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Salient. The Newspaper of Victoria University College. Vol. 19, No. 6. May 31, 1955

The Gap

The Gap

The fundamental flaw in the present financial system is that it produces a disparity between available purchasing power and collective prices for goods for sale, or in the words of Douglas "the wages, salaries and dividends distributed over any given period of time do not and cannot buy the product of that period, and the whole of production can only be bought by a draft and an everincreasing draft on the purchasing power distributed in respect of future production." This theory of a flaw is denied by the orthodox economist who states that sufficient purchasing power is distributed during production. I have never been quite sure what the orthodox economist blames for recurring depressions, inflation, deflation, over-production, under consumption, too much money, not enough money, and all the rest of the afflictions which cause our economic system to stagger from war to war.