Clifford Hugh Douglas



C.H. DouglasC.H. (Clifford Hugh) Douglas (1879–1952), economic theorist, was born in Stockport, Cheshire, on 20 January 1879, the youngest son of Hugh Douglas, draper, and his wife, Louisa Arderne Hordern.

Douglas was a complex and intensely secretive character, and little is known of his life. What biographical information he did release tended to magnify his importance, creating a public image that in some respects differed significantly from the reality. Having been educated at Stockport grammar school, he entered on an engineering and mechanical career, and was a member of the Institution of Electrical Engineers (1904–20) and of the Institute of Mechanical Engineers (1918–36).

It is possible that his employment took him for a time to India, where he claimed to have been chief engineer and manager of the British Westinghouse Company, although the company has no record of his having worked for the firm. In 1910, at the late age of thirty-one, he went up to Pembroke College, Cambridge. In later life he was keen to give the impression of having been educated there in the fullest sense, when in fact he spent four terms only and left without taking a degree. During the First World War he was taken on at the Royal Aircraft Establishment in Farnborough, where he reorganized production and cost accounting. He was promoted to temporary captain in the Royal Flying Corps on 1 January 1916, and soon afterwards to temporary major on 1 June 1916.

Douglas had already been reflecting on society's failure to exploit the full possibilities of modern technology; his work at Farnborough suggested an explanation of this, which in turn led to the theory of social credit. In every productive establishment the amount of money issued in a given period as wages, salaries, and dividends—which he took to be the amount available to purchase the goods produced in that period—was less than the collective price of those products. To remedy the supposed chronic deficiency of purchasing power he advocated issuing additional money to consumers, or subsidies to producers to enable them to set prices below costs. By these devices, which came to be known as social credit, production was to be liberated from the price system, inaugurating an era of plenty, freedom, leisure, and human dignity, without altering the system of private ownership, profit, and enterprise.

Convinced that his analysis was the sole key to understanding and remedying the world's ills, Douglas devoted himself to developing its implications and pressing its claims. His critique of the economic system first appeared in articles in The Organiser in 1917, and later in the English Review (December 1918 – October 1919). In the meantime he was introduced to the journalist A. R. Orage, editor of the intellectual weekly New Age, which offered another platform for his views. In time the journal became completely devoted to advancing social credit theory. Orage's own critique of society had anticipated Douglas's, and he became an enthusiastic convert to Douglas's economic theory, publishing Douglas's first book, Economic Democracy (1920), serially in the New Age (June–August 1919) and collaborating in his second, Credit-Power and Democracy (1920). Douglas's utopian vision of society rejected conventional politics, whether of the right or the left, as a means of change: ‘There is no hope whatever in the hustings; but a modified credit-system could transform the world in five years’ (Douglas, Credit-Power, 86). In 1921 and 1922 these ideas attracted considerable public attention but were opposed by socialist writers and the Labour Party, which formally rejected social credit doctrine in 1922. In 1923 Douglas was brought to Ottawa by some Canadian admirers to expound his views to the Canadian House of Commons committee on banking and commerce.

Public discussion of social credit declined in Britain after 1922, but with the depression of the thirties it revived in greater volume, supported now by the New Age, the New English Weekly, Douglas's own weekly Social Credit, and various pamphlets and books, some of which went through several editions. ‘What gave the Douglas movement its persistent strength, even after the complete fallacy of the social credit monetary theory had been repeatedly demonstrated, was its cutting denunciation of existing society and its epochal vision of a new society’ (Macpherson, 96). Douglas testified to the Macmillan committee on finance and industry (1930) and lectured as far afield as New Zealand and Canada in 1934.

By the late thirties the British social credit movement under Douglas's rather autocratic leadership had dwindled into an esoteric sect. But it had struck roots in western Canada, where Douglas had had a following from the early twenties. When he visited Alberta in 1934 he won such wide support that the ageing United Farmers government, in spite of being sceptical about social credit, appointed him (early in 1935) principal reconstruction adviser to the government of Alberta, with a two-year contract. However, the government was swept out of office by the more zealous Social Credit League in the elections of August 1935. Relations between Douglas and the new government soon became strained. He resigned as adviser in 1936, and published his account of the matter in The Alberta Experiment (1937). In this lengthy work of self-justification Douglas did not conceal his contempt for the Alberta legislators: it was they who had failed the theory of social credit, and not the reverse. At the same time his writing showed deep compassion for the poor and a refusal to accept that in a land ‘fertile, rich, and reasonably developed’, such as Alberta, there should ever exist ‘desperate poverty at the lower end of the social scale, and economic and political insecurity amongst all classes not in actual want’ (Douglas, Alberta, 90). A back-benchers' revolt in the province in 1937 compelled the government to ask Douglas's further help. He sent two of his staff, who prepared legislation which, when enacted, was invalidated by federal authorities. The provincial government remained social credit in name but virtually abandoned Douglas's principles.

Douglas's earlier writings were remarkable for their reasoned protest against the frustration of individuality by business civilization. But his economic theory never surmounted his initial fallacy of reasoning from one firm to the whole economy. And his social and political theory was vitiated by his engineering concepts. He saw social credit ‘as an engineering solution to an engineering problem’, and naïvely believed that he had only to identify the solution for the necessary change to be effected (Macpherson, 121). The failure of the political and financial establishments to take up his ideas in Britain forced him to seek public support, but when this too failed to realize his vision he was forced into increasing isolation. Ultimately he could explain this failure only in terms of a ‘world plot’ that aimed to undermine Christian civilization. He was driven to attribute the thwarting of technology, and hence of human freedom, to a conspiracy of world Jewry, freemasonry, international finance, Bolshevism, and Nazism, and finally to denigrate democracy and denounce the secret ballot. ‘He died a lonely and embittered man, cut off even from the main body of his own supporters’ (Finlay, 88).

Douglas was married twice: first to Constance Mary, daughter of Edward Phillips, of Royston House, Hertfordshire. His second wife was Edith Mary, daughter of George Desborough Dale, of the Indian Civil Service; they had one daughter. He was a fisherman and yachtsman, and for a time ran a yacht-building shipyard at Swanwick, Southampton.

Douglas died in his home in Fearnan, Scotland, on 29 September 1952; his second wife survived him.


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