Sunday, March 22, 2009

Distributism and the American School of Trade

Distributism, to put it in summary terms, is an economic point of view cautioning us that the type of capitalism we have favors an uneven accumulation of wealth and purchasing power to those few who own, in mass, the means of production; that this imbalance tends to need socialistic state intervention, which gives inordinate power to bureaucrats; and that the only way to approach economic equilibrium (a truly free market) and attain the decentralization of political power is to favor an ownership society where the means of production are widely distributed. The Distributist approach simply recognizes that if the majority of individuals receive an income from both labor and ownership, then wealth will be more evenly distributed, people will be consuming what they produce (clearing the market), and we will have, as a consequence, enduring economic stability.

A fair acquaintance with Distributism will show, I believe, that it is naturally akin to the thought of our Founding Fathers. Like the Declaration of Independence, it is rooted in a philosophy of natural law, justice, and the existence of God; like the founders view of a limited federal government, it favors bottom up control; and, similar to the trade theory of Washington, Hamilton, Lincoln, and Teddy Roosevelt (wiki the “American School”), Distributism favors high tariffs, when necessary, to protect our manufacturing base. That last point, I think, is especially relevant today.

Presently, the standard line of bi-partisan “free traders” is that free trade lowers the cost of goods and raises the standard of living. It kind of half remembers the fact that wealth does not consist in money, which is purely a means, but in consumable goods. If, therefore, goods are cheaper and a nation is able to have more, then, it follows, that nation will be wealthier. But that rather puts the cart before the horse, as Alexander Hamilton, in opposition to British free trade policy, well knew: for it is originally in production that consumable goods are created, an income is earned, and the purchasing power to consume those goods is derived. Now couple that fact with the Distributist insight that labor inevitably looses power to clear the market due to a disproportionate amount of income favorably accruing to ownership, and the conclusion inescapably follows that free trade can only serve to accelerate the divide between labor and ownership, and thereby force wages down and decrease the standard of living at an even quicker pace.

The bottomward spiral that results from this whole process increasingly boils economic relations down to bare survival instinct. Whether it’s corporations moving manufacturing to poorer countries in order to compete, or banks, lacking investment in a productive economy, needing to stay alive by making speculative loans; such entities will do what they must to survive. But the same goes in politics. Perhaps -- recalling that a certain party will have to adapt, severely, in order to overcome the latest tidal wave of rejection -- we might speak directly to our politician’s survival instincts, reminding them that we are American constituents, and that a fair trade policy exists, which, contrary to our current one, was dubbed the “American System” – and for good reason.

Saturday, March 14, 2009

Brave New Alternative: Modern Distributism

The United States of America, at the time of its founding, was to be a nation governed by the rule of law -- by the U.S. Constitution. The Constitution’s Preamble, naturally, articulated its goals, among which was to “secure the blessings of liberty to ourselves and our posterity”. Set in stone, therefore, were certain indispensable means to this end: a limited federal government with powers both clearly defined and which acted to check and balance. Somewhere along the way, however, something went wrong. When states and big businesses are vying for “their share” of billions of dollars in taxpayer money, when they are groveling at the feet of a federal government, which can set any condition it wants upon them, can it any longer be said that the federal government works within the parameters originally intended to “secure the blessings of liberty”?

Many people point the finger of blame at Fabian socialists (modern Democrats), rightly decrying redistribution of wealth. What many of these people forget, however, is that welfare is welfare by any name, thus corporate welfare, money to big farms, and all sorts of Republican earmarks “redistribute wealth” just as effectively as any liberal scheme. But even aside from this type of redistribution, big business globalists (modern Republicans) wind up enabling the very ideology they claim to detest. When only a fraction of the already tiny percentage of capitalists are “too big to fail,” then government has no real choice: it’s either “bail out” or let civilization as we know it sink. To many, our current predicament is an absolute surprise. But to some, it is really no surprise at all. For a while now, in fact, there have been “voices crying out in the wilderness”, and it may be time to listen to what they have to say.

The title for this article was inspired, as a case in point, by Aldous Huxley’s work, though not so much by his classic novel “Brave New World” as by an alternative he subsequently offered. From works like “Brave New World Revisited” and a forward he later added to “Brave New World,” one will find Huxley speaking of the need for economic decentralization and distributing property as widely as possible in order to remedy the oppressive partnership between big business and big government; in connection to these remedies he draws upon names like Hilaire Belloc, Mortimer Adler, and Henry George.

Though none of these men are any longer with us, their ideas are still very much alive. Belloc, for instance, along with well-known author G.K. Chesterton, popularized a theory known as Distributism, and a simple Google search will turn up pages worth of modern Distributist theories, practices, and demonstrated successes. Among the successors of Belloc and Chesterton, John M├ędaille, who writes for a blog called The Distributist Review, is playing a part in advancing Distributism both by his insightful writing and by drawing upon allied elements -- like (Henry) Georgism, strategies evolved from Mortimer Adler by CESJ, and, in addition to Huxley’s references, E. F. Schumacher’s work (among others).

All of these men, incidentally, would agree with President Obama that change was long overdue; still, neither elitist socialists nor monopolistic capitalists, that is, neither Democrats nor Republicans have given, nor will give us anything but an insatiably power hungry “Servile State”. The answer may be, as the song goes, “blowing in the wind,” but, then again, perhaps the “winds of change” and a brave new alternative, are only a few more Google clicks away.