Wednesday, April 15, 2009
Tuesday, March 10, 2009
Is There A Bellocian Response For Today's Economics Crisis?
For the article, please go to The Distributist Review.
Friday, February 20, 2009
The True Sources of Wealth
This post was cross-posted to Donald Goodman III's personal blog.
In light of the timely Call to Action posted at The Distributist Review yesterday, I'd like to suggest another practical means of helping establish distributism in the present time: creating wealth.
It's nearly universal for our politicians to tell us that we need to get back to creating wealth. This much is true; sadly, however, our politicians want to get back to creating wealth by getting people to borrow more money to buy more stuff, most of which was made in foreign countries by foreign workers, and most of which they couldn't afford even if they weren't going into still more debt in order to buy it.
Why does our age, alone among all, consider increased consumer debt and the increase in consumption that goes along with it to be "creating wealth"? Isn't this truly merely consuming wealth? And given that the vast majority of these consumer goods that we're purchasing with our borrowed stimulus funds are made in foreign factories by foreign workers, while our own citizens are occupied predominantly with serving each other (increasingly foreign-produced) food and selling each other incomprehensible financial documents (not to mention helping to import the foreign products that we're doing all this in order to buy), isn't this consumption of wealth without ever replacing it with anything?
Certainly, these foreigners (who are mostly perfectly decent people in their own right) are creating wealth, and we're paying them to do so. But what happens when they decide to start selling their new wealth to their own people? And even besides this, is it right for us to rely on the Chinese keeping their workers in borderline slavery in order to provide us with cheap goods, while we fritter away our immense national resources, both human and natural, voraciously consuming the wealth produced on other shores than ours?
At this point distributist readers will doubtlessly expect me to begin railing against industrialization and capitalism. But truly, this financial system isn't even really industrial capitalism (which can certainly be rightly railed against); it's something called finance capitalism, which in some ways is even worse. Industrial capitalism does, in fact, isolate all the means of production into the hands of the wealthy few, leaving the rest in near-slavery; however, at least the non-owning many can easily ascertain that they're being exploited by the owning few. Finance capitalism, on the other hand, ostensibly raises the wealth of the non-owners, and they acquire more and more material goods. This lulls the non-owners into total complacency, unaware that they and their nation are being stripped to the bone by the financiers, who are funding the shipment of the national wealth to foreign countries to be worked by foreign slaves.
Still, our benevolent leaders insist that this sort of activity is really creating wealth for our nation. But what is wealth, really? Surely it's not simply money, green paper or binary signatures on banks' hard drives? No; money is simply an agreed-upon standard for exchanging wealth, not wealth itself. Hillaire Belloc, in his seminal distributist work The Servile State, defined wealth as "matter which has been consciously and intelligently transformed from a condition in which it is less to a condition in which it is more serviceable to a human need." In other words, wealth is anything that's been worked on to make it more useful; so, for example, lumber, which are trees made into a more useful form for building, is wealth. Wealth is created by production, which is the "special, conscious, and intelligent transformation of his environment which is peculiar to the peculiar intelligence and creative faculty of man." The means of production, then, are simply the tools, such as saws and hammers, and resources, such as land and timber, necessary to produce wealth.
Certainly, the non-owning worker has more stuff than ever before; he has more things which have been made more useful for human needs, and consequently he is in possession of more wealth. However, he still does not own the means of production, the way in which wealth is produced. Under industrial capitalism, for a very long time, the non-owning worker was confined in poverty and squalor, and distributists have always identified this as truly evil. Many capitalists have hailed the arrival of finance capitalism as the end of that era, in which even the lowly non-owning workers are awash in unprecedented amounts of wealth. Doesn't this, truly, eliminate the objections of distributists to the capitalist economy? The workers, after all, are well cared for.
However, while distributism has always decried the physical exploitation of the worker, it has first and foremost decried his economic exploitation. Distributists object strongly to a characteristic common to both industrial and finance capitalism, one which remains no matter how stuffed with Chinese-made garbage the non-owning worker's heavily-mortgaged house might become: the fact that the vast majority of society are non-owning workers, with only a very few owners of productive property. In other words, while workers in the capitalist world often now have wealth, they still have no means of producing wealth, and that makes all the difference.
