OK, Free Marketeers…
Talk to me.
In our last comment thread, someone suggested that,
if a family wage was instituted, then bonuses or raises would still be applied appropriately- even if it meant giving raises when the man had a new baby.
To this, commenter Aaron responded:
How exactly does this in particular benefit the employer? Compensation is usually given to high-performers and/or talented butt-kissers. A corporation does not really care whether its employer has another child; it only cares about ROI. If it is a good investment to give a high-performer a raise, then the corporation who sees this will do so. If a low or average performing employee gets a raise based on having a child, how does that encourage people to perform well?
What Aaron has done here, in spectacularly succinct fashion, is underscore with several thick, black lines what is wrong with the current system. It is summed up in this sentence: “A corporation does not really care whether its employer has another child; it only cares about ROI.”
In the introduction to the IHS reprint of Hilaire Belloc’s An Essay On The Restoration Of Property, the editors state:
Readers will therefore not find, in Belloc’s works, traces of that skepticism which speaks of politics as merely the “art of the possible,” and of economics as a science of hypotheses based solely on observable phenomena and codified into a collection of equations, charts and graphs. As an integral Catholic, Belloc followed in the footsteps of St. Thomas the realist, who spoke of Politics as the moral science “which considers the proper ordering of men,” and Political Economy as that science “concerned with the using of money…for the good estate of the home.”
Thus is Belloc’s treatment of economic questions, in Restoration of Property, Economics for Helen, and the Servile State, concerned with reality in both its profoundest sense and its most practical. Profound because Belloc has always before him a knowledge of the Purpose of the sciences, a knowledge that all of the tools, techniques, and means means employed by them are given clear and well-defined directions and orientations by their various Purposes. And practical because when Belloc considers economic matters he is concerned not with the pie (-in-the-sky) charts of modern economic theoreticians, but rather with how to solve the problem of securing for men the material necessities of life in a manner most befitting both their dignity as free men and their sublimity as souls destined for Heaven. There is nothing novel in so doing; Belloc simply follows St. Thomas in subordinating the acquisition of wealth to the true needs of man: “That a man may lead a good life, two things are required. The chief requisite is virtuous action….The other requisite, which is secondary and quasi-instrumental in character, is a sufficiency of material goods, the use of which is necessary for virtuous action” (On Kingship, I, xv).
Such an approach has for a long time seemed quaint and “unrealistic” to a society concerned with satisfying “the bottom line” and getting “more bang for the buck.” Has seemed quaint - until recently. Today such an approach is touted almost as a “revelation” by many moderns who, all of a sudden, are realizing - even if unconsciously - that St. Thomas had the order of economic priorities exactly right. Protesting the domination of academic activity by finance, and the lawlessness of corporate America, a recent editorial in the Nation declares, “The larger purpose of the economic order, including Wall Street, is to support the material conditions for human existence.”
How charmingly similar to the approach taken by the classical and Catholic political economists, men forming a constant and coherent tradition extending over 2200 years, from Aristotle of the fourth century B.C. to Charles Devas of the early 20th century A.D.!
The editorial continues: “During the past two decades, a profound inversion has occurred in the governing values of US economic life and, in turn, captured politics and elite discourse - the triumph of finance over the real economy. In the natural order of capitalism, the financial system is supposed to serve the economy of production - goods and services, jobs and incomes - but the narrow values of Wall Street have become the master.”
I have been trying to establish the fact that the obvious contention between the well-being of the worker and the company ROI too often finds the worker losing that battle. It is the health of the company that matters, not the health of the worker or his family. It is the depth of the corporate bank account that is of chief concern, not the ability of the worker to establish his family in a modest but comfortable standard of living. In corporations, the money flows uphill. This is simply the nature of capitalism, which is at essence a nicely-dressed but still greed-based economic model.
Aaron asks “If a low or average performing employee gets a raise based on having a child, how does that encourage people to perform well?”
The answer to that is simple. If a man is a worthless employee, he should still be fired. But if a man is treated by his company as if he is valued; if the employer seeks to ease the man’s financial worry and reward him for his contribution to society through the procreation of children (who will, it should be noted, become the future customers on which the long-term health of all commerce depends) he will have peace of mind and a sense of loyalty to the firm that will more than likely induce good will and a willingness to contribute.
Economic darwinism may produce some favorable benefits of competition, but it also creates bitterness, anxiety, backstabbing, manipulation, and the devious tactics of survival that help a man rise from poverty to wealth. People who aren’t making ends meet don’t give their best to their jobs. They come into work tired from lack of sleep, or hungover from trying to drown their sorrows. They resent those in the company who are prosperous but seem to do little while they are working hard just to scrape by. They may look for supplemental work, which takes more from their limited supply of time, energy, and mental clarity, making them less productive overall.
The model of the business should really be the family. When a new child is born into the world, his parents do not seek to make him prove himself and work his way up in the home; they invest in him with care and patience, and nurture the contributions he is able to make to the home as he grows old enough to bear responsibilities. A family can do this because its chief concern is love, not its bottom line. And if a business will never truly emulate this, it is possible to take true concern for the development and well-being of employees if the goal is modest profit, not infinite growth. Happy employees are productive employees, and as long as everyone in the company has what they need at home, why must a company continually grow in revenues? If every worker in a business is being provided for adequately, what is the great tragedy in annual sales which are flat?
But what man needs goes even deeper than a good company that takes an interest in his well-being. He needs, at some point, to become an owner himself.
Belloc says:
Man, to live, must transform his environment from a state in which it is less to a state in which it is more useful to himself. This process is called “The Production of Wealth.” Moreover, if a man is to live conformably to his nature, there must be available for his consumption a certain amount of wealth, in a certain variety, for a certain unit of time. For instance, in our society, he must have so much bread, so much meat, so much of a number of different foods every day, so much beer or wine or spirits (or, if he be too weak to consume these) so much tea or coffee or what not; a sufficient amount of somewhat complicated clothing, all to last over such and such an amount of time; and a sufficiency of fuel, housing, and all the rest of it, also to last a certain time.
