C.H. Douglas Out of Print ...... Mondo Politico
Social Credit, by
Major Clifford Hugh Douglas

Part I: Philosophy



WE have in England, probably to a greater extent than elsewhere, two distinct systems of education flourishing side by side. The distinction is clearly marked in the public schools and universities; but it is traceable through every grade of educational institution by the arrangements which are made to prepare candidates for public and other examinations. These two systems in the Public Schools are the Classical and the Modem sides, and have their equivalent Triposes and Honours Schools in the universities. One of these systems is Aristotelean, the second is Baconian.

Now, it does not seem to be so clearly realised as it should be, that these two systems of education are, considered separately, incompatible. The classical system is the embodiment of an attractive and artistic ideal or conception of the nature of society, and the conditions under which society lives, moves, and has its being. It is above, outside, possibly in advance of, facts. The modern school, of which inductive natural science, based upon the experimental ascertainment of fact, is the backbone, has not essentially to do with ideals at all. It is realistic; its first postulate is that forces act in a similar manner when placed in a similar relation to each other. It refuses to admit, as a fact, anything which cannot be demonstrated, and as a theory, anything which does not fit the facts. For example, the classical ideal contends that men "ought" to be good, brave and virtuous. The modern, that it does not understand the meaning of goodness, that bravery and virtue are not capable of exact definition, and, that so far as the word "ought" has any meaning, it postulates the existence of a force so far undemonstrated.

It will be recognised on a moderate consideration, that the effect on the everyday world of these two philosophies cannot fail to be disruptive. The logical outcome of the classical ideal is to lay the emphasis of any observed defects in the social organisation on defects in the characters of the persons composing the society. Wars occur because people are wicked, poverty, because people are idle, crime, because they are immoral. Material progress, which in its essence is applied Science, is repulsive to the Classical mind, because it does, in fact, stultify the rigid Classical ideal. Conversely, the scientific attitude tends to the opposite extreme, towards what is called Determinism; that people's actions, thoughts, and morals, are the outcome of more or less blind forces to which they are subjected, and in regard to which, both censure and praise are equally out of place.

It is probable that, as in many controversies, there is a good deal to be said for both points of view, but it is even more probable that approximate truth lies in appreciation of the fact that neither conception is useful without the other. It is probable that in the less fortunately situated strata of society, a theory of economic Determinism would be a sound and accurate explanation for the actions of 98 per cent of the persons to whom it might be applied; that those persons are, in fact, obliged to act and think in accordance with limitations which are imposed upon them by their environment. In short, that their environment is more powerful in shaping them, than they are in shaping their environment. But this is not true of their more fortunate contemporaries. There are, without a doubt, circumstances in the world, in which the personal conceptions of individuals can have powerful and far-reaching consequences on their immediate and even national or continental environment. It seems reasonable to believe that a Napoleon, a Washington, or a Bismarck have, in effect, changed the course of history, just as it is certain that a James Watt, a George Stephenson, or a Faraday, have altered the centre of gravity of industrial and economic society.

All this is sufficiently obvious, but the important idea to be drawn from it, is that before human ideals (including the Classical and religious ideals) can be brought into any effective relationship with and control by the great mass of the population, that population must be released from the undue pressure of economic forces. It is quite arguable that Napoleon was a curse to Europe, but it is not reasonably arguable that a Napoleon, if living at this time, would be sure to repeat the history of the late eighteenth and early nineteenth centuries. It is reasonably arguable also, that no man could reproduce the career of Napoleon or Bismarck in a country in which the majority of the inhabitants were both economically independent, and politically contented.