As Belloc observed, "[w]ithout wealth man cannot exist." Without the constant transformation of natural resources to a form more useful for man's needs, man will die. And so it follows that "to control the production of wealth is to control human life itself." But in our society, the means of producing wealth are owned by only a very few, and even those few have moved most of those means into the custody and control of foreign producers. Which means, of course, that the vast majority of our society, who are non-owning workers, are really and truly controlled by those few owners and their foreign counterparts. Thus, the state is, in a very real sense, servile, as Belloc warned. (As an aside, it is also servile in a way that Belloc never predicted: not only are the citizens of the state servile to the owning few, but the state as a whole is servile to the other nations which produce the wealth which it consumes.) As Leo XIII observed, two decades before The Servile State flowed from Belloc's pen, ownership by only a few in this way has "laid a yoke almost of slavery on the unnumbered masses of non-owning workers." (Leo XIII, Rerum Novarum.)
That is what distributists despise most about our current system: that it makes the vast majority of us near-slaves of the owning few. Furthermore, it makes the state as a whole incapable of producing what it needs itself; it must instead rely on other states to produce it, which is what has led to many of our economic problems today. Distributism, on the other hand, seeks to establish the distributist state, in which, as Belloc said, so great a number of the citizens are owners that the society as a whole takes on the character of owners, rather than of non-owning workers. Distributism seeks the greater distribution of productive property, the means of producing wealth. That is the first and primary economic goal of the system.
What property is productive? There are almost limitless correct answers to that question, but fundamentally wealth is produced from four forms of such property: the fields, the forests, the factories, and the mines. By fields we mean those pieces of land that are used for the all-important necessity of raising food, both farmland and pasture. By forests we mean those pieces of land that are covered with trees and wild growth, from which can be harvested timber, furs, and innumerable other natural resources. By factories we mean those pieces of land, including the improvements thereon, that take the products from the other three types of productive property and transform them into more useful forms, including the tools necessary to do so; it covers everything from a corner shoemaker's shop to an automaking factory. Finally, by mines we mean those parts of the land that are dedicated to the extraction of mineral resources to be used as such, such as gold, silver, iron, and copper mines.
Notice what is not included in this list. Restaurants; real estate brokers; attorneys (my own profession); stock traders; merchants; shopping malls; supermarkets. All of these professions are necessary (even if some ought to be made much smaller) and good within their proper spheres; but none of them are productive of wealth, and thus all of them are secondary to those which are. Even in a distributist society there will be non-owners who perform certain necessary tasks; however, the vast majority of citizens will be owners of wealth-producing property.
In those four places are the creation of wealth, not Wall Street, and certainly not the Washington mall. None of the proposed government projects to help expand our imploding economy involve creating wealth; they just involve the non-productive consumption of it, which we've been doing for far too long already. So we'll just keep consuming the wealth created by others until either they realize that they don't need us anymore (since they're already producing all the wealth themselves), or we realize that we're almost slaves and rise up to fix the problem ourselves.
But to return to the stated purpose of this article, how can the distributist help establish the distributive state right now, even within the bowels of finance capitalism? It's really quite simple: begin producing wealth. Even if one is in a non-productive profession within our currently terminal economy (as I am), and even if one has no financially feasible means of escaping that situation, one can produce wealth, even if in only a modest way.
If the distributist has a productive hobby, let him practice it until it becomes a second profession. I know a gentleman (not a distributist, sadly) who's an engineer by trade, but who has a great love of woodworking, and produces many things of great beauty while practicing that hobby. In so doing, he's established a small factory, one of the four great means of production; he is really producing wealth, a distributist thing for him to do, though his economic principles vary.
Personally, I am an attorney, one of those that Dmitry Orlov called "mere embroidery on the fabric of an affluent society" (Post-Soviet Lessons for a Post-American Century (Part Two of Three)). While this overstates the point, it does identify the truth that this profession is not productive of wealth in any direct way. However, that fact does not mean that I, as a distributist, cannot do my part in creating a distributist state. While I'm quite halting with my woodwork, I deeply enjoy gardening, though I'm very inexperienced. So I'm reading up on natural and sustainable gardening, and I'm practicing as best as I can. While I don't have much land, I'm using what little I have to produce some wealth; that is what God made it for, after all. It is hard to imagine someone with no interest in any productive craft; let the distributist select one and practice it, and get to work on the all-important economic task of producing things of value. It may be countercultural, but it's also the only way our society can ever recover.