Now this transformation of environment called “The Production of Wealth” is obviously only possible through the use of the instruments of production. A family can only live conformably to its human nature (that is, without undue suffering) in a given civilization on condition that it receive securely and constantly so much of this varied wealth for its consumption. But the wealth can only come into existence through the manipulating of natural forces by certain instruments; and there must also be an existing store of food and clothing and housing and the rest of it so that human beings may carry on during the process of production. These stores of wealth, these instruments and these natural forces are the Means of Production.
It is obvious that whoever controls the means of production controls the supply of wealth. If, therefore, the means for the production of that wealth which a family needs are in the control of others than the family, the family will be dependent upon those others; it will not be economically free.”
So my question to Aaron and the other Catholic free marketeers is this: Why should the business be the most important economic beneficiary in society, rather than the family? Set aside for a moment the system that we have - what should the ideal system be? Shouldn’t society seek to provide opportunities to make men owners, to possess private property of their own, to be able to provide for their families adequately and with some measure of comfort? Or do you think that the dog-eat-dog system is best, and that cheap wages, sky-high CEO pay and the economic advantages of globalization are the best thing for men?
Filed under: Belloc, Distributism, Economics
My objection to these ideas is that you are setting up a false dichotomy between the business and the family. Who is the business owner? The stockholders. Who are the stockholders? Mostly middle-class people whose 401Ks or pension funds depend on the business to be profitable. So who benefits when the company puts profit first? Quite a lot of people, and many families of course. There isn’t any reason that they should be 2nd in importance after the employee. The employee isn’t worthless, of course. But his job consists of creating value for society, and he receives his wage. If he has children, let him work hard to become more valuable, and his wages will increase.
As for ownership, let him buy stock. (See my essay on Distributism entitled, Ownership and Control) I deny altogether Belloc’s idea that we are not meant to exist in economic interdependance on one another.
you are setting up a false dichotomy between the business and the family.
There’s nothing false about it. The dichotomy exists.
Who is the business owner? The stockholders. Who are the stockholders? Mostly middle-class people whose 401Ks or pension funds depend on the business to be profitable.
My opinion - this is not a good system of ownership. It depends too much on perpetual growth; these same people lose huge amounts of money when sales fall. Also, piecemeal ownership is no real ownership. It’s simply an investment. Only the very rich own big stakes in companies, and usually they are minority stakes. Many who own stock in a company simply gamble. Short sellers make their living betting on stocks that will fail.
But I’m also not a fan of huge corporations. There are industries where economies of scale are necessary, but generally it’s the large business, the big box stores of the world, that make independent ownership (and thereby possession of the means of production by families) impossible.
If he has children, let him work hard to become more valuable, and his wages will increase.
He is still only a commodity and is bound by the same strange economic unrealism of the company he works for. He must perpetually produce more. At some point, when he has reached his maximum capacity to produce, he will become a devaluing asset, as he will continue to expect his salary to rise with his length of tenure. But if he produces no additional benefit to the company, why should they pay him more? Why not hire two younger employees in his place for less cost, and allow them to develop in tandem, thereby doubling the capacity to do his work?
Further, you continue to speak of the value of a man to the company. The bigger question is what value the company is to the man. When does he attain economic independence so that he may be the master of his own good?
I deny altogether Belloc’s idea that we are not meant to exist in economic interdependance on one another.
Then you don’t adequately understand Belloc:
“The family is ideally free when it fully controls all the means necessary for the production of such wealth as it should consume for normal living.
But such an ideal is inhuman and, therefore, not to be fixedly attained, because man is a social animal. It is not impossible of achievement for a short time, and has been briefly achieved whenever a lonely settler has fixed himself with his family and his stores in an isolated spot. But such complete economic freedom for each family cannot be permanent, because the family increases and divides into further numerous families, forming a larger community…
…Society being necessary to man, there arise in the economic field these two limitations to economic freedom: -
First, Difference of Occupation: Each in society will concentrate upon what he has the best opportunity for producing and, by exchanging his surplus of it for that which another has the best opportunity of producing, will increase the wealth of all: or what comes to the same thing, lessen the burden of labour for all. Thus men live more happily in an agricultural village if there be a miller to grind the wheat instead of every family grinding it under their own roof, a cobbler to mend and make boots - and so on. “
Kevin is right, and I would add:
Businesses don’t exist to provide jobs or salaries for their employees; they exist to provide goods and services to customers. Employees ought to be compensated based on the value they contribute to the enterprise and its customers; to do otherwise would be an offense against justice.
George Gilder explains, in his book “Men and Marriage,” why married men tend to earn more money and commit fewer crimes than unmarried men. Marriage has a civilizing influence; as men find their families growing, they knuckle down and channel their energies into more productive activities (i.e. working harder, contributing more at work or finding a better job) to support that family. I’d argue that for society to simply automatically compensate men for for having additional children would short-circuit this process, and deprive society of the harder work and more productively-focused energies that these men would now have no incentive to provide.
It’s not the responsibility of the employer to compensate the employee based on the employee’s changing personal circumstances; after all, why stop at adjusting wages based on family size? How about health circumstances that his family is experiencing? (etc, etc)? I contend that when an employee’s personal circumstances change, it’s the employee’s responsibility to adjust his contribution to the company, or find a different company to which he can make a larger contribution, or to take a second job.
A diversified portfolio of stocks is inherently less risky then a small business. You may own implements of production, but what if what you produce falls out of favor? What good is your capital then? A company may go bankrupt, but a well diversified portfolio can’t fail unless the entire society fails first.
To be fair, I don’t disagree that there is something that conflicts with justice in the ideas laid out by Mark in the previous thread regarding the good old boys club.
I’m unconvinced that employers should pay more to a man who has more children, because having children then becomes his meal ticket as surely as any work he does.
