Patriot Realm

When I was young, I had the honour of voting in my first election.  It was in New Zealand back in the 1970's when there were two parties that most people voted for. Right or Left, I voted for neither. I cast my vote for a thing called Social Credit. 

Now don't confuse this with the modern perception  of China's Social Credit system..... in fact the two could not be more different. In fact, the very name that Douglas chose was something that gave it a bad reputation before it ever really got off the ground. 

The Social Credit system, proposed by C.H. Douglas in the 1920s, aimed to solve a common economic problem: people often don’t have enough money to buy everything businesses produce, which leads to waste and financial hardship. Douglas’s solution involved giving everyone a basic income, called a “National Dividend,” and adjusting prices to make goods more affordable. By putting money directly into people’s hands and controlling the money supply through government rather than banks, Social Credit envisioned a fairer, more stable economy without taking away individual freedom or relying heavily on taxes.

You see, back then, I actually trusted my government to do the right thing.

Was  I right or wrong? I will never know. I have voted staunchly conservative in every election since then. Was it the folly of youth? But my young ideological brain rather liked the idea and I have obviously become far more cynical since those heady days of youth. 

In fact, Elon Musk's grandfather, Joshua Haldeman, was involved in Canadian politics and had ties to the Social Credit movement in Canada. Joshua Haldeman was a chiropractor and an adventurer who also became active in the Social Credit Party in the 1930s and 1940s. Haldeman became interested in the Social Credit movement, which was quite popular in parts of Canada, particularly in Alberta, where it even formed the provincial government for a time. Social Credit had a strong anti-establishment appeal and promised to improve people’s purchasing power and reduce the influence of big banks. Haldeman ran as a candidate for the Social Credit Party in Saskatchewan, though he was not elected. While there’s no evidence that Musk has adopted his grandfather's political beliefs directly, Haldeman’s influence may have contributed to Musk’s interest in challenging traditional systems and structures .... especially in areas like finance, technology, and space. Musk’s ventures often focus on breaking up established practices, a sentiment that echoes the anti-establishment, reform-driven nature of Social Credit.

Some ideas Musk has discussed touch on concepts that overlap slightly with Social Credit principles:  Musk has expressed support for a universal basic income, especially as technology and automation replace many traditional jobs. This idea is similar to Douglas’s National Dividend in Social Credit, where everyone receives a guaranteed income to support their basic needs. While Musk's UBI is framed as a response to the rise of AI and robotics, Douglas's National Dividend aimed to fix an economic imbalance. Both ideas, however, focus on giving people a regular income to stabilise their purchasing power. 

Musk has been critical of centralised banking and has supported decentralised financial technologies like cryptocurrency. This view echoes Douglas’s criticism of banks controlling the money supply and creating debt-based money. Social Credit advocates for the government to create and distribute money, reducing dependency on private banks, while Musk’s support for decentralised finance aims to reduce banking control through technology. Musk’s goal of “democratising” technology aligns with Social Credit’s aim to make economies work better for everyone. Though Musk approaches this through innovation, the spirit of making resources more accessible has similarities to Douglas’s desire for fairer access to wealth.

Back back to the Douglas plan: 

The Social Credit system is an economic idea created by Major C.H. Douglas in the 1920s. He saw that people often didn’t have enough money to buy everything that was for sale, which he thought led to big problems like unemployment and poverty. Douglas believed that this “money gap” came from how banks create money as debt, meaning people borrow money from banks, but they have to pay it back with interest. Over time, this leaves people with less money to spend on things they need, while goods sat unsold. 

Douglas noticed that people often didn’t have enough money to buy everything that businesses were producing. For example, imagine a community where a lot of bread is baked each day, but most people only have enough money to buy half of it. The leftover bread goes to waste, and bakers might lose their jobs. Douglas proposed giving every citizen a "National Dividend" .... a set amount of money regularly, regardless of whether they work. This extra income would boost everyone’s purchasing power, helping people buy what they need and reducing waste. 

In my young mind, this sounded splendid. After all, I was newly married and even at my young age, we had just purchased our own home. 

Under Social Credit, the government would create money directly instead of relying on taxes or borrowing from banks. This meant the government could afford to give everyone a National Dividend without raising taxes. For example, instead of taxing you to pay for public services or benefits, the government would just create money for these purposes. Douglas believed this would make people financially stable without having to rely so heavily on borrowing from banks. 