Wealth is wonderful; but he who produces the wealth controls the world. Let us begin to more widely distribute productive property according to our principles, and let us do so by beginning with ourselves.
Praise be to Christ the King!
Note: This is published under the Creative Commons Attribution-Share Alike 3.0 United States License.
In light of the timely Call to Action posted at The Distributist Review yesterday, I'd like to suggest another practical means of helping establish distributism in the present time: creating wealth.
It's nearly universal for our politicians to tell us that we need to get back to creating wealth. This much is true; sadly, however, our politicians want to get back to creating wealth by getting people to borrow more money to buy more stuff, most of which was made in foreign countries by foreign workers, and most of which they couldn't afford even if they weren't going into still more debt in order to buy it.
Why does our age, alone among all, consider increased consumer debt and the increase in consumption that goes along with it to be "creating wealth"? Isn't this truly merely consuming wealth? And given that the vast majority of these consumer goods that we're purchasing with our borrowed stimulus funds are made in foreign factories by foreign workers, while our own citizens are occupied predominantly with serving each other (increasingly foreign-produced) food and selling each other incomprehensible financial documents (not to mention helping to import the foreign products that we're doing all this in order to buy), isn't this consumption of wealth without ever replacing it with anything?
Certainly, these foreigners (who are mostly perfectly decent people in their own right) are creating wealth, and we're paying them to do so. But what happens when they decide to start selling their new wealth to their own people? And even besides this, is it right for us to rely on the Chinese keeping their workers in borderline slavery in order to provide us with cheap goods, while we fritter away our immense national resources, both human and natural, voraciously consuming the wealth produced on other shores than ours?
At this point distributist readers will doubtlessly expect me to begin railing against industrialization and capitalism. But truly, this financial system isn't even really industrial capitalism (which can certainly be rightly railed against); it's something called finance capitalism, which in some ways is even worse. Industrial capitalism does, in fact, isolate all the means of production into the hands of the wealthy few, leaving the rest in near-slavery; however, at least the non-owning many can easily ascertain that they're being exploited by the owning few. Finance capitalism, on the other hand, ostensibly raises the wealth of the non-owners, and they acquire more and more material goods. This lulls the non-owners into total complacency, unaware that they and their nation are being stripped to the bone by the financiers, who are funding the shipment of the national wealth to foreign countries to be worked by foreign slaves.
Still, our benevolent leaders insist that this sort of activity is really creating wealth for our nation. But what is wealth, really? Surely it's not simply money, green paper or binary signatures on banks' hard drives? No; money is simply an agreed-upon standard for exchanging wealth, not wealth itself. Hillaire Belloc, in his seminal distributist work The Servile State, defined wealth as "matter which has been consciously and intelligently transformed from a condition in which it is less to a condition in which it is more serviceable to a human need." In other words, wealth is anything that's been worked on to make it more useful; so, for example, lumber, which are trees made into a more useful form for building, is wealth. Wealth is created by production, which is the "special, conscious, and intelligent transformation of his environment which is peculiar to the peculiar intelligence and creative faculty of man." The means of production, then, are simply the tools, such as saws and hammers, and resources, such as land and timber, necessary to produce wealth.
Certainly, the non-owning worker has more stuff than ever before; he has more things which have been made more useful for human needs, and consequently he is in possession of more wealth. However, he still does not own the means of production, the way in which wealth is produced. Under industrial capitalism, for a very long time, the non-owning worker was confined in poverty and squalor, and distributists have always identified this as truly evil. Many capitalists have hailed the arrival of finance capitalism as the end of that era, in which even the lowly non-owning workers are awash in unprecedented amounts of wealth. Doesn't this, truly, eliminate the objections of distributists to the capitalist economy? The workers, after all, are well cared for.