On the other hand, I continue to believe that justice does demand a living wage, which many employers (just about every one I’ve ever worked for prior to this one) fail to provide. Further, I think a well-compensated employee is as likely (if not moreso) to be a productive employee. The negative psychological consequences of not making enough money can be every bit as damaging to a man’s productivity as being well-paid and comfortable. The difference is that the latter situation inspires a sense of loyalty, where the former, often enough, inspires only feelings of resentment and injustice.
If Belloc is not opposed to the division of labor, I can’t understand why he should be opposed to working for a wage. If you are the town miller, you are just as dependant upon others as if you were an employee. In fact your position is even more precarious. If the particular skill an employee has is no longer needed, there are plenty of employers willing to hire him to do something else entirely. But if a Miller’s use of his capital falls out of favor with his customers, and if he lives in a distributist society, there will be no large corporation to hire him to do something different. His capital is worthless due to a change in consumer preferences, and he has no prospects for employment. He becomes a charity case.
I thought these paragraphs got posted earlier, but they didn’t:
CEOS earn the money they receive by creating value for the stockholders. They are not a drain on the company but a net positive. Profits, especially in the long term, are very sensitive to good decision making at the top. Stockholders must pay top dollar to get the very best decision maker, but it is worth it to them.
Bitterness, Anxiety, Manipulation, etc: All didn’t exist before Capitalism? Wouldn’t exist if more people were small business owners competing with one another for customers? Wouldn’t exist if people were higher paid employees with even more generous wage levels to compete for?
I noticed your remark to Aaron in another thread that a modest, comfortable standard of living was relative, because otherwise there would be an infinite regress of lower standards that were acceptable at one time. Doesn’t it work in the other direction too? Aren’t you saying that no level of income will be enough for more than a short time, until people get used to more? Is there no limit to what heights the “just wage” will rise to in a prosperous future?
Kevin,
And that’s different how from when a large corporation find that its use of capital is no longer in favor, and lays off a large swath of employees? How have they not become “charity cases”?
Sorry, economic security via large corporation is so 1950’s. Don’t you follow the news lately?
And you’re setting up a false dichotomy. In our world, those laid off by those large corporations (why no small companies, in your view?) are highly likely to become “charity cases” — whereas your miller in a distributist society is quite free to either sell his labor to his neighbors who need it for their distributist enterprises, or to re-purpose his capital for a different enterprise.
peace,
Zach
Zach, are you calling me a commie?
Hmm.
A couple of points: first of all, “It is the big box stores that make ownership of the means of production impossible” , is as concise statement of the Socialist hypothesis as there can be. One of the reasons I don’t think much of Chesterbellockian economics is that it tries to reason from Fabian Socialist premises back to Christianity, when the better starting point would be Albertus Magnus.
In any case, the corporate tax rate is 35% on profits, plus 15% on capital gains, plus 15% on dividends, plus state taxes and fees, plus all the lobbying costs it takes to stay in business, all of which are on their way up, up, up. The average family pays far less than that, on a percentage basis, in taxes.
He who pays the piper…
Kevin,
Zach, are you calling me a commie?
Um, no, not at all.
Is this more of that “sarcastic taking out of context to make a point” thing?
peace,
UNCLE!! UNCLE!!
You win, OK?
I’ll give you the Way Too Long Blog Post award.
I’d argue that it’s never been as easy as today to own one’s own “means of production.” For many of us in modern America, that equals a desktop computer — or even a laptop. And it’s precisely the competition between big retailers that has contributed to making this equipment so inexpensive.
Pretty remarkable that so many of us today can support a family with an investment of less than $5k in hardware and software — and have access to clients and customers far beyond the borders of our own towns.
The “means of production” is ultimately between our ears.
“Pretty remarkable that so many of us today can support a family with an investment of less than $5k in hardware and software — and have access to clients and customers far beyond the borders of our own towns.”
I’m listening, Chris. If you can teach me how to do this I’ll make it worth your while …
Jeff-
It obviously takes more than a computer; it takes experience, client contacts, education, and specialized skills as well — I’m talking about the “means of production.” In this economy, a person doesn’t need to own a factory or a bricks and mortar retail establishment to make money; that’s an enormous barrier to entry that previous generations faced that we do not.
Kevin,
The disparity between the good of the company and the good of the employee is no false dichotomy. Right now I work for a mid-sized telecom company. The company is quite profitable and well-established in it’s market. We are being bought by another firm. The money for the purchase was borrowed against our own assets and credit. The purchaser has announced that they will be seeking $1,000,000,000 annually in “synergies”, meaning layoffs. Show me a way in which this transaction is good for the employees. Of either company.
To quote Dilbert, “They’d kill us in our sleep and sell our organs on the black market if they thought they could make a big enough profit.”
CEOs of the largest companies do not create value for the shareholders by turning a profit. They do it by manipulating the financial system and the stock market. Their salaries are used as a way of keeping score. Quite simply, outside the entertainment industry, no one person actually creates $20M worth of value for any company. Especially CEOs, who are largely clueless not only of their company but also their industry. The few times they actually make real decisions they are more likely to be wrong than right. How much money did Carly Fiorina make by running HP into the ground? Over $50M, plus $21M to <b>fire her</b>.
Kevin said:
<i>Stockholders must pay top dollar to get the very best decision maker, but it is worth it to them.</i> That’s a joke. The salary of board members and presidents is set by the same people who serve as presidents and board members. It’s a tiny club of people who work together, belong to the same clubs and vote each other pay increases. Individual stockholders have no say whatsoever in the pay scale.
A system of ownership which divorces success from responsibility, which is precisely what the corporate system is <i>intended</i> to do, bears strinking little relation to the type of ownership Belloc, Chesterton and McNabb were talking about.
Finally, if you really think working hard results in higher wages, you’re too naive to be addressing the subject. Another dozen layoffs might cure you of that.
