Re: [socialcredit] Post to the Daily Bell

[DANIEL KRYNICKI]

As Mr. T would say, "Pity the fool".  Trust must only be reserved for Almighty God.  "The heart of man is desperately wicked; who can know it?"  "The love of money is the root of all evil."  

You want to trust; go ahead.  I want harsh legal strictures that will be enforced by a dedicated people.  When you wake up, let the rest of us know.

On May 25, 2013, at 1:00 AM, johnw...@gmail.com wrote:

http://thedailybell.com/bellinclude.cfm?id=29139&feedbackcount=all

There is too little trust in the world these days.

Without trusting each other, we as humans are nothing.

The whole money system is a system of trust. That is all money is, whether it is gold, paper, seashells, or blips on a computer screen. It is trust.

The fundamental belief of this trust is that, with this money, one can get the physical wealth that one desires in exchange for it.

The whole economy runs on trust, and that is the only thing it can run on. With money we trust that a certain quantity of particular goods will be at a certain place at a certain time. We trust that there will be enough money to get what we want done, done.

So it is important that there in fact be enough money to enable that trust. That is, there must be enough money to ensure that we can obtain possession of all the things that we have made by working together in the specialized processes of machine production. The standard for what is sufficient is the price of this production to the consumer. So it is vitally important that, from moment to moment, we possess enough money to liquidate all prices charged to us.

The factors that make up the amount that a price is charged for are all the costs involved in making that specific product that the price is attached to. The major source of costs derive from direct income payments, but that cost is in most case charged to the consumer long after that income has been paid out, so that by the time that cost is charged to the consumer as prices, the consumer has not got the money anymore, having spent it. Yet we trusted that we would. More costs are added when profit is charged, when loans are recalled, or when interest is paid.

Currently the only way we are able to have the money to buy the things we are being charged for now and for the most part haven't got the money for is if we work at a job that grants us income but charges costs into products that will arrive on the market some time in the future. And as an increasing amount of the costs are the ones arriving from the past (as overhead charges, raw material purchases, plant and depreciation charges, loan repayments, etc.) as technology progresses and machines do more of our work for us, we must work yet harder and harder and resort to more and more desperate measures to get by as prices continue to rise because of the arrival of these costs from the past in the present.

But we enter this system of money on the trust that with it we will be able to claim a just share of the fruits of our joint efforts, past and present. If we are to fulfill that trust, we must have the money to discharge the costs that come onto the market in the present as prices. To do so requires that prices be made to reflect the total amount of consumption that we are able to afford in the moment. To do this without forcing businesses to operate at a loss or granting an unfair advantage in pricing requires lowering all prices charged to the consumer by a universal percentage, and reimbursing businesses with newly created money - as representing the real wealth that we actually can possess, but do not have sufficient money to buy with - to the amount that their prices were lowered.

We have inherited the current economy, along with our entire civilization, from our ancestors, and each of us should rightfully have a share in its products. To deny this is to deny that our ancestors have given their labor to make sure that we could live, and furthermore that we could have a better and richer life than they. And to deny a human being the basic right to life without the necessity of work is to deny that we have machines that save their labor, and increasingly more of it, and is to assert that we exist in an age where everyone's effort is required simply to produce the food and shelter required for a minimum existence. This is patently not the case, as is vaguely hinted at by considering that 80% of employment in the U.S. is in the service sector, when it was once perhaps 30% (citation needed). This fact is disguised only by a system that brings into being by economic compulsion the illusion that we must all work for a living for the great majority of our lives.

This share in the national business then would be a periodic (monthly or bimonthly) payment of freshly created money direct to all citizens in the economy concerned, enough to live decently, if modestly. As machines do more of our work for us, the wage will increasingly be replaced by this dividend payment on our share in the national wealth. This payment will count as part of the income received by consumers, and would factor into the exact calculations of the price discount.

The administration of this would be simple. A National Credit Office of some sort could be arranged to calculate what the incomes of consumers are and what the total price of all ultimate goods and services are. Issuing the dividend payments would be as easy as estimating out how much an individual needs to live respectably on, and then sending out that amount in a check or bank deposit to every citizen. As there is no means testing, there is no bureaucracy, just statisticians and clerks. The price discount could be administered by having each participating business sign a contract to use standard cost accounting principles and charge a fair profit (that is, no more than 10% of turnover, perhaps), and have license to reduce their prices by the declared amount. The total amount lost on each sale would then be written up in an account, and be reimbursed by that amount upon presenting that account to the business's bank. The bank would balance its books by presenting the total amount of discount to the National Credit Office and being credited that amount by a new creation of money. Again, there is no bureaucracy, aside from the licensing, the criteria for which would simply be, will the business apply the discount and do its accounting and profiting honestly.

In the beginning of the transition from this current economy to the proposed one it might be adviseable not to issue the entirety of the estimated gap between income and prices, as it would likely cause a spike in demand along with a wave of unemployment as people demanded more goods and quit jobs they hated working, causing a temporary shortage of goods as production adjusted to meet higher demand. This spike in demand would open up plenty of well-paying jobs for those who wanted them, but the disruption in other sectors of business might actually make things worse, not better. As production adjusted the full gap could be issued.

