Devon, PA. Thanks in part to the series of fine essays John Médaille has provided us during the last several weeks, the implicit economic vocabulary on the Front Porch has added to that of the Agrarian that of the Distributist. All writers here have articulated the nature of place as one of limits, as something that shapes, binds, obliges, and even disciplines us, and some have emphasized that the family farm does this in a unique and inimitable way. It has perhaps not always shown forth clearly that an Agrarian society is not one in which everyone is “reduced” to farmers, but one in which agriculture provides a society its type, its norm, its understanding of what is good. Nor perhaps might it have been obvious that the particular claims of the Agrarian trace at least one of their roots to the abstract principle of private property that historical Distributism defends. (Mark Mitchell has written on Hilaire Belloc twice, and Patrick Deneen on G.K. Chesterton, so perhaps Distributism will have struck some readers as more obviously informing FPR than I suggest).
If life on the land should be an everyday blessing–the way of life that, as it were, most persons should live–then behind that prescription lies also a belief in the goodness of ownership. Private property, as Thomas Aquinas argued, is a multifoliate good for the human person and for human society as such. Thus, Distributism is that economic philosophy that refuses the boostering of a free market as either an instrumental good or a good in itself, and refuses also the pleas of the socialist for the state’s ownership and distribution of property according to some bureaucratic rule. The Distributist contends that private property constitutes one necessary element of the good life for man, the political animal, and that, therefore, as intrinsically communal or social, man desires the widest possible distribution of private property among his fellows, not to mention property for himself. The highest end of all economic activity should be the creation and cultivation of private land ownership supporting private households.
In my latest Treasonous Clerk column in First Principles, “The Empire of Addiction, Part II,” I attempt to set forth the primacy of private property, what it entails, and, perhaps more importantly, what it does not. Several great economic superstitions haunt our age: most persons believe we live in a free market society rather than a state-capitalist one; many persons believe that a free market along the lines they believe ours to be is the one means of securing private property and prosperity for any great number of persons; and nearly all persons believe that the unit of the modern market, wealth, is identical with private property.
To be disabused of this first superstition, one would do well to converse with a libertarian. To be disabused of the second, one need only look around oneself, or read some of the quantified data Lew Daly provides us in his FPR essay, to suspect some other measure and means of prosperity must be possible. But the third superstition I hope I may reserve to myself the pleasure of exorcising in the aforementioned essay. There, I follow Hannah Arendt in insisting on the specious conflation of the idea of private property (which Aquinas was right in defending as necessary to a good society) with that nefarious invention of modern usury, unlimited wealth accumulation:
Private property is not a euphemism for anything I happen to acquire, but a reference to the place in the world that is necessarily mine if I am not to be reduced to dependence on another. The way to secure such property is not usually to expand it and widen its frontiers (though that may sometimes be the case), but to fortify it, to fill it with the productive means necessary to maintain it and for it to maintain me. That kind of security and self-sufficiency-in a word, autonomy and autarchy-requires stewardship and conservation rather than expansion and avarice. Such virtues serve the purpose of having the property remain my property with a permanence approximating to the solidity of its literal foundations. If one cannot reasonably imagine one’s children and grandchildren still cultivating one’s own land and household, one probably has not made them sufficiently private or sufficiently one’s property.
The early modern defenses of private property did not have such permanence in mind, except as a residue of the long western tradition of private ownership. They sought rather to expand the definition of property beyond its literal signification to include anything individual human industry and ambition might acquire; wealth-in all its placelessness, its liquidity, its versatility, and its instability-replaced property. The reasoned defense of a place in the world to provide for, and so relieve one of the burden of, life’s necessities; a place to house the fragile human life in the moments when it bows to its inexorable needs; a place that contained, limited, and secured, was reconceived in a defense of endless, material, and yet abstract acquisition. And so, we reply to the capitalist that he does not defend private property but, instead, rationalizes endless wealth accumulation, and in so doing he does not defend the one, best hope for the wide distribution of private property. He advocates, rather, the source of its usurpation and dissolution.