Chris said:
<i>Businesses don’t exist to provide jobs or salaries for their employees; they exist to provide goods and services to customers. </i>
Wrong. Businesses exist to give selfish, ugly and repellent men a chance to meet atractive women. And in these days of women’s exploitation liberation, to give selfish harpies the chance to prove that they can be more replellent than men. In so far as decisions made at the executive level have any purpose outside that, it is to inflate the stock price so as to extract more money from the market for the benefit of those at the executive level.
Joe Marier,
The big box stores,a s well as all the large national and international companies rely on government regulation and abuse of the courts to maintain their market share. So I suppose they do “call the tune.” To Be Expected and Best are not equivalent.
Am I cynical? You bet. After 30 years in the corporate world you will be too.
“It obviously takes more than a computer; it takes experience, client contacts, education, and specialized skills as well — I’m talking about the ‘means of production.’”
Well, I would say that a person who sells his services with the use of a computer is still a hireling. Not that there’s anything wrong with that, but the value here is labor, not capital. When the man can longer labor, there goes his “means of production” - himself.
“In this economy, a person doesn’t need to own a factory or a bricks and mortar retail establishment to make money; that’s an enormous barrier to entry that previous generations faced that we do not.”
A man could always sell his labor - his services - as an employee somewhere, without any capital investment at all. Today there is a small minority who can do this from home with a computer, but it’s still the same kind of arrangement.
Danby, I never said there wasn’t conflicting interests between company and employee. Like any two entities making a bargain, what one gains the other loses. My point is that the stockholders have families too, and its not clear to me that one family is more important than another because of the nature of their interaction through the medium of the corporation.
It is interesting to me that you don’t think CEOs do much for their company. Who is creating all that value out there?? If the lower-paid employees are the ones responsible for the value of the company, there is nothing stopping them from all quitting and starting a new company together without that worthless scumbag of a CEO that is exploiting them and appropriating all that value that they are creating. More power to them! That’s called Capitalism.
Jeff: Read a book on computer programming.
Oh, and Zach: Why should I believe you that you’re not calling me a commie? Hmm?
Kevin,
Normally, when two people make a bargain, both win. One sells his good at a price equal to or greater than it’s value to him, the other obtains a good at a price less than or equal to it’s value to him. That’s what the theoretical free market is all about.
The stockholders in this case were already making a good return on their money. Because they (or rather their stand-ins, the BOD) hold all the cards, they win and we lose. Period. That their families are more important than mine “because of the nature of their interaction through the medium of the corporation” could not be more explicit.
Let me ask what you mean by “the value of the company.” The true societal value of the company, as I see it, is as a producer of goods and provider of employment. The worth of it’s stock on the market is a meaningless number in that context. So yes, the lower level of employee is the foundation of the value of the company.
Your snarky reply, equivalent to “go home to Russia, Commie Pinko Fag” is that they should just start their own company. There’s the little matter of capital. Once upon a time, one floated a stock to raise money to start a company. That is incredibly unlikely to work in today’s market. Instead, one now tries to get venture capitalists to invest in the company. The initial stock offering has become their payday. And guess what the venture capitalists want when they pungle up the dough. They want control. They want one of their own (that small club that already has massive money) put in charge. That’s why very few companies are actually run by their founders.
In addition to which, the laws of this country are very heavily skewed to the corporations. That’s why doctors and lawyers in private practice with two employees and no need to raise capital set up LLCs.
Your final statement seems to be sayingthat Capitalism is the final word in economics and nothing more needs to be said in favor of a system than that it is Capitalism. In actuality, what we have in this country is not Capitalism, it is Liberal Financial Capitalism, but I’ll let that slide. My point is that the particular form of Capitalism in practice in the US was not handed down by God, and does not embody any kind of perfection. It is good in so far as it creates actual human goods, and bad in so far as it encourages actual human evils. That is does both is true. The question is how it can be improved. To strut about saying that everything is well and that anybody who loses under the current system deserves to do so is both uninformed and singlularly ideological.
People who aren’t making ends meet don’t give their best to their jobs. They come into work tired from lack of sleep, or hungover from trying to drown their sorrows. They resent those in the company who are prosperous but seem to do little while they are working hard just to scrape by. They may look for supplemental work, which takes more from their limited supply of time, energy, and mental clarity, making them less productive overall.
THAT is a business case! That affects ROI! If a company is smart, it WILL pay employees what they are worth, and will get better service. Companies that don’t realize this don’t retain my services… for long.
My position is, still, what is good for the company is usually good for the employee, and vise-versa. A company that treats its employees well will get better work. An employee that provides good work will be rewarded.
In my case, I’m with a company that treats me badly, but pays me well and gives me a great title on paper, that I will capitalize on in about a year when I jump ship. But this is my choice. My last company, which I voluntarily left, treated me better and was much more enjoyable. I voluntarily made the tradeoff. It is in my company’s fiduciary benefit to treat me better, but they are not doing so. They’re just stupid.
And THAT is capitalism in action.
The answer to that is simple. If a man is a worthless employee, he should still be fired. But if a man is treated by his company as if he is valued;
That’s a gross oversimplification. What if the employee is merely adequate? 80% or more employees are just adequate. I’m a high performer at my job. I’ve been in a job before that was so far out of my expertise, that I was a low performer, and was fired (luckily while already in the interview process with another company.) Most of my co-workers are merely adequate. We just let a few under-performing freelancers go today.
Again, what do you do to encourage an adequately performing employee to become better? What do you do to encourage a high-performing employee to continue performing well? Give people raises based on marital status and progeny?
BTW: I often come across rather aggressive; that’s my terse and cold nature. I’d like to say that I’m immensely enjoying your blog. Unlike most other distributist-minded folk I’ve met, you don’t result to ad-hominem.
Anxiety is actually a rather recent mass phenomena, especially as we see in anxiety-related disorders, especially hypochondria. It was first recognized in the late 19th century, among bored housewives in wealthy industrialized urban areas. Nowadays, increasing numbers of young men and women have hypochondria, and this is the primary reason why health-care costs are soaring.
