Social Credit is an economic theory developed by Scottish engineer Major C. H. Douglas. He showed with his A+B therorm that the rate of flow of income received in any period of production was less than the prices generated in the same period there arose a deficiency in purchasing power in that period.
Clifford Hugh Douglas
In 1923 C. H. Douglas identified a critical flaw in the fractional reserve monetary system and presented his ideas to the Canadian House of commons. In 1924 Douglas published his book, "Social Credit", in which he laid out the problems with the money system and his solution. The term Social Credit was coined by A. R. Orage, editor of the "New Age" in his explanatory notes to C.H. Douglas
" We are not accusing the Financial Power of malignant hostility to society (but) The effect is inherent in the separation of Real Credit from Financial Credit - Social Credit, that is to say, from Financial Credit privately controlled." - A. R. Orage
The statement by C. H. Douglas that the supply of money was only remotely connected with the supply of loanable funds was widely disputed at that time. In fact it is a statement that much of the general public would find hard to understand even today. And yet it is agreed with by the economic orthodoxy, albeit grudgingly and with varying and contradictory explanations of the details.
Douglas understood and clearly spelled out the implications of the economic system in his work. The implications; the concentration of immense wealth and power in the hands of a small international elite; an inevitable drive to economic growth for survival of the system; escalating debt of national and local governments, business and consumers; progressive damage to the global environment; socio-economic breakdown, and technological unemployment.
C. H. Douglas proposed a changed the financial system which would correct the societal problems generated and exasperated by the present banking system. His work went unheeded.
"A comparatively short period will probably serve to decide whether we are to master the mighty economic and social machine that we have created, or whether it is to master us; and during that period a small impetus from a body of men who know what to do and how to do it, may make the difference between yet one more retreat into the Dark Ages, or the emergence into the full light of a day of such splendour as we can at present only envisage dimly." - C. H. Douglas, Social Credit, Part III: The Design of Economic Freedom, Chapter III, The Critical Moment