The essay proceeds to set forth private property rightly understood as the economic good par excellence for society. It is a public good but also provides for the individual household the basis for what is itself a great good, the foundation of a family’s liberty: autarchy. And the autarchy of the family household, I contend, is the analogous foundation, the microcosmic model, for still another public good: the sorely needed autarchic independence of our country.
On this note I conclude by way of explanation for why I began with the suggestion that Distributism adds something to Agrarian thought that may necessarily lurk in the background but does not always stand forth as obvious. The principles of the private family farm-a discipline and diversity that make for self-sufficiency-are the root principles of any truly prosperous and sustainable country as well. One need not desire to return to the land and till it in order to understand something of great and imperative consequence; the obscene use of the phrase “homeland security” over the last decade may have benumbed us to its luminous truth. We all rightly, as persons and as citizens, desire to be secure; the surest and most rewarding path to such security will be found less in the strategic fortification of the homeland and its thorough wiring with intelligence services and more in the making of the homeland into a productive, self-sufficient place. That family flourishes best that is most secure in its ownership; our country would be more secure if it learned once again to grow and make everything it requires for itself, and to reduce or eliminate its dependence on the labor and resources of foreign nations. Property makes for autarchy and autarchy is the most incontestable material condition of prosperity.
Autarchy will be more feasible once we have DIY biotechnology and “drexlerian” nanotechnology. I don’t believe anything resembling autarchy is possible with current technology.
Wonderful essay Dr. Wilson,
Regarding autarchy, I believe that there are indeed new forms of it possible within our current economy that are not solely confined to the agrarian model. They do not receive much attention, but there is a growing base of entrepreneurs, who have out of necessity, found a way to become self employed using the tools of information technology. Graphic artists, graphic designers, consultants, accountants, lawyers, and other service related professions.
To quote Joel Kotkin from the American Enterprise Institute
“in San Francisco, by 2006 there were an estimated 70,000 home based businesses and a thriving culture of self employed “Bedouins” working in post-industrial professions.”
It reminds me of a trip to visit friends in Vermont 6 years ago. I was struck at how most of the state had somehow missed the development of suburban-corporate sprawl. There was a distinct lack of big box stores, fast food chains, and a high density of houses with shingles hung out front, announcing their trade (or trades) – crafts, accounting services, wood working, contracting. It made me hopeful for a future beyond globalization, where human scaled, local economics along the distributist model was possible.
There is much said about the non-existence of free markets, now we see autarky, which is even more elusive. Market implies place, community. Free market implies an economic community which has the ability to choose the good and avoid the evil. For instance under the current Federal Reserve fractional reserve banking regime, no bank is legally allowed to hold 100% reserves. In other words, no bank is allowed to choose the good of banking stability amidst the inherent instability of fractional reserves. This is the central problem facing the modern world today, and it goes a long way in explaining why the city banking mercantilists have been able to exploit wealth by seigniorage away from the unprivileged, especially the rural interests, and even the smaller big city interests.
So, I still fail to see the lamentation of the idea of a free-market. The free market constitutes place and allows property owners in each particular place the ability to discern the good, the ability to discern how best to serve his community without interference. Does that mean farming? Possibly. Does that mean building a factory? Possibly. Does that mean tearing the factory down and building homes? Possibly. The entrepeneur must discern, and if he is incorrect, he will fail. Upon failure, he or someone else will find another use for the property in order to serve the community.
The problem I have with distributism, is that it is unable to explain economic phenomena in either the particular or general sense. It is merely economic sentimentality. What is the distributist theory of interest, prices, etc? What is their theory of capital (because it exists regardless of efforts to disregard it, for the farm a donkey is capital)? These concepts exist in all economies, and can’t be defined away by positive law. In other words, they are part of the natural law which man participates. Thus, the free market, is the market which allows man to participate in the natural laws of economics. When the positive law interferes with this participation, chaos ensues. And when the positive law does not interfere with this participation, but rather supports it, we have the free market.