Kevin,
Oh, and Zach: Why should I believe you that you’re not calling me a commie? Hmm?
Oh, I don’t know. Why should you believe that the moon isn’t made of green cheese?
peace,
Zach
Jeff: Read a book on computer programming.
You don’t actually work in the industry, do you?
That’s only slightly less ridiculous than “Read a book on medicine” or “Read a book on carpentry”.
Your snarky reply, equivalent to “go home to Russia, Commie Pinko Fag” is that they should just start their own company.
Is this going to be a regular thing?
Zach, what makes you more special than me? When I “read between the lines” and divine some hidden meaning in what you said, you expect to be able to correct that interpretation. But when you look in your crystal ball and decide I was calling somebody a communist, merely because I mentioned Siberia, I’m not allowed to correct you.
There’s really only two ways to interpret that, and neither of them allows me to conclude we can debate effectively.
1) You have the right to re-interpret my meanings, making me responsible for whatever meaning you attach to my words. In which I case I don’t want to talk to you.
2) You believe I was lying about my original intention, and I can’t be trusted to be honest even about what I meant to say on a public website mere moments ago. In which case I don’t see why you would want to talk to me.
Anxiety is actually a rather recent mass phenomena…
No, we just whine about it now and treat it like a disability instead of a normal part of life.
Kevin,
Is this going to be a regular thing?
Ask yourself the same question. Your tone, and your ability to communicate in this text-based medium without coming across as condescending and snarky, dictates the good will you receive.
You may not mean to be insulting, sneering, and rude (and I honestly believe it may be unintentional) but your tone in this debate leaves a lot to be desired. Expect the men you find here to push back. Most of my readers are older than you and I, have families, and a hell of a lot more life experience. Show some respect, and disagree with civility. If nothing else, get off your high-freaking-horse.
Zach, what makes you more special than me? When I “read between the lines” and divine some hidden meaning in what you said, you expect to be able to correct that interpretation.
Kevin, since you’re only a few years younger than me, I’m not sure whether or not you remember much about living through the cold war. We caught the tail end of it as kids, and maybe because I always watched the news with my dad I had more of a sense of the common sentiment surrounding it.
I’ve never heard anyone talking about going to Siberia without thinking of Soviet forced-labor camps. Not ever. You brought up Siberia without providing context, and in light of your antagonistic debate style and the fact that you could as easily have used Kansas City, Missouri (or any other place with cheap land) as an example, your choice of Siberia was suspect.
If you had provided context when you gave the example, it might have been believable. But to blatantly ignore the political connotations of exile associated with Siberia and then get defensive when people don’t believe your after-the-fact rationalization strains credulity.
I have little doubt that you meant it in the way you explained it. It occurs to me that you simply lack the sense to see why without having earned any credibility among the other readers here, those who don’t know whether you’re sincere or a comment troll may find your story far-fetched.
I’ve said it before and I’ll say it again - you’re welcome to stay here if you can be more vigilant about your tone and approach. I love a good debate, and I welcome your perspective provided that you approach those you disagree with respectfully.
But what I won’t put up with is when you antagonize people, condescend to them, and then get all hurt and defensive when they decide they don’t like the way you’re playing the game and start fighting back.
I make my living as a communicator, and you CAN get things across with just text without being misinterpreted if you take the time to evaluate your words carefully. In charity, give others the benefit of the doubt. If you think they’ve misunderstood you, ask yourself what you might have done that could have facilitated that.
I should note that your buddy Aaron is not having the same problems as you, and he’s coming from the same perspective as you on most of the issues we’re discussing. He’s giving respect and getting it in turn. That should tell you something.
These are the rules of the game here. Play them, and you’re cool with me. Keep doing what you’ve been doing, and I’ll ask you to leave.
Gentlemen, courtesy is a two-way street. It may be the case that I should have known you would interpret my remark about Siberia in the context of another issue that effectively ended before I was a teenager, with the fall of Communism in Russia. But courtesy also means accepting that it was unintentional, which I pointed out at once.
Now compare one off-hand remark about Siberia to the following.
Zach: “And “if you don’t like it, leave!” is a child’s taunt, not an argument.”
That was in the first comment he ever addressed to me!
Zach again: “I could sort of give you half-credit for Siberia, if you’d (a) allow as how maybe you understand how it might have come across, and (b) actually try to reply substantively.
Let me know when you’re ready to argue, rather than sneer.””
Recall that this was written after I had explained that he had simply misunderstood me.
Half-credit? Child’s taunt? Sneer? I’m sensing a theme here. (But its me that’s the rude one, sure.)
I understand why, before my explanation, the word “Siberia” might have been misinterpreted. Is there a single other instance of my being “insulting, sneering, and rude” that somebody would like to point out? Danby apparently thinks I’m calling him a communist and a homosexual to boot. Why? Because I asked why we weren’t seeing the natural and logical consequences of his characterization of the worth of a CEO:
I said: It is interesting to me that you don’t think CEOs do much for their company. Who is creating all that value out there?? If the lower-paid employees are the ones responsible for the value of the company, there is nothing stopping them from all quitting and starting a new company together without that worthless scumbag of a CEO that is exploiting them and appropriating all that value that they are creating. More power to them! That’s called Capitalism.
No mention of Siberia this time! So what was it that set him off? I can only guess.
Danby: “Your snarky reply, equivalent to “go home to Russia, Commie Pinko Fag” is that they should just start their own company.”
Is it really? Because why wouldn’t it make sense for a company to ditch the dead weight and increase profits? Sounds like a pretty air-tight business plan to me. If it is really the case that CEOs are worthless (or even just worth less) wouldn’t there be bright people in banks somewhere that know this and want to make some money lending to a superior business model?
