He tells us that in the 19th century there grew up the banking system of choquesagnd the extension fof credit instruments, "or in other:
Jwords a super-currency," which enabled its wielders, the banks, the financial pools and the international financiers, to provide goods-tickets' for the goods' they wanted J—which were not necessarily, the {goods of national importance,' etc. But," he goes on, "it might be urged, as they made the goods-tickets', surely they were entitled to their full employment, even if that involved selling one-third of the human race into economic slavery, [In point of fact, analysis shows that currency is only valid by reason its credit? or general acceptance'
Jand that bank notes and cheques are equally only potent because people will accept them as goods-tickets—ie., because they procure the actual goods and services, which must the only sound and final' backing? of any currency!
This passage shows Mr. Wakinshaw at his best and also except thet it is mostly relevant which much of tuis book is not—at his worst. There is the interesting, but by no means novel, truth about money being cods tickets, only valid because They can be turned into anything tha: their holder desires; there is quite unsupported innuendo about "economic slavery"—how many of us are enslaved by bankers Jand financiers?—and there is the Jeurious delusion which causes Mr. Wakinshaw to—imply—and. ap-Jyarently to believe—that the banks and financiers who manage the evedit system themselves spend the credit which they create. "Whit else can he mean cly saying that, The Ultimate Decision He seems to think that the bank Jere who make the new credit enj.y hough they have no right to the full employment" of it, and raat consequently they only pr.- vide tickets for the goods that they In fact, as every~ body, knows. which the modern banking. system: works, bankers create credit, to spent not by themselves, but by the people who came to them to horvow for the purpose of the enter prises in which the borrowers, not the bankers, propose to engage assisted by the the bankers. It fanizers of industry who Jiudge concerning the kinds of goods to be produced, and they, in doing fare actuated solely by the eon sideration of public demand. that the ultimate decision is with he porehasing: public Unless wants and will buy the goods pro-Jduced, those: who produced them fiose their money and may have Jdificulty in repaying to the banks the credits that the latter have ad~ vanced.
This obvious fact is very clour to the bankers, who when they are Jasked for credits, have to be careful to ace that they are used in the production, or marketing, of goods Jof a kind that are wanted, not by themselves, but by the great buying public which has the last say as to what goods will be profitable those who produced them and to those who finance their production and sale. Both the producer and those who finance him thus always have to consider nothing but the wants of the general public, because it is only by satisfying these wants, Jat a price that the public can pay, ihat cavbody san eave, "pra Producers, like everybody Jeometimes, makes mistakes and anticipate a demand which never makes its appearance, and when this happens, there is wasted effort and Hess.' If we were governed by a benevolent despot or committee despots who told us exactly avkat goods we were to buy and saw to their production, much economic waste would be avoided; but we [should not submit to such a system we As things are, the only "tyrant" is the general public, which, by its purchases condemns production to loss or blesses it with profit.
Text read from the printed page and cleaned; old type leaves the occasional error.