Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
As a Catholic and a political conservative, I constantly find myself resolving tension between the guidance of American bishops (who lean to the Democratic Party on economic issues) and my political conservatism. To be sure, it is tension and not contradiction, but it is there nonetheless. That tension flares up when I encounter other conservatives who profess fondness for Ayn Rand, who, by my reading, is anti-conservative, militantly atheist, and anti-Christian.
A recent book by John C. Médaille, Toward a Truly Free Market, addresses this tension. In Catholic social thought, the ideas he presents have typically been labelled "distributism," a ideological trend that goes back to G. K. Chesterton and Hilaire Belloc. The thing that interested me about Médaille's approach is that he proceeds by accepting some of the goods of laissez faire capitalism, and asks why we seem unable to achieve them. Why was Ronald Reagan unable to roll back the modern welfare state? Why, instead, did it grow under him?
We always draw distinctions between "good capitalism" and "crony capitalism," but why do we seem to inevitably slide to crony capitalism, with its collusion between an ever-growing Big Government and rent-seeking Big Corporations? The most appealing economic tenets that Médaille espouses are that our policy should encourage entrepreneurship at the widest level (like Bush's "ownership society"), and that it should encourage both labor AND capital while penalizing rent.
I am as dubious as the next guy when I hear about "third way" approaches, but does Chesterton provide any insights lacked by both Keynes and Hayek? Has anyone else here encountered distributism and do you have any reflections to share on it, on whether it provides us any insights in our current plight?
- Comment (38)
- · Quote
- · UnfollowFollow (2)
- Pages:
- 1
- 2
Comments:
Dec '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Jan-Michael Rives - LOL, yeah, it's a world class read.
Sep '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Distributism does not quite fit a libertarian or free-market capitalist system, in that it seems to want to distribute ownership of the means of production as evenly as possible, no matter the type of business in question, sort of a "one size fits all" theory. Moreover, don't current free market vehicles, such as stock ownership, already do distributism to some extent?
Suppose the airline industry, for example, was most efficient (and therefore best for the consumer) operating with just a few big companies, with not very "even" distribution of the means of production. Isn't this a better deal economically for the consumer in every way, and thus a more moral situation than that which exists with many less efficient, but more, and more "equally" held, means-of-production companies?
Oct '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
michael kelley:
Also, crony capitalism and rent seeking Big Corporationso are labels used by the Left to dissuade us from believing in the most prosperous system in the world. Are there abuses in the free market? Yes but stop and dwell on the amazing corporate entities America has produced and you will conclude that our corporate successes are myriad. · Jun 10 at 9:03am
If crony capitalism didn't exist, why would Paul Ryan try so hard to end it? He has some reforms in his budget, even.
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
For the answer to that question, one need look no further than Mancur Olson's theory of the logic of collective action. See the brief overview below from my friends at the Institute for Humane Studies:
bagodonuts:
We always draw distinctions between "good capitalism" and "crony capitalism," but why do we seem to inevitably slide to crony capitalism, with its collusion between an ever-growing Big Government and rent-seeking Big Corporations?
Apr '11
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Distributee-Liberty
William F. Buckley
Was asked by G. Wills "Who's a
Conservative true?
"Is a Distributist?"
"No" said Bill Buckley,
"Ideologically
There's no room for you!"
Michael Novak somewhere reminds us that when society enforces certain conditions, viz., the right to work, the right to own property, the right to form families, the right to form free and private associations, "Capitalism" occurs. It is a phenomenon, not the ideology that Marx bamboozled too many people into believing. (Those conditions are long-standing Catholic social principles, by the way.)
One of the ways in which Liberal Fascism works its evil on Natural, healthy society is its sentimentality. E.g., No one must be a loser, so businesses can't screen applicants with IQ tests. But schools can, so businesses use "education" as a proxy for IQ tests. If college is good for 20% of the population, it must be good for 50%. So we have student who don't belong in college taking courses unworthy of college making places for people who shouldn't be college professors to be professors. Inflation, or dilution, all around.
This corrosive niceness weakens society, and Distributism seems to share the flaw.
Oct '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
"We always draw distinctions between "good capitalism" and "crony capitalism," but why do we seem to inevitably slide to crony capitalism, with its collusion between an ever-growing Big Government and rent-seeking Big Corporations?"
Catholic teaching, as well as any other legitimately Christian fellowship, begins with the understanding that man is sinful. The failures of capitalism are the failures of man. The idea of severely limiting any man's agglomeration of power, either through political or industrial centralization is the, as I understand it, "Distributionist" goal. Rather than think of this in economic terms, it is better thought of in terms of freedom. The Constitution we were blessed with can be thought of as the distributionist Constitution.
By limiting the power of political centralization, and holding every man's property sacrosanct, the mechanism is in place to give everyone the chance to achieve.
By having a strong rule of law and contracts, and having clear criminal statutes, the problem of individual corruption is held in check.
But...man is still sinful.
Nov '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Hi Bagodonuts,
You may find this link of interest.
http://blog.mises.org/8729/beyond-distributism/
Aodhan
May '11
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Where I come from, Catholics were traditionally conservative with their social values yet tended towards the political left on economic issues with strong trade union affiliations. I would say there's a lot more to being 'conservative' or 'progressive' than the god you believe in (or don't).