As a result of people actually having the money to meet all prices charged them, the success of a business would depend more on whether people truly wanted its products, instead of persuading people to make poor choices in their finances by buying unnecessary items to make their stressed lives easier at the cost of quality of the other products they buy, or at the cost of indebtdedness. As well, people would in general have less stress, having security in their livelihoods, which would reduce the tendency to crime and mental illness. Having security in their livelihoods, people would also have the freedom generally to choose the type of job they wished to occupy, or to pursue an unpaid occupation such as childrearing, invention, culture, spirituality, etc., and would have better lives in that way.

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[Jim Schroeder]

". As there is no means testing, there is no bureaucracy, just statisticians and clerks. The price discount could be administered by having each participating business sign a contract to use standard cost accounting principles and charge a fair profit (that is, no more than 10% of turnover, perhaps),"

 

Hi John P.

 

Very well written.  I agree with everything you say below, but I want to point out that there's another way to issue the price dividend, and it's the way that I prefer because it's much simpler, and doesn't dictate to firms their return on turnover, or profit on sales. The rebate could be issued directly to the consumer, instead of the company selling to the consumer.  It would involve a simple computer program for purchases made with debit, or credit, cards.  For cash purchases, a special receipt would have to be printed and submitted to the bank.  I think this method is more efficient, and will stop the cries from "libertarians" that Social Crediters want to interfere with the micro-economy and dictate profits to the firm.

 

I think that the Social Credit paradigm is concerned solely with the macro-economy, and I also believe it should stay that way.  I think the method of distributing the price rebate that you mention above interferes with the efficient allocation of resources that the profit motive provides in the micro-economy.

--

Jim Schroeder

 

http://social-credit.blogspot.com/

 

 

[DANIEL KRYNICKI]

It is trust.  Hence there is the dire need for harsh legal strictures to deal with the endless malfeasance and misfeasance before any monetary innovations are launched.  These trust violations today, because of the way in which international trade is regulated, make traitors of many.  The PTB want patriots to give their futures and lives in the name of their countries for their endless wars, but nevermind the fiscal violations perpetrated by the PTB making economic slaves of the many.  Dividend isn't going to solve this with the core of the PTB control intact - the authority to create the money and then charge interest for its use.    

On May 25, 2013, at 7:17 PM, johnw...@gmail.com wrote:

Do you disagree with the notion that money is trust?  If it is not, what is it?

[DANIEL KRYNICKI]

The end of the poem below reveals it originated in UK.  This is how the PTB operates.  Is a SC Dividend going to solve this?  So the people get a dividend.  Not only will the PTB raise the interest rates, they will also raise taxes.  The more things change, the more they will remain the same.

(Note: PTB = Powers That Be or to those who have taken the time to find out, they are the privately owned central banks of the world.)

The PTB want patriots to give their futures and lives for their countries in the PTB's endless wars, but nevermind the fiscal violations perpetrated by the PTB making economic slaves of the many.  Dividend isn't going to solve this with the core of the PTB control intact, which is the authority to create the money and then charge interest for its use.  

The SCers say that usury is not bad and does not harm.  We might ask: Does no harm to whom?  A monetary system can provide enough currency for business to flourish.  But who creates the money (the people or privately owned institutions) and whether usury is legal or not are the real issues.

Daniel S. Krynciki

St. Clair Shores, Michigan

May 26, 2013

At first I thought this was funny....Then I realized the awful truth of it. Be sure to read all the way to the end! 

Tax his land, 
Tax his bed, 
Tax the table 
At which he's fed. 

Tax his work, 
Tax his pay, 
He works for peanuts 
Anyway! 

Tax his cow, 
Tax his goat, 
Tax his pants, 
Tax his coat. 

Tax his tobacco, 
Tax his drink, 
Tax him if he 
Tries to think. 

Tax his car, 
Tax his gas, 
Find other ways 
To tax his ass. 

Tax all he has 
Then let him know 
That you won't be done 
Till he has no dough. 

When he screams and hollers; 
Then tax him some more, 
Tax him till 
He's good and sore. 

Then tax his coffin, 
Tax his grave, 
Tax the sod in 
Which he's laid. 

When he's gone, 
Do not relax, 
It's time to apply 
The inheritance tax. 

Accounts Receivable Tax 
Airline surcharge tax 
Airline Fuel Tax 
Airport Maintenance Tax 
Building Permit Tax 
Cigarette Tax 
Cooking Tax
Corporate Income Tax 
Goods and Services Tax (GST) 
Death Tax 
Driving Permit Tax 
Environmental Tax (Fee) 
Excise Taxes 
Income Tax 
Fishing License Tax 
Food License Tax 
Petrol Tax (too much per litre) 
Gross Receipts Tax 
Health Tax 
Heating Tax
Inheritance Tax 
Interest Tax 
Lighting Tax
Liquor Tax 
Luxury Taxes 
Marriage License Tax 
Medicare Tax 
Mortgage Tax
Pension Tax
Personal Income Tax 
Property Tax 
Poverty Tax 
Prescription Drug Tax 
Real Estate Tax 
Recreational Vehicle Tax 
Retail Sales Tax 
Service Charge Tax 
School Tax
Telephone Tax 
Value Added Tax
Vehicle License Registration Tax 
Vehicle Sales Tax 
Water Tax 
Workers Compensation Tax
Tax (VAT) on Tax. 
And Now they want a blooming Carbon Tax!

