CHEMISTRY AND INDUSTRY 971 Sor. 16. 11):14

1)y t h iiicrciisctl rapidity of ilcvelopiiieiit tlint IWR Institiitc \viis his friend and prctlcccssor in the lxcoiiiiiig iioticeiit)Ii: iiintl cont,ril)utc I)y its energy chnirninnsliip of Impcrinl Cliciniciil Intlustrics, nnil iiiitniiitivr in tlic rciilni of rcsciircli to the gcncrnl Lord l\lclclictt, ii1id thiit onc of thc gucsts wiis 1)r. iiii1)rovcnicnt in the \vcIt-hcing of tlic conii1iiiriit;y. 13crgius, \vhosc pioneer work on tlic liytlrogciiittion

i\tltlccl interest wns lent to Sir lriirry’s i i t l t l ~ c ~ ~ of oil from coil1 is now I ~ i n g csploitetl on ii vcry Iiirgc by tllc! filcts thilt, the I~o~~t l t lcr Prcsitlcnt of the scnlc hy I.C.I. on t . h Sortli-ISiist const.

THE DOUGLAS SOCIAL CREDIT SCHEME By FRANK MORRIS

less niid confiiscil. Curioiisly cnoiigli, on t tic principle of o ) w c (ynotunt pro ?wy/t$co, this nicthoil of iipproiich is iiii undoul)tetl nssct, iiiid cspliiins the strong :ippc:tl wliicli Jfiljor l)ougliis’s tlicory tins for ninny niintls. l fc starts with i i pliiusihlc fiilliicy, nnd tlicn tlis:irnis criticism Iiy tlic iiforcsiiitl sinoltc- scrccn of fiilse nnii1ogic:s iind self-cotit riitlictory nsscrt ions, uiiiiccor~i~~iinictl hy any colii!rcnt. :irgiinicnt. A roccnt critic, Prof. R. F. ITnrrod of Christ Cliiircli. Osford, pits tlic ciisc well i n tlic following piriiyitpli i n tlic Speclrilor \vliich 1 take tlic lihcrty of quot.ing :

‘’ ‘l‘lic I)ool; (Jlnjor lhigliis’ JIiiniiiiI) iihiinds in cpigriiintiiiitic iipliorisins itntl witty tliittriI)cs. !I’licrc is liiiniitiiity iiricl iilso i i proplictic striiin. Oi*ciision- :illy i n ccrtiiin pitrngriililis soinc sctiil~liincc of systc- niiitic t.lioiiglit semis to be tiikiiig ship, but ill1 qiiiclrly fiitl~s out into obscurity. Scitlier tlic tliiigiiosis of t I iv present systcni nor !tic Iiriicticitl proposiil~ iirv Iirtrsvntctl i n a clciir iiiitl ortlcrly \viiy ; tlicrc: is notliiiig for 1111: i t i i i i t l to griisl). I f only a clinriot; of clciir t,liitikiiig coiild IJC Iiitclic!tl to liis splciitlid ciitliiisiiisin iiiiil rcdortl~tiil~lc p o w r of 1iropii-

‘I’lic i i i i i i i i iirguniciit iind intlectl tlic only one on which ?diijor I)ougliis raises liis clnliorntc structure of suciiil crtclit i i n i l i i i i ccononiic revolution is sirii- plicity itsc:lf :ind I ciriinot do 1)ctLcr t l i i i n prwcnt. it. i n his o\vn \vortls tiikcii from one of liis niiiiicroiis publiciitioris.

( I ) J’ricc ciiiinot Iioriiiiilly I)c less t h i i cost pliis profit. (2) Cost inclutlcs ill1 cspcnditiirc on 1iroduct. (3) fI’licrcforc cost iiivolvcs ;ill cspciiditurc on coii- autiipt,ion (food, clotlics, Iiousing, cto.) piiiil for out, of wngcs, siiliirics, :intl clivitlciitls, iis well iis i i l l cspciid iturc on f:lctory nccount duo r c p r c . w / l i q prcuiorrs coirsrtrtrp/iotr. (‘I’lic itiilics i i re niiiic.) (I.) Since it iiicliitli!s this cspriiclit3urc the purbioii of the cost rclircsciitcil I J ~ t liis cspcnditurc Iiiis iilrciidy I)ccii piiitl I)y t,lic recipients of iviiges, siilitrics, iiutl tlivitlciitls. (5) ‘I’licsc rcprcsimt tlic ooiiiiiiunity ; tllcrcf~irc tlic oiily tlistributioii of rciil 11iircli:ising po\vcr in rcspcct of production over ti imit pcriod of time is tlic surplus wiigcs, siiliirics, tint1 clividciids aviiilnblc tiftcr i i l l siibsistciicc cspeiiditurc tind cost of nitttcritils consiinii:d hiiw bccti tlcductctl. The surplus protluc:tioii, Iio\vcvcc, includcs d l tliis us- pcnclituro in cost iintl conscqiioiitly i n pricc. ((;) Tho

gilnllll ! ”

