Can This Market Be Saved?

In the May edition of U.S. Catholic (a magazine I'm actually not too fond of) there was an excellent article called Can This Market Be Saved. The author, Daniel Finn, touched on a number of very important issues: notions like the common good, solidarity, subsidiarity, and the excellent point that “free markets… exist in a context”, which includes at least some government protection. However, though I agreed with just about everything in the article, and was delighted to come across some novelties, I don’t think it went far enough.

Since the nineteenth century, people like Hillarie Belloc, G.K. Chesterton, Bishop Fulton Sheen, *Aldous Huxley, Mortimer Adler, and even certain popes, like John Paul II, have been warning us that the type of capitalism we have favors an uneven accumulation of wealth and purchasing power to those few who own the means of production; that this imbalance tends to need state intervention, which gives inordinate power to bureaucrats; and that the only way to approach economic equilibrium (a truly free market) is to favor an ownership society where the means of production are widely distributed (thus the economic theory Distributism, popularized by Belloc and Chesterton, carried on by folks like Dale Alquist, and modernized by authors like John Medaille).

Moreover, this growing divide (between capital and labor) was, and still is, exponentially accelerated by what Pat Buchanan calls “quasi-religious faith” in free trade. Free trade has dismantled our manufacturing base (the true wealth of nations). Consequently, banks, lacking investment in a productive economy, have had to stay alive by making speculative loans -- it’s not just greed but a matter of the incentive to survive. The problem, therefore, is structural, and, according to Mr. Buchanan, can only be fixed, in part, by implementing the wisdom of Washington, Hamilton, Lincoln and Theodore Roosevelt; by re-establishing the “American System”.

So, to conclude: Though I was enlightened by Finn's article and agreed with the main points, I would have liked to have seen mention both of the deeper causes, not just the symptoms, of our recession, as well as certain approaches to address those causes -- like the economic theory **Distributism, and the trade approach of the American System.

*Aldous Huxley, in Brave New World Revisited, stated that "if you believe in democracy, make arrangements to distribute property [the means of production] as widely as possible". Such an "arrangement" a) makes for economic stability, and b) makes for a self-sufficiency that naturally desires limitations on government.

**An excellent modern day example of legislation distributists would support is The Employee Ownership Act of 1999, co-sponsored by people spanning the political gamut; unfortunately it failed to pass.

Should corporations be viewed as living people?

Should corporations be viewed as living people?

Youn vs. Simpson on Supreme Court Ruling for Corporate Influence

The First Amendment is about freedom of speech. It's not about freedom to spend unlimited amounts of money. It's that difference that makes our political system a democracy ruled by the people, rather than a plutocracy ruled by money or those who have the most money. -- Monica Youn

Click here to see video and/or transcript.

Capitalism and Democracy (a revised response)

The Capitalist defense, to my mind, is that of a form of capitalism that is ultimately incompatible with democracy. For what if our current capitalism-of-the-few can only negatively impact the stability required to maintain, for the many, both economic opportunity and its concomitant self-determination and independence? In that case, wouldn’t capitalism be clearly adverse to the realization of a self-governing, harmonious citizenry that inherently checks, limits and defines the power of its political overseers to that of an ideal democracy – one that is in fact socialist-free?

The unfortunate reality is that dependency and the consequent expansion of government is the direct result of concentrated capitalism; a capitalism of the few requires more and more the hand of “Big-Brother”, namely, of Brother Keynes. That being the case, there’s no irony, to my mind, that distributists protest capitalism and uphold democracy. To be clear, we believe in capital ownership, we believe in democracy, we believe in a market that is truly free; and yes, we also decry socialism, thus we decry that form of capitalism which has not the vital spirit to support society and must inevitably conjure forth, as it has done in true Fabian fashion, the specter of socialism to work its black magic - and like all black magic, eventually it will exact a heavy toll.

For those seeking an alternative, then, we’re naturally forced to ask, can the private ownership in the means of production, that is, of capital instruments in an industrial society support true democracy? The answer, so I believe, is yes, but only when it aligns with the principles of justice and liberty (this alignment, for the record, is what I would call not pure capitalism but distributism, or distributist capitalism; it is, to adapt a line from Mortimer Adler, “capitalism perfected in the line of [the principles of justice and liberty], and without any admixture of socialism”).