The question becomes, what do state methods of interference with these human activities do to communities? Until one has a good theory of these human actions, one will have great difficulty in diagnosing problems and finding solutions.
Distributism can go on and on, but no one will listen until it gives us a way to understand the world rather than an appeal to the allure of the Shire. Nevertheless, their defense of property is a right and admirable one.
Bingo and thank you. I’ve been scratching my head for some time now at neoagrarians like our good author here who labor under a polluted conception of the free market and thus seek to prove their I’m-not-a-Republican bona fides by whipping capitalism every chance they get. Dr. Wilson, before getting into his harangue of free markets, admits as much, counselling us, correctly, to consult a libertarian on just how “free” (quotes required) our markets really are. Rod Dreher operates under this bewildering false dichotomy as well. The opportunity to indict individual choice on computers, the prices of which free(er)-market competition has caused to plummet, is never ignored. I believe pundits of this ilk would do well to investigate the culpability of corporatism (the true American economic system currently in use) and the employment of central banking to explain the disparities and market distortions they rightly deplore.
I wonder whether there is a bit too much absolutism front-loaded into the term “autarchy” ….something more normally associated with a single entity exercising absolute power. Is what you speak of more in the spirit of a Family-centric anarchy? Here again though, the accepted definitions are entirely insufficient. I would second some of what Khan and Freddy assert but am looking forward to gaining a fuller understanding of Distributism and its practical mechanics as a venue for sustaining the conversation of trade before rendering any kind of informed opinion. One thing is certain, the economy of this nation is far from “free market”. It is more stacked than the casino tables of Bugsy Siegel’s era in Vegas. Large Institutions, both private and public have perverted any notion of an authentically free and mobile exchange or , in fact, any fundamental and clarifying concept of property and value. Cause and effect still exist but they are garbled and incoherent to an extent that myth is as prevalent as reality.
Still, to build upon the stewardship qualities of property with a family unit as essential building block is to create a right minded point of origination. Any notion that we may somehow peacefully and equitably reform the existing paradigm however is a pipe dream. We have had an authoritarian and voracious wolf galavanting around in the sheep’s clothing of “democracy” for so long that the people can almost be forgiven for thinking the gnawing on their shanks is the bleating of lambs. Listening to this current government bleat-growl its’ platitudes about “security” and “liberty” and “opportunity” is what it might have felt like to be asked over for dinner by Jeffery Dahmer. One never gets as far as just “desserts”.
I think debates about the “free market” are somewhat besides the point, since nobody now living has ever seen one. But if we are going to debate a free market, we should first define it. Right-wing libertarians usually mean a market free of gov’t control, but then they contradict themselves by demanding that the gov’t guarantee property. As Adam Smith noted, somewhat ruefully, “Governments are established to protect the rich against the poor, or those who have some property against those who have none.”
But the fact is that even in strict classical and neoclassical economics, the primary condition of the free market is the “vast number of firms” assumption; that is, production for any given commodity is spread out among such a large number of firms that no firm, nor any feasible combination of firms, can have any influence over price; they are all price takers rather than price makers. Further, the assumptions only apply to elastic, reproducible commodities made specifically for the market. In a system such as ours, where the “commanding heights” of an economy tend to be in the hands of a few firms, free market assumptions simply do not apply. So then, you can have WalMart or you can have a free market, but you cannot have both. You can have the majority of oil and gasoline production in the hands of five firms, or you can have a free market, but you cannot have both.
The “vast number of firms” assumption depends on the widespread distribution of productive property throughout the economy. But this is the condition known as “distributism.” Therefore, the primary condition for a free market is distributed property, or distributism.
But even in a distributive economy, there are certain goods that will be socialized (contra both right and left-wing libertarians). Roads, for example. You cannot have a free market in roadways because it is not practical to have a “vast number of roadway firms” along the same route. You can, to be sure, privatize a public road, but this does not create a free market but its opposite: a private monopoly guaranteed by state power.