However, while distributism has always decried the physical exploitation of the worker, it has first and foremost decried his economic exploitation. Distributists object strongly to a characteristic common to both industrial and finance capitalism, one which remains no matter how stuffed with Chinese-made garbage the non-owning worker's heavily-mortgaged house might become: the fact that the vast majority of society are non-owning workers, with only a very few owners of productive property. In other words, while workers in the capitalist world often now have wealth, they still have no means of producing wealth, and that makes all the difference.
As Belloc observed, "[w]ithout wealth man cannot exist." Without the constant transformation of natural resources to a form more useful for man's needs, man will die. And so it follows that "to control the production of wealth is to control human life itself." But in our society, the means of producing wealth are owned by only a very few, and even those few have moved most of those means into the custody and control of foreign producers. Which means, of course, that the vast majority of our society, who are non-owning workers, are really and truly controlled by those few owners and their foreign counterparts. Thus, the state is, in a very real sense, servile, as Belloc warned. (As an aside, it is also servile in a way that Belloc never predicted: not only are the citizens of the state servile to the owning few, but the state as a whole is servile to the other nations which produce the wealth which it consumes.) As Leo XIII observed, two decades before The Servile State flowed from Belloc's pen, ownership by only a few in this way has "laid a yoke almost of slavery on the unnumbered masses of non-owning workers." (Leo XIII, Rerum Novarum.)
That is what distributists despise most about our current system: that it makes the vast majority of us near-slaves of the owning few. Furthermore, it makes the state as a whole incapable of producing what it needs itself; it must instead rely on other states to produce it, which is what has led to many of our economic problems today. Distributism, on the other hand, seeks to establish the distributist state, in which, as Belloc said, so great a number of the citizens are owners that the society as a whole takes on the character of owners, rather than of non-owning workers. Distributism seeks the greater distribution of productive property, the means of producing wealth. That is the first and primary economic goal of the system.
What property is productive? There are almost limitless correct answers to that question, but fundamentally wealth is produced from four forms of such property: the fields, the forests, the factories, and the mines. By fields we mean those pieces of land that are used for the all-important necessity of raising food, both farmland and pasture. By forests we mean those pieces of land that are covered with trees and wild growth, from which can be harvested timber, furs, and innumerable other natural resources. By factories we mean those pieces of land, including the improvements thereon, that take the products from the other three types of productive property and transform them into more useful forms, including the tools necessary to do so; it covers everything from a corner shoemaker's shop to an automaking factory. Finally, by mines we mean those parts of the land that are dedicated to the extraction of mineral resources to be used as such, such as gold, silver, iron, and copper mines.
Notice what is not included in this list. Restaurants; real estate brokers; attorneys (my own profession); stock traders; merchants; shopping malls; supermarkets. All of these professions are necessary (even if some ought to be made much smaller) and good within their proper spheres; but none of them are productive of wealth, and thus all of them are secondary to those which are. Even in a distributist society there will be non-owners who perform certain necessary tasks; however, the vast majority of citizens will be owners of wealth-producing property.
In those four places are the creation of wealth, not Wall Street, and certainly not the Washington mall. None of the proposed government projects to help expand our imploding economy involve creating wealth; they just involve the non-productive consumption of it, which we've been doing for far too long already. So we'll just keep consuming the wealth created by others until either they realize that they don't need us anymore (since they're already producing all the wealth themselves), or we realize that we're almost slaves and rise up to fix the problem ourselves.
But to return to the stated purpose of this article, how can the distributist help establish the distributive state right now, even within the bowels of finance capitalism? It's really quite simple: begin producing wealth. Even if one is in a non-productive profession within our currently terminal economy (as I am), and even if one has no financially feasible means of escaping that situation, one can produce wealth, even if in only a modest way.
If the distributist has a productive hobby, let him practice it until it becomes a second profession. I know a gentleman (not a distributist, sadly) who's an engineer by trade, but who has a great love of woodworking, and produces many things of great beauty while practicing that hobby. In so doing, he's established a small factory, one of the four great means of production; he is really producing wealth, a distributist thing for him to do, though his economic principles vary.
