(An article of Louis Even, first
published in the June 15, 1961 issue of the Vers Demain Journal.)
am, let us say, a farmer. I need a hired man to help me in my work.
Lacking money with which to pay him, I might possibly arrive at a
settlement whereby I can pay him with something else besides money.
can, for example, agree to give him ten pounds of potatoes, three pounds
of meat, one pound of butter, and one gallon of milk for every day of
work that he gives me, the products coming from my own farm.
can also estimate the value of his work in dollars, without actually
giving him any, since I don't have them. In this case then, for example,
each day I can sign a ticket permitting him to choose, from among the
products on my farm, those things which he wants to the value of five
dollars for each hour of work he does. Here again, he is given by me the
right to choose from among the products of my farm.
I certainly cannot sign for him tickets that give him the right to
choose from among the products made by other farmers nor by craftsmen in
towns. I can only give him claims to those things which strictly belong
I pay him in dollars — well, that's different! He can then choose
goods or services from any source anywhere in the country. But in order
to pay him in money, I must first of all have the money.
difference between a ticket issued by me and money is that my ticket
gives a right over only those things which belong to me, whereas money
gives a right over the products of others, as well as over my products.
can use tickets on my own products because I make these products; I am
their owner. I cannot issue (create) money because I am not the owner of
everyone else's products.
— my tickets and money — can very easily be two pieces of paper of
the same size. Both can bear the same numbers. My ticket can just as
easily be labeled for ten dollars of value, just as is a ten-dollar note
issued by the Bank of Canada. But my ticket can only buy my products,
whereas the ten dollars of paper money can buy any goods or services for
the amount of this value.
of this is just another way of saying that money is a social instrument.
And since it gives the right to draw on the goods and services of
everyone without exception, its issuance by one individual, or even by a
group of individuals, cannot be justified. For this would be to give
these private individuals the right to use the goods of others.
yet new money must begin, be created, somewhere. The money that is
already in circulation certainly did not fall from heaven like manna; it
did not come into being by spontaneous generation. Similarly, when
production increases, the volume of money in circulation must
necessarily increase. Canada's present-day industry and commerce would
be paralyzed if there was no more money in the country than there was at
Champlain's time, in the early 1600s.
the money supply did increase. There was new money added. And as
industrial activity increases, so must the money supply. But, then, from
whence is to come this additional money, since no private individual or
group of private individuals has the power to issue claims on the
property of others?
money, increases in the money supply, can come from no other source than
society itself, through the agency of an organism established to
accomplish this function on behalf of society.
today, who fulfills this function, which is social in its very essence?
Certainly not the Government, since it has no money to spend except for
what it gets through taxes or through loans which it repays through new
tax levies at a later date.
is created by the banks
small part of modern money is made up of coins and bank notes. By far,
the larger part is made up of credits existing in the ledgers of banks.
knows that anyone who has a bank account can pay his grocery bill
without taking cash out of his pocket. He has only to make a cheque for
the required amount. The merchant who gets the cheque has only to go to
the bank and deposit it to his account or, if he wishes, get bank notes
or coins in exchange.
knows that. But what everybody does not know is that there are two types
of accounts which one can have at the bank: first, the case of the
saver, who comes to the bank to deposit money in his account — a
savings account; and secondly, the case of the borrower, who asks the
bank to deposit money in it for him.
is a big difference between these two kinds of accounts.
you take your money to the bank, the banker places this money in his
vault and inscribes in your account this amount of money to your credit.