Further some goods cannot be “market goods” because they are not produced for the market and are not elastic. Human beings (labor) and land (nature) fall into this category. Both escape market logic (that is, the logic of a supply controlled by price). The former has a supply that depends on things other than price, while no price can produce more of the later. Trying to pretend that these are market commodities simply extends a theory into an area where it can have no validity.
The “free market,” I freely admit, is a great truth. But like every material truth, it has it proper assumptions and domain, and considering it apart from those assumptions and beyond its proper domain converts a great truth into a great error.
The first two comments invite a point well worth making; indeed, a point made decades ago in that great collection, “Who Owns America?” In that volume, rural electrification was held forth as promising the possibility of a return to home production even in the industrial age. The hopes were, in the short term, forlorn, but in the long term not entirely unmerited; if I may, let me say that I’m by nature rather reclusive and have found a way to earn a living by emerging from my home for business purposes only two or three times a week, and then only for part of the day. The rest is spent at home with my family, where I read and write in my office, do things like FPR, and emerge routinely to spend time with my family. While I don’t do this enough, and while I still don’t spend enough time with my family, I think I am a rather intellectualized example of the kind of “home-production” those great writers hoped for decades ago.
May I also say that I shiver at the uncritical expression of hope for “do-it-yerself” nanotechnology. I think, translated into any other language besides internet-speak, that would be the word for “death.”
Mr. Kahn throws down two worthy gauntlets. The first, which John Medaille addressed in his first essay on FPR, is that Distributism may offer coherent first principles but has historically failed to produce concrete and systematic means of organizing an actual economy according to those principles. I think this is partially a specious objection; presumably, a true principle could be realized in multiple ways, or rather, expressed in multiple ways. My arguments have thus far largely been focused on trying to establish the true principle in light of our experience. Nonetheless, I think one is right to insist that any principle ought to have a little flesh put upon it, and I am hopeful that I can aid in doing that in the months ahead. Indeed, I thought I had at least offered one practical initiative in my Clerk essay in suggesting a radical constricting of usury. My original intent, last night, had been to write an essay submitting other practical items, but, as we see, my mind drove to other destinations.
Mr. Kahn’s comment truly asks for the kind of practical argumentation to which I’ve just referred, but, if you will pardon me, I would offer yet another layer of theoretical semantics instead. I should hardly think that Distributism rejects most of what most people think of when they think about “capitalism” or a free market. Capitalism is a relatively new historical phenomenon. We know for sure that something divides the bourgeois system of economy that emerges in the late eighteenth century and everything that existed before; I would not reduce this difference to any single feature, and would admonish others against doing so. Capitalism per se, then, is distinctly modern and the term therefore cannot describe the use of money, the convention of private property, or even the existence of certain kinds of banking. Typically, its advocates seek to distinguish it from mercantilism, which is, indeed, an important and valid distinction, but not a comprehensive one. My reply has gone on too long, so let me just say that I would like to submit for inspection in the near future an account of the word “capitalism” that rejects its use except as a description of relatively recent social conditions, where all linkage between persons becomes reducible to capital. In support of this, I would refuse the irritating Marxist aggregation of history’s distinct economic systems into “petty capitalism” and “capitalism.” Marx thereby avoids confronting the fact that the stable (therefore, admittedly, not so “dynamic”) economies of pre-modern societies are qualitatively different from modern capitalism.
John Médaille points out the interesting assumptions of Adam Smith, which I agree, if they are correct assumptions, extending the “free-market” beyond them leads to great errors.
However, coming from the Austrian paradigm, I think we have great cause for rejecting the “vast number of firms” assumption. Austrians, operating on more Aristotlean grounds begins with the assumption of the acting person and goes from there. For a more universal and consistent definition of market, there needs to be at least two human persons (a community) who engage in the action of exchange (that exchange can be barter or indirectly through money). One that is free, is one where the positive law does not interfere with these exchanges. In other words a free market is not one governed by aggression. Corporate conglomerates that lobby Congress for onerous regs to squash the marginal competition are rightly not acting as free market participants, but aggressors. A free market, like any other community, can spring up spontaneously in any place where there are people acting for exchange. Thus views of capitalism are insufficient in explaining economic phenomena since they also have sentimental views of how economic activity should look.
