Douglas conceived Social Credit in 1917

Every year, on September 29th, the Social Crediters recall the death of the eminent founder of their school of thought, the engineer and economist, C. H. Douglas. It is on that day in 1952, on the feast of Saint Michael, that Douglas passed away in his home in Fearnan, Scotland at the age of 73.

Clifford Hugh Douglas was born in Scotland in 1879. He graduated from Cambridge University with an honour degree in mathematics. He made engineering his profession.

Douglas was a staff member of the Westinghouse Company in the United States. Later he was sent to India, then a British colony, as Chief Engineer for the English branch of the Westinghouse Company. He would later work, in South America, as assistant chief engineer for the Buenos Aires & Pacific Railway.

Upon returning to England, he became Chief Engineer for the construction of the Post Office’s electrical tube railway in London. During the First World War, he became Assistant Superintendent of the Royal Aircraft Factory in Farnborough, England.

After the war, he ran a small yacht-building yard, in which he was helped by Mrs. Douglas, who was herself an engineer.

Throughout his career as an engineer, Douglas had to tackle problems of a physical nature and solve them. But he gradually noticed that, if the solving of physical problems was always possible, many undertakings were stopped because of purely financial problems. That led him to study the financial question with the mind of an engineer.

In an address to members of the Canadian Club in Ottawa in 1923, Douglas explained how he was lead to explore why and how a financial system could act in such a way as that of a very sick patient or of an accomplished criminal.

While in India around 1908, the government had asked him to make a survey of the hydro-electric potential of a large territory. He found a great potential of water power. He reported to Calcutta, and asked what must be done with it. Good, they said. But nothing doing. There was no money!

Douglas found that decision deplorable. For this was at a time when the manufacturers in Great Britain were finding it hard to obtain orders, and the prices for machinery were very low. As for India, it badly needed electric power. But “they had got no money,” and Douglas could only accept it, while pigeonholing in his mind this case of a beautiful physical possibility that was paralyzed by a financial impossibility.

Round about that time, he said he dined frequently with J.C.E. Branson, the Controller General in India. This Branson used to bore him considerably by discussing something he called “credit”. Treasury officials in India and Britain persisted in melting down and recoining rupees (India’s coins), having regard to what they called the “quantity theory of money”. Yet, insisted Branson, silver and gold had nothing to do with the situation; it nearly entirely depends upon credit. Douglas subsequently remarked that had he been given a short lecture on Mesopotamia, it would have been, at that time, just as intelligible. But, nevertheless, Branson’s repeated words had also been pigeonholed in his mind.

Shortly before the First World War, Douglas was hired by the British government to build a railway for the Post Office from Paddington to White Chapel. There were no physical difficulties in realizing the project. All went well until suddenly he got the order to suspend work and pay off the men. Always for the same reason: no money.

During the war, he was sent to the Farnborough Royal Aircraft Works to sort out a muddle into which the books of that institution had found themselves. It was not long before he noticed that each week the cost prices of the goods produced were greater than the income distributed in the form of wages and salaries. Prices were not in accordance with purchasing power. If this were the case in all industries, as he soon found out, how could the sum of wages pay for the prices of production?

Douglas also noticed that once war was declared, there no longer existed the question of a lack of money. So there was nothing sacred about money. Money could appear all of a sudden, and all that was physically possible could be made financially possible at all times, as was the case during the hostilities.

Douglas also faced other experiences. He decided to identify and to disclose the defects of the financial system. Then as an engineer, to seek, discover and formulate principles to put finance in accordance with realities at all times. This is what has been known since as Social Credit.

An efficient weapon against Communism

It is not my purpose to explain here the system that Douglas devised. In recalling his memory, I would like to show how Providence used him to give the world an efficient weapon to fight against Communism and Socialism, in the temporal realm.