Oi2 CHEMISTRY AND INDUSTICY Sov. 111, 11134

only effcctirc clciiinnil of the coiisiiincr, therefore, is n few per cciit. of tlic pricc \.illtic of coiiinioditics illid is cirsli credit. Tlic reiiinindcr of tlic lioiiic cffcctivc dcmiind is lonn credit, which is coiit,rolletl by t.lic hiiiikrr, tlic finniicier, iuid t,lic intlustriiilist,, i n tlic interest of produt:tioii with ii fiiiniiciiil ol)jcct iw , cuud not iii t.hc iutcrcst of the u1tiiii:itc coiis\iiiicr.

T,ct iiic give one iiiorr quotiition from Jliijor I~ougl:is's works :

(1) factory or other prodiictivc orgiiiiiziithii liiis Iicsides its ccoiioiiiic function iis n protliiccr of goods, ;I finiiiicinl iispcct -it 1ii:iy I)c rcgiirtlctl on tlic one Iiitncl iis ii h - i c i ~ for tho clistriliiitioii of piircliiisiiig p o w r to iiitlividiiiils through t lie iiirtliii of iviigcs, siiliirics, : i i id tli\-itlcntls : i inc l 011 the ot Iivr Iiiilid iis it iiinuiifiictory of ~)ricc~-fiiiiiiiciiil vnliics. From this standpoint its piiyiiiciits iiiny l)c divitlctl into two groiips : C:roup 2L--i\ll piiyiiiciits riintlc to iiidividunls (\\.ages, siiliirics, iriitl tlividcids). Group :l3-All p y - iiicnts miidc to ot lier orgiini~iit ions (rii\v nicitcrinlt;,

Kow the rate of flow of piirchisiiig power to iiidivitluiils is rcprcscutcd by '' 11," Iiut. since id1 piiyinents go into priccs, the rntc of llo~v of prices cniinot lie less tliiui '' A " plus " U " . . . Sincc. * ' :\ " will not, piiroliiisc '' '' plus '' J3," ii ~)roport,iori of tlic product iit least eqili\.iileilt to " n " must Ix dist ril)utcd by :I foriii of prclinsirig p w c r ~vliicli is not coinpriscd i n tlic tlescriptions groupcd uiidcr '' A." It will lie iieccssiiry iit n h tc r stiigc to show t hiit this iiddition:iI purcliiising p o w r is provided by loiin credit (I)iink ovcrdriifts), or rsport credit. I n considering t.hc iibovc iirgiiiiients, Ict not t,lic rcntlcr iilloiv liixnsclf to he confiisctl i)y t,lic fiict, t,lint * ' I3 " hiis at sollie previous stilgc jviiges, siiliirics, iind dividends. It is the riitc of flow wliich is vitiil . . . iiiid if tlic outflow of piircliiisiiig p o w r is Icss tli:iii tlic inflow sonieonc Iiiis to losc! purchiising power.

Tlic sum total of this cl;il>oriitc sciiffoltliiig o f cliiilcctic: is nicrdy this-thiit t I N wiigc-cariiws i d

tlic rticipiciits of siiliiries ii i i i l o f profit, I i i i w joi i i t ly t o piiy for tlic product., \ J i l t iniisliiiicli iis the cost, of the p h i t iiiid fisctl iisscts Iiave to I)c rccovcrctl from t lie I I I I I I I ~ ~ tlistrihutcvl 11y the iiii;iiiif;ictttr~~r,

for tlit! products (//id /lie p h t t but o d y rcccivc tlic I)rotliict, this tlifforciicc iiciiig 1JrOVidI!d by IJiiiikws' Iuiiiis, which i i i t u r n Iiii\.c to I)(! rtyiitl i i t t Iic cspeiisc of t,lic iiltiiiiiitc hrycr.

