Showing posts with label Distributist Lament. Show all posts
Showing posts with label Distributist Lament. Show all posts

Saturday, May 10, 2025

The Agrarian's Lament: Distributism in a time of economic insanity.

The Agrarian's Lament: Distributism in a time of economic insanity.

Distributism in a time of economic insanity.

The heavy duty, or at least heavy, premium American automobile of the golden age of American manufacturing which Trump seems to dream can be restored through tariffs.
In reality, capitalism is based on the idol of money. The lure of gain gradually destroys all social bonds. Capitalism devours itself. Little by little, the market destroys the value of work. Man becomes a piece of merchandise. He is no longer his own. The result is a new form of slavery, a system in which a large part of the population is dependent on a little caste. 

Robert Cardinal Sarah.

I don't use the term "insanity" here lightly.  Donald Trump is, I am convinced, rather dumb, obviously economically ignorant, and suffering from dementia.  That nearly half the country could vote for him is simply beyond me, but they did, and the Republican Party, which was once the party of business has fallen right into line.

I suspect Americans voted for him as they have a poor grasp of economics themselves and see it only through what they've experienced in their own live and that of their immediate predecessors.  Americans, came to view the economy sort of like Billy Joel expressed it in Allentown:

Well, we’re living here in Allentown

And they’re closing all the factories down

Out in Bethlehem they’re killing time

Filling out forms

Standing in line


Well, our fathers fought the second World War

Spent their weekends on the Jersey shore

Met our mothers in the USO

Asked them to dance

Danced with them slow


And we’re living here in Allentown

But the restlessness was handed down

And it’s getting very hard to stay


Well we’re waiting here in Allentown

For the Pennsylvania we never found

For the promises our teachers gave

If we worked hard

If we behaved


So the graduations hang on the wall

But they never really helped us at all

No they never taught us what was real

Iron and coke

Chromium Steel


And we’re waiting here in Allentown

But they’ve taken all the coal from the ground

And the union people crawled away


Every child had a pretty good shot

To get at least as far as their old man got

But something happened on the way to that place

They threw an American flag in our face


Well, I’m living here in Allentown

And it’s hard to keep a good man down

But I won’t be getting up today

 

And it’s getting very hard to stay

And we’re living here in Allentown

Problem is, a sense of economic nostalgia evolving into economic rage doesn't grasp economics at all.

1968 Oldsmobile 442.

The US didn't become an economic and manufacturing giant because of something really special in the American system or some amazing native genius.  It was the simple forces of economics that apply to corporate capitalism, combined with the Second World War, that caused it.

Largescale industry can really only be developed through capitalism or socialism.  In Europe, it was capitalism that introduced it in the form of the Industrial Revolution.  The US as a manufacturing titan came about as the Industrial Revolution came to the US late, not because we were better at it.  The arrival of industrialism in the United Kingdom and a united Germany reflected the eras in which it occurred, and it occurred there first.  Capitalism, in the end, just like socialism, seeks to serve itself, and in the case of capitalism it does it by viewing human beings as consumers, as opposed to the socialist workers, and trying to get them to consume as much as possible.  It does that by seeking to make products faster and cheaper, amongst other strategies.  Seeking efficiency products not only relentlessly advance, but manufacturing methods do as well.  But manufacturing method require massive investment of capital.  Once machines are in place, the economic incentive is to use them as long as they can be, given the investment.  This means that new start ups always have the advantage in equipment, as they are starting with newer stuff.

Added to that, industrial Europe was destroyed during World War Two to a large extent.  The Allied air forces bombed German industry into rubble.  What was left after the war was taken back to the Soviet Union if was east of the Elbe.  The Soviets themselves had suffered massive economic dislocation in of their factories, which were forcibly created in the Communist system.  Japan's industry, which was real, but not nearly as advanced as the other major combatants, had been destroyed by the United States Army Air Force.  The US, however, remained untouched and with a massive consumer demand built up due to the war and the Great Depression, US industry came roaring back and dominated the globe. . . right up until other countries could rebuilt, which very much started to show itself by the late 1960s.

One of the things nearly destroyed during the Second World War was Distributism.  Distributism really came up as a line of thought as a "third way" between Communism and Capitalism during the 1920s and the Great Depression   The tensions that came out of World War One saw the Socialist far left dramatically rise in power and take over the government of Russia, and briefly Hungary.  They vied for control of Germany, and effectively did take over Poland in a modified form.  Wars and struggles broke out in numerous places as Socialism sought to effect global change.  In opposition to it rose not only fascism, but extreme capitalism.  Distributists sought to effect a more sane and humane path.  But when the war came they, and their intellectual fellow travelers the agrarians, put aside their efforts to support the war effort, which in the West meant unleashing capitalism in aid of the war effort.  When the war ended, the economic crisis that it had brought about in Europe and the Cold War caused it to carry on, and very successfully, with Distributism being all but forgotten.

Capitalism, however, if not heavily regulated, results in the same end result as Socialism, single entity control of a machine that serves itself.  In Socialism the machine claims to serve the workers, but claims to identify itself as the workers.  In Capitalism the machine serves itself while claiming to serve "consumers".  Neither system really cares about people at all.