STILL THINK THIS IS FUNNY?

Not one of these taxes existed 100 years ago, & our nation was one of the most prosperous in the world... We had absolutely no national debt, had a large middle class,a huge manufacturing base, and Mum stayed home to raise the kids. 

What in the Hell happened? Could it be the lying parasitic politicians wasting our money?
Oh, and don't forget the relatively new bank charges....
And we all know what we think of Bankers. 

I hope this goes around the UK at least 1000 times!!! 

YOU can help it get there

On May 25, 2013, at 7:17 PM, johnw...@gmail.com wrote:

Do you disagree with the notion that money is trust?  If it is not, what is it?

On Saturday, May 25, 2013 8:21:38 AM UTC-5, pipefighter2 wrote:

[Jim Schroeder]

Hi John P.

 

I think the people that fear that companies will run away with prices really don't understand competitive forces of markets and their influence on prices.  The assumption is that firms can simply charge what they want in prices, but this is not true.  Another company can always steal customers and increase revenues by reducing prices. This is why companies in competitive industries often have a very low rate of return on sales.  There's no need to mandate returns in a capitalist system, and if I have one major disagreement with a policy initiative of Douglas, that would be it. 

 

On Sat, May 25, 2013 at 5:21 PM, <johnw...@gmail.com> wrote:

Hi Jim,

That is a better method.  I had been thinking that the profit-clause was necessary because otherwise businesses would just run away and up their prices to null the discount, but that would likely not happen because of the force of competition, and now that I think of it, it doesn't jive with the whole trust idea.

Although in that method one might receive the complaint that that method would force people to get credit/debit cards, or inconvenience those who use cash.  This is a silly complaint (I would collect all my receipts if I got money for them!  Look what people do for bottles!) but I just thought of it, and it might come up and be insinuated in some way.

[Jim Schroeder]

"The heart of man is desperately wicked; who can know it?" (Daniel)

 

Does that apply to you, Daniel? 

[Jim Schroeder]

"  I want harsh legal strictures that will be enforced by a dedicated people." (Daniel)

 

This is why Norman Webb called Puritanism of the devil. It's the dark desire to rule over others in "moral disguise", very similar to what the communists wanted with their "change of heart", and many people were sent to gulags or killed  by "dedicated people"

 

This is also why Douglas called people who wanted to end interest on loans "amateur currency experts" and "propagandists for totalitarianism".

 

 

 

 

On Sat, May 25, 2013 at 7:21 AM, DANIEL KRYNICKI <pipefi...@wowway.com> wrote:

[Joe Thomson]

Hi Jim,

 

At the end of your reply appended below you wrote:-

 

"There's no need to mandate returns in a capitalist system, and if I have one major disagreement with a policy initiative of Douglas, that would be it. "

 

Where did Douglas "mandate returns"?  Offhand, I can only remember two places where it might be construed that that is what he was proposing, though I personally  don't believe it really was.   Are you aware of any more?  There may well be, but I'm at a loss to remember just where.

 

One was the passage in 'Warning Democracy'  where he utilised the hypothetical  example of  "the large departmental stores" like,  (in his day, in England),  Harrod's and Barker's agreeing to restrict their "profit on turnover" to "10%".   In return for their customers being subsequently rebated the per centage amount of the CPD applied to the sale price  after the time of purchase,  (through presentation of their bill of sale to a bank).  Where the amount of the rebate was considerably more than the 10% margin on turnover, I believe the usual 25% that Douglas seemed to often use in his examples.

 

The other was in the 'Draft Plan for Scotland', where any firm enrolled in the CPD scheme that couldn't show a profit in three years was to have its discounting priviledge revoked.

 

My own belief is that Douglas was not particularly concerned about 'profiteering' as is often assumed.   But in talking about the "large departmental stores",  (not ALL stores), his concern was that they may try to 'predatory price' their smaller competitors out of business utilising even LOWER prices, using the CPD to assist them. 

 

For just as it's often said on the 'production' side of the economy that,  "Unit cost is a function of volume", so, I believe,  that would hold true on the 'distribution' side as well when it comes to 'unit prices'.  

 

A further increase in the volume of sales done by these large stores, (who already have, as Douglas noted elsewhere, a 'paper efficiency' in having a greater access to credit not available to smaller competitors), could allow them to sell below cost, take a loss which they could quickly recover from later through a combination of a larger volume (with the smaller competitor then eliminated completely), plus a higher price then that an effective monopoly position would assure.  At least for a time, until other competition might arise, if it could.

 

I believe, this could also be the reason why Douglas was concerned about any firm not being profitable being struck from the CPD scheme in the 'Draft Plan'.  

