPD in place, the greater
inducement to profit for some large businesses might well be to try to lower
prices further. To try to 'predatory price' smaller, lower volume
competitors completely out of business.
Which, again in my own opinion, is one of the reasons
why we would want to covenant with the merchant that he will try to maintain
an 'average' profit on turnover.
Our idea is to keep business de-centralized and
'consumer' oriented over time, not to further increase consolidation
and inadvertantly enhance some future straight 'financial'
orientation to it by increasing market domination.
I doubt very much there would have to be much
'policing' done to ensure the system was functioning properly. If there
were, with the provisions above agreed to by participating merchants in
place, I don't see where that would pose any particular difficulty.
Compliance would be no more difficult to determine than would presently be
the case with existing sales taxes, and probably a great deal less
so.
Some businesses will have a high volume of sales and
can operate with a very small margin on their turnover to cover their
costs. Other businesses have a low volume of sales and require a
higher margin on turnover to do the same thing. There is NO
"restriction" that forces different businesses, with different sales
volumes, to sell the same products for the same price. It is up to
you, as a Consumer, to decide where you will buy. Same as
now.
What the CPD does, through augmenting "effective
demand"available to consumers, is to make it possible for sales volumes at
ALL participating merchant's store to rise. And with that rise will
come an increase in the merchant's rate of profit. It is from that
'profit' that 'loans' are more fully amortized, enabling needed and wanted
production that CAN already be made, to continue TO BE MADE. Without
the current necessity for ever expanding exponential debt growth, or the
inanity of some of the other supposed "cures" of the "magic money for
infrastructure" varieties.
Regards,
Joe
----- Original Message -----
Sent: Monday, January 05, 2009 6:09
PM
Subject: RE: [socialcredit] Looking For
Info
Wally. Four points, I believe:
1. Sorry, yes I spelled
Martin's name wrong. A a slip I regret. And,yes, I have found him to be
the member of this group most likely to clear up difficult points
logically and practically.
2. A National dividend is not only our
policy, but is written into our Constitution.
3. I have strongly
opposed the universal income idea which is, I accept, socialistic. I
have expressed this view strongly internally. It is also unconstitutional
in view of 2 above. That is what I was referring to in my message, and I
expect it to be sorted out this year. Or "die in the attempt". I am
embarassed that it is there.
4. I will accept the discount scheme if
someone tells me the significance of a "just price" concept that appears
to be simply that, with no practical application. I have spent some time
trying to get people to explain this lately, and the best I got was being
accused of not pushing forward regardless! In a group where many seem to
waffle and very few offer practical means of progress. Would you like to
tell me whether we would have an army of bureaucrats enforcing "just
prices" for every article, or alternatively, what is to stop the discount
scheme simply subsidising rising prices? Nobody else appears to be able
to.
Regards.
John R.
From: wmklinck@shaw.ca
To: socialcredit@elistas.com
Date:
Mon, 5 Jan 2009 15:37:33 -0700
Subject: Re: [socialcredit] Looking For
Info
John,
The Consumer (National) Dividend is central to genuine Social Credit
and if you have not "picked up" on it (a rather casual manner of
expression, seemingly) you are certainly not "pure Douglas S C" or
anywhere near to being so. I think you have already made it clear
that you do not accept the Compensated Price and the concept of the Just
Price which are pivotal to Social Credit as Douglas presented it. So
you are "fairly pure S C"? I would infer that you are not even
poorly "pure S C." Seems that some of the problems with "Social
Credit" in New Zealand are far from being resolved. A guaranteed
basic income is not a Social Credit idea but is manifestly socialist.
I observe that your "Democrats" website provides a link to Victor
Bridger's Social Credit School of Studies which is a sound site. I
am mystified by your reference to "Martin Hatterslee" whose ideas you
"rate most highly." Most highly above whose might you tell? In
this case you must be familiar with his ideas. I have never heard of
any Martin Hatterslee. Perhaps you are referring to J. Martin
Hattersley. For one who seems ever anxious to upstage or improve
upon Douglas, you don't always give the impression of being overly
precise.
Wally
On 4-Jan-09, at 11:45 PM, John G Rawson wrote:
For activity in NZ, log
onto our website www.democrats.org.nz Ignore
a couple of socialistic items, which are transient. Otherwise, we are
fairly pure Douglas S C except that we have never picked up the Dividend
angle. Don't forget the "nz" bit on the end, or you might get
Obama. For the rest, of course, 4 years on this group .... And
good luck. Don't get sidetracked onto things that look attractive
and won't work. Are you in contact with Martin Hatterslee, whose
ideas I rate most highly? Regards. John
R.
From: helgenome@hotmail.comTo: socialcredit@elistas.com; socialcredit@fsbdial.co.ukCC: thtardif@hotmail.com; thtardif@sympatico.ca; mail@michaeljournal.org; versdemain@citenet.net; alainpilote@hotmail.com; michaeljournal@gmail.com; siebenthal@gmail.comDate:
Sun, 4 Jan 2009 17:17:58 -0700 Subject: [socialcredit] Looking For
Info Hi All, We are in the process of rebuilding the Social
Credit Movement here in Alberta and we are looking for simple
introductory material on Social Credit for people who have never heard
about it before (99.8%), and who are not necessarily particularly
interested in economics as a field of study. We would appreciate if any
of you could direct us to suitable sources. Thanking You, Helge
Nome V.P. Communications, Alberta Social Credit Party
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