American capitalism, particularly after Ronald Reagan, favored unyielding corporate growth, with one corporate machine eating another.  As foreign economies rebuilt after the war, or started up after the war, corporations naturally moved manufacturing overseas, and the American government did not stop to do anything about it, believing fully in capitalism.  To a certain extent, it favored manufacturing moving overseas as it conceived as many manufacturing jobs as less than ideal, and with some reason to look upon them that way, but just as the nation had a "cheap food" policy that hurt family farmers, it had a "cheap goods" policy that hurt the domestic manufacturing sector.

It can well be argued, and it has been, that something should have been done to arrest the relocation of American manufacturing.  But in reality, that day was long ago.  It was clear in the 1970s what was occuring, but the nation, lead by a much more sober and serious group of politicians, did not elect to intervene.  Now, of course, we have Donald Trump, who doesn't seem to grasp even basic economics and who has made his money, it might be noted, in a highly anti distributist industry.

It's nearly impossible to define what Trump's economic vision is, as he probably doesn't have one.  It seems to be ruled by nostalgia and a complete failure to grasp basic economic principals.  Trump seems to look back on the econmy of his youth as a natural one, and believe that if tariffs are imposed all the old industries will come home.  A very wealthy man, he doesn't seem to care what that does in terms of imposing his tariffs all at once, and if it creates a devastating trade war, so be it.

What Trump has no interest in, however, is disrupting capitalism.  He's okay with whipping corporate entities into relocating into the US, or devastating the economy with the thesis he can make it happen, in what amounts to a type of autarky, but the basic evils of capitalism are of no interest to him.

Some closer to Trump envision something more sinister, it seems, a jump starting of an AI driving manufacturing economy.  The concept is that tariffs will not only pressure industry to relocate here, but when it does, the next stage in the relentless Industrial Revolution evolutionary cycle will occur.  Basically, baseball caps now made in Vietnam (none of them seem to be made here) will be made by robots in the US.  Human laborers in Indochina, who depend on their jobs to feed their families, will be made unemployed while factories owning robots here in the US will profit.

It's immoral.

But what of Distributism?

Some of this probably should make any distributist rethink some basic propositions, as frankly Distributism, like Trump's tariff policy, would have the impact of making some things more expensive.  Maybe many things.  But the economic impact of it would be distinctly different.

Distributism policies, as long noted here, would take the corporations out of retail and agriculture.  In agriculture, for the most part, that would not actually have a great impact on prices, save in certain instances (poultry for sure, perhaps pork).  But it would also have a levelling effect.  Virtually nobody would get fantastically wealthy in these industries, but many rank and file workers would get back up into the real middle class.  Therefore the economic impact would be levelling, more than anything else.

Manufacturing, as we've noted here before, is a much tougher nut to crack.  We've  had some suggestions in the past, but frankly the lesson of the Trump tariffs is that they may frankly be unrealistic.  We'd favor partial employee ownership of larger manufacturing entities.  We could still argue for that, but it's tough for industries like the clothing manufacturing industry, whose workers are mostly overseas.  I suppose it could still be argued for, however.  A person here, however, can't be nativist.  Economically, that is, it can't be argued that ownership in the corporation by Nguyen is any less important than Johnson, all things being equal.

It'd be pretty hard to effect, however, in countries whose economies are state run.  Again, perhaps something could have been done about that, but it would have had to start in 1975, rather than 2025.  Trump's policies, which don't fit this mold, are coming all at once, and fifty years too late. That might suggest, of course, that something could be done, but it would have to be done gradually.

If nothing else, however, Trump and his spastic policies might serve to give Distributism a little voice.  Corporate Capitalism resulted in the situation Trump seeks to address.  There's no reason to believe Corporate Capitalism is going to get us out of it.  Distributists have been warning about capitalisms long term impacts for years. Socialism has demonstrated what its were, and that's what killed it.

Perhaps the Distributist Lament can get a little more heard.

Friday, December 13, 2024

Cliffnotes of the Zeitgeist, 67th Edition. So you say you want a revolution?

Наро́дная во́ля?

The Pitchforks Are Coming… For Us Plutocrats

 

July/August 2014


Hanauer is a very wealth man.

Hanauer concluded his article with:

My family, the Hanauers, started in Germany selling feathers and pillows. They got chased out of Germany by Hitler and ended up in Seattle owning another pillow company. Three

 

generations later, I benefited from that. Then I got as lucky as a person could possibly get in the Internet age by having a buddy in Seattle named Bezos. I look at the average Joe on the street, and I say, “There but for the grace of Jeff go I.” Even the best of us, in the worst of circumstances, are barefoot, standing by a dirt road, selling fruit. We should never forget that, or forget that the United States of America and its middle class made us, rather than the other way around.

Or we could sit back, do nothing, enjoy our yachts. And wait for the pitchforks.

I suspect we're past that point now.  We've elected a plutocrat who promised to be sort of what Franklin Roosevelt actually was, "a traitor to his class".

He won't be. 

I suspect the rage will amplify.

So, what am I talking about?

I've never had any problems with my health insurance.  People complain about their health insurance a lot, however.

