Each year, usually in the spring or at the beginning of summer, the government brings forth what it calls "the budget".
The budget is, on the one hand, an estimate of revenues for the coming year; on the other hand, an estimate of expenditures for the coming twelve months.
In terms of our existing financial system, it is necessary that the budget be "balanced" that is to say, expenditures must not exceed revenues. If they do, then a deficit occurs. And deficit, means debt, which debt makes only the greater, the budget or budgets of the future.
At first glance, this necessity for balancing the budget seems to be beyond any argument. And this is true if public budgets are viewed in the same light as private budgets. An individual cannot, unless he wishes to go into debt, spend more than he takes in.
Since an individual cannot make money, or order it to be made, all the money which he needs must come to him from some source outside himself from a salary if he is employed, from profits if he is in business, from invested money, etc. He, therefore, cannot long maintain a situation where expenses exceed revenues.
But is the case of governments the same? Yes, reply those who can think only in terms of money. No, reply those who are used to thinking in terms of the ensemble of realities.
The national budget, for example, is quite obviously the budget of the nation and not simply the budget of an individual, Mr. Jones who is the Minister of Finance.
The expenditures which are forecast in the budget are to be made for the benefit of the population considered in its totality. Moreover, it is the population in its totality which addresses itself to the government to find the means of meeting these expenditures.
But, since it is the population in its totality, which (except for goods and services imported) furnishes whatever is to be realised by these expenditures, we are justified in asking why it is that the population is taxed financially for that which the population itself has produced.
Let us go back to the example of the individual. Peter is a farmer. If he wants to buy himself a tractor or an automobile, he must find some place from which to get the money; from the sale of his farm products, for example. But supposing what he wants are potatoes for his table. Is he obliged to wait until he has obtained money from somewhere before he takes the potatoes out of his root cellar; or before he enlarges his potatoe field if he has a lot of spare ground?
Peter must, of course, submit to the exigency of money if he wishes to buy what he does not produce, or has not produced for lack of space. But he certainly doesn't have to wait on money for the use of those things which he produces and can do with as he pleases. If Peter produces plenty of potatoes and wheat and beef and butter, it is utterly unthinkable that he should go without such things or go into debt in order to use them; or give up the use of beef and butter in order to make use of wheat and potatoes.
But it is just such an absurdity which has been built into a sacred dogma in the world of finance when it comes to the case of the nation as a whole or a province. The province of Quebec, for example, is physically quite capable of furnishing all the manpower and all the materials necessary to undertake its programs for road maintainance and road building for the year 1960-61; and at the same time, quite able to maintain the flow of goods and services needed to nourish the consumer market. Why then should individuals be deprived of the money which they need in order to procure consumer goods, in order that the government may have the means with which to go ahead with its road programs?
- But we must pay those who are going to work on the roads!
Of course we must. In other words, we must give them that with which they may make claim for goods which are for sale on the market, in the stores. Is there any doubt that there is a sufficient quantity of such goods on the market to satisfy the demands of these workers, without having to oblige the rest of the people to go without?
If the total production of consumer goods was so slender that there was danger of their exhaustion, we might be justified in considering decreasing the share of some so that others might also partake. But as longer as such a danger is non-existent, rationing of goods and services is stupid. And it is precisely such rationing that is exercised when the private individual is taxed for the benefit of the public. It is equivalent to taking from John's plate to put into Joseph's, while all the time the pot is full to the brim!
The pot is full to overflowing when there are more than 300,000 unemployed in the province of Quebec, and nearly a million (registered and otherwise) in the whole of Canada.
A budget, national or provincial, which faced up to realities, would be drawn up according to the services and public works demanded by the people, and which the population would be capable of furnishing without in any way hurting the production of goods for private consumers. Such a budget would be said to have been conceived according to the capacity to produce according to the capability to find the necessary manpower, materials and other things necessaryto public works and services.
For example, if the budget had to make provisions for a 100-mile road which had been demanded by the people; the question to ask would not be: "Have we the money to build this road?" We don't build a road from money but from materials and labour. The question then to be asked is: "Have we enough manpower and materials to build this stretch of 100 miles of road? Can this material and this manpower be employed in building the road without in any way causing a fall-off in the production of carrots, potatoes, butter, meat clothing, shoes, etc.?"
If the answer is in the affirmative, then there is nothing to obstruct the building of the road without having to take from the private citizen his means of procuring carrots, potatoes, butter, meat, clothing; shoes, etc...
In the answer were: "No, the country cannot continue to provide as many things for the stores when so many hands are employed in building the road" then there is no recourse but to make a choice between building the road or having as much as before of food, clothing etc. Or perhaps only build 40 or 50 miles of the road and thus not give up quite as much of consumer goods. In either case, we are always at grips with realities. The representatives of the people have to exercise their judgement in making a decision. But it is a decision about realities, about the capacity to produce, and not about the capacity to tax or the capacity to find money. The question of the means to pay for that which we produce is a question pertaining to accounting, and nothing more. It is not a question of forbidding the right to goods which are piling up faster than they can be used.
The inability to pay in the face of the ability to produce is a direct and clear manifestation of a false system of accounting.
The meek submission of a government to such a system of false and erroneous accounting is nothing more than stupid and criminal servility. Stupid because the government spends precious time cracking its head-over problems that are artificial. Criminal because it condemns the people to want and insecurity when the land is overflowing with real and potentially real wealth.
Taxation and levies on revenues under such conditions are nothing more than servitude, or slavery by taxation. For it is to deliver the entire people to the tyranny of the controllers of credit, of the controllers of that which by every right belongs to the people.
The government is already a slave of the system, when it does not take the step of issuing credit to realize the production of the wealth which is lying idle. It becomes a slave a second time when, to finance public works and services, it demands from individuals money which is under the authority of the banks.
For regardless of where the individual gets the money which he pays out in taxes, this money, had its origin in the banks in the form of a loan to be repaid with interest. And the length of time this money will remain in the hands of private individuals depends entirely upon the time limits set by the banks. The rate of repayment can be accelerated by the banks whenever they choose to do so.
The Bank of Canada has failed the roles which it was instituted to fill: to be a bank of Canadians to serve Canadians in that measure and rythm in which they, the Canadians, produce goods and services, public and private. And if the Federal government refuses to do anything, why does not Mr. Lesage, or Mr. Frost or the other premiers of the provinces, institute a system of provincial credit to provide the financing for the people of the province in that production of which they are capable according to the human and natural resources of the province?
Why does Ottawa - why do the province - insist on letting financial decisions dictate to realities, instead of making finance serve and bow down to realities the realities of what men can produce, and the realities of what men need?
Governments are elected by the people (so our democracy would have us believe). When, then, will these governments cease to serve the god of Mammon, incarnated in the existing financial system; when will they cease to make sacrifice to this god, of the people whom they were elected to serve?
LOUIS EVEN
Attention! members of the Liberal government of Quebec. Now is the time for you to realize the following important point of the program you drew up in 1956, and which you promised to legislate when you came to power:
"To make financially possible whatever is physically feasible and meets the private and public needs of the population."
The means for doing this: the institution of Quebec Credit whereby the province will be supplied the means for paying for such production as can be realised and is needed and demanded.יי