Thursday, August 9, 2012

Lawson #2

Last week I told you about the scallywag Captain John Lawson, who conned many people into believing he had discovered, in New Guinea, a Mount Hercules, three thousand feet higher than Mount Everest.  Of course, it doesn’t exist.  Nor did Captain Lawson apparently, because no one knows who he was.
Alfred William Lawson
Today I want to introduce another Lawson – in this case Alfred William Lawson, born in London, England, on March 24, 1869, which he later claimed was “the most momentous occurrence since the birth of mankind”.  Three weeks later his family moved to Canada and three years later settled in Detroit.  He was a man of many talents – professional baseball player, publisher, aviation pioneer, physicist, economist, philosopher, and university president.
He was also a prolific writer, whose output we can all envy.  He wrote a total of about 50 books, mainly about his scientific, philosophical, and economic theories.  And, as you will read in my next blog, he figured out an almost perfect marketing strategy to sell them.
There is so much of interest to report about Lawson that I may have to write a third Lawson blog to do justice to the breadth of this man’s expertise.
I have been a fan of Lawson since I learnt about him in the mid 1970’s from my friend Bob Jacobs with whom I worked at the Aviation Research Lab at the University of Illinois at Urbana-Champaign.  Bob and I, in our spare time as graduate students, also founded the Numbers Racket, which was the best retail outlet in the area for hand-held calculators.  But that is another story.
In my subsequent reading of some of Lawson’s books and of biographies of Lawson, I have come to the conclusion that he was fundamentally influenced by his father, Robert Henry Lawson, who spent decades trying to perfect a perpetual motion machine.
First, a brief background:
1.   Made his Major League Baseball debut as pitcher for the Boston Beaneaters (!) on May 13, 1890.  It appears that after one appearance he was transferred to the Pittsburgh Alleghenys, for whom he played two games.  The rest of his career was in the minor leagues.
2.   When his baseball career started to fade, he founded and published aviation magazines.  This venture showed his character, as he had no publishing or aviation experience.  What’s more, when Fly magazine came out in 1908, only three people had ever flown in heavier-than-air machines.  He went on to also publish Aircraft, a term he trademarked in 1910.

Training aircraft
3.   He founded the Lawson Aircraft Company, which designed a training aircraft during World War I.  The war ended before the plane went into production.   He then turned his hand to building an aircraft to carry passengers.  His plan was to provide passenger service around the country.  In 1919, his 16-seat airliner flew a 3,000 km from Milwaukee to New York and Washington D.C. and back.  When in Washington, he took a flight with six senators, the Secretary of War, and several others.  His lobbying efforts won him a large Post Office contract to deliver mail to the country’s major cities.
16-passenger airliner
Unfortunately his latest plane, the L-4, crashed on its maiden flight causing his financial backers to withdraw their support.  Undaunted, he designed a double-decker, twelve-engine plane capable of carrying 125 passengers.  It had sleepers and showers.  Unfortunately, the Great Depression thwarted his ideas and his financial backers again pulled back.  (By the way, he patented the idea of the double-decker vehicle and made some decent money by selling the rights to bus and train manufacturers.)
Luxurious interior
         He decided to get out of the aviation business and turned to economics, philosophy, and education.  It is the first of these I want to tell you about in this blog.
The Great Depression had a big impact on Lawson.  It destroyed his aviation dreams, but also was the catalyst for him to start the Direct Credit Society, which soon had millions of supporters.  In his 1931 book Direct Credits for Everybody, he wrote:
Owing to the brightness and scarcity of gold, as well as to its glittering appeal for childlike people, that metal was principally used as money in the beginning, and eventually became the standard of money value throughout the world.

But the visible supply of gold in the world could not keep pace with the ever increasing population who needed money for trading purposes, and credit then came into vogue which permitted trade to be carried on many times larger in amount than there was gold to pay for it.

And because there was not enough money for everybody to use there were men who made it their business to get control of it and make everybody pay for its use in the shape of interest.
No autocrat of any type ever held such power over human beings as is held by the present international financiers who control the supply of money. They are the real masters of office holders, manufacturers, merchants and workmen. And they are gradually screwing them all down to nothingness.

The branch of capitalism which allows interest to be charged on money, has not only paralyzed mankind, but it is the two-edged sword that will destroy Capitalism unless abolished at once.

