Social Credit meets this challenge. The Douglas solution to this, the greatest problem of our day, provides a scientific money system by basing the supply of credit directly upon the supply of goods. Douglas has defined Social Credit as “The ability to monetize our existing real wealth for the benefit of society.”1 Social Credit gives us a definite practical plan for the control and use of this money system, designed specifically to overcome the chronic shortage of buying power.
In Major Douglas’ own words, “The business of a modern and effective financial system is to issue credit to the consumer, up to the limit of the productive capacity of the producer, so that either the consumer’s real demand is satiated, or the producer’s capacity is exhausted, whichever happens first.”2
Moreover Social Credit aims directly to start immediate and permanent business recovery. Its object is “to cease the accumulation of national, no less than international, debts, and put an end to the continual and simultaneous existence of glut and poverty.”3
With growing certainty the voice of the shopping public demands that the deluge of debt be replaced by individual security. Depression must give way to lasting national prosperity founded solidly upon Real Wealth. In this Age of Plenty, brought about by our progress in scientific achievement, we have already learned that every consumer is a partner of industry. Production cannot go on without constant buyers.
We have seen that the present shortage of buying power in the hands of consumers is due to two fundamental causes, both of them rooted in the system of Debt-money. The proposals of Social Credit are designed to remedy these causes and to eliminate the shortage of purchasing-power. “Now, broadly speaking, what we are aiming at in the Social Credit Movement is, in the first place, simply to increase purchasing power so that the money system shall become self-liquidating, and, secondly, we are aiming to meet that condition.... that fewer and fewer operators are required to tap the machines of industrial production.”4
This may sound like a large order. Now let us see how it is to be filled. Social Credit says that it is as possible as it is logical and necessary. “To claim that a world which has witnessed the marvelous mechanical, scientific and cultural progress of the past 150 years cannot adjust a system which is merely a combination of accounting and ticket-issuing so that it truly reflects the physical facts as they change from time to time, is to ask too much of the credulity of an exasperated public.”5
1) Lecture, The Evolution of Finance — New York, April 1934.
2) C. H. Douglas, Credit Power and Democracy, pp. 106-7.