 

We do know that 'predatory pricing' does happen, even though proof of it being purposefully engaged in is against the law in Canada, under our "anti-Combines" legislation, (similar to the "anti-Trust" laws in the USA, only with less chance of success in accomplishing the intended purpose, usually). 

 

I believe Chapters Bookstores, a large Canadian concern now dominant in the book trade and controlled, as we might say, "by the usual suspects",  was nailed on that after they tried to eliminate another long-standing BC book store, Duthie's, if I remember correctly. And the latter didn't cave in as expected. 

 

I think this is supported throughout Douglas's works by his antithesis to 'monopoly' and anything that would aid its development.  That while we certainly want the customer to get the 'best price' on products for sale, we also recognise that, over a longer term,  the maintenance of competition is important.   For ' best price' alone isn't everything, and, in fact, is often not always even the main consideration for all consumers in choosing what and where to buy.  

 

That's my thinking on it, anyways, though I may well be wrong.

 

Cheers,

Joe

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[Jim Schroeder]

Actually, Social Crediters do not say that usury does no harm.  Usurious interest rates are harmful, and there's laws against them currently.  Social Crediters are smart enough to distinguish between usury and interest, which the Hebrew language does as well. 

 

Social Crediters are also intelligent enough to know that interest is merely the price of a loan, and all firms charge prices in a capitalist system.  Prices and profits determine the efficient allocation of resources.  Social Crediters are not so ignorant as to believe that banking is a costless activity.

Jim Schroeder

 

http://social-credit.blogspot.com/

 

 

[Robert Klinck]

He obviously is convinced that he is something special--a superior being more or less on a par with the angels.  One has to wonder why, from his lofty judgmental perch, he so persistently consorts with the ordinary mortals who contribute to this discussion group.

[Robert Klinck]

An honest individual would provide the sources of these quotes.  Unfortunately for Daniel, doing so would demonstrate that they are unrelated.

[Jim Schroeder]

Hi Joe:

I can't remember exactly where I read it off the top of my head, but I do remember that one of Douglas's proposals, where the firm sold below cost and was later reimbursed through the price rebate mechanism, he wrote something to the effect that an agreed upon rate of return on turnover would be allowed for specific industries.  I think this would interfere in the efficient allocation of resources by not allowing firms to increase their rate of return through cost saving initiatives.

[John G Rawson]

It was quoted here not long ago. Approx. "If Harrods could be peruaded ro sell at a lower price....."
The quote I would like is where he changed his mind and promoted a reimbursement of customers scheme. 
J R

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Date: Mon, 27 May 2013 11:39:48 -0600

Subject: Re: [socialcredit] Post to the Daily Bell

From: jimsch...@gmail.com
To: social...@googlegroups.com

[Joe Thomson]

Hi John (Rawson),

 

The exact quotation is as follows:- "Suppose that the large departmental stores, such as Messrs. Harrods, Messrs. Barker's, etc., were to agree, as they probably would, to restrict their net profit on turnover (not, be it noted, on capital) to 10 per cent.  Imagine them to issue with each sale to an individual consumer, an ordinary statement of sale, commonly called a bill, and imagine arrangements to be made with the banks that these bills, when turned over by the individual consumer to the bank, should be credited at 25 per cent of the face value to the individual consumer's account to which they refer. "   'Warning Democracy' 105-7.

 

Douglas further stated,  a little later, " I have, of course, used the figure of 25 per cent for purposes of illustration."

 

So there is NO 'persuading'  to "sell at a lower price" involved.  It may even be open to question as to whether a 10% "net profit on turnover" for a store like Harrods or Barker's at the time 'Warning Democracy' was written,  (in the worst years of the Depression),  might have been an improvement on the rate of net profit on turnover they were then getting.  I recall reading once that the margin in some areas of retail for some of the largest, high volume retailers of groceries was somewhere around 2% normally. 

 

The important thing that  Douglas repeatedly stressed was to understand the principle that consumer purchasing power could be increased by a debt free issuance of new credit that effectively LOWERED the price to the consumer whenever he made a purchase.  And it can be.  The mechanism we utilise to do this, is whatever works best considering all the particulars involved.  I agree with Jim, it seems to me to be more practical to credit the consumer at, or after the point of sale, (as Douglas illustrates above), than to credit the merchant on condition he discount his regular price by that amount.  And I'll stick by what I previously said about there being likely a greater tendency of large merchants to 'predatory price' than to engage in 'profiteering'. 

 

Regards,

Joe

Version: 2013.0.2904 / Virus Database: 3184/6365 - Release Date: 05/28/13

[Jim Schroeder]

"were to agree, as they probably would, to restrict their net profit on turnover (not, be it noted, on capital) to 10 per cent." (Warning Democracy)

 

This is the exact quote by Douglas that I take issue with.  Why would we ever restrict net profit on turnover?  I can see there being laws against predatory pricing and monopolistic behaviour, but we already have those in Canada (the Combines Investigation Act) and in the US (Anti-Trust Laws).  One could argue the effectiveness of these laws, but I still don't believe there should ever be laws restricting the rate of profit on turnover because it rids the company of the incentive to reduce costs and become more efficient (ie. it distorts micro-economic prices and profits).  I, like you, prefer the idea of giving the rebate directly to the consumer.  Plus, this delivery method is simpler and more effecient, in my opinion.

