Our discussion, going on now for some time and through many comments, is finally beginning to take some definitive shape, with specific examples and ideals being nailed down a bit more.
I must state again at this point in the conversation that I do not yet consider myself a distributist, only that I lean toward distributism as the most Catholic economic system and the one that makes the most sense to me, even if it’s only an ideal.
In terms of the practical limitations of establishing a distributist system (or, restoring “the institution of Property”) Belloc very wisely notes the following:
Economic freedom is in our eyes a good. It is among the highest of temporal goods because it is necessary to the highest life of society through the dignity of man and through the multiplicity of his action, in which multiplicity is life. Through well-divided property alone can the units of society react upon the State. Through it alone can public opinion flourish. Only where the bulk of the cells are healthy can the whole organism thrive. It is therefore our business to restore economic freedom through the restoration of the only institution under which it flourishes, which institution is Property. The problem before us is, how to restore Property so that it shall be, as it was not long ago, a general institution.
Three provisos must be kept clearly in mind before we approach the problem and attempt its practical solution.
The first proviso is that in the restoration of property we are not attempting, and could never reach, a mechanical perfection. We are only attempting to change the general tone of society and restore property as a commonly present, not a universal, institution.
The second proviso is that we cannot even begin such a reform unless there is a favorable state of mind present in society [which demonstrates the point of these discussions - Steve] a desire to own property, suffiicient to support and maintain the movement and nourish institutions which will make it permanent.
The third proviso is that in this attempt to restore Economic Freedom, the powers of the State must be invoked.
- Hilaire Belloc, An Essay On The Restoration Of Property
Note the similarity to the Bush/Gerson “ownership society”.
the practical limitations of establishing a distributist system
Distributism isn’t an economic system It’s a value system. This is one of the problems Distributists have always had when trying to talk about Distributism. Other schools of economic thought have definite policy prescriptions; “all power to the Soviets”, “Think of the Children”, “No child left behind” or “laissez faire”. Distributism merely provides a goal and an yardstick. We can judge the effect of policies by seeing whether it results in the broader or narrower distribution of productive property. We can devise new policies by looking for structures that inhibit the distribution of productive property.
In other words, a basic capitalist system can be distributist (google Mondragon). A basically socialist system can be distributist. Distributism is not a system of itself.
The third proviso is that in this attempt to restore Economic Freedom, the powers of the State must be invoked.
And to paraphrase Lenin, how is this to be done? Particularly since Distributists posit that capitalism is morally corrupting. Is the corrupt populace somehow not to be reflected in the State, or just not reflected while the state is “restoring Economic Freedom”? The “Original Sin” critique of Socialism (basically, that the theorist presupposes an uncorrupt transitional away from a corrupt epoch) is just as powerful against Distributism.
And yes, I’m aware that Belloc’s first caveat “I’m not trying for perfection.” Fine, but the problem of status-quo institutions presiding over a change remains. On what non-theoretical basis does he have for thinking the state’s efforts to “restore economic freedom” will actually **result** in a better state of affairs.
I said long ago on Amy Welborn’s site (http://amywelborn.typepad.com/openbook/2004/10/a_reason_not_to.html#comments) the following:
Then there’s the — no other term for it — economic illiteracy regnant. Is it some rule for Christian intellectuals that you have to not understand how economics works? Noll says: “Basic medical coverage, supplied at minimal cost and with minimal hassle, should be offered to all.” And why not “the best health coverage supplied at no cost and no hassle, with a chocolate on the bed every night”? Or why not “the lion shall lie down with the lamb” while we’re at it, since we’re obviously just spouting off desiderata here. MacIntyre’s utopianism is hardly better. I couldn’t stop laughing at: “as a minimal economic demand, the provision of meaningful work that provides a fair and adequate wage for every working parent, a wage sufficient to keep a family well above the poverty line.” Never trust anybody who speaks of economics without mentioning “trade offs,” “investment,” “opportunity costs,” “price,” and “scarcity” (You might as well trust a theologian who never speaks of “sin.”)
Oh … and later in that thread, I added “unintended consequences” to the list of terms that absence of which makes an economic thinker the equivalent of a theologian who never speaks of “sin.”