Personally, I am an attorney, one of those that Dmitry Orlov called "mere embroidery on the fabric of an affluent society" (Post-Soviet Lessons for a Post-American Century (Part Two of Three)). While this overstates the point, it does identify the truth that this profession is not productive of wealth in any direct way. However, that fact does not mean that I, as a distributist, cannot do my part in creating a distributist state. While I'm quite halting with my woodwork, I deeply enjoy gardening, though I'm very inexperienced. So I'm reading up on natural and sustainable gardening, and I'm practicing as best as I can. While I don't have much land, I'm using what little I have to produce some wealth; that is what God made it for, after all. It is hard to imagine someone with no interest in any productive craft; let the distributist select one and practice it, and get to work on the all-important economic task of producing things of value. It may be countercultural, but it's also the only way our society can ever recover.
Wealth is wonderful; but he who produces the wealth controls the world. Let us begin to more widely distribute productive property according to our principles, and let us do so by beginning with ourselves.
Praise be to Christ the King!
Note: This is published under the Creative Commons Attribution-Share Alike 3.0 United States License.
Sunday, February 15, 2009
Saturday, February 14, 2009
Thursday, January 15, 2009
Why Distributism Can Work (For Us, Right Now) Part I
For the article, please go to The Distributist Review.
Thursday, January 8, 2009
Saturday, December 13, 2008
Why Care about Distributism?
This post was cross-posted at Donald Goodman's personal blog.
An old friend has been commenting on my post Consumer Confidence or Consumer Recklessness, and he's led me to an interesting question. He asked me why I bother with this whole distributism thing at all? After all, he observes, it's exceedingly unlikely that I'd ever live to see distributism put into place; why not focus on making capitalists more virtuous, rather than explaining to them why the system itself is bankrupt?
I can respond in two ways. First, of course, is that while I might not see a distributist system in place in my lifetime, I can certainly see certain distributist principles put into practice. Some of this is happening already, though often under different names. The credit union system, for example, is in a certain way quite distributist (in others not really at all). Another example is the increasing prominence of farm co-ops. The people who form these efforts rarely go by the name "distributist"; however, these efforts are eminently in accord with distributism, and can and should be supported as such by distributists. My advocacy for distributism can therefore forward these and other efforts that I can actually effect, even if an entire distributist system is unlikely in the immediate future.
Second, I advocate for distributism the same way I advocate for Catholicism. While I'm talking to a Protestant, for example, it might be extremely unlikely that I'll convert him entirely to Catholicism, but pretty easy to convince him that he should venerate Mary. I'll certainly try to convince him to venerate Mary (as I certainly now try to convince capitalists to be more virtuous); but that doesn't mean that I give up trying to convince him to adopt Catholicism (as I don't give up trying to advocate for distributism over capitalism).
Well, this friend replied, you do that because God has commanded you to try to convert people to Catholicism, so it's different. However, God has commanded us to spread the truth, and distributism's economic principles are truth, while capitalism's are falsehood. To spread the truth, then, I must try to spread distributism; I can't exclude this one part of the truth any more than I could exclude Marian veneration from spreading Catholicism.
The capitalist at this point generally smirks knowingly, as he's now certain that his interlocutor is not quite straight in the head. Are you seriously claiming, he'll ask, that distributism is just as important as Catholicism? That's absolutely absurd. Well, yes and no; is distributism just as important as Catholicism? Obviously not. But is Catholic social teaching just as important as Catholicism? Unquestionably, yes; indeed, it is part and parcel of Catholicism, and one cannot be had without the other.
Is that absurd? If so, I'm afraid you'll have to tell that not just to me, but also to John Paul II, who said precisely that. Catholic social teachings, he argued, are an integral part of the Gospel and must be spread along with it. Rerum Novarum, for example, the flagship of Catholic social teaching, "is a document of the Magisterium and is fully a part of the Church's evangelizing mission, together with many other documents of this nature." Centesimus Annus, no. 54. Think for a moment about how strong a statement that is; the late Pope is saying that Catholic social teaching is part of the message that the Church must spread throughout the world. That's a pretty high-octane statement if spreading distributism is pointless.