But more to the point of this comment, even if you think the company would have trouble raising the capital, what need is there to take offense at what I wrote? I’m truly baffled.
Perhaps a more substantive reply is due to Steve’s characterization of my participation here.
Steve: “I’ve never heard anyone talking about going to Siberia without thinking of Soviet forced-labor camps. Not ever. You brought up Siberia without providing context, and in light of your antagonistic debate style and the fact that you could as easily have used Kansas City, Missouri (or any other place with cheap land) as an example, your choice of Siberia was suspect.”
I absolutely disagree.
Firstly, I have heard people talk about Siberia without reference to communism. I know somebody who has been to Siberia multiple times, both to do mission work, to discern a monastic vocation, and also just to live and work there.
Please note: If you want me to allow for the personal experience of others influencing their interpretation of me, then I expect you to treat me with the same deference!
Secondly, the costs of both land and commodities in Missouri is many times higher than Russia! Kansas City does NOT serve in the point I was making. It would take tens of thousands of dollars to start a farm there, at least! Truth be told, my first thought was Alaska, (like in Into The Wild, interesting book) but I ruled that out because it is too cold and technically it is mostly government land, so you’re not allowed to farm there. Now, I’m not a geography whiz, but I’d spoken a lot to my friend who spent time in Russia, and that seemed just the place to serve in my example.
Steve: “If you had provided context when you gave the example, it might have been believable. But to blatantly ignore the political connotations of exile associated with Siberia and then get defensive when people don’t believe your after-the-fact rationalization strains credulity.
I have little doubt that you meant it in the way you explained it.”
It is contradictory of you to say that my correction of Zach’s interpretation was an “after the fact rationalization” and then to say in the next breath that you believe me. Which is it? And frankly if you really don’t believe me, then I don’t understand why I haven’t ALREADY been banned. And if you do believe me, I don’t understand why we are off on this tangent.
Steve: “But what I won’t put up with is when you antagonize people, condescend to them, and then get all hurt and defensive when they decide they don’t like the way you’re playing the game and start fighting back.”
I can give you complete assurance I haven’t felt at all hurt in this conversation. I doubt you could make me feel hurt if you wanted to. Nor do I agree that I’ve been defensive. My sarcastic mis-interpretations of Zach’s subsequent posts were meant to illicit a certain response from him to help me illustrate the double standard in the way he was responding to me. But understand: This tactic IS A SUBSTANTIVE reply to his argument. The substance of his argument was that I had not the right to dispute a misinterpretation of my words, no matter how plausible my explanation was. This is not a matter of my emotions, but a serious issue in the philosophy of language. It was with deliberate purpose that I linked to this story.
Here you have a politician getting in trouble for describing some bureaucratic office or another as a “black hole”, because it was thought that the phrase was offensive to the black community! There was a similar case a while ago about the word “niggardly”, which is completely distinct etymologically from the “n-word”. The argument of the professionally aggrieved in these cases has consistently been that it DOESN’T MATTER what the original intent of the speaker was, that they should be punished for the “hurt” their words caused. I hope you will agree that intent does matter.
It has never been my goal to be condescending, antagonistic, etc etc. Everything I write here is written with a smile. If I seem combative it is always the delight of the argument that moves me. I always strive to ignore tone and respond to the substance of my opponent’s argument. I think I did that with Brian and Zach, and I certainly did it with Danby. I know of no reason why it should be disrespectful to argue through the form of “Your case as stated would seem logically to result in X, which is not observed in the real world. Why is this?”
I STILL THINK that Brian’s words do imply that he would be quite happy in Siberia, although there may be other considerations of his that he hasn’t informed us of, like proximity to family. On top of that, I think that if CEOs were really worthless there would be corporations cutting costs by eliminating them.
Would anybody care to just set feelings aside like grown men and discuss those issues?
“Jeff: Read a book on computer programming.”
Kevin: Why should I take anything you say seriously after an idiotic retort like this? I’ve taken CLASSES on computer programming and it isn’t anywhere near enough.
Our economy, quite simply, reduces men who lack high-level technical or marketing skills to peons. I like to use the example of a man who cuts my hair - for $10. He’s 74 years old. Back in the day he paid for a house and raised a family on a simple barber’s paycheck. Today, it can’t be done. What has happened is that ordinary men with ordinary talents - barbers, warehousemen, store clerks, mechanics, deliverymen, etc. - can no longer earn a family wage, no matter how hard they work.
Ah, there’s that term again, “family wage”. I agree with Steve as to its definition. A family wage in Haiti or Bangladesh is not the same as a family wage in northern Virginia or California. Though it cannot be defined with precision, it does exist, and it does mean something more than a mud hut and rice cakes in the United States.
Kevin,m
I was not referring to your Siberia comment. I was referring to your “If you don’t like it, leave” response to genuine problems of the current system. When I was as young as you, “go home to Russia, Commie Pinko Fag” was a common caricature of the standard establishment response to similar criticisms. It’s the opposite of engaging the argument
The point of all your responses seems to be that the current system is self-consistent (fairly true) and provides opportunity for all (more or less false). The opportunity is there on a theoretical basis, but theory is not enough.
Here are my contentions:
1: the current tax, regulatory, legal and financial system encourages the concentration of the use of capital into a few hands.
2: The current tax, regulatory, legal and financial system places enormous roadblocks in the path of small business, and encourages their absorption into larger companies
3: The worth of an economic system should be measured by the human goods it creates, enables and encourages, not by the amount of money it generates
4: Human goods would better be created, encouraged and enabled by a system in which it was more difficult to concentrate the use of capital into a few hands, and easier to start and run a small business, and
5: Most individual would be better off owning and running or working for a small business, run by the owner.
Finally, I did not say CEOs were worthless. In any hierarchical organization, there has to be someone at the top. What does not follow is that they are worth anywhere near 200x the salary of a mid-level manager. The $10M and $20M compensation plans you see are just sweetheart deals, where the board votes ginormous salaries and bonus plans for themselves and their friends, because they can. And the stockholders can’t do anything about it because the majority of the stock is controlled by people who think $10M is a reasonable salary.
