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     The Other Road To Serfdom




Forthcoming Book: The Other Road to Serfdom, A history of the abuse of money


This book is the most comprehensive history yet of the private banking sector and its misuse of M0, the nation’s currency comprised of notes and coins; our legal tender money which is issued interest free, on the back of which it creates 90% of the nation’s total money-supply burdened with interest payments and escalating debt. It details not only the major events in our troubled history of economic cycles of boom and bust, but shows clearly what lay behind them as well as how the causes were explained away by economists hired to uphold a system designed to contain us in perpetual slavery.

As with previous generations, our children are not being educated, but conditioned to accept the unacceptable. The questions they are asked, and the answers they are allowed to submit, are based on classical nonsenses and false assumptions which have purposely been employed for the past 300 years to maintain the financial status quo.

We and our children are taught to accept, as a proven fact, that: “Economics is about the management of scarce resources.” Students, however, are not told that the resources in question are kept artificially scarce, and so fail to realise that the reason for farmers being paid for the non-production of food is linked to the same reason why bankers keep money in short supply – in order to maintain an artificial scarcity value.

Arthur Swan, the author of this in-depth study of money and monetary policy wrote this book in response to Professor Hayek’s book The Road to Serfdom. At the time, Hayek’s writings seemed to skilfully demonstrate that Marxism – via socialism – was the only road to serfdom and in the eyes of the majority of those living in the relative freedom of a democratic state the vast prison camp of Soviet Russia and its subjected iron curtain countries seemed to confirm his analysis. In The Road to Serfdom, Hayek makes quite clear his conviction that nationalisation and any form of planning, economic or social, would destroy our democratic freedoms.

What this book The Other Road to Serfdom attempts to show is that unregulated capitalism is also a road to servitude. In a different way, and probably more so, George Orwell’s Animal Farm and 1984 alerted the free world to the horrors of the Marxist state, but with an all important difference. He did not claim that the forces of the free market would prevent this sort of catastrophe from curtailing the freedom of people here, and was deeply concerned that Hayek’s beliefs would lead to a return to the conditions of slump and unemployment in which the seeds of communism could germinate.

With close to three million unemployed and millions more kept above the poverty line by a costly social security system in Britain and a similar story in most developed industrial countries, the Left is as convinced as ever of the ‘evil of capitalism’. Most of us, as did Orwell, feel concern to a lesser or greater degree about the plight of the unemployed and the poor, but it does not make us Marxist-Socialist, far from it.

The tragedy, therefore, of 20th century politics, and more so since the end of the second world war has been the incalculable damage inflicted upon economic activities both nationally and internationally by the partisan interpretation of the meaning of ‘capitalism’. Most men, whether they are drawn to the teachings of Karl Marx or to the faith of the free play of market-forces are, no doubt, sincere in their beliefs that their way is the rod to social justice, not the road to serfdom.

However, these opposing beliefs fail to convince the broad mass of the electorate as they instinctively feel that both these forces should be kept under control for the well-being of the nation. This long drawn out struggle between the ‘haves’ and the ‘have-nots’ has now entered a far more dangerous stage than the great monetary and economic disaster of the 1930’s , and the forces that bedevil man’s attempts to evolve a fair and just society are actually monetary, not economic.

Arthur Swan started his investigation into the causes of inflation and unemployment in the 30’s and observed that every economic crisis in the last century followed a period of heavy lending. The flaw in the world’s economic thinking is the desire of all nations to have a favourable balance of trade. It is a general, though false, assumption that foreign investment in itself is desirable. However, foreign investment means – in real terms – the export of real wealth (i.e., raw materials and manufactured goods) on credit; with the certainty that a large proportion of that exported wealth will be lost to the exporting nation, and that the receipt of payment of the balance must disorganise the trade of both the creditor and debtor nation.

There is no point in a country increasing its means of production if the producers of this increased wealth cannot consume it or export a portion of it to another country in exchange for the goods and raw materials they require, but cannot produce locally. this is the pivotal point of all economics and when we lost sight of this and allowed the credit-creators to gain control of the levers of power it was inevitable that instead of increased prosperity that our technical and mechanical means should have bestowed upon the nation at large, we have with us a problem of unemployment and its attendant erosion of the moral fibre, increasing poverty, bad housing, the problem of increasing old-age and an over-stretched social security service. We lost sight of this cardinal principle when the nation allowed itself to be fooled into believing that to export was good business, and from the acceptance of this fallacy and on to the present day, in spite of slumps and booms and economic disasters, we are still urged to ‘export or die’.

It is one of the incredible conundrums as to how this fallacy remains a tenet of faith when the sheer simplicity of what happens when a country exports on credit is understood. For if we state the case shorn of all the technical jargon of the economists and bankers the proposition we have is simply this: The nation produces real wealth, i.e. ships, planes, machinery of all sorts, raw materials and finished goods of great variety; the great proportion of which it consumes itself, the remainder of which is exported in exchange for raw materials and finished goods which should mean the real increase of wealth to the nation, but this is not so, simply because we cling to the myth that to export on credit is national Wealth when in fact what actually happens is we send real wealth – a steel-works say – to the Argentine, in exchange for bonds or securities subscribed to by the British investor, in other words the British public have supplied the money to produce the steel mill for the Argentine and the attraction held out for the investor is a high rate of interest. But, here lies the nub of the fallacy of exporting on credit, in that the interest can only be paid by taking from the Argentine, in the main, wheat and meat which must be sold in Britain to the detriment of British farming.

This system has been put in place and consolidated on a global scale, and even the Sovereignty of Parliament is not allowed to question the monetary policy of the Treasury and the Bank of England. It is still, and always has been, a closed book.

The Other Road to Serfdom was Arthur Swan’s life-long work and saw its conclusion over half a century after it had begun, when Arthur Swan in discussions with Islamic Party leader David Musa Pidcock discovered the Islamic alternative and incorporated it into his opus. Sadly, he died before he could see the fruit of his tireless effort, but David Pidcock continued to get the book ready for publication, adding a comprehensive index which will make it a most valuable work of reference for any student of economics. The book is scheduled to be published later this year.

Author: Islamic Party of Britain
Date Published: Winter 1998


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