Now, distributism is a name for an economic system that attempts to embody Catholic social teaching; as such, it could be mistaken in some particulars, and can't be called, by itself, part of Catholicism. But the Catholic social teaching that it seeks to embody unquestionably is such. So I must, when spreading the Gospel, spread Catholic social teaching, including those parts that are fundamentally antithetical to capitalism. Such as:
And these are just specifics; they barely begin to get into the principles of capitalism as opposed to the principles of Catholic social teaching.
So yes, it is important to spread Catholic social teaching, and as such the particular way of embodying it that I support, which is called distributism. To spread Catholicism without it would be omitting an essential part of the Gospel message. Truth is truth; I will try to spread all of it whenever I can.
An old friend has been commenting on my post Consumer Confidence or Consumer Recklessness, and he's led me to an interesting question. He asked me why I bother with this whole distributism thing at all? After all, he observes, it's exceedingly unlikely that I'd ever live to see distributism put into place; why not focus on making capitalists more virtuous, rather than explaining to them why the system itself is bankrupt?
I can respond in two ways. First, of course, is that while I might not see a distributist system in place in my lifetime, I can certainly see certain distributist principles put into practice. Some of this is happening already, though often under different names. The credit union system, for example, is in a certain way quite distributist (in others not really at all). Another example is the increasing prominence of farm co-ops. The people who form these efforts rarely go by the name "distributist"; however, these efforts are eminently in accord with distributism, and can and should be supported as such by distributists. My advocacy for distributism can therefore forward these and other efforts that I can actually effect, even if an entire distributist system is unlikely in the immediate future.
Second, I advocate for distributism the same way I advocate for Catholicism. While I'm talking to a Protestant, for example, it might be extremely unlikely that I'll convert him entirely to Catholicism, but pretty easy to convince him that he should venerate Mary. I'll certainly try to convince him to venerate Mary (as I certainly now try to convince capitalists to be more virtuous); but that doesn't mean that I give up trying to convince him to adopt Catholicism (as I don't give up trying to advocate for distributism over capitalism).
Well, this friend replied, you do that because God has commanded you to try to convert people to Catholicism, so it's different. However, God has commanded us to spread the truth, and distributism's economic principles are truth, while capitalism's are falsehood. To spread the truth, then, I must try to spread distributism; I can't exclude this one part of the truth any more than I could exclude Marian veneration from spreading Catholicism.
The capitalist at this point generally smirks knowingly, as he's now certain that his interlocutor is not quite straight in the head. Are you seriously claiming, he'll ask, that distributism is just as important as Catholicism? That's absolutely absurd. Well, yes and no; is distributism just as important as Catholicism? Obviously not. But is Catholic social teaching just as important as Catholicism? Unquestionably, yes; indeed, it is part and parcel of Catholicism, and one cannot be had without the other.
Is that absurd? If so, I'm afraid you'll have to tell that not just to me, but also to John Paul II, who said precisely that. Catholic social teachings, he argued, are an integral part of the Gospel and must be spread along with it. Rerum Novarum, for example, the flagship of Catholic social teaching, "is a document of the Magisterium and is fully a part of the Church's evangelizing mission, together with many other documents of this nature." Centesimus Annus, no. 54. Think for a moment about how strong a statement that is; the late Pope is saying that Catholic social teaching is part of the message that the Church must spread throughout the world. That's a pretty high-octane statement if spreading distributism is pointless.
Now, distributism is a name for an economic system that attempts to embody Catholic social teaching; as such, it could be mistaken in some particulars, and can't be called, by itself, part of Catholicism. But the Catholic social teaching that it seeks to embody unquestionably is such. So I must, when spreading the Gospel, spread Catholic social teaching, including those parts that are fundamentally antithetical to capitalism. Such as:
- Just wages cannot be set merely by the market, but must be compelled to be at least sufficient to support a worker and his family. Rerum Novarum no. 63; Quadragesimo Anno p. 36; Centesimus Annus no. 15.
- Women should be legally compelled to avoid certain occupations, no matter to what the market might lead them. Rerum Novarum no. 63.
- Some industries not only might, but ought to be owned and run by the state. Quadragesimo Anno, p. 55.
- Onwership of private property is a right, but the use of private property is not, and is subject to just state and community regulation. Rerum Novarum no. 25; Quadragesimo Anno p. 24-25; Centesimus Annus no. 30.