1 rcfririii from orit.icizing this theory for t.hc iiioiiiciit, i i i order t 0 prcsciit t.lic cotistriict.i\.c pro- posiils ~vliieli :ire its logiciil corolliiry. 'I'l~csc pro- I)osiils, it wil l 1w oIis(!rvcd, iirc cotitlitiolictl by t.Iio t hcory t.liiit iiiitlcr the csisting systcni i i l l biiycrs of' ulLiiniitc goods (coiisiiriipt.ion gooils) pny too Inucli for tlicin, 11s tlic price t h y piiy iaclutlcs tlic cost of ciipitril iiiitl pli i i i t , , iigiiiiist wliicli iio piircliiisiiig po~ver, iiccortling to Bliijor .I)oiiglus, is issiicd I)y t l i t ! 1)ro- ducer. It follo~vs froiii tliis tliiit in somu tviiy prices iniuit IJC rcdiiccil in t h riitio of totiil rcctlio~tul pro-

Iiiiiik cliiirgcs, iiiitl otlicr cstcrliiil costs).

becli rcpreseiit ctl

the ivorkcrs Iiii\.c S ~ I I ~ C ~ I O \ ~ 01' O ~ I I C ~ to 1)iiy I )o t l i

duction to nntio)tctl consiimpt.ion. Aliijor I)ougliis cs~~resscs this i n tlic following foriutilii :

pricc totnl i i i i t iod consumption cost, totnl riiitioiinl production -=

l'lir diifwcnce I)ct.wccii the prices tho iiiiiiiii-

fiicturcrs rcccivc f r o i i i coiisuiiicrs iiiicl tlicir totiil costs is t o he rcpiiitl by t , l ic issiic of 'I'rciisriry iiotcs, tlic rciisoii for t.liis reiiiiirkiil~lc proccdurr h i n g tliiit iiiiisiiiuch iis tlic iiiit ioii hiis produced (iiicliitliiig ciipitnl goods) iiiorc t,liaii it his coiisiriiictl, Sociiil Credit should I)c issued Iiy tlic stiite ii i ortlcr to niiikc up t,Iw tlcliciency. I%y wiiy of fiirtliw illiistrii- tioii Niijor 1)otigliis tirkcs ii p i r t iculiir iiitlust,ry, viz. : cod-iiiiiiiiig, though of coiirsc his I)roposiils iipply to :ill iudiist rics. 15rery person cngiigctl in this intlustq is to beconic :I sliiircliolilcr iii ii iiiiners' ixiiik. ;\I1 c s~~ci i scs of t,lic industry, XviigeS, snliirics, ctc. nre to I N Ixiitl into this \);ink. Ag:iinst t h o tlcposits, rniiicrs ctc. ciiii drii\v cllcqilcs. Fiirtdicr t,lic bank is to I)(! c:iiipo\vcrcd to furnish ~ l i i i t ~ \ * ~ r iirlditioiinl c:ipitnl t,lic niiiieowncrs require for cstciision iiiitl new pliint, rcrriving irgaiiist this ntlclitioiiiil capital, nrlditioiiiil sliirrrs iii tlic ilntlcrtilking. I t srciiis tlicrcforc, t hiit, t.lic producers (ix., iiiiiicrs) who ;irv froiii tlic inception of t lie ~ c l ~ c i i i e iill sIi:irclioldcrs i n thc biiiik, will rcccivc iiii iiicrciisiiig nunibcr of sliiircs in t.he coitl-iIiiiic witliout liiivi1ig to 1)iLy for thcui. By way of crit.icisiii of this rciniirkiil)It! proposiil, let8 inc quote from ti simtliiiig iiiiiilysis of t l iv scliciiic i n ;I report Iiy ii st roiig tccliiiiciil commit tcc of t IN! I,nbour l'iirty, ivlio w o t c ;is follow : *' This soiintls tlcliglit- f id. Uiifort.uiiiitcly it overlooks tlio clcniciitiiry iicrtl for tlic: iiiiiicrs' I)iiiil< to h:ivc the ciipitiil Iichrc it ciiii supply it to thc colliery coii ipiirs i n rct.iirii for tlic issiic of new sliiircs." This w i s writ.tcii scwriil y('iirs iigo iiiid I tiike t.liis opporttiiiit,y of cslircssing niy rcgrot tliiit t hc coiiiiiioii sciisc nut1 siiiiity dislhycd i n tlic critiqisni of N;ijor 1)oiifilii~'s proposiils iirc sciircidy rcflcctctl in thrir iithtiidc towirtls Iiiiiiks iind crcdit i inc l p r i c d c . w r i q s wliicli is tlic fountliit,ion of tlicir ow11 .' coiistmctivc " pro- posiils, if ant1 w l i r i i t.licy iit t i i i i i ollicc.

