This paper is concerned with the political theory developed by Major C. H. Douglas, the English founder and leader of the Social Credit movement, and not specifically with the ideas of the Canadian Social Credit movement, although the English theory has had a continuous, if not always a decisive, influence on the Canadian movement. Since the Douglas political theory stems from the Douglas social critique we shall begin with the latter.

The frustration of the engineer by the business control of industry may be seen as the starting point of Major Douglas's social thinking. Deeply impressed by the waste of industrial capacity and potential, Major Douglas developed a sweeping critique of industrial civilization. A man of broad sympathies and with a professional view of his engineering calling, he saw that whatever held back the progress of science in industry made it impossible for the technologist to serve the people and give them the benefit of their heritage. He saw further that the concentration of power in the control of industrial production was only a part of a trend toward concentration of power in government, in trade unions, and in every institution which affected the life and opportunity of every individual both as worker and consumer. In his earliest writings his main concern was to expose this trend toward the submergence of the individual, to establish its pervasive nature, and to warn that it must be defeated if the human quality of civilization was not to be destroyed. His case was presented with restraint and with telling effect. His recommendation of a monetary device, which later became commonly identified with social credit, as the most probable direction in which a solution might be found for freeing men from the tyranny of concentrated power, was also presented with restraint in the writings of the first few years, and was subordinated to the main analysis. His point was that men could not be free in any other way until they had secured a freedom of choice, both as producers and consumers, and a level of material well-being which the existing system of production and distribution denied them. The economic system must therefore first be reformed. Socialism was not the answer, since it would mean still further centralization of economic and political power. Monetary reform was the answer because it could destroy the mechanism by which economic power was being increased and by which the material well-being and the freedom of the individual were being diminished. Always Major Douglas presented monetary reform merely as a means toward the end of establishing a new society in which human beings would be free to develop their individuality in a way that had never been possible before.