The Regulation of Consumer Credit

Abstract

The control of consumer credit occupies an important place in the economy of war. When a nation decides to fight it out with other nations, two kinds of demands are made upon its economic system: first, military and second, civilian. Each of these kinds of demand competes with the other. Military demand, which is the most urgent, springs up instantly once war is declared and starts the wheels of production to turning with increased rapidity. Civilian demand, due to greater purchasing power arising out of wartime production, also greatly increases. Hence, the government is required to bid against civilians and civilians are required to bid against each other for the output of the economic system and the prices of everything, including the weapons of war, tend to rise. In the midst of these circumstances the relation of consumption to production, the extent to which military demand takes precedence over civilian demand and the control of consumer credit as a part of the total stream of purchasing power become of direct interest to the entire nation.