There is no end to this interest-paying game. It is a series of circles running around within circles. It would require a lifetime to explain, so that everybody could understand, how it keeps people struggling for a pitiful existence; to explain how the money masters, who produce nothing, are overloaded with wealth and power, while everybody, who produces everything is reduced to beggary.
Capitalism can be made to work, yes, but not before this undermining parasite called interest is exterminated.

To counter the iniquity of interest, he proposed that everyone be given (by the government) a Direct Credit to be used to maximize his or her potential – food, clothing, education, and so on.  In this way, everyone would have a chance to prosper, the poor would be fed and educated, and everyone’s talents would have the potential to be realized.  If the credit is squandered, the person gets no more.  If the credit is used wisely, the person will be able to repay it.  If an entrepreneur wants to start a company, the government provides a Direct Credit to each of the partners.  Again, if the credit is squandered, the participants can receive no more.  If successful, there will be enough profit to repay the credit.
Lawson argues that it is interest that kills innovation and often existence.
The system of Direct Credits will work for everybody. It will give work to everybody, opportunities to everybody, credit to everybody, money to everybody, nourishment to everybody, comforts to everybody, education to everybody, character to everybody, intelligence to everybody, and justice to everybody.

It will let Capital live in a clean way. It will let Labor co-operate with Capital on a fair basis. It will make Capital and Labor staunch friends who will work together in harmony for the benefit of everybody.

It will allow reasonable profits to the manufacturers and merchants. It will give high wages to workmen so they can purchase what they need from the merchants and utilize every useful thing made by the manufacturers.

He also had strong views about inheritance:
To inherit a large fortune without having done anything for it, is enough to make a lunatic of one, even if not one before. And if it does not actually make a lunatic of him it will certainly do him much harm in many ways.

The wealth of one generation is not the wealth of a succeeding one. Each generation makes its own wealth, so that a dead man's will is but an instrument to enslave following generations. Constant labor is the only thing that makes wealth last.

It is easy to see why the Direct Credit Society had so many followers, especially during the Great Depression.  As the depression lessened, so did support for Lawson’s ideas.
I like some of the parallels to today, and I’ve no doubt that Lawson would have been part of the financial protests that sprung up around the country recently.
Our forefathers fought, bled and died that we could have the right to vote, but suffrage is worthless to everybody if it is used to keep in power international financiers who control 90 percent of the wealth produced by everybody.
At present if the government needs money for improvements or other things, it borrows it and issues interest paying bonds which are turned over to privateers for less money than the bonds call for. The government is forced to do this, the same as individuals and corporations, because there is not enough money in circulation to meet general expenses.

In this manner the government is kept in perpetual debt trying to pay the different interests upon the different bonds that are forever accumulating.

It is estimated that the combined municipal, state and national debts of the United States of America amount to more than One Hundred Billion Dollars (1931). And if this compound interest-paying scheme is kept up, the debts will increase to such an extent that all of the wealth of the country will not be enough to pay them, and the privateers who control the money can force the nation into bankruptcy in the same way they do shopkeepers and manufacturers when they fail to pay the interest, or, take away the home of the widow when she owes interest on the mortgage.

In today’s political and economic environment, I could see Lawson running for national office, with a large and rowdy following.  I’d love to see his attack ads.
As I mentioned earlier, Lawson was also an educator and scientist.  Next time, I will introduce you to the educational institution he founded – the humbly named  University of Lawsonomy – and his theory of the universe that everything can be described by the Law of Suction and Pressure, and its corollary The Law of Zig-Zag-and-Swirl. 
Stan - Thursday


  1. Stan, this must be an August Fool's Day joke. Nobody could be that talented and accomplished. Except for you, of course.

  2. Jeff, wait until you read about the Laws of Suction and Pressure and the Zig-Zag-and-Swirl! And the University of Lawsonomy.

  3. Stan, I would not nominate Lawson for President. I don't think anyone as creative as he has held that post in 200 years. But I would LOVE to see him in Timonthy Geithner's job. A guy with that power who understood that banks should not rule the world might at least give the rest the people a fighting chance. We March-born babies tend to be passionate in our beliefs, I think. I look forward to the next installment!

  4. Lawson was the last person to make an effort to change our faulty financial system and that was 80 years ago. He understood that for Direct Credits to work it would require the elimination of selfishness and greed. Something this country still knows little about based on where we are now. People often make fun of things they don't understand. I don't see anyone able to prove he was ever wrong in what he was advocating. He was definitely a man ahead of his time.

  5. I have recently found out That this great man is an ancestor of mine and am researching everything about him.