[Vi King]

Hi Joe,

 

Thanks for the information.  As to the percentage that stores take in, I understand that grocery stores in the US average only 1%  of sales that they keep for themselves.  However, department stores might be quite different.  The reasons for this are that they offer much more help to their customers than do groceries (which is to say that the former are actual salespeople, and not just checkers or clerks),  and they don't have nearly as high a turnover of merchandise in consequence.  I would suspect that this makes a huge difference in their percentages.  Ten percent might still be more than sufficient, but maybe not.

 

 Viking

[John G Rawson]

Thanks Joe, that's constructive. At last someone provides the full picture.
Still looks like a massive job for our Commerce Commission to deal with every retailing firm in the country,
Profit control might be somewhat unpopular.
And how would it affect your business? Different ptices for timber sold to private customers and that sold to builders????
Regatds.
J R

---

From: thoms...@shaw.ca
To: social...@googlegroups.com

Subject: Re: [socialcredit] Post to the Daily Bell

Date: Wed, 29 May 2013 21:20:36 -0700

[Joe Thomson]

Hi Jim,

 

Some comments in 'green' interspersed with yours below.

From: Jim Schroeder

"were to agree, as they probably would, to restrict their net profit on turnover (not, be it noted, on capital) to 10 per cent." (Warning Democracy)

 

This is the exact quote by Douglas that I take issue with.  Why would we ever restrict net profit on turnover? 

 

The way I read  what he wrote in the rest of that passage in 'Warning Democracy', beyond the part that I quoted, and also in "The Draft Plan for Scotland",  it almost seems to me that he was more concerned with net profit on turnover still being maintained at whatever would be a 'normal' average for the type of business concerned before any "assisted price scheme" comes into play after it was operating.    Rather than with some merchant  unfairly 'profiteering' from it the way it's often imagined some could.     Even though if the turnover increases due to the lowering of prices to the consumer  through the CPD, that net profit should increase, too. 

 

Traditionally there seems to be a belief  that the kind of restriction on profit  Douglas is imagined to be calling for was to counter merchants raising their prices to 'profiteer' from part of the discount that should be going to the consumer.  But I wonder if that's really so? 

 

They're already going to get an increased profit from having a larger turnover, so what would be the incentive to 'profiteer' this way?   And anything paid out by the business to its owners is going to buy more when they spend it on their own personal consumption.

 

Perhaps there's something in the way that accounting works that we're missing here?  Could it possibly have something to do with the way net profit on turnover relates to cash flow?  Or am I way, way off base, and the 'traditional' viewpoint is the correct one, even though it seems to me to be somewhat contradictory to Douglas's other views on several things?

 

 

I can see there being laws against predatory pricing and monopolistic behaviour, but we already have those in Canada (the Combines Investigation Act) and in the US (Anti-Trust Laws).  One could argue the effectiveness of these laws, but I still don't believe there should ever be laws restricting the rate of profit on turnover because it rids the company of the incentive to reduce costs and become more efficient (ie. it distorts micro-economic prices and profits). 

 

I think the history of effectiveness of those  kind of laws has been more pronounced in the USA than in  Canada, and I wonder whether there was even anything as effective as that, (or at all), in England?   Douglas mentioned 'price rings' in several places in his books, almost as if what would be illegal in the USA was an acceptable  practice in  England.   

I, like you, prefer the idea of giving the rebate directly to the consumer.  Plus, this delivery method is simpler and more effecient, in my opinion.

 

I'd still like to know for sure what he had in mind in the quote you take issue with.  Regardless, I can't see where there'd be any insurmountable difficulties with the CPD, and it's too bad it's never received  more attention from those seeking to promote Social Credit politically.

Version: 2013.0.2904 / Virus Database: 3184/6371 - Release Date: 05/31/13

[Jim Schroeder]

"Traditionally there seems to be a belief that the kind of restriction on profit Douglas is imagined to be calling for was to counter merchants raising their prices to 'profiteer' from part of the discount that should be going to the consumer. But I wonder if that's really so? "  (Joe)

 

Perhaps he was concerned with maintaining profits for the firm, but either way, I don't agree with it.  Profits and relative prices are market signals to efficiently allocate resources.  If some companies cannot maintain profits with a CPD, then, chances are, that people don't actually want what they are selling, and they should go out of business.

 

I think the plan to interfere with micro-economic profits is off base, and I don't think it's philosophically consistent with the rest of Social Credit.  Unfortunately, Douglas is not alive in order to question him on the subject, so we can only speculate, but I don't believe that this sort of delivery mechanism is consistent with the Social Credit philosophy, nor do I believe it's as efficient as the other mechanism.