I'm noting that here as the public reaction to the assassination of Brian Thompson, CEO of United Healthcare, has been shocking.  I've seen people I know and respect actually rejoice at his killing, and that reaction has been extremely widespread.  I even saw somebody who is associated sort of with the insurance industry rejoice at the murder.  Moreover, one of the most right wing people I know, who voted for Trump twice, made a positive comment about the killing.

Let that sink in.  Far right, voted for Trump twice, and expressing some sympathy with the killer.

We find ourselves, at the same time that populists elected a childish billionaire who started nominating his billionaire buddies to government positions, in a situation in which a large section of the American population, including no doubt many of the people who voted the overaged rich child into office, pretty much cheering a terroristic assassination of a health insurance company CEO.

That it was an assassination, there can be no doubt. Expended shell casings were labeled "delay", "defend" and "depose", showing both a familiarity with civil litigation and the book Delay Deny Defend: Why Insurance Companies Don't Pay Claims and What You Can Do About It.

What's that tell us?

Well it tells us in part that the social fabric in this country is a lot more ripped than we even began to imagine.  

And it also tells us people attempting to read the populist weather vein might be reading it wrong.  The rage might not be as fully right wing as imagined, as now we have Americans cheering the killing of an industry figure, something that Trump/Musk and his cronies love.  That's its populist, however, there can be no doubt.

I can't recall things like this happening in the US, the targeted assassination of industry figures, since the 1920s, when it was a feature of real radicalism.  We're entering a very bad space.

It suggest, however, that in spite of what Trump/Musk imagine, the country might actually be ready for some real economic reform as it received in the 1930s.  Assassination is not tolerable, but it would appear some aspects of corporate capitalism may not be so much any longer either.

Indeed, the same right wing fellow I mentioned above proposed that all health insurance companies should be forced to be 100% policy holder owned, a highly distributist suggestion.

It is, I'd note, worth noting that plenty of current Trump backers from the far right are noting that the killer, Luigi Mangione, is from a well to do family.  He is. This is supposed to tell us that this was a deluded left winger.

Deluded, no doubt.  Left winter, maybe.  But it's also worth noting that before Trump was the populist darling, Bernie Sanders was.  Tulsi Gabbard, one time Democrat and now Trump nominee for security chief, was a Sanders supporter before she supported Trump.

Joseph Goebbels was a Communist before he was a Nazi.

Goebbels in 1916.

Lenin was from a middle class family, whose parents were monarchists.  He was a lawyer, hardly a proletarian occupation.


The point of this?  Well, just because Mangione was from a well to do family, who no doubt supported none of this, doesn't mean that he became a populist assassin as he was radicalized by the left.  He personally may have been.  We don't know.  He may be just a nut.

But the widespread cheering for him, and it is widespread, shows that Hanauer may very well be very right.

Last edition:

Cliffnotes of the Zeitgeist, 66th Edition. A little song, a little dance, a little seltzer up your pants.*

Thursday, March 14, 2024

The Agrarian's Lament: A sort of Agrarian Manifesto. What's wrong with the world (and how to fix it). Part 5. What would that look like, and why would it fix anything, other than limiting my choices and lightening my wallet? The Distributist Impact.

The Agrarian's Lament: A sort of Agrarian Manifesto. What's wrong with th...:


So, having published this screed over a period of days, and then dropping the topic, we resume with the question.

Why, exactly, do you think this would do a darn thing?

Well, here's why.

A daily example.

When I started this entry on Monday, March 4, I got up, fixed coffee and took the medication I'm now required to as I'm 60 years old, and the decades have caught up with me. The pills are from a locally owned pharmacy, I'd note, not from a national chain, so I did a distributist thing there.  It's only one block away, and I like them. Distributism.

I toasted a bagel, as in my old age the genetic "No" for adults consuming milk has caught up with me.  I got that at Albertson's and I don't know where the bagels are made.  Albertson's is a national chain that's in the process of trying to merge with another national chain. Corporate Capitalism.

The coffee was Boyers, a Colorado outfit. Quasi distributist there.

I put cream cheese on the bagel.  It was the Philadelphia brand. Definitely corporate capitalist there.

I'd already shaved (corporate capitalist, but subsidiarity makes that make sense).

I got dressed and headed to work.  My car was one I bought used, but its make is one that used to be sold by a locally owned car dealer.  No more. The manufacturers really prefer regional dealers, and that's what we have.  All the cars we have come from the dealer when it was locally owned.

I don't have that option anymore.  Corporate Capitalism.

In hitting the highway, I looked up the highway towards property owned by a major real estate developer/landlord.  A type of corporate capitalism.

I drove past some churches and the community college on the way in. Subsidiarity.

I drove past one of the surviving fraternal clubs.  Solidarity.

I drove past the major downtown churches.  Solidarity.

I drove past a collection of small stores, and locally owned restaurants adn bars, and went in the buildings.  Distributism.

I worked the day, occasionally dealing with the invading Colorado or other out of state firms.  Corporate Capitalism.

I reversed my route, and came home.

So, in this fairly average day, in a Western midsized city, I actually encountered a fair number of things that would be absolutely the same in a Distributist society.  But I encountered some that definitely ran very much counter to it.