Ron Paul, the former U.S. Congressman known for his libertarian views, has expressed interest in some ideas that overlap with Social Credit’s critique of centralised banking and debt-driven money systems. However, he does not identify as a Social Credit supporter, nor does he endorse all aspects of the theory.

Here's how Ron Paul's views align and differ with Social Credit:

1. Critique of Central Banking: Like Social Credit’s founder, C.H. Douglas, Ron Paul is deeply critical of central banking. Paul has long argued that the Federal Reserve's control over the money supply leads to economic instability and inflation, advocating instead for a return to sound money, often backed by gold or silver. While Social Credit calls for reforming money creation by transferring this power to a government-controlled credit system, Paul argues for a more decentralized financial system, ideally without a central bank.

2. Skepticism Toward Debt and Bank Power: Both Social Credit and Ron Paul critique the idea of debt-based money, where banks create money through loans with interest, which they see as an unfair system that burdens consumers and concentrates wealth. Paul, however, prefers free-market alternatives like decentralized currency and is more in favor of reducing government intervention than relying on government to create and distribute money as Social Credit proposes.

3. Limited Government vs. Economic Redistribution: Social Credit advocates for government-distributed income (the National Dividend) to boost consumers' purchasing power, which goes against Paul’s limited-government philosophy. He would likely be wary of any system that relies on government distribution of income, viewing it as an infringement on individual liberty and a step toward socialism.

4. Shared Anti-Establishment Appeal: Both Ron Paul and Social Credit appeal to people who feel left behind or dissatisfied with traditional economic systems. Paul’s followers often seek freedom from government and corporate control, a sentiment similar to Social Credit’s challenge to financial power, even if their solutions are different.

Douglas also proposed a system to make things affordable without businesses losing money. Say a loaf of bread costs $5, but with Social Credit, the government might help cover part of that price. So, you’d pay only $4 for a loaf, but the baker would still get the full $5. This way, goods stay affordable, and businesses can keep running without losing income. 

Tribute speech from Eric D Butler, Founder of the Australian League of Rights (ALOR): In 1946, Butler founded the ALOR, which started as an organization focused on Social Credit and promoting conservative economic policies. However, the group soon evolved into a broader right-wing political organization known for its anti-communist, nationalist, and Christian values. Butler and the ALOR argued that communism and international financial powers were significant threats to national sovereignty and individual freedoms. More on him in another article.

Douglas’s system wasn’t about making everything government-owned like communism. In his view, stores, factories, and farms would still be privately owned and run. The government’s role would mostly be to make sure people had enough money to buy what they needed, without letting banks control the flow of money too tightly. People would still have choices about where to shop, what to buy, and what kind of jobs they wanted. 

Social Credit aimed to make life fairer without taking away personal freedoms. If you had money from a National Dividend, you’d be freer to spend it on what you need or want. If you lost your job or wanted to take some time to learn new skills, you’d still have a basic income to support you.

Socal Credit was a bit of a blend, and it didn’t fit neatly into the usual conservative or left-wing categories. It incorporated ideas from both sides of the political spectrum, aiming for a “middle way” that borrows elements from capitalism and socialism but didn’t fully align with either. 

Social Credit valued private ownership and individual choice. It didn’t advocate for the government to take over businesses or control production, which is often associated with more left-wing policies. Instead, it aimed to keep markets and private enterprises running but proposed a system that made these markets fairer and more accessible for everyone. This focus on preserving individual freedoms and private property resonated with some conservative ideas. 

By proposing a National Dividend ... a guaranteed income for all citizens .... and advocating for the government to create and control the money supply rather than relying on banks, Social Credit leant toward a type of welfare model. 

Ultimately, Social Credit was best understood as a “third way” or an alternative approach. It aimed to fix what Douglas saw as the flaws in both capitalism (the concentration of wealth and debt) and socialism (over-reliance on state control) without fully embracing either. The system was designed to empower individuals within a market economy, reduce financial dependency on banks, and ensure people have enough income to support themselves.

Social Credit was neither strictly conservative nor left-wing. It blended elements from both sides and is often described as a distributive economic model focused on making economies fairer without radically altering their structure.

So where do  I sit now? All these years later? 

I suppose I have to conclude I was young and had the illusion that a government would do the right thing.

It seemed like a great idea at the time, but these days? Who the hell would trust a government?

But then again, who would trust a bank?