- Free competition is not the best, or even a good, way to organize economic affairs. Quadragesimo Anno p. 44.
- Social justice and social charity are just and, in fact, are the "soul" of a just economic order. Quadragesimo Anno p. 45.
- Income earned by a man which is not necessary for his upkeep according to his state is subject to just regulation and use by the state and community. Quadragesimo Anno p. 26.
And these are just specifics; they barely begin to get into the principles of capitalism as opposed to the principles of Catholic social teaching.
So yes, it is important to spread Catholic social teaching, and as such the particular way of embodying it that I support, which is called distributism. To spread Catholicism without it would be omitting an essential part of the Gospel message. Truth is truth; I will try to spread all of it whenever I can.
Wednesday, November 26, 2008
Monday, November 10, 2008
Consumer Confidence or Consumer Recklessness?
This post was taken from Donald Goodman's personal blog.
The current economic crisis is often blamed in part on a “crisis of consumer confidence.” The essential problem, according to those who place such blame, is that consumers just aren’t confident enough. Because they’re not confident enough, they’re not making lots of purchases, which cuts down on orders from retailers, which cuts down on transportation orders for distributors, which cuts down on orders from manufacturers, and thus hits everybody. The important thing, it’s said, is to get consumers confident again so that they’ll start spending again.
Along this vein is the oft-repeated statement that “the consumer is two-thirds of the economy.” Since the consumer is two-thirds of the economy, we need to get him spending his money, or the other one-third won’t work anymore. What’s more, that single two-thirds will shrink, thus costing everybody, consumer and otherwise.
Let’s think about those statements for a moment, however. First, let’s take “the consumer is two-thirds of the economy.” Really? If consumption is two-thirds of the economy, what exactly is the consumer consuming? Presumably, the other one-third is production and services; but let’s be charitable to our dear country and presume that the other one-third is production. (In reality, of course, a great deal of it is, in fact, services; but we’re being charitable.) That means that we’re consuming twice what we’re producing.
Think about that for a moment. If we’re consuming twice what we’re producing, where is all that extra stuff coming from? The answer is China; Japan; Europe. Essentially, elsewhere. And because we’re consuming twice what we’re producing, we’re also spending twice what we’re earning. Where does the extra money come from? The answer is China; Japan; Europe. In other words, we’re borrowing to cover for the extra consumption that doesn’t balance what we produce. And, as a corollary, we’re accumulating a great deal of debt and paying a great deal of interest on it.
And that leads us to thinking about the other notion now, that the problem here is one of “consumer confidence.” Don’t we really mean “consumer recklessness?” The problem, such people say, is that consumers just aren’t spending their money like they used to; they’re saving it instead. Tightening their belts. Never mind that once this great country prided itself on the thrift of its hard-working citizens, noting that said thrift and hard work are the elements which made it economically great. Such people, though, want us “consumers” to just keep spending our money, even though we really need to save it. Even though, in the past, the money that we’ve spent is often money that we didn’t have, and that we had to borrow to spend. We need to retrench; pay off our past debts; save up a cushion in case of a fall. That means that we, as consumers, are not “confident.”
In reality, though, it means that we, as consumers, are not reckless. We’re being wise for a change; we’re being careful only to spend money that we actually have; we’re foregoing present pleasures for the sake of future safety; we’re actually, horror of horrors, paying off some debts instead of constantly racking up new ones. This is terrible! Consumers aren’t confident! Can you imagine what might happen to the economy if this spreads? What horrible disasters might befall our nation if such ludicrous practices spread, and our government adopted such an insane scheme so lacking in “confidence?”
Modern economics have led us to a strange place. Though this country was built on working hard, producing goods, foregoing unnecessary consumption, taking debt as rarely as possible, and paying off necessary debt as quickly as possible; though the wealth of every country has been based on these perennial, thrifty, and diligent practices; we have nevertheless convinced ourselves that our wealth is based on spending as much as we can, racking up as much debt as we need to in order to get everything we currently want, and letting other countries bother with the annoying hard work, production of useful goods, and delayed gratification.