Broadening this out.

A significant thing was just in how I ate.  And I eat a lot more agrarian than most people do.

The meat in our freezer was either taken by me in the field, or a cow of our own that was culled.  Most people cannot say that. But all the other food was store bought, and it was all bought from a gigantic national chain.  In 1924 Casper had 72 grocers, and it was less than a quarter of its present size.  In 1925, just one year later, it had 99 grocery stores.  The number fell back down to 70 in 1928.

August 1923 list of grocers in Casper that sold Butternut Coffee, which was probably every grocer.

When I was a kid, the greater Casper area had Safeway, Albertson's, Buttreys and an IGA by my recollection, in the national chains.  Locally, however, it had six local grocery stores, including one in the neighboring town of Mills.  One located right downtown, Brattis' was quite large, as was another one located in North Casper.

Now the entire area has one local grocery store and it's a specialty store.

Examples like this abound.  We have a statewide sporting goods store and a local one, but we also have a national one.  The locals are holding their own.  When I was young there was a locally owned store that had actually been bought out from a regional chain, and a national hardware store that sold sporting goods.  So this hasn't changed a lot.

And if we go to sporting goods stores that sell athletic equipment, it hasn't either. We have one locally owned one and used to have two. We have one national chain, and used to have none.

In gas stations, we have a locally owned set of gas stations and the regional chains.  At one time, we only had local stores, which were franchises. The local storefronts might be storefronts, in the case of the national chains, as well.

When I was a kid, the only restaurants that were national were the fast food franchises, which had competition from local outfits that had the same sort of fare and setting.  The locals burger joints are largely gone, save for one I've never been to and which is a "sit down" restaurant, and we have national and regional restaurant chains.  We retain local ones as well.  

We don't have any chain bars, which I understand are a thing, and local brewing, killed off by Prohibition, has come roaring back.

We used to have a local meat processing plant that was in fact a regional one, taking in cattle from the area, and packing it and distributing it back out, including locally.  There are no commercial packing plants in Wyoming now.  The closest one, I think, is in Greeley Colorado, and the packing industry is highly concentrated now.

We don't have a local creamery, either.  We had one of those at least into the 1940s, and probably well beyond that.  The milk for that establishment was supplied by a dairy that was on the south side of town.  It's no longer that and hasn't been for my entire life.

We've been invaded by the super huge law firms that are not local.

Our hospital is part of a private chain now, and there's massive discontent. That discontent took one of the county commissioners that was involved in the transfer of that entity out of county hands down in the last election.  But that hasn't arrested the trend.  My doctor, who I really like is part of a regional practice, not his own local one, anymore.  This trend is really strong.

And then there's Walmart, the destroyer of locally owned stores of every variety.

So would distribution make anything different?

The question is asked by a variant of Wendell Berry's "what are people for", but in the form of "what is an economy for?".

It's to serve people, and to serve them in their daily lives, as people.

It's not to make things as cheap as possible.

On all of the retail things I've mentioned, every single one could be served by local retail stores.  If we didn't have Albertson's, Riddleys and Smith's, we'd have a lot of John Albertson & Son's, Bill Riddley & Family, and Emiliano Smith's stores, owned by their families.  If Walmart didn't exist, and moreover couldn't exist, it would be replaced locally, probably by a half dozen family owned retailers. . . or more.

Prices would in fact be higher, although there would be competition, but the higher prices would serve families who operated them, and by extension the entire community.  And this is just one example.  

Much of the old infrastructure in fact remains.  As discussed above, numerous small businesses remain, and according to economic statistics, small business remains the number one employer in the US.  But the fact is that giant chain corporations have made a devastating impact on the country, making all local business imperiled and some practically impossible to conduct.

Reversing that would totally reorient the local economy.  Almost everyone would work for themselves, or for a locally owned business, owned by somebody they knew personally, and who knew them personally.

And with that reorientation, would come a reorientation of society.

We'll look at that a bit later.  Let's turn towards the agrarian element next.

Last Prior:

What's wrong with the world (and how to fix it). Part 4. A Well Educated Society.

Wednesday, September 6, 2023

Distributist Notes. Note 1. A distributist or more distributist society makes democracy work.

The more money that is vested in a middle class, with a very broad middle class, and the less that's vested in remote corporate boardrooms, means that the economy itself is vested at the widest possible self-sustaining level.

Jefferson's yeoman, so to speak.

"San Augustine, Texas. A meeting of the town council to discuss buying a new water tank to replace the one which was destroyed by the March tornado. Left to right around the table: Troy Mitchell, city manager; J.W. Ritchie, tinner; H.D. Clark, department store owner; Mayor Alonzo Rushing, druggist; Mr. Ramsey, city attorney; R.V. Hall, grocer; Clyde Smith, grocer; and Frank Phillips, city secretary".  April, 1943.

Conversely, if your economic well-being depends on a giant corporate employer with headquarters far away, you will none the less be inclined to vote their interests, irrespective of whether they are your own.

Blog Mirror: Jack Welch and the End of Stakeholder Capitalism Chapter 6 of The Common Good

 

Jack Welch and the End of Stakeholder Capitalism

Chapter 6 of The Common Good

Tuesday, June 20, 2023

Liberal Economics.

[W]hat is bemoaned by the right is due not to the left but to the consequences of its own deepest commitments, especially to liberal economics. And it seeks to show that what is bemoaned by the left is due not to the right but to the consequences of its own deepest commitments, especially to the dissolution of social norms, particularly those regarding sexual behavior and identity. The “wedding” between global corporations and this sexual agenda is one of the most revealing yet widely ignored manifestations of this deeper synergy.

Patrick J. Deneen, Why Liberalism Failed.

You've heard what Deneen is observing here before, but it bears repeating.  We do not have a "free market" economic system, but rather a corporate capitalist one, which favors size over everything else, and which reduces individuals to "consumers", not people.  The economy serves only that, and operates exactly as Deneen notes.

Right wing economists and left wing ones, therefore, basically serve the same master, even if they fail to realize it. And everyone serves it in the end, rather than our economy, and everything in it, serving us.

Thursday, May 11, 2023

Some basic economics, for economists


The simple reason being, economist grasp almost nothing about the economy and how it actually works, on a more existential level.

Including, even why the economy exists.

And politicians, speaking about the economy, don't look at the whole, but the part, as the whole isn't very satisfactory in a right/left construct.

Indeed, left wing politicians would be horrified by a real deep reform of the economy in ways that would actually work, as would right wing politicians.

Witness the latest by economist Robert Reich:

The economic message that will get Biden reelected and give Dems a majority in both Houses of Congress

Indeed, let's break them down and look at the uncomfortable truth.

The economic goal should be more jobs at higher wages. Right?

Let's start there.  That seems reasonable enough, so I'll basically concede it. But perhaps a better position would be to state that the economic goal would be more worthwhile jobs that allow for individual family independence, at middle class reasonable wages. 

Because, what's an economy for? To serve people.

It isn't really "more decent jobs at higher wages".  Indeed, it would really be all jobs at family supporting wages.  That's not really the same thing.

I don't know that Reich would disagree with that, but it's important to keep it in overall mind.  Economist tend to think that all jobs are super nifty, not matter what they are, as long as 100% of everyone who can work is working, and for good wages.  

Actual people, however, don't think that way. They want decent jobs worth doing to support themselves, and their families if they have one, and most people do.

The irony here is that the left and the right have come around to the same position on this, over the year.  It's a very Soviet, warehouse the children you unfortunately had so that everyone can work, until they are old, of course, as the Boomer run the economy and it's okay if they retire.

We continue.

Yet the Fed, corporate economists, and the GOP have turned the goal upside down — into fewer jobs and lower wages. Otherwise, they say, we’ll face more inflation.

Bob can't quite seem to grasp that unless an overheated economy is slowed down, wages erode.  And the Fed, etc., isn't trying to depress wages.  Inflation itself erodes wages.  They're trying to slow inflation in the only method known to work.

He knows that, but he has a pet thesis that is, as he would put it: 

Rubbish.

And here, several paragraphs later, is the thesis. 

The Fed has raised borrowing costs at 10 consecutive meetings, pushing its benchmark rate to over 5 percent. Yet inflation has barely budged. In April, it dropped to 4.9 percent (year-over-year) from 5 percent in March — according to Wednesday’s Labor Bureau data.

Why are the Fed’s rate hikes having so little effect?

Actually, historically, that's not bad.

An ideal inflation rate would be 0%, or quite frankly slight, perhaps 1% or 2% deflation, to recover some lost ground.  5%, however, is headed in the right direction.  3% for much of my life was regarded as basically no inflation at all, and the extremely low inflationary rates we had until COVID were simply extraordinary.

Oh, COVID, remember that? The thing that closed the ports and kept good from coming in, reminding Americans that we make nothing.

A thing like that could almost have been inflationary.

A think like that may also have served to remind Americans that some of the jobs they had left, pre COVID, were awful.  Note the big decrease in long haul truck drivers, employees in an industry that had already seen a massive departure of Americans in favor of foreign nationals, and which is effectively subsidized, as we've noted elsewhere.

It's an awful job.  It's almost as if we might want to think about doing this more efficiently.

If only private companies could be induced to ship things by rail. . . .oh wait. . . 

Anyhow, raising interest rates hasn't worked as it hasn't been high enough, that's why.  5% is a joke.  It ought to be at least 8%.

And, additionally, because this inflationary cycle is global, that's also why.

Because, left wing economist, global food prices and energy prices have risen dramatically as a former far left wing operative, now politicians, and a person with a strange relationship (listening right wing politicians) with Donald J. Trump, has invaded a neighbor resulting in the first peer to peer, large scale, conventional war since the Korean War.

That's a lot of the reason why.

But, left wing economist states:

Because inflation is not being propelled by an overheated economy. It’s being propelled by overheated profits.

Okay, I'm a distributist, and I'd favor addressing this to the element it's the truth, but it's just frankly not very true.   One basic fact is that those supposedly profiteering business are taking in money that's worth less every day.  No wonder they feel they have to take in more.

But Bob says:

So, what’s causing inflation? Corporations with enough monopoly power to raise their prices and fatten their profits — which the Fed’s rate hikes barely affect.

Okay, well then let's go to a Distributist economy and limit the number of areas business enterprises can operate the corporate business form.  That would be extremely deflationary, make for more good jobs at a wider level, and be much more stable.  It'd do a whole lot more than raising taxes, as Bob suggest, which would be most likely passed on to everyone else.

Any regular economist in favor of that?

Absolute not, as they're all really just corporate capitalist economist and favor slightly tinkering with the mechanics of things. Basically, the difference between a conservative economist and a liberal economist is the difference motor heads of the 70s exhibited on whether they were Holly Carb or Edlebrock fans.

Big whoop.

But here's another uncomfortable truth.  Let's go back to the first item.

The economic goal should be more jobs at higher wages. Right?

Part of the reason that wages rose is that during COVID there was a big decrease in immigration, legal and illegal, into the United States.

For years, economist on the left and right have claimed that immigrants take jobs that Americans won't, never mind that they take what are frankly a lot of middle class jobs in some industries.  As they didn't come in, Americans took those jobs, but demanded living wages.

Supposedly, in the economist world, immigration had no impact on inflation, or jobs, and in fact boosted the economy.  They may have boosted the economy, but its now conclusively demonstrated that they did so by depressing wages.

And this worked an injustice for the native born, including the native born poor.  This was always known at some level as it provided the fuel to the occasional riots and domestic strife at the inner city urban level.

This has also caused liberals like commentator Chuck Todd to directly claim that we're experiencing inflation as we aren't seeing immigrants come in. But what this implicitly admits is that the high American immigration rate operates to keep wages low, and that is what was depressing inflation.  Absent the high immigration levels, wages would rise to their natural level.

And that's what they've been doing.

Setting aside Donald Trump's pal, Vlad "if Czar Nikki owned I still do" Putin, part of what is going on is at attempt at wage stabilization, at American living wage levels, something that was frustrated by decades of wage erosion due to immigration.

Monday, March 20, 2023

Bank collapses, The Economy, Modern Work. A meandering trip through the punditsphere.

I haven't commented on the recent bank collapses at all here, as banking doesn't interest me much.


It should.  Economics does. But banking doesn't.  Given that, I tend to think this probably isn't as big of a crisis as it's being portrayed.

Indeed, I think it isn't.

Not that it isn't important.

A couple of observations, however, on the observations.

On This Week and Meet The Press, Elizabeth Warren was on, meaning she was doing a full court press over the weekend.  Both of her interviews were nearly identical, as both interviewers let her backtrack on a question to give her full, long explanation of the history of this topic.

I have to say, her explanation was good.  I don't know if it's correct, but it was good.  And that's saying something, as I frankly can't stand Elizabeth Warren.

One thing she continually noted is how we weren't watching these big banks like we were "small local banks".  I don't know if that's true either, but she was full of profuse praise for small local banks.

Hey, I'm a distributist and a localist, so I like small banks.  Is there an argument here for keeping small local banks local?

Seems like there is, although with a modern economy you're going to need big financial institutions.  She wasn't arguing otherwise.  It's just an interesting aspect of this.

One member of the banking committee was asked if these banks were "too big to fail" and he flat out said yes, an interesting example of political honesty.

Of note, while the banks are sort of being "bailed out", those who are really emphasizing this right now seem to fail to appreciate that FDIC insurance is being used for this, which suggests that the insured face amount of $250,000 is really way too low.  It probably ought to be more like $1,000,000 at this point.

Robert Reich, whose opinions I have a love/hate relationship with, used the opportunity, predictably, to hammer the rich, writing:


A while back I saw somebody commenting to one of Reich's Twitter feeds on this topic, which he's obsessed with, that Reich was rich himself.  According to an online source he has a net worth of $4M, which would mean, quite frankly, that in contemporary terms, he really isn't.  Shoot, half of that could be his house alone, depending upon where he lives, with the house not really being all that much.

Reich's article is an interesting one and basically amounts to an argument that post Reagan, the economy has been rigged to favor the upper 1%, more or less.  That's not how he puts it, of course, but is basically what he believes.  He notes that workers incomes haven't really gone up in 40 years.

All that is true, and from a Distributist point of view, is a nifty argument, the problem is however that the percentage of Americans who are "wealthy" has increased remarkably in the past 40 years.  Indeed, some demographers worry that the American middle class is disappearing not because the middle class is sinking into poverty, but that the upper middle class is moving into wealth.

In real terms, almost nobody, save for people on the street, something that wasn't tolerated 40 years ago, is poor the way the poor were, say, in the 1960s.  Prior to 1950, the middle class was mostly lower middle class and lived on the edge of poverty, That's just not true anymore.  And poverty was by and large worse in real terms at that time, than now.  It's easy to forget that as we have a 1) Norman Rockwell view of the past and 2) we always think our own times are worse than they really are.

Therefore, the Reich argument, the way it's made, really doesn't hold water.

Which gets us to the fact that  the best arguments for addressing the modern economy actually have to do with Social issues, as in Social Justice in the classic Pieper sense, rather than economics.  

What people like Reich, or Warren, edge up on is arguing that life was "nicer" when there was a big middle class.  That's true.  And many things that are unobtainable to even the upper middle class and the lower wealthy class were then, as there were very view super wealthy.  But lib economist don't go there as they are, frankly, just a little left of center on the capitalist scale.

Put another way, the difference between liberal economist and conservative economists is very slight.  Both main camps are fully vested in capitalism and are, beyond that, invested in the theory that a capitalist economy is its own good, rather than the distributist concept, which is another free market concept, that any economy only serves to serve people.

Hardly anyone is going to argue that in the lib or con economic camps, but it's true.  The theory is always that we do this or that for the economy, and then this or that happens to people, rather than considering what do people want, and what kind of economy best serves that.

A really interesting example of this, I'd note, is that really left wing economist essentially join industrialist in concepts that really only serve industry.  They seemingly don't know that.

For example, you'll see left wing economists, and politicians with strong interest in economic topics, argue that we need abortion so that women can work, or that we need government funded day care so that women can work.

This is really only liberal in that it takes the liberal view that pregnancy is some sort of freakish medical aberration that needs to be medicated into extermination or, if a person is so unfortunate that a child is born, it needs to be separated from the Dear Worker.  Beyond that, it's pure industrialism.

The big achievement of industrialism early on is that it took men off of family farms and family workshops and sent them off all day long to work.  In the 20th Century, it started to do the same for women.  Abortion and birth control were big industrial successes, as they meant that there was a way to separate women from biology and all those problematic little people.  Of course, it turned out that people had children anyhow, so daytime child concentration camps had to come about in order to address that.

This, really interestingly, is one area where the extreme left and industrialist have all come together.  Communists, for example, boosted the "let's warehouse all these little problems so that the mothers can toil" approach to things, whereas quite a few modern businesses have put in day cares so that they can take the "time off to raise children: . . no, just bring the little urchins into the business day care".

Here's an area where Reich and company have a real wage point, but not in the manner that they might imagine.  Part of the reason that wages have remained low over 40 years is that we've practically doubled the work force in relationship to the population.  I.e., if where you had 200 adults and 100 workers 40 years ago, now you have 200 workers.  More workers equal less pay.  

Now, I'm not saying that women shouldn't work.  I'm just saying that in our modern economy, they've been compelled to work.  And one way or another, in the modern economy, employers have had to accommodate children in the workplace where they would have resisted even 20 years ago.  

A lot of people are refusing to work now, it seems, or so the society wide rumor has it.  And that does seem to have some merit.

Chuck Todd, on the Meet the Press, noted a labor shortage in his early part of the show this pasts weekend, attributing that to a "restrictive immigration policy".  

Todd is apparently delusional.

The US has the most open immigration policy on the planet.  What the country has been working on, not too successfully, is halting illegal immigration.  That's what Todd really means.  Clamping down on illegal immigration is creating a labor shortage, in Todd's mind.

Illegal immigration actually serves to depress wages for the same reason noted above.  Illegal workers in the country means more workers, and that means lower wages.  D'uh.

All of which suggests, on this topic, that addressing illegal workers would mean a rise in wages, which we have been seeing.  Isn't that what we wanted?  Well, it is inflationary, at least temporary, but having suppressed wages for years, some of that's going to occur until it levels out, which it ultimately will.

All of that gets back to this, what do people want out of the economy?

I suspect they want something of their own.

Saturday, November 26, 2022

Blog Mirror: Small Business Saturday: Remembering Quadragesimo Anno.

Small Business Saturday: Remembering Quadragesimo Anno.


It is a fundamental principle of social philosophy, fixed and unchangeable, that one should not withdraw from individuals and commit to the community what they can accomplish by their own enterprise and industry. 

Just as it is gravely wrong to take from individuals what they can accomplish by their own initiative and industry and give it to the community, so also it is an injustice and at the same time a grave evil and disturbance of right order to assign to a greater and higher association what lesser and subordinate organizations can do. For every social activity ought of its very nature to furnish help to the members of the body social, and never destroy and absorb them.

Pope Pius XI, Quadragesimo Anno, 1931

I suppose this entry here is mistitled in that not only do most people not remember Quadragesimo Anno, most have no clue what it is.

It was a Papal Encyclical issued in 1931 on economic matters and the social order.  

Because I write, of course, from the United States, the land of "rugged individualism" which has, curiously, turned the economy completely over to government sponsored and therefore, quasi state created economic entities, I can't expect that anyone will actually think of the Pope and economics, let alone as sort of a radical economic theorist.  But perhaps they should.  After all, the focus of the Faith isn't on economic profit, but on the wellbeing of body and soul.

This too, of course, will be a bit radical in the US. The US is a Protestant country still, and to an enormous degree, the "Protestant work ethic" defines how economic matters are viewed, even among Catholics and the fully secular.  That early heritage, which relied to a degree on a Calvinistic world view in which wealth was regarded as a sign of God's favor, remains even in an era in which liberalism has made major societal inroads.  And those inroads interestingly have not taken the view that the Catholic teaching of Subsidiarity would have taken us, which would seemingly be more natural for our society in which individualism is nearly worshiped, but rather into a morphed version of the American System, in which the government simply takes over certain areas of the economy, but in a hidden background fashion.