I n vie\\. of tlic: I+itc:t t , l i i i t the prii(:ticiil working of Jfiijor I)oiigliis's tlicory of Soc:i:rl Credit iipIwirs to iiivolvc! i i polit:y of ii i i l i i i i i tct l iiiid progri;st;ii\*c i i i - llirtiori, it is i i r(biiso1i;ilil(! coiicliision t1i:it t,licrc is soiiict Itiiig tvroiig wit Ii tlic t,livory itself', i r i i t l t,liiit is wliy t lie \vritt:r Iiiis rcvt!rsctl t I i c usuiil iiic:t;l~ocI of' tlisciissiiig t lie tlrwry first iiiid its ii1)Idiciitioii iiftcr- iviirds. Ilwertiiig to the tlicory i i i i t l tlic " stnte- niciit, of ~ l i i i i l i " iiiitlcr t lie sis Iiciitlirigs iilrciidy givcii ii i t,liiti artkle, iL will lie sccii t l i i i b the whol~: i r r ~ i i i i i c i i t is csscritiiilly Iiiisetl oil t \vo t:oiitciit ions. !I'lic first, is tliiit tlic iniuiufiicLurer iiiitlcr the prcsciit systciii is iliciipiililc of tlistri1)utiiig sulliciciit p r - clinsiiig p o w r i i i wiigcs, SiiIiiricH, iiiid tlivitlciiils t o liuy tlic wliolc of t l w I)rodiiut iiiid i t t tlic siiuic tiiiict provide I'or tlic UCISL of t lie pl i i i i tr i i n t l niiichiucry. The sccoiitl coiit.ciition is t l i i i t if i t IN cliiiiiicd t,lirit puroliiisiiig power Iiiis iilrcritly bccii tlistributccl to tlic

Hov. 10,1034 CIIEMISTRY iWD INDUSTRY 073

innkcrs of plnnt, iind nincliincry, i i i it l frirtlicr piirclins- ing po\vnr i n tlic foriii of iviiges to tlic workcrs who niiike the lilt inintc coiisriiiinblc coniiiiodit.ics, tlic iinswcr is tliiit. tlic iviiges distributctl i n protliicing phiit, iiiitl iiinchiiirry Ii:ivc alrciidy bccn s p i t long Iic.fore tlic! consuniption goods conic on tlic mirkct.. :\(*cording to Jlnjor ~I)oiigl:is, t;we is tlic csscncc of tlie ~ i ~ d J h ! i i i . '' The \vliolo ccoiioiiiic systcni," JIiijor Dougl:is writvs, " is i n ccnsdcss niotiori. Z'rirclinsiiig p o w r is wiistiintly flowing Iiiick froiii intlivitluiils i i i t o t l i c credit systcni f r m i which it. ciinic, iintl if t t i c o i i t l loiv is Iws t h i n tlir inflow SOIiICtJIiC Iiiis to lose piircliiising powr."

l'lic siiiqdv i i i i svcr t o t lw first roiitciitioii is tliiit. it is qiiitv t riic t l i i i t , t.lie ninkws of coiisiiniption gootls (lo l i d rwcive siifIicii*nt piirehasing p o w r to Iiuy Iiotli t lie prodiict :ind t.lic pl:iiit., hit tl int tlicy ;ire not. iisk(!cl to do nnytliiiig so iinpossililc. 'l'lir workers \vho IIiiilic IJoots, for esiiiiiplc, Iiriy i i portioii of the oi i t1 i i i t only, :tiid tlic workers wlio iii:ikc tl iv 1il:rnt Iiiiy t l i v Iiiiliiiice of tlir oritpit. Tt is quitis t riic t Iiiit t I i v wigcis piid out Iiy, siiy, n hoot fiictory :ire riot siiltickmt to piiy for tlic boots :itid tlic! p l i i n t , in: isni idi :IS t Iir iiiiiniifnctiirrr's costs, pl:iiit,iind wigw i i w nioria t l i i i i i liis rrccipts. On t l i c t otlirr Ii: i i id, :I i i i i i i i i i l k t iirc'r of pliiiit, p i p or i t ittore tliiiii lie rcccivcs I~iic:k i n t I i v forni of 1iiircli;isrs Iiy tlic workers. 'L'liere- fore it is i i l i s i ird 10 siiggcst., iis JIiijor Ih~iigli i~ tlocs, that iindcr t tic p r c w i i t . system t lie iiltiniiitc Imycr of tlic liiiislrcd Iirotliict, is :iskctl to piiy not only for the Iioots but the pliint :IS \ d l . IIow Illen, it ni:iy lie irskcd, is tlic p l i i i i t piid for ! 'l'lic : i n s w r is simple ; it is piid for out of t.lic s r i v iqs of t lit! niiiniifiict iirer or by borroiviiig otlicr people's sii\.illgs froin tlic Iiiinks. A s rcgiirds tlic scwntl iirgiinicnt t Iiitt / i m is tlio cssonci! of tlic prolilciii, tlie iiiiswr is t l i i i t t.lic! point is irrelcviiiit.. It is quite trric t l i i i t tlic iiioiicy slicnt. o i i Idtint, derived froiii ii hiink loiiii hiis ii1rciidy

