SIR,—Mr. R. I. S. Rands's idea of CrownCredit Food Vouchers (first explained in the New English Weekly), is, of course, a step in the right direction, but in its financial details it falls, unfortunately, into the usual Douglasite fallacy (on what is called the " cancellation " question.)
For many years, nearer twenty than ten, I myself and many others have made a continual effort, in the periodicals of the Douglasites themselves, to get them to face up to this weak point in their case, but all in vain. Most of them seem to be accountants by profession, and, as long as they can balance the national books by some device or other, they don't seem able or willing to imagine what happens to the actual money in the nation's pockets.
The question of money-reform is so central and urgent that the pseudo-varieties must not be allowed to bring discredit on the truth. I therefore beg you to print the enclosed letter which I sent three weeks ago to the New English Weekly, where it has not, so far, been published.
Sin,—Alas. the Crown Credit Voucher scheme is still open to the old criticism, owing to Mr. Rands's obstinate resolve to have no taxation, May I put a finger on what seems to me the fallacy, please?'
" Inflation," he says, "only takes pities when there is an increase in money without a corresponding increase in goods."
Very well, Mr. Rands proposes to pour about million sterling every week into circulation (via people's banking accounts, true, but that makes no essential difference) and len va it in circulation. Jo one year the amount of new money will be .00 million, in two years .e1110 Million. in three years ,e;150 million, in ten years A500 million, and so on.
Mennwhile, what is the " corresponding increase of goods "? It consists of feodstuffs to the value of .21 million a week, which are immediately eaten.
In ten years' time, with .251)11 million extra of sterling (sterling, mind you), in our pockets tir bank accounts, the " corresponding increase of goods " will still amount to the usual £1 million worth a week with perhaps £20 million or HO of food stored in reserve.
Will somebody please tell me where I ams wrong?
Lest I should end on too negative a note, let me say that the Crown Credit Voucher scheme would be all right, so long as the British-grown food was there to be purchased, and so long as there were taxation in some form (or Government borrowing of genuine savings at small interest could be counted as taxation for this purpeSe) at suitable points, in order to make the money flow back to where it came from after it had done its work. Of that necessity the very word " revenue " is a sufficient reminder; if we want another we have certain words spoken about money: " Render to Caesar the things that are Caesar's."
F. H. DRINKWATER.
763, Coventry Road, Birmingham.
[Fr. Drinkwater has wired to say that the New English Weekly has now printed his letter with the following comment: Our correspondent is wrong in his statement about the money that will be left in circulation. For a long time it would gradually filter back in repayment of debts, both bank debt and mortgage debt. It would ease the farmer's position to reduce his creditors' power over him, besides helping to feed the people." The same commentator, adds Fr. Drinkwater, a propos of another letter, says that the food vouchers are to be issued for as long as the system on the whole needs it." From this it would appear, concludes Fr. Drinkwater, that Mr. liands's proposal is only offered as an emergency measure for a abort period, which of course removes most of the point from the orlit hticsisomu.
ld be made clear that the Csenceee HERAI,13 does not necessarily support any of the schemes which its readers may advocate as possible means of overcoming the Unem
ployment problem. It wishes to give all peblicity to such schemes as Beene worth discussing, but it holds that means are the department of the experts and the responsibility of the government in power. Its own campaign is directed towards the formation of an insistent national will that the problem should be tackled and not shelved as is being done at present.—Eerroa.]