Victor,
I’ll let Belloc explain it himself:
“The third proviso, that we must call in the State to help us, should present no difficulties save to minds mislead by the false categories of the nineteenth century - by such terms as “Individualism,” for instance, which never did or could correspond to reality.
The evil from which we are suffering today is not the evil of State interference but the evil of the loss of Freedom. State interference may have for its effect a loss of Freedom and certainly usually has for its object a loss of Freedom; but it always may be, and very often must be, invoked for the very purpose of restoring Freedom.
There must be laws to protect property not only against direct rapine but against dissolution through exaggeration of competition. There must be State sanction for the powers of the Guild, for the process of Inheritance, for the restriction of undue burdens. There must be some official machinery today fostering the destruction of small, widespread property by large owners: and the effort at restoring property will certainly fail if it is hampered by a superstition against the use of force as the handmaid of Justice. All the powers of the State have been invoked by Capitalism to restore servile conditions; we shall not react against servile conditions unless we avail ourselves of the same methods.”
Have at it.
So, how is this to be done? If I read Belloc correctly, it’s “The same way they did it to us!”
And “State sanction for the powers of the Guild” sends a shiver down my spine. He says “Guild”, I hear “Teamsters.”
I have neither a moral problem with state power per se, nor do I deny that it can serve the common good. What I have a problem with (and Belloc’s third paragraph displays it in spades) is assuming (1) that Distributists and/or the government they’d empower act from noble motives (the only people who do so apparently) rather than base ones; and (2) a result of being overly influenced by medieval action theory that there’s a two-way congruence in politics between singular motive and singular act, and between aim and result without unintended consequences.
To take two examples:
(1) What the colorful does Belloc mean by “There must be some official machinery today fostering the destruction of small, widespread property by large owners…”? Why MUST there be (that’s a different question from “is there”)? He doesn’t name it (here anyway),. But because he doesn’t understand how markets operate nor take seriously the aggregate effects of many people’s freedom, that a thing can happen without having been explicitly intended, as in “an official machinery that fosters Effect X” is simply beyond him.
(2) When Belloc says “there must be state sanction for the powers of the Guild,” why is that so? Other than social snobbery or back-scratching, how does a Guild serve the common good in a way distinct from “it protects their private interests, thus serving the common good.” Yes, protected Guilds increase the freedom of the Guild members, but like all government-protected monopolies, they deny the freedom of those outside the Guild, either to make a living this way themselves, or to profit from cheap goods made by non-Guild members. Belloc assumes that laws protecting Guilds, even if they may serve the common good, are not in actual fact the result of self-serving rent-seeking on the part of the “ins.” A free-market theorist would have no problem per se accounting for this fact (private vice can serve public virtue, Mandeville famously said in the Fable of the Bees). But what would “Catholic economics” (compare: “Jewish physics”) have to say about that?
Victor,
Don’t we all assume the government we’d empower would act from noble motives, rather than base ones? Isn’t that sort of the whole point of our little experimental republic? I don’t see this as a flaw in Belloc’s thinking, but rather a given - we never advocate for a government we think will screw us, just like we never deliberately choose an evil (but rather, often enough, embrace evil disguised as a good.)
As for the question of two-way congruence, I suppose that unintended consequences are always the risk of any undertaking, and the potential pratfalls therein grow as the scope of the enterprise increases. Is there some way to avoid this, or is it only that Belloc speaks of his ideal without discussing the drawbacks. (To be honest, I haven’t read enough of this essay yet to know if he indulges in this later on.)
As regards your examples, I would say that:
(1) I assume that he may be indirectly referring to the Statute of Frauds, which he goes on to talk about in more detail later on (and how it was used to confiscate hereditary property). But if, in a capitalist system, there is no widespread distribution of small property, is it a logical fallacy to assume that some machinery, legal or otherwise, must be in place, making it so?
Large businesses regularly employ the tactic of underselling their smaller competitors, even at a loss, until they drive them out of business. Would this not be an example of such machinery?
(2) I don’t know enough about the structure and operation of guilds to give you a competent answer on this. I’m a n00b, and I can only debate these things on their apparent merits or disadvantages, not on my deep historical knowledge of the topics.
As you know, Victor, from our conversations about movies and TV, you quickly outstrip me on historical details.