It is, therefore, not a question of “imposing one’s vision of ‘the good life’”, but of tweaking the political context so that it fully subordinates economics to the common good, to a just society. Indeed, for if we take as our guide the classic liberal definition of freedom popularized by J.S. Mill, and which is well put by M. Stanton Evans, that “Liberty to act on one’s behalf must be fenced off by the equal liberty of others, so that freedom for one individual doesn’t become oppression for a second”, and if concentrated ownership in the means of production leads to the exclusion of opportunity for the many to earn a viable income through participation in ownership, and thus to a form of government which works as a default corrective through socialistic means that are ultimately destructive of liberty; and, moreover, if it’s the purpose of government to do, in Mill’s sense, the fencing off, then its relatively clear that for those who believe in freedom from oppression there is, politically, (as Adler put it in the Capitalist Manifesto) a “justifiable limitation on individual liberty to acquire wealth in the form of capital goods.”

I’ll quickly summarize. My point is a basic rephrasing of the distributist vs. capitalist question. For I’m asking, somewhat rhetorically, which type of capitalism best achieves the ideal of liberty (both distributists and capitalists, at least nominally, oppose State capitalism)? Is the distributist type of capitalism, which conceives individuals or households accumulating wealth to some extent by taking part in ownership, with its consequent provisions of independence for self-government and motives for limiting the scope of state power – very Jeffersonian – more agreeable to the ideal of liberty? Or does a capitalism concentrated into the hand of a few, which increasingly upsets economic equilibrium, works to erode the family unit, and perpetually requires the aid of a growingly intrusive government offer “the greatest breadth of opportunity to its citizens”?

You may argue that these are not fair questions, and I admit there’s certainly more to it all; but this, in general, is how I’ve come to view the debate. Given this perspective, I see no contradiction in being a distributist who accepts true progress and at the same time opposes an inherent flaw, which has accompanied it - that is, who opposes a mixed capitalism that many (among which I was one) defend but do not quite understand.

The Imbecile Within

[I]t is upon fashions, cars, and gadgets, upon news and the advertising for which news exists, that our present industrial and economic system depends for its proper functioning. For, as ex-President Hoover pointed out not long ago, this system cannot work unless the demand for non-necessaries is not merely kept up, but continually expanded; and of course it cannot be kept up and expanded except by incessant appeals to greed, competitiveness, and love of aimless stimulation. Men have always been a prey to distractions... but never before today has an attempt been made to organize and exploit distractions, to make of them, because of their economic importance, the core and vital center of human life, to idealize them as the highest manifestations of mental activity. Our is an age of systematized irrelevances, and the imbecile within us has become one of the Titans, upon whose shoulders rests the weight of the social and economic system.

--Aldous Huxley

Ambiguity and the Pope's latest encyclical...

I’ve always been fond of an Aldous Huxley quote: “ambiguity in language leads to confusion of thought”. Abusing language intentionally is the primary tool of the propagandist, who seeks not beauty and clarity of thought but emotional manipulation. The propagandist who goes about his manipulation fully knowing that the actions he seeks to inspire conflict with the actors own beliefs is a propagandist in the extreme. But not all propagandists are fully operating within a view they know to be morally incompatible with those they seek to influence. Most bodies of knowledge, in fact, are full of blind spots, which are, by default, overlooked in faith. In some cases, especially moral, the grounds for this type of faith is suggested more, if not entirely, by what the adherent rejects, by what he sees as an unacceptable consequence which keeps him back, safe within his faith-patched system of thought. It is here, in this second case of the propagandist, that we can at least have some sympathy and assume that any error we perceive in his thought is due to blind spots overlooked in good faith; it’s important therefore to see the end he has in view, and proceed then to an examination of means. Granting this good faith, I propose to examine, in the next post, what I think are the errors of an article written by Gabriel E. Vidal about the Pope’s latest encyclical. Before I go there, however, I should note one more thing.

Ambiguity in language is sometimes due to the inability of language to capture the dynamism of reality. It is, therefore, not always the person who propagates a view who is proceeding on faith, but the recipients who must accept on faith what the teacher says based on what they know of the faithfulness of that teacher. Jesus, for instance, knew full well that people could not see how they could eat his flesh and drink his blood, and, though the doctrine of transubstantiation was to develop later on as the bounds to which reason could go in understanding it, the apostles simply had faith. When it came time and those words were realized, when Christ broke blessed bread and passed around blessed wine, those same apostles, though not understanding fully, at least understood there was another sense in which this saying could be accepted. St. Augustine said likewise about the opening of Genesis, how there are deeper senses to the language in which the truth of creation was expressed. In both cases: In the case of Christ’s sayings, and in the case of the opening of Genesis -- as well as the Psalms and certainly other parts of Scripture -- it takes time to unpack meanings that are latent and which could never be discovered without first having faith. Everything about Benedict XVI equally suggests to me that, even where he is speaking as pioneer and not as clearly in light of past encyclicals, he deserves the benefit of the doubt, and that just perhaps he’s speaking in terms beyond his time, with plenty of senses to unpack for those who would first believe so that they may see.