[Joe Thomson]

Hi Viking,

 

Yes, like you say, the department store  overheads would be higher and the volume of turnover lower than would be the case with the grocery supermarkets,  and so if they were to be able to book a comparable return on their investment I believe their net profit on turnover would have to be higher. 

 

One could imagine that the costs of the stores themselves, to build, or rent, equip, light, heat or cool, insure, etc., wouldn't be much different nowadays.  The multi-storied department stores now seem to be a thing of the past.  Modern stores are all on one level, or two at most.  And what could be used to retail one, could usually be as readily used to retail the wares of the other.

 

Likely there'd be more overall labour costs in a department store than a grocery supermarket if the wages and salaries paid were comparable, because the former would seem to need more people on the floor than the latter.  Though this may not always be the case, since I believe the staff at many large volume grocery supermarkets are often much better paid than their counterparts in large department stores. 

 

This used to be the case in Canada, anyways, where an 'entry-level' job at a large supermarket,  like Safeway,  stocking  shelves,  often paid as much, or  more, than what any entry level job in a unionised lumber mill stacking lumber or doing clean-up paid.  And you were indoors in the winter, with no heavy lifting as well!   But those starting  in the department stores were often at the mandated minimum wage, or very close to it, and didn't come up much even after years of experience. 

 

Now, of course, a lot of that's changed, and wages at many large grocery supermarkets have been pared back, and the spread between them and the large chain department stores' staff seems to be narrowing.    Some of the large department stores, Wal-mart, Target, etc.are getting more and more into offering a full complement of groceries.  Turnover seems to be the key, and a small margin on a large volume preferred over a large margin on a small one. 

 

Traditionally, this seems to have been the case in manufacturing, too.  There are many reasons for it in the lumber industry.  Why, for instance, contrary to what many believe should be the reverse, a plant making a large volume of a very basic, low value lumber product like 2x4x8 ft. studs, say,  often does better financially, even after paying a high cost for the raw material, than a plant making a much higher-value but slower moving product will.  And I believe a large part of that is due to the way 'cash flow' and 'profit and loss' relate to one another.  Unfortunately, I'd be getting beyond my limited knowledge of  the  rules and conventions of  accounting to give you an adequate explanation of it from that aspect of the overall situation.    

 

Regards,

Joe

[Joe Thomson]

Hi John (Parr),

 

(John Rawson wrote:-) "And how would it (the CPD) affect your business? Different prices for timber sold to private customers and that sold to builders????"

 

In my business we have one price that applies to both.  This is not so everywhere, however, where some building supply dealers offer a 'contractor's discount' to those engaged in construction as a business. 

 

The CPD would  apply to lumber sales to the final consumer, (which would be a 'do-it-yourselfer' buying lumber for his own particular project).  It wouldn't  apply to lumber sales to a contractor, who is going to pay for that lumber himself and include the cost of it as part of the  whole cost of the project, materials and labor,  ultimately paid for by his customer.  Who would be the one who received the CPD rebate, on the total price he was billed.

(John Parr wrote:-)  That's a point I've been wondering.  How would we prevent merchants from making purchases as "consumers" and then transferring those materials to their businesses, without obtrusive government oversight?

 

That's a very good question, John, because I do suppose there's a possibility of that happening.  It certainly does happen now to some degree, only in reverse.  Where a businessman charges items he is consuming personally to his company as a business expense. 

 

One common practice is the full expensing of a company owned car or light truck, and all the fuel it takes to run it, when it's being utilised partially for personal use.  That can be overcome by keeping an accurate mileage log separating the two, especially if personal use is substantial and likely business use otherwise unverifiable. 

 

Somewhat more difficult to track is a business purchase of of an item like toilet paper, say, where the businessman diverts some of the supply homeward for his own household's needs.  Difficult, but not impossible.  It is truly amazing what a well qualified government  tax auditor can often tell you about your business, just by looking at your books and spending a bit of time around the business.    And the penalties imposed when you get caught, especially if there's a suspicion of purposeful fraud, do tend to act as a costly dis-incentive to believing you're smarter than the tax man.

 

But to get back to your question, one way would be found in the fact that the recipient of the discount has to surrender a copy of his bill of sale to the bank in order to have his account credited with the rebate.  Assuming that two copies of the bill of sale were given to each customer, one of which a retail purchaser would surrender to receive the CPD, and one he'd retain for his own records, (such as any he may keep), it doesn't seem to me to be a very difficult practice to require any business customers to be able to produce two copies of each bill of sale instead of one to verify their business purchases as recorded in their books. 

 

We could engineer it somehow so that all prices, not just of consumeable goods, were given rebates.

 

No, that wouldn't achieve the desired purpose. 

 

We could make it so that there would be incentives for competing businesses to report suspicious pricing, or for banks to report observeable abuse in rebates, and for the businesses or the government to prosecute those businesses.  The incentives would have to come after the facts have been proven, and mere reporting would not have to damage the business before the facts have been proven.  Otherwise businesses could be reported just for having actual competitve prices, and then have to go through the burden of a legal battle to prove they're right.

 

Yes, IF the concerns that some  businesses might tend to use the CPD to 'profiteer' as is often supposed they might were proven to be valid, those are some of the ways that might be utilised to prevent that.

