WE WONDER WILL CORY BERNARDI TAKE NOTE? from Canadian Wallace Klinck

Thanks for this latest report, Cory.
Interesting to learn that you have terminated your past political allegiance and decided to pursue a new approach. 
You express concern about the accumulated financial debt burden bearing upon Australian society.  Precisely what do you suggest as a solution to this problem?  Under the existing financial system you will be entirely unable to improve this situation or even to halt the relentless growth of that debt. 

All nations operate essentially under the Keynesian system of debt finance.  This system generates financial costs at an ever greater rate than it distributes effective consumer income.  Under existing rules there is no alternative whatsoever but to incur more debt in a futile attempt to compensate for this growing shortage of effective income.  Because this deficiency increases as industry modernizes, and non-labour costs increase relative to labour costs, the financial problem intensifies with every increase in productive efficiency achieved through increasingly refined real capital enhanced by improving technology.

Industry must recover its financial costs and the ruling accountancy convention is that these must be recovered ultimately via sales to consumers.  Today, an attempt to deal with the increasing deficiency of purchasing-power is made by the issue of bank credit as consumer and public debt and by attempting to export more real wealth than is received in return via imports.  Any reduction of debt merely shrinks the money supply and makes it impossible for the consuming public to buy the products of industry at prices which allow the latter to recover its financial costs.  The result is economic malaise and bankruptcy. 

Aggressive attempts to export in excess of import are a major cause of international friction and war.  Obviously, all nations cannot export more than they import. 

Expansion of State activity by expenditures financed by means of increasing debt is inevitable if purchasing-power is to be maintained and so-called “unemployment" is to be minimized, otherwise the cost of supportive financial assistance will increase the need for taxation. (unless those thrown into destitution are considered expendable—obviously an unacceptable option) 

In summary, constant expansion of the money supply is absolutely necessary to allow consumers to access the product of industry and permit business to recover its financial costs and remain solvent as a continuing and going concern.

The required increasing infusion of new purchasing power to consumers is absolutely necessary.  However, it must be made in a manner that is not registered as financial debt and does not, thereby,  increase production costs, through direct payments to consumption in the form of National (Consumer) Dividends and payments to retailers at point of sale which enable them to charge reduced or Compensated Prices.

The price-system is NOT self-liquidating and until this phenomenon is fully recognized, acknowledged and appropriately dealt with the best intentions of any and all governments will come to naught as they founder on the shoals of financial ignorance. 

John Maynard Keynes was a Fabian Socialist and his policy and recommended financial mechanisms were expressly designed to increase the involvement of the State in the lives of nations, slowly but inexorably, by stealth. Conservatives seem to be completely oblivious to this Marxist revolutionary strategy and that is why the best they ever are capable of doing is to engage in ineffectual rear-guard actions which amount to a continuous succession of defeats and retreats before the financial factors which contribute to inflation, mounting debt, increasing taxation and State power—and endless war.

 Robert Klinck - “Economists’ Failed Professionalism” - 2016

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