becn s p i t , liy the workers niitl possibly rcpnid to tlic bank, hut BI:ijor I)ougl:is scciiis to forget t l int these loans iirc Iicing rc!iiewetl i n otlicr directions, and tlicrcforc tlic iissuiiictl sliortiigc of p1ircli:ising powcr is iioii-csistcnt,. Of coiirsc it, is corrcct- t l int if tlie banks refriseti or cc:isctl to niiikn lo:iiis, :I brcnktlown of iiitlristry iiiiglit rcsiilt, hiit, this is riot tlic issue riiisccl by J1:ijor 1)oiigIirs. 1)ilenirii:is of tlic kind riiisecl iiiit1c.r t lie I)ori,yI:rs thcory :ire oftell best solved Iiy :I process of siniplilic:ition. Assrirnc that n fiirniw I I I : I ~ W iI plough or pays for i i ploiigh with nioiicy IJorroIvcd froill ii Iiiink. 'l'h fiiriiicr dis- trillritos \viigcs to his fiirlii Iiiliol1rct.s siillicicrit, to buy siiy t l i r c d o u r t l i s of tlie product. 'i'lic rest. of tllc p~odlll~t lit! SCllS to t .tW \VlJrkcl.S \\.\.llO Iil:illC tlic ploilg~i (or to new workers niiikiiig ot tier ciipittil gootls), illid with tlic niowy received repiiys tlic Ixmk lonn. Tn this ciisc tlic fiiriiiw's profits nrc coiivcrtccl into thc effcctivc owiersliip of tlie plougli.

I n tlic! nl)ove criticisin of Major I~oiigliis's tlicory : i i d pr:ictice, 1 Iiiivu ciitlriivoiirctl to (lo tlic aut,hor not o d y just.ico Iiut iiiorc tliiin justice. It, would Iic! easy to draw itttciition to inmy scrious contrn- tlic!tioiis cveii i n liis ~ t v n 1)rcscnt:ition of tlic itrgii- iiient. 'l'licsc inny occur i n discussing nil eliisivc issrir arid i t \voiild lie uiifnir to iiinkc too iiiucli of tllcnl. At the siinic tiriie it is Icgit.iinntc to siiy that. \vliciievcr Iic fiiitls Iiiiiisclf i n n tlillicillty Iic \viiiiclcr.s off into ;I i n n z c of iiililiiguo1is plir;iscology and quickly pnsses on to niiotlicr pliiisc of his subject. 'l'liis is tlic! nrt of tlic controversialist but not of tlic logicin11 or cconoiiiist,. Stripped of :ill vcrbingc tlic fiiiidn- iiicntnl cliiini of Jliijor I)origlris is tlitit consiiniption

of iirodiictioii iintl tlic loss iiiiitlc good liy iiii issue of ntltlit,ioiiiil l'rciisury notes. 'l!licre is iio ncetl to IIC nii ccoiioniist to rciilizi! the t l i s i i ~ t r o ~ ~ ~ nnturc of this proposiil.

goods slio~ltl LC sold iintlcr tlic ~iiiilillfiictu~cr'Y cost

VEGETABLE PARCHMENT AND WRAPPING MATERIALS FOR FOOD

By J . STRACHAN, F.lnst.P., M.I.Chem.E., and Dr. W. L. DAVIES Paper read before a meeting of tl ie London Section on October I , 1934