Or we could make it so that the accounting of every business was available for the public to see. 

 

The 'public', including many of us in business ~most, perhaps, and certainly I include myself in this category ~ would first have to have a lot better understanding of how business accounting developed and actually works before something like that would be very useful.  Personally, I have no objections to it otherwise. 

Or something else.  These are just thoughts. 

 

And they are good thoughts, very well considered. I believe I can speak for everyone who's been on this List for any length of time, but even if not, certainly for myself, in expressing my positive impression of your postings here. 

 

For someone of your age to take up the study of this complex and often frustratingly  difficult subject and make the progress you've made  in such a short time is truly amazing.   And most encouraging, too, for the future of Social Credit.

 

I hope you'll stay with it, even when it seems like you've reached a 'dead-end', and all you've thought you've discovered that was just fitting together so nicely suddenly starts to fall apart. Just remember we've ALL been in that same spot, and to a greater or lesser degree probably all still are.  But if you can continue to 'intuit' that the answers ARE there, that Douglas WAS right, even though you can't immediately always make sense of what he's getting at,  you're likely going to find those answers. 

 

Regards,

Joe Thomson

Version: 2013.0.2904 / Virus Database: 3184/6373 - Release Date: 05/31/13

[Steve Hummel BenFranklinWasRight]

Jim and Joe,

I agree that the CP would be better if given directly to the
individual. Power, is best left in the many hands of individuals, and
I think competition would be a more effective deterrent in a Social
Credit administered economy. Just my gut feeling.

On Jun 1, 11:22 pm, "Joe Thomson" <thomsonh...@shaw.ca> wrote:
> Hi Jim,
>
> Some comments in 'green' interspersed with yours below.
>   From: Jim Schroeder
>
>   "were to agree, as they probably would, to restrict their net profit on turnover (not, be it noted, on capital) to 10 per cent." (Warning Democracy)
>
>   This is the exact quote by Douglas that I take issue with.  Why would we ever restrict net profit on turnover?
>
>   The way I read  what he wrote in the rest of that passage in 'Warning Democracy', beyond the part that I quoted, and also in "The Draft Plan for Scotland",  it almost seems to me that he was more concerned with net profit on turnover still being maintained at whatever would be a 'normal' average for the type of business concerned before any "assisted price scheme" comes into play after it was operating.    Rather than with some merchant  unfairly 'profiteering' from it the way it's often imagined some could.     Even though if the turnover increases due to the lowering of prices to the consumer  through the CPD, that net profit should increase, too.
>
>   Traditionally there seems to be a belief  that the kind of restriction on profit  Douglas is imagined to be calling for was to counter merchants raising their prices to 'profiteer' from part of the discount that should be going to the consumer.  But I wonder if that's really so?
>
>   They're already going to get an increased profit from having a larger turnover, so what would be the incentive to 'profiteer' this way?   And anything paid out by the business to its owners is going to buy more when they spend it on their own personal consumption.
>
>   Perhaps there's something in the way that accounting works that we're missing here?  Could it possibly have something to do with the way net profit on turnover relates to cash flow?  Or am I way, way off base, and the 'traditional' viewpoint is the correct one, even though it seems to me to be somewhat contradictory to Douglas's other views on several things?
>
>   I can see there being laws against predatory pricing and monopolistic behaviour, but we already have those in Canada (the Combines Investigation Act) and in the US (Anti-Trust Laws).  One could argue the effectiveness of these laws, but I still don't believe there should ever be laws restricting the rate of profit on turnover because it rids the company of the incentive to reduce costs and become more efficient (ie. it distorts micro-economic prices and profits).
>
>   I think the history of effectiveness of those  kind of laws has been more pronounced in the USA than in  Canada, and I wonder whether there was even anything as effective as that, (or at all), in England?   Douglas mentioned 'price rings' in several places in his books, almost as if what would be illegal in the USA was an acceptable  practice in  England.
>
>   I, like you, prefer the idea of giving the rebate directly to the consumer.  Plus, this delivery method is simpler and more effecient, in my opinion.
>
>   I'd still like to know for sure what he had in mind in the quote you take issue with.  Regardless, I can't see where there'd be any insurmountable difficulties with the CPD, and it's too bad it's never received  more attention from those seeking to promote Social Credit politically.
>

