SOCIAL CREDIT

Hokitika Guardian, 28 July 1933, Page 2

SOCIAL CREDIT

By X. ARTICLE VIII. In this concluding article of this eerie* 1 would point out that in a young and sparsely populated country, there is one line of development which i 3 always sound, economically—that is the settlement of the people on the land. The Seddon. Government demonstrated this arid showed th .1 money cOidd a 1 ways he 'borrowed for advances to sett-lere, and purchasing lands for settlement. I need not, refer po\v as to how a scheme at first. economically. sound, got out of hand through piolrtiail .pressure. There is now a schema of settlement on small areas (averaging ten acres) which is perfectly sound as long, as it as kept within the scope as proposed at present. There are at present 12,000 application,-, for these small farm settlements. The estimate is that it would cost from £3OO to £4OO to nrovide the land, fence, it, <rect- a «* naft dwelling house and cow shed, and provide seed etc., after ploughing over (each holding, thus enabling a man and his wife to settle in on their own place. It is estimated that £1 a week from the unemploy* ment funds would have to be advanced to each settler before he could make, 'his little holding ••self-supporting. I haven’t space to refer to the details of the «oheme-~ftha particular!* of •which in my lease are available for those intereeted. The point is that for about £soo' 'outlay ail told, a settler can he established. If there are 12,000 applications now there will be probably 2000 or 3000 whqn the scheme is properly developed, -and its possibilities realised. But the Government is making very- slow progress bsertaso they sav they haven’t the money. Now 12,000 settlers at £SOO each would only recurve six millions of money—just about double the amount guaranteed to the banks for exchange'equalisation in this one year only; And this money would be immediately put 1 in cirhulatioh, unemployment would* be -relieved and industry encouraged'; Also the scheme i,s soundly economic afe each settler—•if advanced the money' 1 at 3 per cent, with a one per cent, sinking fund, coiiid easily repay' it, ' and in course of time pay . off liability on his holding as bis rental (if we ©an cell it so) would only he £1 13s 4d a month oi about '8 S ' a week. Of ' course ' there will he a percentage of failures, _ tint under proper control not necessarily losses. Anyhow th e scheme i% one that might well he financed by “social credit,” and iany government wh'ch attempts' to hoid b'lck land settlement now on the ground that “rtonev is not available,” will not retain the confidence of. the people.

Theve are other avenues open for development-—unfinished, railway lines for instance on which large sums have ■already been spent, and 'which, though t-hev maty not show a return on their entire cost 'could certainly (show a return on the amount required to complete . them. There are water races which it would he a sound economic proposition to bring On to well tested alluvia] goldfields ; there are propositions with unlimited possibilities like the flax /md wood pulp industries which could, be boosted along with judicio% assistance. We may stand a ghasit, ‘at- the policy of President Roosevelt i,n issuing dollar currency to the extent of 3.300 millions for the purpose of developing industry. But we might with more reason stand aghast at the conditions now existing in New Zealand where a large proportion of the people have bee.n. absolutely ruined eW”«h wo fault of their own, and the balance, who have money, are too neared to put it into circulation.

Something will have to be done, and will be done to remedy this. The remedy will be undoubtedly in the utilisation of social credit. But T have endeavoured to point out the dangers surrounding this. Once the system gets out of hand it will, fb Sir Joslah Stamp has warned America, lead to disaster, but I trust your readers have noted that he at the same time said the of the Roosevelt experiment would depend on the mental and moral calibre, of the people. He admits therefore that the experiment which would revolutionise the industrial outlook of the world, m-ight quite conceivably be successful. There •>*« one point in President Roosevelt’s policy which should be noted. Notwithstanding the enormous sum issued under “social credit” he estimate,-, that 220 million dollars will be required, in addition to meet the expenditure contemplated which will have to be raised by taxation.

The utilisation of ’’social credit" must be under firm control, and to differentiate between what may be financed under it, and what must he directly home by taxation can . only be done effectively by (co-operation, with the banks. It must not be left to the dictates of political expediency. The banks cannot refuse to issue credits and currency a,s against Government guarantee backed by bonds or treasury bills. But they should be in a position to show clearly, and to issue warning that excessive use of this method of finance will depreciate currency. If the brinks were linked up, internationally, they could state exactly what that depreciation ' would amount to, so that if New Zealand, for instance, "in' ahv one year proposed to issue teh pr twenty millions of new

, ■unrency it opul'id be .shown, Exactly how much th‘at 'would depreciate the value, as compared with other world

currencies, of the New Zealand £. (Social .credit financing is (coming—in .'fact is now in operation—but until the necessary safeguards are established the utmost caution must be exeicised in making use of it, otherwise it will lead to irretrievable disustei. It is for this reason that schemes like those of Douglas cannot be too strongly condemned as they appeal to the sympathies and imagination, and not the reasoning power of the people.