MAJOR DOUGLAS' GOSPEL
[To the Editor of THE SPECTATOR.]
Sin,—While thanking your reviewer for his generous notice of my compilation of the Douglas Manual, may I respectfully, submit that, in common with other economists, he has failed to observe the exact meaning of the word " allocated " as applied to the " B " costs of Major Douglas' famous " A plus B Theorem " ? So obvious a correction as that pointed out by your reviewer was not likely to have been needed by Major Douglas ; and, in fact, his theorem is completely safeguarded by his statement that the " B " payments to other organiza- tions are not distributed as spendable income or purchasing power, but allocated or earmarked for other purposes.
While " A " payments, as your reviewer agrees, undoubtedly directly form purchasing power as spendable income, the purpose of the " B " payments is either (1) to reimburse the recipient for purchasing power distributed by him yesterday, or (2) to provide him with the means for distributing pur- chasing power tomorrow. In the one case it merely discharges a previous book-cost ; and in the other it is merely made ready to create a book-cost for tomorrow ; but in neither case does it result in creating purchasing power today. Only
A " payments, in short, constitute current purchasing power. " B " payments merely transfer debts on account of past or future " A " payments.—I am, Sir, &c.,
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