I have much more to say in a coherent way but gotta go.
To call Austrianism “Aristotelian” is problematic, to say the least, since Mises makes only a few contemptuous references to Aristotle, and the Austrians contradict The Philosopher at every single point. But I would be interested to hear what Casey thinks is Aristotelian about Mises. As far as their “assumption of the acting person” goes, their description of human action is flat contradicted by every other humane science that deals with human action; indeed, it is contradicted simply by looking in the mirror and seeing how that person acts.
But for all that, Casey is actually agreeing with me: the right-wing libertarians recognize gov’t as the only limitation on the market. The truth is otherwise. Without rules, no one will trade. These rules may initially arise from custom, but eventually they must be embodied in law and legal institutions. That is why the Greek word “nomos” refers to both law and custom.
John Médaille is right to mention Mises, as he is perhaps the greatest of all the Austrians, however, many prominent Austrians prior to [Menger] and post [Rothbard, Hulsmann] Mises have embraced a more Aristotlean perspective. [Along these lines, I commend the work of Jorg Guido Hulsmann, in The Ethics of Money Production, which in part looks at the history of monetary thought from the Aristotlean tradition following St Thomas, Bishop Nicholas Oresme, and the Salamanca Scholastics.]
Further, philosopher David Gordon briefly examines John Médaille’s objection in “The Philosophical Origins of Austrian Economics”:
“I have so far claimed that the deductive method of Austrian economics stems from Aristotle. But an obvious objection comes to mind. When one turns to the third great figure of the Austrian School, Ludwig von Mises, Aristotle seems absent from the scene. Instead, Mises resorts to a distinctively neo-Kantian terminology: in particular, he regards the propositions of Austrian economics as synthetic a priori truths. The action axiom assumes free choice, but this to Mises is but a postulate. Mises does not presume to legislate for the noumenal world. One cannot, he thinks, rule out the possibility that science will one day demonstrate that hard determinism is true. (Oddly, Mises here reverses Kant, who thought we were phenomenally determined but noumenally free.)
“Having raised this objection, I shall not spend much time on it. Although Mises does indeed resort to Kantian language, nothing in his argument depends on Kant’s system. As Mises employs the phrase “synthetic a priori proposition,” for example, it simply designates a proposition that is necessarily true and not a tautology. Those who prefer an Aristotelian approach can easily translate Mises’s terms into their own preferred usage.
“Mises’s chief importance for our purposes does not lie in his Kantian veneer. Rather, a group of philosophers, the logical positivists, who arose in the 1920s developed doctrines that threatened to undermine the Austrian system. Their views, to the extent they impinged on Mises’s system, did not challenge his economics; it was instead his deductive method that roused the positivists to protest. For Mises, then, our focus is not on the philosophers who influenced him, but on those who attacked him. In his response to these attacks, Mises further developed and clarified the Austrian position.”
So when I say “more Aristotlean” than the classicals and neo-classicals, I don’t think I’m out in left field. Also note, that the most radical of the right wing libertarians, the Rothbardians, have embraced natural law and Thomistic views of economics, politics, and ethics. It is these radical libertarians who are often derided as kooks by the libertarians who owe their philosophical economic foundations from the British empirical schools (Hume & Smith), ie, the “respectable” libertarians.
This is total nonsense, Gordon notwithstanding. And it is obscene to link it to St. Thomas, who goes out of his way to condemn utilitarian economics as a simple violation of the 7th commandment. Utility, Thomas points out, exists in the buyer, not the seller, and when someone sells utility, he sells what he does not own. And Aristotle’s method of economics is not “deductive.” Aristotle understood, as the Austrians do not, the distinction between speculative and practical sciences. Only the former can be deductive from “axioms”. It is even more obscene to link the School of Salamanca with the Austrian nonsense (yes, I am familiar with the writers to Schumpeter to Chafuen who try to make this argument stick.) Chafuen, at least, admits that he cannot find his major premise (the absolute division between the ontological and deontological realms) in the Scholastics, but he claims it is “implicit.” But Chafuen is wrong. The premise is explicitly considered, and explicitly rejected; it is called the “doctrine of the double truth” and is considered a heresy.
