The Social Credit System

Abstract

UNDER the title “Poverty and Over-Taxation; the way out”, the Marquis of Tavistock has published a further account of the Social Credit system (Coventry: Prosperity Office, 1937. 6d.). Among seven reasons given for the failure of the present financial system, he stresses the way in which science and machinery are destroying the need for human labour, but are increasing the output of real wealth in goods. Because the machine does the work of several hundreds of people, it becomes more and more difficult every year to find work for everyone, and no cure for poverty can be found by attempting to give everyone a paid job in industry. The effect of machinery and fresh scientific inventions is to destroy the demand for human labour, and although new industries are started, fewer and fewer people are needed. Apart accordingly from the necessity of education for leisure, it is urged that the State should direct the banking system to create and issue, not in the form of debt, as much money as is required to enable the citizens of the country to buy at a price fair to sellers all that they desire of what industry and commerce can produce or import. Of the three main items in the reform necessary to make money the servant of industry, aiding the consumption and production of goods, the first is the abolition of the Gold Standard and of any gold basis for the issue of money, since it is goods and not gold which give value to our money. It is suggested that under a policy of National Dividends, a man unable to find work would still be able to live in reasonable comfort without being a burden on others and he would be able to help the man at work by being in a position to buy his goods. It would still pay a man to get work if he could, as wages would be paid extra to National Dividends and a natural check to living on National Dividends would operate because their amount depends on the country's production of goods.