Here is national suicide. We need to return to the basic principles of sound economic management. Namely, that it is production which is primary, not consumption; that it is better to save than to buy what we don’t need; that it is better to be free of debt than to have debt; and that gratification of our present desires need not be immediate, or even occur at all. Thrift; moderation; looking to the future. There is national prosperity. There, and there alone, is the solution to our economic crisis.
Praise be to Christ the King!
The current economic crisis is often blamed in part on a “crisis of consumer confidence.” The essential problem, according to those who place such blame, is that consumers just aren’t confident enough. Because they’re not confident enough, they’re not making lots of purchases, which cuts down on orders from retailers, which cuts down on transportation orders for distributors, which cuts down on orders from manufacturers, and thus hits everybody. The important thing, it’s said, is to get consumers confident again so that they’ll start spending again.
Along this vein is the oft-repeated statement that “the consumer is two-thirds of the economy.” Since the consumer is two-thirds of the economy, we need to get him spending his money, or the other one-third won’t work anymore. What’s more, that single two-thirds will shrink, thus costing everybody, consumer and otherwise.
Let’s think about those statements for a moment, however. First, let’s take “the consumer is two-thirds of the economy.” Really? If consumption is two-thirds of the economy, what exactly is the consumer consuming? Presumably, the other one-third is production and services; but let’s be charitable to our dear country and presume that the other one-third is production. (In reality, of course, a great deal of it is, in fact, services; but we’re being charitable.) That means that we’re consuming twice what we’re producing.
Think about that for a moment. If we’re consuming twice what we’re producing, where is all that extra stuff coming from? The answer is China; Japan; Europe. Essentially, elsewhere. And because we’re consuming twice what we’re producing, we’re also spending twice what we’re earning. Where does the extra money come from? The answer is China; Japan; Europe. In other words, we’re borrowing to cover for the extra consumption that doesn’t balance what we produce. And, as a corollary, we’re accumulating a great deal of debt and paying a great deal of interest on it.
And that leads us to thinking about the other notion now, that the problem here is one of “consumer confidence.” Don’t we really mean “consumer recklessness?” The problem, such people say, is that consumers just aren’t spending their money like they used to; they’re saving it instead. Tightening their belts. Never mind that once this great country prided itself on the thrift of its hard-working citizens, noting that said thrift and hard work are the elements which made it economically great. Such people, though, want us “consumers” to just keep spending our money, even though we really need to save it. Even though, in the past, the money that we’ve spent is often money that we didn’t have, and that we had to borrow to spend. We need to retrench; pay off our past debts; save up a cushion in case of a fall. That means that we, as consumers, are not “confident.”
In reality, though, it means that we, as consumers, are not reckless. We’re being wise for a change; we’re being careful only to spend money that we actually have; we’re foregoing present pleasures for the sake of future safety; we’re actually, horror of horrors, paying off some debts instead of constantly racking up new ones. This is terrible! Consumers aren’t confident! Can you imagine what might happen to the economy if this spreads? What horrible disasters might befall our nation if such ludicrous practices spread, and our government adopted such an insane scheme so lacking in “confidence?”
Modern economics have led us to a strange place. Though this country was built on working hard, producing goods, foregoing unnecessary consumption, taking debt as rarely as possible, and paying off necessary debt as quickly as possible; though the wealth of every country has been based on these perennial, thrifty, and diligent practices; we have nevertheless convinced ourselves that our wealth is based on spending as much as we can, racking up as much debt as we need to in order to get everything we currently want, and letting other countries bother with the annoying hard work, production of useful goods, and delayed gratification.
Here is national suicide. We need to return to the basic principles of sound economic management. Namely, that it is production which is primary, not consumption; that it is better to save than to buy what we don’t need; that it is better to be free of debt than to have debt; and that gratification of our present desires need not be immediate, or even occur at all. Thrift; moderation; looking to the future. There is national prosperity. There, and there alone, is the solution to our economic crisis.
Praise be to Christ the King!
Sunday, November 2, 2008
"Untouched by the breath of God, unrestricted by human conscience, both capitalism and socialism are repulsive." - Aleksandr Solzhenitsyn
For the article, go to The Distributist Review
Tuesday, October 21, 2008
Catholic? Socialist? Distributist.
See Bill Powell's recent article at Inside Catholic and support him with your comments.
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