Why Fat in War and Lean in Peace ?

Written by Louis Even on Friday, 01 January 1954. Posted in Social Credit

We have been living under a war economy, in varying degrees, ever since September 1939. The decade before the war was known as depression years.

Depression years do not mean years of droughts, or locusts, or earthquakes, or epidemics, or bombs upon our producing plants. In our technically-equipped world, the depression is never in the means of production, but in the means of payment.

An explanation of where these means of payment originate, and of how they can be made either scarce or abundant, will be found in the pages of this issue of “Social Credit”.

With less purchasing power, the consumers buy less. With sales slackening, production is compelled to drop; men lose their jobs; and with the jobs, go the wages, the only source of income for a great number. The situation is then bound to get worse and worse, unless and until a measure of some kind injects into the system a new flow of purchasing power, without adding to the accumulated stock of goods offered for sale.

This was done in 1939, when money flowed in to pay soldiers, who placed nothing on the market, and to pay men and women who produced shells, guns, bombs, war planes, and other things not offered for sale.

The end of war, in 1945, did not quite mean the end of our war economy. We had to help repair the ruins which, during six years, we had zealously contributed to make as big as possible. This and the abundant money distributed for war purposes kept the wheels of industry turning at a fair speed.

But when all industry is turned back to the production of civilian goods, it does not take much time to catch up with delayed programs. And as early as 1950, goods were again glutting the markets, throwing three hundred thousand Canadian workers out of employment.

Once more, the situation was saved by a resumption of war activities. The events in Korea, whether or not calculated for the purpose, provided the cure to stagnation. A two-million-a-year shot in the arm revived Canadian industry. War contracts were acclaimed as a godsend by both employers and employees.

But the armistice in Korea last summer, and signs of relaxation in the tension between East and West, threaten to spoil the situation again. A growing number of unemployed have just had a gloomy Christmas, and the end is not yet. What, if war fails to come, when the program set for the defense system is completed?

Of course, this is all wrong, this is all nonsensical. Prosperity should thrive in peace, when all industry is available to produce for the home, and not in war, when it produces for the battlefield.

The trouble, which should be a blessing, is that industry can produce more and more with less and less human labour. This is due to progress, and should mean an increase in leisure, with an income to buy the products of the machine.

It is not so, because we stand by the obsolete rule that one must be employed to receive an income. This creates the unbelievable condition where workers are punished when they have filled the warehouses with goods. They cease to receive purchasing power to buy the goods which they have helped the machines to produce. Unless jobs be found for them to produce non-marketable goods, and this is where war industry is the welcome rescue.

Social Credit offers the only sensible solution to distribute the fruits of peace and progress. A dividend to all, allowing to all their share in a production which arises more from a common inheritance (progress) than from individual labour; while continuing the wages and salaries to such persons as are still requested to maintain the flow of products. The sum of dividends would be made to increase as the sum of wages and salaries would decrease. "Full "empayment”, instead of full employment.

This would not only kill an incentive to war; but it would usher humanity into a civilization where, to quote Douglas, "production, and still more the activities commonly referred to as 'business', would of necessity cease to be the major interest in life and would be relegated to a position of minor importance, to be replaced, no doubt, by some form of activity of which we are not yet fully cognizant". (Monopoly of Credit, p. 110.)

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Louis Even

Louis Even

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