You may use this credit as you wish. You can make payments when you want
by drawing on this account through cheques. It is not hard cash (notes
and coins), like the money you carried to the bank, but it is money just
what about the borrowing account? The borrower does not bring any money
to the bank. He goes there to ask money from the banker. Often this is a
large sum — let us say something like $50,000. The banker is not going
to reach into the drawer and take out $50,000 in hard cash and give it
to the borrower. And the borrower would hesitate to leave the bank with
this amount of money in his possession. What the borrower wants is to
have $50,000 inscribed to his credit in his account, upon which he will
be able to make cheques according to his needs. And the banker will do
this for the borrower; he inscribes this amount to the credit of the
mark you, the banker does this without taking a penny out of his drawer,
without the borrower having to bring a penny to the bank, and without
anyone else's account having been in any way touched.
the case of the saver, there was a transformation of hard cash, locked
up in the banker's drawer, into financial credit, which appeared as
figures in the credit account of the saver. This transaction did not put
one additional penny into circulation.
the case of the borrower, there was no such transformation since the
borrower did not bring any money with him. And since nothing was taken
from the vault, from the drawer, from the account of any of the other
depositors, it happens now that there is, in the bank's ledger, to the
credit of the borrower, a new sum of money which did not exist before.
is what is called the creation of money by the banker. It is a creation
of credit, of checkbook money. This money is just as good as any other,
since the borrower can make out cheques on it in the same fashion as the
saver can draw on the money he deposited.
this new money, the borrower can pay for work, materials, goods — the
work of others, the materials of others, the goods of others.
creating this $50,000 for the borrower, the banker has given to the
latter the right to draw upon the production of others; not upon the
production of the banker, but upon all the production in the country.
The banker who does not, as a banker, own one bit of the country's
production, nevertheless can give the borrower a claim to a share of the
is what might be called, in all justice, the usurpation of a social
function. Only society, in its whole, may with justice accomplish this
function, a function that society may very well entrust to a competent
organism, under its own control. But it is inadmissible that so
important a social function be delegated to a private institution that
traffics in it for its own profits.
power over economic life
borrower must, by a certain agreed date, repay to the bank the money
which it created for him. When the money returns to the bank, it is no
longer in circulation. It is dead money. To get another amount of money
into circulation, another loan is needed, another creation of book
therefore put money into circulation. Repayment of loans withdraws money
a given period — let us say, a year — if the sum of bank loans
granted is greater than the sum of repayments made, then the volume of
money in circulation has been increased. If, on the contrary, the banks
have been more difficult about making loans, while still demanding
repayments at the same rate as previously, then the volume of money in
circulation decreases. This is what is known as a restriction of credit.
the banker charges interest on his loans, every repayment entails the
return of more money to the banker than was originally issued in the
loan. The result is that, in order to keep up the volume of money in
circulation, it is necessary to have, over all, a greater activity in
loans than in repayments.
fact that it is necessary to repay to the bank more money than was
issued results in private individuals and public bodies being obliged to
have recourse continually to new loans, whence comes the ever-increasing
debt. Without such a practice, it would not be long before the amount of
money in circulation dried up completely. This function of the banker
therefore confers upon him supreme power over the economic life of the
country. He is more powerful than the Government, for he has the power
to grant, refuse, and regulate credit, which is the very lifeblood of
any country's economy.
for an end?
in Europe, the United States, and Canada have denounced, even openly,
this supremacy of the banking system. Canada's Prime Minister Mackenzie
King said in 1935 that as long as this power remained unbroken, it was
futile to speak of democracy and the sovereignty of Parliament. There
have been those who, like him, promised to restore to the nation the
control of its money and credit. Others, like former Canadian Finance
Minister Donald Fleming, have publicly attacked the arbitrary and
harmful acts of the top bankers.
yet none of these men were able to effect any change. And those
politicians who are most vocal in their attacks on this money power —
and this includes those politicians who fraudulently used the label
“Social Credit” (real Social Credit, as advocated by the
“Michael” Journal, has nothing to do with so-called “Social
Credit” parties; moreover, it does not need either a “Social
Credit” party to be implemented into the laws of a country) — will
never change anything as long as the people themselves are not united to
form a power even greater than that of Finance, a power that will force
the Government to take action.
is not a matter to be settled by elections. It is a question of forming
a large enough group of citizens who are enlightened and determined to
the point that they will make themselves heard by their governments,
regardless of what party is in office.
is also a matter for Divine assistance, since the enemy has a diabolical
nature, and the money dictatorship is only one of his multiple faces.
This is what the Social Crediters of the “Michael” Journal have
understood, and understand more and more.