(1) Actually the American government, and this is more explicit in the liberal theorists of early modernity, especially the Federalist Papers, than in the Constitution and Declaration per se, is based on the assumption that man is more inclined (or more-reliably inclined) to be bad than good. For example, the whole notion of why you want to separate powers rather than unite them is so that power can check power, which this theory says is more reliable than relying mostly on virtue to check power because men are more-assuredly jealous of their power than protective of virtue in the face of power.
(2) More relevant to Belloc and Distributists then and now, my point wasn’t so much that he assumed a false view of man, but rather that he holds both a global critique of existing capitalist society as generally corrupting (both men and government) **while holding at the same time** that government can be used for (what he saw as) good. It’s not so much that either part of it is wrong, but the **combination** cannot add up. Or rather, it can only add up if you insert the continued existence in a corrupt society of an uncorrupted remnant, or a “vanguard” even. To whit:
(3) Obviously, we all (bar the certifiably deluded) hold some version of a belief that man is some mixture of corruption and virtue. But I submit that the more sweeping is one’s critique of an existing society, the more problematic becomes the notion of change without resorting to a minoritarian tyranny of the uncorrupted remnant and/or (as Brecht mordantly put it about East Germany) deciding to “dissolve the people and elect a new one.”
The point of my citing “unintended consequences” is not simply to say that large-scale actions are risky (that’s obviously true regardless of social system), but to allude to the argument Hayek makes in “Road to Serfdom” about information. Because an economy is such a large and continually-in-flux entity, and based on self-conscious actors rather than dumb atoms, that no single actor, even if his motives be simon-pure (which they won’t be), is ever in possession of enough information to plan it “rationally.” Thus abstract “reason” is not a standard that either economics as a science or the economy as an entity can hope to attain to, and “unintended consequences” is a first principle of economics (in Adam Smith’s phrase, we profit unintendedly from the butcher’s pursuit of his self-interest not from his desire to help us). The ubiquity of unintended consequences militates against any group of reformers, whatever their agenda, designing an economy to serve some end (love, justice, religion) other than material ones that can be expressed in commodity terms. Those material ends are ends capitalism serves rather well, and better does so the freer it is.
“if, in a capitalist system, there is no widespread distribution of small property, is it a logical fallacy to assume that some machinery, legal or otherwise, must be in place, making it so”
Yes, it is a logical fallacy. He is assuming that this is not an unintended consequence.
It is undoubtedly the case that some large companies dump product in order to drive out less-capitalized rivals. But that’s a consequence of several independent phenomena coming together in an unintended way — free pricing (does Belloc think the government should set prices), cheap transportation (how did THAT come about and does Belloc think government should prevent it), cheap communications (ditto), anti-spoilage technology (ditto), and free trade among nations (only this last one is a government policy). It may perhaps be countered by government (at great cost), but one reason I have such distaste for Distributist writings is this anti-intellectual attitude toward economic causality — “X happened” means “somebody willed X.”
But more than that, I deny the premise. Capitalism distributes capital and wealth far more equitably than any other existing system can, because it recognizes no non-economic “right,” be it the Guild or the aristocracy of Chesterbelloc’s Merrie Olde England. Indeed, this was far more central to the non-Marxist critique of capitalism — that it created and empowered the vulgar middle-class who had no culture but money. We see some of that in Waugh’s BRIDESHEAD REVISITED (Rex Mottram, Lt. Hooper), in the person of M. Homais in MADAME BOVARY, the mayor in Di Lampedusa/Visconti’s THE LEOPARD, and many others in the 19th-century novel.
Don’t forget that predatory pricing is already illegal in the United States and many other places, so that should be a moot point.
Re: Belloc’s second proviso: If society at large valued private capital ownership over the security (yes, security) of a wage, distributist “reforms” would hardly be necessary. No?
I’ll add that, legality aside. “predatory pricing” is an extremely hard thing to do, because you burn up your capital when you do it, creating a opportunity for people to short your stock and drive you out of business.
I’m reading the Essay now, and the most important thing I’ve come to understand is that what Belloc means by “economic freedom” is totally different from what people mean by it today. Since his whole program is to restore “economic freedom” we have to be very careful to understand what he means by it. My remarks about security here only scratch the surface. I’m really going to have to write something more in depth on the subject.