Nor are the “praxeological” axioms true, or at least, no science that deals with human action finds any truth in them, nor does anyone who actually owns a mirror and can examine his own actions. Further, the libertarians confuse natural law with naturalism, repeating the “Englightenment” mistake. Natural law is not possible for the Austrians, since NL deals with teleology, with the end and purpose of things, a classification excluded by Austrian theology (which is a better description of it than “economics”).
“Nor are the “praxeological” axioms true, or at least, no science that deals with human action finds any truth in them, nor does anyone who actually owns a mirror and can examine his own actions.”
Well, we can start with the first fundamental axiom of Austrian thought, man acts. Is this untrue? Would it be untrue if I looked in the mirror? You make a powerful indictment of Austrian axioms, what axioms in particular are untrue?
Second, you keep saying “no science that deals with human action finds any truth in them, nor does anyone who actually owns a mirror and can examine his own actions.” Are you saying that the current dominant positivist models from neo-classical, rational expectations, Keynesians, etc, finds no truth in them? Are you saying the same with other such variations of social science? Note that these other dominant forms of social science, in one way or another ignore acting man.
Austrian theory, and yes it is a theory, is from this practitioner’s standpoint, currently offers the most powerful and persuasive explanation of economic phenomena, particularly with regard to its monetary and interest theories. I’ve worked for many years as a “Weberian” technician in the energy markets working with the top economic and financial models offered by the dominant theories, and all of them have been woefully impotent in explaining anything that has currently passed. On the other hand, operating under the Austrian paradigm, I had a far superior grasp over what was taking place in the credit markets than any of my peers or seniors. Austrian theory of subjective economic valuation (which yes Salamanca Scholastics did find well in advance of the labor theorists of the British Enlightenment) and their theory of time preference helped me look past the errors of the objective models offered by the positivists in Black Scholes, and the Keynesian macro models as well.
And to your point about teleology, Austrian theory does not per se exclude these things. In fact there is a powerful argument to be made that by examining economic phenomena, we can better see how to make acting man become “good instances of their kind.” What is a good instance of a market (community)? Similarly, while there is a subjective theory of economic valuation, Austrians like Hulsmann ask, what is the ontology of money? In other words, if we treat money in a certain way, does it make us less than a good instance of our kind?
If the Distributists can offer a better theory, I’m all for it. But for now, compared to the impotent models offered by the dominant theories, I’ll go with the best theory that can explain economic phenomena. The dominant theories currently are undergoing what Macintyre calls an “epistemological crisis” in light of the current economic malaise, meanwhile the Austrians are the few who can offer an alternative and coherent explanation that is rightly gaining traction. Which brings us back to Distributism, what does it offer to the current economic conversation other than sentimentalism? I’m open to examinig its version of price theory.
“Man acts” is not an axiom; “Man always acts for reasons of self-interest” is, and it is wrong, and cannot explain the myriad of human actions. It cannot explain, for example, what a mother does in the normal course of a day in the bearing and rearing of children. Or rather, the “axiom” is true only in the trivial sense that “a person always has an interest in his actions.” True, but it is not of necessity a “self-interest” in any useful meaning of that term.
The Austrian theory of money is complete nonsense and their are no working models of it. Money is not a commodity with a equilibrium point between supply and demand. Indeed, when you talk about credit, the S&D curves do not cross, because credit is administratively allocated; it is not an exchange. So, for example, if bread costs a dollar and I have a dollar and want the bread, I will get it. But if a loan “costs” 10% and I am willing to pay 10%, I will not necessarily get the loan. In fact, the banker is properly suspicious of people willing to pay such rates and normally restricts rather than expands their credit.