Jun '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
KC: Your notion of an iterative series with no final winner is very appealing. It's interesting to think what Steve Jobs has done with Apple, isn't it? That competition kept broiling along (sometimes under the radar almost) and now Apple is HUGE and RICH. No final winner. Who'd a ever predicted this? Not your regular competition by any means but still your theory tends to hold.
grendel: Brilliant, brilliant comment. I have always thought of capitalism in that more neutral way -- as a symptom not a cause. But, you explained it better.
Marx was really railing against the crony-"capitalism" of Europe. These countries are still run by elites (cronies) and it stinks.
Mar '11
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Robert: Really glad you mentioned A Theory of Moral Sentiments. It is an almost forgotten classic and fleshes out many ideas Smith broaches but doesn't fully explain in Wealth of Nations.
Mar '11
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Kenneth: What is it with this "I'm a Catholic and a conservative" or "I'm an evangelical and a conservative"? or "I'm a Mormon and a conservative"?
How about "I'm an American and a conservative?"
Conservatives are supposed to eschew identity politics, no? · Jun 10 at 4:24pm
Kenneth,
Bagodonuts is trying to explain his conflict. If he weren't Catholic AND conservative, he wouldn't be conflicted about a Catholic teaching. Personally, as a Catholic and a conservative, I find distributism to be hogwash. Chesterton extrapolated distributism from a papal encyclical, and Belloc cheered him on. The system would return the state of World affairs back to the 12th century. Maybe I'm over-analysing the situation, but, at that period, the Church just happened to be at her most powerful politically, and I wonder how many bishops who espouse distributism also subconsciously pine for the respect, influence, and power of the 12th century? Otherwise, it doesn't make sense; the social stresses caused by the resulting famines and civil wars would lead to concrete violations of Church teaching of much greater magnitude than the hypothetical ones of capitalism.
Mar '11
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Here's a link to a great article by Jeffrey Tucker, which he originally posted at InsideCatholic.com:
Why Catholics Don't Understand Economics
Edited on June 11, 2011 at 1:37pmJun '11
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Joseph Eagar
michael kelley:
Also, crony capitalism and rent seeking Big Corporationso are labels used by the Left to dissuade us from believing in the most prosperous system in the world. Are there abuses in the free market? Yes but stop and dwell on the amazing corporate entities America has produced and you will conclude that our corporate successes are myriad. · Jun 10 at 9:03am
If crony capitalism didn't exist, why would Paul Ryan try so hard to end it? He has some reforms in his budget, even. · Jun 10 at 7:11pm
Mea culpa - didn't mean to imply that such arrangements don't exist. Did mean to say that there are phrases (crony capitalism, Big Corporations - think "evil" corporations) that are used by the Central Planners to discredit the achievements of American capitalism.
The public is indoctrinated with the belief that there is something essentially wrong with the private sector when that is obviously where most of America's vitality, strength and prosperity is evident. This belief is an essential accepted and received doctrine of the Left. Its intent is to create a situation where the nationalization of industry can take place (think FDR, think Obamacare).
Dec '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
I just read an article via RCP by Christopher Whalen which I believe pertains. From In Defense of Free Market Fundamentalism.
"Once we understand that many of the problems we face today as communities of individuals called nations come about due to concentrations of power in large governmental and corporate enterprises, and the corruption of these structures, then people on all sides of the supposed political debate are going to discover new common ground."
Although a big fan of Chesterton, I'm unfamiliar with his concept of distributism. I too struggle with the confused messages which seem to come from our church. However, despite being raised by FDR Democrat Catholics and having no personal experience of my own, I'm convinced of the morality of entrepreneurial activity, which I've come to believe is in imitation of God's creative enterprise. "I am come that they mighthave life, and that they might have it more abundantly. John 10:10.
If the creative side of the economy is all to the good, then I believe the focus on distribution, whether of capital or power, is misplaced.
Great post bagodonuts. You're one of several new members worth following it seems.
Aug '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Aodhan: Hi Bagodonuts,
You may find this link of interest.
http://blog.mises.org/8729/beyond-distributism/
Fat Dave: Here's a link to a great article by Jeffrey Tucker, which he originally posted at InsideCatholic.com:
Why Catholics Don't Understand Economics
Great articles, Fat Dave and Aodhan.
I think Jeffrey Tucker is right: theologians spend too much time thinking about non-scarce goods to be adept at also thinking about scarce goods.
No wonder so many theologians are such poor economists.
Nov '10
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
To the contrary, it is in the left's interest to blur the distinction between crony capitalism and real capitalism. Every time I've heard the phrase it was used by someone on the right to explain why America's problems are not the fault of capitalism; why the financial crisis does not discredit true liberalism.
Jun '11
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Charles Lavergne
To the contrary, it is in the left's interest to blur the distinction between crony capitalism and real capitalism. Every time I've heard the phrase it was used by someone on the right to explain why America's problems are not the fault of capitalism; why the financial crisis does not discredit true liberalism. · Jun 12 at 12:08am
Yes and in the blurring create the impression that the system needs fixing which is merely a drum roll and introduction for the soft gloves of totalitarianism.
What people call crony capitalism has been a dynamic in America since the Nation was formed. Fortunately, crony capitalism is only a footnote in the grand scheme of things.
May '11
Re: Distributism, or Does Economics Really Boil Down to Keynes vs. Hayek?
Sorry I've been away from this thread, and thanks to everyone. A couple of points: