Social Credit

Social Credit is described by its originator, C. H. Douglas^[1] , as "the policy of a philosophy". Douglas called his philosophy "practical Christianity". This philosophy is interdisciplinary in nature, encompassing the fields of economics, political science, history, accounting, andphysics. The term "Social Credit" originated from the writings of Douglas, a British engineer and originator of the Social Credit movement, (1879–1952), who wrote a book by that name in 1924.

According to Douglas, the true purpose of production is consumption, and production must serve the genuine, freely expressed interests of consumers. Each citizen is to have a beneficial, not direct, inheritance in the communal capital conferred by complete and dynamic access to the fruits of industry assured by the National Dividend and Compensated Price.^[2] Consumers, fully provided with adequate purchasing power, will establish the policy of production through exercise of their monetary vote.^[2] In this view, the term economic democracy does not meanworker control of industry.^[2] Removing the policy of production from banking institutions, government, and industry, Social Credit envisages an "aristocracy of producers, serving and accredited by a democracy of consumers."^[2] Assuming the only safe place for power is in many hands, Social Credit is a distributive philosophy, and its policy is to disperse power to individuals. Social Credit philosophy is best summed by Douglas when he said, “Systems were made for men, and not men for systems, and the interest of man which is self-development, is above all systems, whether theological, political or economic.”^[3]

The policy proposals of Social Credit attracted widespread interest in the decades between the world wars of the twentieth century because of their relevance to economic conditions of the time. Douglas called attention to the excess of production capacity over consumer purchasing power, an observation that was also made by John Maynard Keynes in his book, The General Theory of Employment, Interest and Money.^[4]While Douglas shared with Keynes some criticisms of the monetary and banking systems, his unique remedies were disputed and even rejected by most economists and bankers of the time. Remnants of Social Credit still exist within Social Credit Parties throughout the world, but not in the purest form originally advanced by Major C. H. Douglas. Likewise, the Keynesian Revolution of the 1940s and 1950s was eventually eroded by neoclassical economists and banking interests. Now as Keynes' ideas seem the most generally accepted response to theFinancial crisis of 2007–2009,^[5] modern analysts like Richard C. Cook argue the need for a renewed interest in the long dormant ideas of Major Douglas.^[6]