Further, “subjective value” refers to use-value, not exchange-value, and the failure to understand the difference renders Austrian (and neoclassical) economics useless. The fact is, there must be a gap between use-values and exchange-values, or no exchange could possibly take place (what would be the point?) In order for there to be an exchange, the buyer must have a better use for the commodity than for his money, and the seller must have a better use for the money than for the commodity. If both statements are not true, there will be no exchange. By speaking of value in univocal terms, the Austrians demonstrate that they do not understand the topic. The Scholastics, on the other hand, understood the distinction very well, with is why they condemned utility pricing, the very pricing upon which Austrian theories depend.
In the entire history of the human race, there is not one example of a working “Austrian” economy, and every attempt to impose Austrian policies (and they must always be imposed–nobody would do this voluntarily) always results in economic chaos. Distributism, on the other hand, not only has a rich tradition of actual practice, but is on the ground and working today in both large and small-scale examples. We know how distributism works because we can see it working; we can only theorize about Austrian systems, because no such system exists, or ever could.
[…] Matthew Wilson recently reflected here on the smallholder vision as embodying “the need for autarchy.” Property right, in this view, […]
If a fellow who has spent 20 years earning the right to be pedantic about Greek can be forgiven for exercising that right, I’ll offer a clarification.
Autarkeia is Greek for self-sufficiency or independence, especially of a household, but also describes the minimal dependence a philosopher may feel on the good opinion and services of others.
This enters English both as “autarky” and as “autarchy”.
“Autarchy” also means absolute sovereignty. “Autarchia” does not exist in Greek as a noun (though verbal and adjectival forms do), but it is a reasonable analogy from words like “monarchia” and “oligarchia”.
So to avoid confusion, I recommend “autarky” for self-sufficiency and “autarchy” for absolute despotism.
Didn’t Robert LeFevre call himself an autarchist?
ditto Casey Kahn “Which brings us back to Distributism, what does it offer to the current economic conversation other than sentimentalism? I’m open to examini(n)g its version of price theory.”
But price “measured” by what axiom?
When Mr Medaille can define ‘money’ we can have a discussion on usury, but he’d first have to refute Hulsmann’s and De Soto’s Aristotellian critique of fractional reserves, central banking, and FIAT paper money as basic offences against the seventh commandment on stealing. His argument re: usury as abuse of voluntary exchanges assumes we operate in a biblical fiduciary system of physical tokens of face value equivalent to production value (ie honors 8th commandment against deceit “thou shall not bear false witness against thy neighbor”) with 100% reserves (ie no spelunking, see Mark 11:15, Matthew 21:12, Luke 19:45, or John 2:12) and no alteration of monies by the King’s mint (see scholastics at Salamanca).
Sadly NONE of these three conditions apply to modern money production or banking practices, tho’ Chesterton and Belloc can be forgiven for their lack of foresight in anticipating the Jeckyll Island confab that brought about the creation of the Fed that extended the credit to the industrialists that supplied the combatants embroiled in World War I and financed the bubble of the roaring twenties that burst and led to the Great Depression, or Nixon’s audacity in suspending payments on banknotes drawn on the gold “supposedly” held at Fort Knox, but actually long gone to pay for the last remnants of World War II being fought in Korea and Vietnam). Isn’t relying on Victorian Sages to prescribe solutions for the 21st century rather abstract in and of itself?
The abstractions to be decried are those of human folly, the limits of which are indefinable, hence cannot be accounted for in any model of collective human conduct. The limits of Creation are knowable, and hence make for a far more reliable basis from which to argue economic value, but are only applicable in discrete personal (or actionable) situations, hence the theory of value that the Austrians defend, a subjective marginal utility. This is not heresy, since there is no coersion of internal free will to an external ideal. The acting person (as JPII reminds us) is the moral agent in the exchange. Only he can know what sacrifices re: price he or she is willing to pay “in the normal course of a day in the bearing and rearing of children.” for example whether she must sell her eldest into slavery to pay for the next meal for her youngest, or whether, as in times past, she fed her own babe water and gruel, so she could earn enough to feed the rest of the family by wetnursing an aristocrat’s infant.