Conservatism and “Distributive Justice”

If Conservatism means holding to the philosophy of the Declaration of Independence, and of generally rooting oneself in the wisdom of the Founding Fathers as well as those great statesmen like Abraham Lincoln who walked in their stead, then call me a conservative. But please, if you do so don’t confuse me with those who call themselves conservative using “free market capitalism” as their defining attribute, and don’t get caught up in knee-jerk “ditto’s” with those same neo-conservatives who’ d automatically insist I’m therefore some type of socialist. Like any balanced view, my conservatism requires nuance; it also requires, if it is indeed balanced, listeners who are themselves level headed. Thus, it is to the levelheaded – whether or not that includes the ditto headed - that I call to mind an alternative conservatism, what I believe is a truly conservative conservatism.

As an introduction to this form of conservatism, I’d like to start with a basic truth: “Governments are instituted among Men… to secure… certain unalienable Rights… among these are Life, Liberty and the pursuit of Happiness.” The genius of our founders, however, did not stop at this and other phrases of the Declaration of Independence. In later producing the Constitution, they recognized that government itself needed built in checks and balances to prevent it from also violating our unalienable Rights. What the founders established, therefore, was a form of government, which checked and balanced itself, though was still strong enough to secure the external conditions necessary for individual liberty. Liberty, however, is not license.

Understanding the unalienable right to liberty, the second right of the Declaration, is crucial, I believe, to understanding the limiting function of government. Clearly, liberty to pursue happiness cannot mean a pursuit by means, which would interfere with another’s pursuit of happiness, so that a vision of the common good - one, as Jefferson might say, that includes the rights of each individual - presents itself as the defining context for excluding the wrong sorts of means. In other words, each individual has the right to pursue the good life (happiness) for himself, thus anything, which infringes upon the conditions necessary for each individual’s opportunity to do so must be protected against by law; this is what securing liberty, the proper function of government, means.

According to neo-conservatives, however, economic matters can never infringe upon the conditions necessary for individual liberty; they are, instead, always part of the conditions themselves. I’ll give three reasons why I believe this view not only false, but also hypocritical.
1) Any criticism of our capitalist system brings the cha rge that such a system brought unparalleled prosperity, but what brought – and generally brings – national prosperity was Alexander Hamilton’s system, later dubbed the American System, which imposed high tariffs to protect and encourage manufacturing. Hamilton’s prudential economic measures were anathema to free trade proponents, as were those of Lincoln, Theodore Roosevelt, and other great men.
2) Every sane neo-conservative will make an exception and admit that breaking up monopolies is a federal obligation. Unconditioned capitalism tends naturally to monopolistic practice, and thus to destroy the conditions requisite for liberty. If economics is not subordinate to the common good, that is, to the conditions for liberty, then we have no basis for breaking up monopolies.
3) Prosperity depends on stability, and economic stability, unfortunately, has had to come at the hand of Keynesianism, of stimulating demand through governmental means. Moreover, these periods of stability are cyclical, and each upset requires more government involvement, thus, as we currently witness, more dependency. Neo-conservatives, in defending our prosperity, unwittingly defend the very socialistic means they claim to detest (for no self-respecting neo-conservative will propose that government, whose constitutional duty is to “promote the general welfare”, should just let the economy crash).

What, then, is the alternative? Pope Benedict XVI, in his recent encyclical titled Caritas In Veritate, referenced “distributive justice”; the reference is older even than the Catholic Church, originating in that great common sense conservative, Aristotle. The beauty of it is, it falls perfectly in line with the principles of our great Democracy, and is really the only thing that can save it. Attempting to abolish capital ownership leads only to the communist debacle, it merely transfers power to elitist bure aucrats. But working through legislation to preserve the conditions requisite for liberty by promoting, as far as possible, widespread ownership in the means of production through, for instance, employee ownership initiatives; that is the way to ensure a more equitable distribution of wealth. That is the way to ensure self- reliance and independence. That is the way to ensure limited government. That is the way to promote both ancient and revolutionary-period conservatism. In a word, that is the way to implement a conservatism, which the great intellect G.K. Chesterton appropriately dubbed - Distributism.