The Scenario

This is the scenario: Credit advanced by a NZ Credit Authority would make up for a supposed inherent lack of purchasing power in the economy which, freed from the fetters of a restricted money supply, would then pour out goods in abundance and lead us to the promised land of automation and the four day week, full employment, price stability and a living wage. Just as the alchemists disdained to submit to the laws of nature, so social crediters deny the existence of objective economic laws. In the words of one pamphlet circulated by the NZSC League, 'Economic laws are usually conventional laws and therefore can be altered if required.' (R S J Rands: The Problem of Money)

Social Credit Thinking is made up of a number of economic theories and views each of which has been given different emphasis at different times. The 'A + B' Theorem characterised the early thirties while arguments about the size of the money supply in relation to GNP, and the power of the finance industry are typical of present day NZSC theorists.

These ideas have two characteristics in common. The first is that they assert that somehow or another there is a permanent shortage of purchasing power in the economy. The second is that they fail to grasp the realities of modern monopoly capitalism.