Chapter 6 — Poverty amidst Plenty


The abundance of goods introduced into the world, since man discovered the means of transforming energy and harnessing the forces of nature to his service, ought to be reflected in economic security for all — which means, at the very least, modest material comfort in every home, in an era of good, joyful, and peaceful social relations among individuals and nations.

Unfortunately, the picture that meets the eye in all the civilized countries of the world is quite different. In front of an abundance of goods that pile up, except when they are destroyed in wartime, destitution takes place.

Elevators and warehouses are full to overflowing; shop windows, newspapers, radio and TV announce everywhere a wide range of products, while people in their homes have to do without food, and use their rags and old furniture longer than ordinary.

“What percentage of our population is merely existing rather than enjoying the use of available and sufficient wealth to live in reasonable comfort? At least three-fourths of our population.” (Rev. Charles E. Coughlin, Money, page 26.)

But quotations are hardly necessary. Most readers have only to examine their personal situations and that of their neighbours. So who, today, is ensured of a reasonable comfort for tomorrow?

No one doubts that tomorrow Canada can continue to supply in plenty what is needed in terms of food, clothing, and housing. But how many people are assured of having a sufficient share for themselves and their families tomorrow, the day after tomorrow, next year?

The number of unemployed and laid-off workers should, logically, show an overabundance of goods, and that consumption has reached saturation point. This number means, above all, sufferings, destitution, and desperation.

The goods are there in front of human needs. So why is it that these goods do not fill these existing needs? What prevents the economy from reaching its end?

Why is it that consumers, who have so many unsatisfied needs, cannot use these goods made for them?

The existence of widespread poverty, in front of so much production and unused production capacity, is a terrible accusation against the distributive system.

Never has supply been so great. In front of this supply, is there actually no demand?

Demand exists. But the claim on supply, the right to have it, is wanting; this claim is money.

Real demand, effective demand

One should make a distinction between real demand and effective demand.

Real demand ensues from real needs. As long as there are people who are hungry, there exists a real demand for food. As long as there are people without proper shelter, there is a real demand for housing. As long as there are sick people, there is a real demand for medicine and medical care.

But this real demand becomes effective only if it presents the claim to production: money.

Effective demand exists only where money is united to needs.

Under the present economic system, one usually notices a lot of real demands without the claims that would make these demands effective. The producers, forced to recover their expenses, look for places where there is still some money left, and then do everything possible to create a demand. This is to sell under pressure, which no longer answers the needs of the consumers, but the needs of the producers.

This is a reversal of the economic order. The consumers become exploited victims, and no longer the masters to serve.

The humane solution would be to put money where the needs are, thus making the real demand effective; and not to create artificial needs where the real demand does not exist.

Major Douglas points out that to reconcile the real demand and the capacity to pay, the will-to-power will have to be defeated by the will-to-freedom, and that this reconciliation involves a modification of the distributive system. (See Economic Democracy, page 90.)

He adds, with a sound conception of the end of economics:

“Now if there is any sanity left in the world at all, it should be obvious that the real demand is the proper objective of production, and that it must be met from the bottom upwards, that is to say, there must be first a production of necessaries sufficient to meet universal requirements; and, secondly, an economic system must be devised to ensure their practically automatic and universal distribution; this having been achieved it may be followed to whatever extent may prove desirable by the manufacture of articles having a more limited range of usefulness. All financial questions are quite beside the point; if finance cannot meet this simple proposition then finance fails, and will be replaced.”

Since production exists to satisfy the needs of the consumers, and since, according to regulations generally accepted, the consumer must present money to be able to draw upon production, the money in the hands of the consumers must be in keeping with their needs, combined with the country's production capacity. If this is not so, money works against the consumers, therefore against man. In this case, a change is essential.

It is because the present monetary system hinders the satisfaction of the consumers' needs, that certain people propose the abolition of money. According to them, the State would then seize all of the production that is not consumed by its authors, and would itself distribute it to all the members of the community.

This is the Communist solution, which nobody wants in our country. Yet, one cannot approve of the immobilization of goods and production in front of urgent needs.

We will not even consider the dictatorial solution, in which it is no longer the consumers who express their needs: A superman dictates to all what they should have, and to production what it should do. In such a system, guns may well be produced at the expense of bread.

There is another solution — the solution which, in putting money in the hands of the consumers, of ALL consumers, gives them ALL the right to choose products. Then the consumers really orient production. It is the Social Credit solution. It brought a sociologist to write:

“And if you want neither Socialism nor Communism, bring Social Credit in array against them. It will be in your hands a powerful weapon with which to fight these enemies.” (Rev. Georges-Henri Lévesque, O.P., in Social Credit and Catholicism.)

But one must first study this money question, to understand whence the shortcomings of the monetary system, and how to make the system work and fulfill its role.



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