A clear understanding of the circumstances in which personality is of importance in effecting environment, and, on the other hand, the circumstances in which it is unreasonable to expect the development of personality which may be considered satisfactory in a pragmatic sense is of the first importance to a balanced consideration of the difficulties and dangers which beset the civilised world at the present time, as well as to the framing of proposals to meet the situation. No one, having devoted any consideration to the subject, can fail to feel exasperation at the exhortations of the sentimentalist forever clamouring after a "change of heart." What effect on his particular difficulties is it going to have, if the miner, abandoning self-interest, goes to his employer and offers to accept half his present wages? Or the mine-owner, faced with a loss, who raises his men's wages? What effect on the dividends of the shopkeeper already in debt to his bank, and in doubt as to the source from which he shall pay his next week's rent, and meet the difference on his overdraft, does it have, if smitten with the sudden desire to apply the golden rule to business, he sells his goods at half their cost to him, because he knows his clientele, who are coalminers, cannot afford more; thus accelerating his progress to the bankruptcy court and the cessation of his activities as a distributor? What is the use of epileptic addresses on the criminality of war, when the enemies' aeroplanes, if not stopped, propose dropping poison gas-bombs on a population which has, probably, not the faintest understanding of the casus belli.

On the other hand, no one who has attempted to obtain a hearing for concrete proposals of a social nature from persons who seemed from their position in the world to be favourably situated in respect of their furtherance, can fail to have realised that a difficulty is always met with, in establishing a common point of view; that in fact, it is a condition of executive position-holding, that the point of view shall be in the highest degree, and in the narrowest sense, conservative. It is not an unfair description of the situation to say that those persons who in the main are anxious for changes in the social structure are powerless to effect them, while persons more favourably situated to bring them about, are rarely anxious to do so. There is not much difference in the "heart" of the two descriptions of person; the difference in behaviour arises from the fact that one is reasonably satisfied with his lot, the other is not.

This is not an abstract problem, it is a practical problem of the first importance. It can be stated in general terms as the problem of bringing together of desire and the means of fulfilment, in relation to the largest possible number of individuals. At every step it is complicated in the practical world by the interjection of so-called moral issues. The courageous bishop who stated that he would rather see England free than sober, may, or may not, have realised that he was postulating in an attractive form, an issue which challenges the idea that a good end can excuse a bad means. The same issue is raised by the endeavour (a successful endeavour), to exhibit "unemployment" as a symptom of industrial breakdown, rather than, as it should be, a sign of economic progress.

Closely interwoven with the classical and moral theory of society, is the theory of rewards and punishments. So familiar is this idea, through education and experience, to most people, that it is only with some difficulty that they are brought to realise that it is an artificial theory and not inherent in the nature of things; that the statement "be good and you will be happy" does not rely for any truth it may possess on any fixed relation between the abstract qualities of goodness and happiness, but upon the fixed relation of cause and effect between certain actions to which the title "goodness" may arbitrarily be applied, and their reactions which we term "happiness." This may appear to be word splitting, but when we realise that the whole of the industrial, legal, and social system of the world rests for its sanctions on this theory of rewards and punishments, it is difficult to deny the importance of an exact comprehension of it.

For instance, the industrial unrest which is disrupting the world at the present time, can be traced without difficulty to an increasing dissatisfaction with the results of the productive and distributing systems. Not only do people want more goods and more leisure, and less regimentation, but they are increasingly convinced that it is not anything inherent in the physical world which prevents them from attaining their desires; yet captains of industry favourably situated for the purpose of estimating the facts, are almost unanimous in demanding a moral basis for the claim put forward. That is to say, those persons whose activities at the present time are chiefly concerned with restricting the output of the economic machine to its lowest limit, while yet asking each individual to produce more, are determined that not even the over-spill of production shall get into the hands of a semi-indigent population, without some equivalent of what is called work, even though the work may still further complicate the problem with which these industrial leaders are concerned. Nor is it fair to say that this attitude is confined to the employing classes. Labour leaders are eloquent on the subject, and with reason. The theory of rewards and punishments is the foundation stone of the Labour leaders' platform, just as it is of the employer whom he claims to oppose. The only difference is in respect of the magnitude and award of the prizes and as to the rules of the competition for them. To any one who will examine the subject carefully and dispassionately it must be evident that Marxian Socialism is an extension to its logical conclusion, of the theory of modern business.