Communism is the most terrible plague mankind has ever experienced. It shows no respect for any value. For it, God does not exist. For it, the soul does not count. For it, man is nothing but a tool to be exploited and done away with. Communism rejects the right to property. It abolishes every freedom. It tramples the right to life, as well as all rights and all moral values, while it pursues its ends.

It is in 1917 that, through a revolution, Communism seized power in Russia. Not to confine itself there, but with the intention of taking over the whole world by any means, whether legitimate or not, hypocritical or violent.

Against this conspiracy, God, in His goodness and despite the sins of today’s world, deigned to give us, from the start, a sovereign remedy. It is in that same year, 1917, that Our Lady brought Her Message to the three children of Fatima, ordering them to pass it on to the world: To stop offending God; to say many rosaries; to do penance while observing the duty of one’s station in life; to consecrate ourselves and the world to the Sorrowful and Immaculate Heart of Mary; to receive Holy Communion in reparation on the first Saturdays. If Her Message is answered, Mary promises that Russia will be converted. If not, the errors that dominated Russia will spread throughout the world.

This is the transcendent Message which, if it had been put into practice, would have saved the world from the vast expansion of Communism in the past century, especially since the Second World War.

But in the temporal realm, Heaven deigned likewise to put into our hands, through Douglas, new knowledge that would be used to answer the economic and social arguments of the Communists when they denounce existing evils in order to serve us their poison.

It is precisely in 1917 that Douglas completed the observations and studies he needed to finalize the system he would first publish the following year.

Douglas did not aim his study expressly against Communism; he simply sought to correct what was wrong, as well as tyrannical, in the present financial system.

But the implementation of Social Credit in economics and finance would replace an error by a truth, slavery by freedom. And it so happens that truth is the means by which error is destroyed, and freedom the means to escape tyranny. Since Communism is a lie and a tyranny, Social Credit strikes it head on.

The very guarantee of a dividend to each individual, not bound to employment nor to any other condition, would render the forced recruitment of the Communist economy impossible.

Besides, Communism uses the struggle between classes and the denouncing of capitalism to win over the working classes. But Social Credit considers that everyone is a capitalist: all people are co-owners for life of the natural resources, the true capital without which neither dollars nor manpower could produce anything. We are all coheirs of the discoveries, inventions, technological improvements that were developed and passed on from generation to generation.

A real capital without which both capital dollars and work would produce little in comparison to our huge modern production. Therefore, all would be entitled to the dividend of a capitalist, on top of what they may earn by taking part in the exploitation of this huge common capital. What kind of class war, what kind of Communist propaganda could survive a collectivity where everyone is a capitalist, where everyone can access their share, a generous share of the fruits of production?

If Social Credit has not yet prevailed in our economy, it is because those who are in command, the dictators of finance, do not want to lose their power of domination. It is because a whole series of lackeys and footmen, politicians, honorable people, people with nice jobs, with titles, Mammons of all kinds, hang on to what they have more than others who are less affluent. And they crawl to keep it rather than to stand up and demand the correction of a system that is hardly less odious than Communism.

Fatima and Social Credit

But, welcomed or not, the Social Credit light goes on shining. And the “Michael” Journal continues to form patriots, apostles to spread this light. They are too aware of its possibilities to minimize its value.

In no way does this prevent the Social Crediters of the “Michael” Journal from ranking first the Message of Mary at Fatima. Although they are of a different nature, Fatima and Social Credit go well together. Both answer a need for our times. With Fatima, it is Heaven which speaks to us directly; it is Mary who tells us what She wants of us; it is Mary telling us what She Herself will obtain if we are faithful to Her requests. But this does not free man from having the duty to resort to the knowledge and truths that are available to his mind. And Social Credit is one of these great lights, one of these key ideas which, once acknowledged and put into application, can greatly contribute to the sound progress of a civilization.

Anyone who studies Social Credit with an open mind, open to the truth, feels all the more at ease with it than with the contradictions, distortions, falsehoods, not to say more, of the teachings which now prevail in our universities as regards finance and the distribution of goods that answer human needs.