We’ll be glad to “just set feelings aside like grown men” when you stop with the ad hominems.
Jeff, I was responding to this:
“I’m listening, Chris. If you can teach me how to do this I’ll make it worth your while …”
and not to your subsequent posts. While at first it seemed that you were saying it wasn’t possible to earn a living from home using a computer, I see that you are now drawing a different sort of distinction. (And I didn’t mean to suggest that reading a book was ALL you needed to do for a career to fall into your lap, of course.) Yes, you are correct that a freelance programmer is selling their labor to the customer. So in a sense they are still a “hireling”.
But that would be true of anyone whose work chronologically follows an agreement with the customer. Is a wedding planner a hireling? What about a guy who builds custom homes? What about a freelance photographer?
Its even true of our exemplar of distributism, the town miller. Don’t the people bring the grain to him and agree on a price before he mills? Then he is also a hireling.
As for what level of income satisfies the demands of justice, that is a matter of varied opinion. I think $30,000 is more than enough to raise a family on, but Steve thinks the $50,000 is not enough. If you want to suggest a general principle that you think helps pin down the amount, I’m open to suggestions.
I’m sorry you found my post to be an “idiotic retort”. (But I do wonder how long it would take me to get banned from Steve’s website for saying something like that.)
Danby: “I was not referring to your Siberia comment. I was referring to your “If you don’t like it, leave” response to genuine problems of the current system.”
I didn’t think you were responding to the Siberia thing, I thought you were responding to my suggestion that a company could be formed without a CEO. Which made it all the more confusing, believe me. If there was some other comment of mine that boils down to “If you don’t like it, leave,” then I hope you will copy and paste it, or link to it, to explain what it is you were reacting to. I agree that saying something like that isn’t much of an argument.
Regarding your contentions,
1) Are you distinguishing between ownership and control? I’m not sure what you mean by “use”. (See my essay here.)
2) Granted, at least inasmuch as the current system has too many roadblocks for all businesses. And small businesses find it harder to afford a lawyer to traverse the many obstacles. I would like to see our whole system of regulation simplified and reduced.
3) Please define “human good”. I’m not clear what you mean by that.
4) Ditto
5) I disagree with this, but of course we may have different standards of what is good for the average person. Big companies have both advantages and disadvantages for their employees. I think each person should decide for themselves. Small companies don’t offer yoga classes like mine does, for instance. They often can’t afford to offer as good a health insurance program, either. Large companies can be impersonal and overly bureaucratic. You take your pick, I guess.
Finally, I think my response to your comment on CEOs still stands, with the obvious revision according to your clarification. Why don’t people start a company with bylaws that prevent the CEO from making more that X dollars, and pass the savings on to investors. If paying a CEO $100K or so was a good business model, you would think there would be investors who would realize this and be happy to get on board and reap the benefits of a lower-cost business model.
Oh, and if you would like to point out where I have engaged in an ad-hominem argument, by all means point it out to me so that I can take it back.
Kevin,
By use of capital I am referring to actual use of the capital. As an example, like most people in the tech business, I have a 401K (actually three of them, due to the constant cycles of merger and acquisition in the telecom business). That means I own capital amounting to several tens of thousands of dollars. Yet because that money is in mutual funds, I have no say in how that money is used. I cannot vote for or against a board member. I cannot vote up or down on a merger proposal. Except by moving my money from one managed fund to another, I cannot even determine which companies that money is invested in.
So the use of my capital, as well as that of millions of others is in the hands of a few fund managers working at a brokerage house/investment bank in NYC. That is what I mean by use of capital. Keep in mind that under the tax laws, I am <b>not allowed</b> to actually control the use of that money, except at the crudest possible level.
You don’t know what I mean by a “human good”? I guess I’ll have to start at the basics of economic theory. The purpose of any economic system is to produce human goods, which is to say those things that tend toward true human happiness. The primary human goods are those that are required by all, regardless of circumstance, such as food, shelter, clothing, health, religion, family, dignity and society. The secondary human goods include those things that cannot be available to all, but are desireable and good in themselves, like liberty, productivity, social order and self-respect. Intermediary good are those good through which human goods can be achieved, such as money, employment, computers, democracy, authority, education, medical care, etc.
An economic system must have as it’s purpose the provision of human goods, not intermediary goods. Few would say that the provision of free medical care, or the efficient production of shoes in the old Soviet Union justified the destruction of the actual human goods of liberty, family, and dignity. In a similar way a Distributist argues that the efficient production of intermediate goods, such as computers, telephone calls and money do not of themselves justify any economic system. Instead the basis of evaluation should be in the provision of human goods.
The current system is very good at providing for the material needs of the population. Very few go hungry, shelterless or without sufficient clothing in this country, outside of those subject to abuse, drug addiction or mental illness. On the more metaphysical goods, however, we are woefully lacking. Religion is taking a shellacing, and has been for 70 years. Independence is virtually nonexistent. Liberty (freedom to do what is right and refrain from doing what is wrong) is the latest assault victim, thanks to the gay rights and abortion lobbies. The family is virtually destroyed in this country. Of the dozens of boyfriends/girlfriends my adult children have had, as well as my two sons-in-law, <b>none</b> has come from an intact two-parent household.
Certainly not all of this damage has come from the economic system, but some large portion of it has. As an example, how much of the destruction of the family is due to the widespread employment of women outside the home, and the consequent encouragement of divorce, contraception and abortion?
If you really have not run into the term “hman goods” before, may I suggest to set aside the neoliberal and libertarian writers for a while and read some Leo XIII, specifically Rerum Norvarum.
Putting capital use aside for a moment, this introduction to economic theory is all very mystifying to me.
The economic system is supposed to “produce” religion?
Self respect cannot be available to all?
I’ve studied a bit of economics and I don’t remember it going this way.
To top it off, Rerum Novarum (which I’ve read more than once, by the way) does not contain the phrase “human good”, at least according to my browser’s search function.
Also, you may be interested in my essay “What is Freedom?“ It addresses the alleged “definition” of liberty put forth by Pope Leo. This is something I believe is much misunderstood.
Now, regarding capital.
I will agree with you that there is a large amount of capital being controlled by the day-to-day decisions of relatively few high-level managers in the form of CEOs and the like.
Of course it may be more correct to say it is “used” by their many employees, according to their instructions. And it is owned by the stockholders, no one of which has power when acting alone, as you point out.
But if the capital was being very clearly misused, the conscious interests of all those many stockholders would converge quite neatly, wouldn’t they? Its not really an issue of whether you, Joe stockholder, has the power of control, but whether all the stockholders together do. After all, why should your interests prevail over the other stockholders, most of whom probably want things run by the professionals? And really, if a lot of people agreed that the capital was being misused, they wouldn’t even need to get organized and try to change things. They could just sell the stock and do something else with their money. If the general consensus is that stock is not worth having, its going to crash in value, possibly cease to exist at all. The company disappears, problem solved, eh?
So I get that the control is in a certain sense in the hands of “the few”, but those few are falling all over themselves to please the stockholders, aren’t they? Are your NYC fund managers really going to put your 401K money in a stock that they honestly believe is headed for failure? That doesn’t sound like a strategy to be a successful fund manager, if you ask me.
Oh, very important point: What do you mean precisely by “economic system”?
In my thinking there is: 1) the economy itself, meaning all mens’ economic actions aggregated. 2) the legal system, how the government regulates economic activity, and 3) economic theories which may promote one or the other style of economic governance or take a neutral stance and just examine the results of various governmental systems without judging the outcome.
So is it one of those three or something different? I think this is an important thing to settle.
This thread kinda lost its direction, but when has that ever stopped me from commenting?*
I’m in agreement that the big box stores misuse regulations and the legal system to gain a competitive advantage. However, those regulations and legal systems were put in place in a democratic fashion, and remain popular today, if not among small business owners. Good luck getting rid of ‘em.
Kevin, I kinda like what you’re saying, and I’m glad you’re saying it. People’s financial positions and perceptions thereof are deeply personal to them, so people (including you) will get prickly and defensive extremely quickly, as soon as the argument turns into a proxy argument about their financial situation.
People like me will get preachy, though, which is probably worse.
*(Answer: all the time, but you wouldn’t know that…)
I think this phrase of Steve’s is the key point.
A family can do this because its chief concern is love, not its bottom line.
Now Steve acknowledges in his next sentence that businesses cannot emulate this (”truly”), but this thought never really gets absorbed by Distributists all the way down (if it does, they cease to be Distributists).
Love presupposes an agreement on ends. In the absence of an agreement on ends, love is theoretically impossible because the same act can be either love or hate depending on the end sought. (To take a simple and easy example in the forefront of the news, taking a child to church is a species of hate [brainwashing] if there is no God, or He is not great or it’s just a frackin’ cracker, etc.)
But plurality of ends is a simple fact about any civilized general human polity at any time whatever (I am not speaking of the Benedict Option, self-conscious hermit secession groups or tribal societies), and this is as much a fact as the law of gravity. Any society larger than maybe a few thousand has to work on the “anonymous stranger” principle because that is what most people in society are, in fact and not in imagination. And because I seek to go directly to “la verita effetuale della cosa,” we do not in fact want an economic system based on “love,” because we’re talking about the acts of anonymous strangers with different ends.
In the acts of anonymous strangers, there is no difference between “motivated by love” and “motivated by their idea of love” (this is why all so-called “moral realism” fails as a social ordering principle), which coincides with “love” only accidentally. Enshrining “love” as the basis for social action in a pluralistic society is a short one-way street to the spirit of coercive compassion behind much of post-60s liberalism.
To take Danby’s list of human goods — food, shelter, clothing, health, religion, family, dignity and society — at least the last four obviously all are directly related to love and (not coincidentally), they presuppose disputable, and in fact disputed, ends. Only the first three are obviously material ends, in both senses of “material” — i.e., things that can theoretically be bought or sold, and things that pertain to man as a mortal animal.
What capitalism tries to do … and is very good at doing … is to generate wealth for the pursuit of material ends. In and of itself, it leaves non-material ends to other institutions in society because, not being based on love, it isn’t very good at providing the goods based on love.
we do not in fact want an economic system based on “love,” because we’re talking about the acts of anonymous strangers with different ends.
To be a little more concrete about what I mean, I’ll provide an example. If we wish to defend businesses making decisions on how much to pay based on the circumstances of the particular man’s family, then if smaller families are better for whatever reason (this is in fact a view widely held and therefore what follows will be an act somewhat practiced), then it must also be acceptable to fire a man for social irresponsibility in having too many children.
And yes, before anyone thinks to say it, I am deeply skeptical of Natural Law philosophy as applicable to a factually pluralist society. And one underlying theme in several different spheres is The Fallacy of the Philosophical Last Move, i.e., assuming both that true ideas are more effectual than false ones, and assuming that only My Political Side gets to implement its Natural Law ideas. To provide an example, I’d say that Griswold and Roe are natural-law jurisprudence par excellance.
Where did everybody go? Was it something I said?
[...] “family wage” The following resources are pertinent to a discussion at Steve Skojec’s [...]
Kevin, don’t you know? Me and Victor Morton always get the last word!
But seriously, the quotes Stony Creek Digest linked above are pretty good.
Remember one thing, though: if a company can’t both 1) pay its workers a living wage and 2) turn a profit, it must 1) go out of business, 2) lay people off, or 3) appeal to the government to block international AND domestic competition by hook or crook, in order to take a greater share of its consumer’s wages, thus driving up the definition of a living wage.
Ain’t reality fun.