Spencer Heath Archives

Item 249

Letter dictated in September, 1958 at suggestion of Spencer MacCallum on eve of his departure for the University of New Mexico, Albuquerque, with the idea of transcribing it and mailing it the next time he returned to Elkridge, possibly at Christmas. However this was never done. Similar letters were to have been sent to Glenn Saxon and Percy Greaves.

Dear Major Angas:

    Only three or four /Some/ years ago, a man died in poverty in New York who ought to be remembered, not for his own sake but for the sake of free enterprise in the Western World. His name was Edwin C. Riegel, and he spent the greater part of his long life promoting a practical detour around inflated money. One of the latest of his books was entitled, Private Enterprise Money.

     Most of us know that actual legal tender plays a very small part in the buying and selling that goes on. The men who conduct the free enterprise system hardly use the Government money at all, except as it flows into them by way of the retail trade. All their own transactions and even a large part of retail trade receipts, are carried on by bookkeeping alone, the system of accountancy balancing everybody’s obligations automatically without resort to money at all.

     Mr. Riegel took notice of this, and proposed that in their accounting system men should simply make reference to a kind of fictitious dollar — a credit given by a buyer to his supplier and backed by the goods themselves until redeemed by the buyer selling his own goods, which of course he would always be eager to do.

 

     Mr. Riegel worked out in a very practical way the simple details whereby businessmen, as a means of increas­ing their turnover, could put this idea into effect. Mr. Riegel contemplated that the value unit employed — the valun as he called it — should at the outset be used as the equi­valent of a dollar. The inaugurators of this scheme would deal among themselves in terms of this unit as optional with the dollar, the only difference being that they would use the valun sign instead of the dollar sign in their transactions one with another. All would be rigidly bound to treat as counterfeit any valun credit that was not given in payment for actual goods received (the whole scheme being dependent upon this restriction being faithfully observed and any violation of it treated as a fraud). Dollars and valuns would be interchangeable in the market; but if dollars were issued except in exchange for goods — as government does — it would not be long until in this parallel system the dollar would be at a discount with respect to the valun. And this would be true also of any foreign currency as well.

 

     Mr. Riegel contemplated that in course of time, the greater part of business accounts would be kept in terms of the uninflated valun, especially those involving long term debts or obligations.

     I think I have said enough to give you the basic idea. Mr. Riegel believed that government could not easily pre­scribe the only method that could be employed in keeping accounts. And even the government itself might prefer to take its taxes in valuns by reason of their purchasing power. I wish I had an extra copy of Mr. Riegel’s last book, Private Enterprise Money. There is little or nothing cloudy or confusing about it — as in most money books — and I am sure you would enjoy reading it, if nothing more. It is in the New York Public Library, and I am sure in many others. I also think you could obtain a copy from Major Ivan Firth, 51 Morton Street, New York, who with his wife inherited all of Mr. Riegel’s papers and effects.

     I have written you all the above because of knowing something of your own creative ideas and feeling that Riegel should be brought to the attention of an intelligence like yours. I am sure you will find Mr. Riegel’s writings very different from everything else written on the money question. His explanation of the fundamental principles seems crystal clear and not at all confused.

     I trust that all goes well with you since our last communication and look forward to further exchanges with you.

 

Sincerely yours,

 

 Spencer Heath