>   On Wed, May 29, 2013 at 10:20 PM, Joe Thomson <thomsonh...@shaw.ca> wrote:
>
>     Hi John (Rawson),
>
>     The exact quotation is as follows:- "Suppose that the large departmental stores, such as Messrs. Harrods, Messrs. Barker's, etc., were to agree, as they probably would, to restrict their net profit on turnover (not, be it noted, on capital) to 10 per cent.  Imagine them to issue with each sale to an individual consumer, an ordinary statement of sale, commonly called a bill, and imagine arrangements to be made with the banks that these bills, when turned over by the individual consumer to the bank, should be credited at 25 per cent of the face value to the individual consumer's account to which they refer. "   'Warning Democracy' 105-7.
>
>     Douglas further stated,  a little later, " I have, of course, used the figure of 25 per cent for purposes of illustration."
>
>     So there is NO 'persuading'  to "sell at a lower price" involved.  It may even be open to question as to whether a 10% "net profit on turnover" for a store like Harrods or Barker's at the time 'Warning Democracy' was written,  (in the worst years of the Depression),  might have been an improvement on the rate of net profit on turnover they were then getting.  I recall reading once that the margin in some areas of retail for some of the largest, high volume retailers of groceries was somewhere around 2% normally.
>
>     The important thing that  Douglas repeatedly stressed was to understand the principle that consumer purchasing power could be increased by a debt free issuance of new credit that effectively LOWERED the price to the consumer whenever he made a purchase.  And it can be.  The mechanism we utilise to do this, is whatever works best considering all the particulars involved.  I agree with Jim, it seems to me to be more practical to credit the consumer at, or after the point of sale, (as Douglas illustrates above), than to credit the merchant on condition he discount his regular price by that amount.  And I'll stick by what I previously said about there being likely a greater tendency of large merchants to 'predatory price' than to engage in 'profiteering'.
>
>     Regards,
>     Joe
>
>
>
>
>
>
>
>       ----- Original Message -----
>       From: John G Rawson
>       To: social...@googlegroups.com
>       Sent: Tuesday, May 28, 2013 8:36 PM
>       Subject: RE: [socialcredit] Post to the Daily Bell
>
>       It was quoted here not long ago. Approx. "If Harrods could be peruaded ro sell at a lower price....."
>       The quote I would like is where he changed his mind and promoted a reimbursement of customers scheme.
>       J R
>

> --------------------------------------------------------------------------

>       Date: Mon, 27 May 2013 11:39:48 -0600
>       Subject: Re: [socialcredit] Post to the Daily Bell

>       From: jimschroed...@gmail.com

>       To: social...@googlegroups.com
>
>       Hi Joe:
>
>       I can't remember exactly where I read it off the top of my head, but I do remember that one of Douglas's proposals, where the firm sold below cost and was later reimbursed through the price rebate mechanism, he wrote something to the effect that an agreed upon rate of return on turnover would be allowed for specific industries.  I think this would interfere in the efficient allocation of resources by not allowing firms to increase their rate of return through cost saving initiatives.
>

>       On Sun, May 26, 2013 at 12:56 PM, Joe Thomson <thomsonh...@shaw.ca> wrote:
>
>         Hi Jim,
>
>         At the end of your reply appended below you wrote:-
>
>         "There's no need to mandate returns in a capitalist system, and if I have one major disagreement with a policy initiative of Douglas, that would be it. "
>
>         Where did Douglas "mandate returns"?  Offhand, I can only remember two places where it might be construed that that is what he was proposing, though I personally  don't believe it really was.   Are you aware of any more?  There may well be, but I'm at a loss to remember just where.
>
>         One was the passage in 'Warning Democracy'  where he utilised the hypothetical  example of  "the large departmental stores" like,  (in his day, in England),  Harrod's and Barker's agreeing to restrict their "profit on turnover" to "10%".   In return for their customers being subsequently rebated the per centage amount of the CPD applied to the sale price  after the time of purchase,  (through presentation of their bill of sale to a bank).  Where the amount of the rebate was considerably more than the 10% margin on turnover, I believe the usual 25% that Douglas seemed to often use in his examples.
>
>         The other was in the 'Draft Plan for Scotland', where any firm enrolled in the CPD scheme that couldn't show a profit in three years was to have its discounting priviledge revoked.
>
>         My own belief is that Douglas was not particularly concerned about 'profiteering' as is often assumed.   But in talking about the "large departmental stores",  (not ALL stores), his concern was that they may try to 'predatory price' their smaller competitors out of business utilising even LOWER prices, using the CPD to assist them.
>
>         For just as it's often said on the 'production' side of the economy that,  "Unit cost is a function of volume", so, I believe,  that would hold true on the 'distribution' side as well when it comes to 'unit prices'.
>
>         A further increase in the volume of sales done by these large stores, (who already have, as Douglas noted elsewhere, a 'paper efficiency' in having a greater access to credit not available to smaller competitors), could allow them to sell below cost, take a loss which they could quickly recover from later through a combination of a larger volume (with the smaller competitor then eliminated completely), plus a higher price then that an effective monopoly position would assure.  At least for a time, until other competition might arise, if it could.
>
>         I believe, this could also be the reason why Douglas was concerned about any firm not being profitable being struck from the CPD scheme in the 'Draft Plan'.
>
>         We do know that 'predatory pricing' does happen, even though proof of it being purposefully engaged in is against the law in Canada, under our "anti-Combines" legislation, (similar to the "anti-Trust" laws in the USA, only with less chance of success in accomplishing the intended purpose, usually).
>
>         I believe Chapters Bookstores, a large Canadian concern now dominant in the book trade and controlled, as we might say, "by the usual suspects",  was nailed on that after they tried to eliminate another long-standing BC book store, Duthie's, if I
>

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