Such sins are not new – man’s folly of succumbing to the temptation of “yielding to a desire that the universe be modified to suit their preferences, and when this desire is not granted by reality they embrace falsehood.”
has been with us since time immemorial. Praxeology does not say that an act is sinful (that is reserved to religion) merely what social conduct is reasonable or not. That is, if you are going to invent a social tool such as money, there are logical ways to do so, ways that engender trust and cooperation, and hence lead to conditions that make voluntary exchange using the newly invented social tool more likely, and ways that undermine trust and cooperation, and hence lead to circumstances where neglect, even antipathy, of neighbor is more likely by abuse of the newly invented social tool. Americans’ blind trust in the ‘powers that be’ is very unreasonable, and the Austrian-schooled libertarians amongst us know it. Adoring the good is a gift of faith, all an economist can do is advise you not to give in to evil. Tu ne cede malis as Mises would say …
Clare, I have no idea why you think distributists support a fractional reserve system. None of my acquaintance do.
[…] introductory essay to this site, and James Matthew Wilson’s wonderful essay last week, “The Need for Autarchy”–to think rather practically, as well as theoretically, about what a simple commuting tool […]
[…] thorough considerations of such arguably communitarian forms of political economy and government as autarchy and distributism and Christian social democracy. Given all that, perhaps a review of the broad […]
In Gore Vidal’s novel, Burr, the aging protagonist observes that Thomas Jefferson dreamed of a republic where every citizen could live on his own estate, supported by the labor of his slaves. Agrarian communities are prone to such delusions. Even freeholders in free soil communities require hired hands and extra labor at the harvest, who tend to become a rather numerous proletarian rabble, precisely because they do NOT have property. It is of course possible to get the harvest in with the aid of local teens and of housewives who could use a little extra money and can let the duties of the household go for a few weeks, but then, if Texas starts importing labor from Mexico, partly because “one hates to see white people living that way” in the meager shelter afforded by the thin margins of agricultural commerce, sooner or later orchard owners in Michigan will want to get in on it, and then their field hands will find that they would rather work in the canneries and rent a nicer house… Frankly, nobody who has to live on a farm really enjoys getting out in the mud, and looking at the rear end of a mule all day. They’d like to find some way to pass it on to someone else.
In a very rough manner of speaking, we could say that the United States began as something of an agrarian freeholder republic… even in Virginia and North Carolina, although not in South Carolina and Georgia, slavery was considered an evil foisted upon the colonies by the Royal Africa Company, and best ended as soon as anyone could figure out how to do so. But those New England mill owners WOULD import illiterate Papists, when the local farm girls proved not quite so tractable as the Lords of Capital desired. And then, by golly, their children wanted to vote, and form unions, and such things. If everyone does not have a freehold, these are natural responses.
I would like to find a way that we could all live a less intensive life, perhaps make it a felony for an employer to expect employees to “multi-task,” live more according to diurnal and seasonal cycles, and have at least the prospect for any who can handle it to secure their freehold. We may find some really can’t handle it, and those will turn out to come in all colors. We need a reasonably humane way for those who can’t administer property well to rent, have an honorable living, and not be disfranchised of citizenship.
And there is the ultimate lesson of the communist experiment: can anyone insure that the fundamental requirements of any envisioned society will remain in place, without the most rigorously totalitarian enforcement. Communists started as groups of weavers and skilled craftsman seeking to liberate their trades from the tyranny of decrepit feudal lords and arrogant financiers. Can the mechanism be self-sustaining without the iron hand of The State?
What about the Federal programs that were supposed to spread homeownership after World War II? They worked until 1970. After that, though they were not suspended, they ceased to be able to provide widely affordable housing in many parts of the country, largely because of local land use regulation. And government encouragement of easy money and liar loans for increased home ownership at the margin was one of the major causes of the current recession. Are pressures for home ownership an expression of the desire for autarchy, do you think, or a perversion of it? Is suburban life kind of a perversion of rural life? One major difference – in rural life the value of property arises from what you can do with it. In suburban life the value of your property mostly arises from what you can restrict your neighbors from doing with their property.
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