A political movement which has enjoyed some success in various parts of the world, but has often been perceived as a populist fringe organization advancing unorthodox ideas. The ideas on which Social Credit were based were developed towards the end of the First World War by Major C. H. Douglas (1879–1952). Douglas was preoccupied by what he perceived to be the problem of underconsumption. He developed the A + B theorem, a method of analysing costs which endeavoured to show that in peacetime there is a gap between the total buying power of individuals and the total prices of goods ready for sale. Additional purchasing power had to be created by manufacturers selling their goods below cost, the difference being made up by grants of credit through the issue of paper money. Every citizen was to be given a National Dividend as of right, although the inflationary implications of this injection of free money into the economy never seem to have been thought through. Keynes, although critical of the ‘mystifications’ associated with Douglas's work, commented in the General Theory that ‘Major Douglas is entitled to claim, as against some of his orthodox adversaries, that he at least has not been wholly oblivious of the outstanding problem of our economic system’. Social Credit as a political movement achieved its greatest electoral success in Canada. Under the leadership of the charismatic William (‘Bible Bill’) Abelhart it won control of the Alberta provincial government in a landslide victory in 1935, providing the premier until 1970, and of the British Columbia provincial government in 1952, remaining the governing party for all but three years up to 1991. In New Zealand, Social Credit support peaked at 20.7 per cent in the 1981 general election. Small‐scale business people and farmers have provided many of the party's activists in Canada and New Zealand. For such a movement, political education can be as important as electoral success, which Social Credit has never achieved at a national level.
Subjects: History of the Americas — Politics.