This may be why economic debates in the US are so fundamentally weird.  It's much like arriving late at an extended family dinner, in which two cousins are in a raging debate over whether the 1968 or 1969 Mets are the better team, and then turn to you to demand your opinion just as you find the little crackers with salami and cheese on them, you aren't going to come out well in this debate, no matter what.

So let's turn to the encyclical, in much reduced part:

QUADRAGESIMO ANNO

ENCYCLICAL OF POPE PIUS XI ON RECONSTRUCTION OF THE SOCIAL ORDER TO OUR VENERABLE BRETHREN, THE PATRIARCHS, PRIMATES, ARCHBISHOPS, BISHOPS, AND OTHER ORDINARIES IN PEACE AND COMMUNION WITH THE APOSTOLIC SEE, AND LIKEWISE TO ALL THE FAITHFUL OF THE CATHOLIC WORLD.

Venerable Brethren and Beloved Children, Health and Apostolic Benediction.

Forty years have passed since Leo XIII's peerless Encyclical, On the Condition of Workers, first saw the light, and the whole Catholic world, filled with grateful recollection, is undertaking to commemorate it with befitting solemnity.

2. Other Encyclicals of Our Predecessor had in a way prepared the path for that outstanding document and proof of pastoral care: namely, those on the family and the Holy Sacrament of Matrimony as the source of human society,[1] on the origin of civil authority[2] and its proper relations with the Church,[3] on the chief duties of Christian citizens,[4] against the tenets of Socialism[5] against false teachings on human liberty,[6] and others of the same nature fully expressing the mind of Leo XIII. Yet the Encyclical, On the Condition of Workers, compared with the rest had this special distinction that at a time when it was most opportune and actually necessary to do so, it laid down for all mankind the surest rules to solve aright that difficult problem of human relations called "the social question."

* * *

49. It follows from what We have termed the individual and at the same time social character of ownership, that men must consider in this matter not only their own advantage but also the common good. To define these duties in detail when necessity requires and the natural law has not done so, is the function of those in charge of the State. Therefore, public authority, under the guiding light always of the natural and divine law, can determine more accurately upon consideration of the true requirements of the common good, what is permitted and what is not permitted to owners in the use of their property. Moreover, Leo XIII wisely taught "that God has left the limits of private possessions to be fixed by the industry of men and institutions of peoples."[32] That history proves ownership, like other elements of social life, to be not absolutely unchanging, We once declared as follows: "What divers forms has property had, from that primitive form among rude and savage peoples, which may be observed in some places even in our time, to the form of possession in the patriarchal age; and so further to the various forms under tyranny (We are using the word tyranny in its classical sense); and then through the feudal and monarchial forms down to the various types which are to be found in more recent times."[33] That the State is not permitted to discharge its duty arbitrarily is, however, clear. The natural right itself both of owning goods privately and of passing them on by inheritance ought always to remain intact and inviolate, since this indeed is a right that the State cannot take away: "For man is older than the State,"[34] and also "domestic living together is prior both in thought and in fact to uniting into a polity."[35] Wherefore the wise Pontiff declared that it is grossly unjust for a State to exhaust private wealth through the weight of imposts and taxes. "For since the right of possessing goods privately has been conferred not by man's law, but by nature, public authority cannot abolish it, but can only control its exercise and bring it into conformity with the common weal."[36] Yet when the State brings private ownership into harmony with the needs of the common good, it does not commit a hostile act against private owners but rather does them a friendly service; for it thereby effectively prevents the private possession of goods, which the Author of nature in His most wise providence ordained for the support of human life, from causing intolerable evils and thus rushing to its own destruction; it does not destroy private possessions, but safeguards them; and it does not weaken private property rights, but strengthens them.

50. Furthermore, a person's superfluous income, that is, income which he does not need to sustain life fittingly and with dignity, is not left wholly to his own free determination. Rather the Sacred Scriptures and the Fathers of the Church constantly declare in the most explicit language that the rich are bound by a very grave precept to practice almsgiving, beneficence, and munificence.

51. Expending larger incomes so that opportunity for gainful work may be abundant, provided, however, that this work is applied to producing really useful goods, ought to be considered, as We deduce from the principles of the Angelic Doctor,[37] an outstanding exemplification of the virtue of munificence and one particularly suited to the needs of the times.

52. That ownership is originally acquired both by occupancy of a thing not owned by any one and by labor, or, as is said, by specification, the tradition of all ages as well as the teaching of Our Predecessor Leo clearly testifies. For, whatever some idly say to the contrary, no injury is done to any person when a thing is occupied that is available to all but belongs to no one; however, only that labor which a man performs in his own name and by virtue of which a new form or increase has been given to a thing grants him title to these fruits.

53. Far different is the nature of work that is hired out to others and expended on the property of others. To this indeed especially applies what Leo XIII says is "incontestible," namely, that "the wealth of nations originates from no other source than from the labor of workers."[38] For is it not plain that the enormous volume of goods that makes up human wealth is produced by and issues from the hands of the workers that either toil unaided or have their efficiency marvelously increased by being equipped with tools or machines? Every one knows, too, that no nation has ever risen out of want and poverty to a better and nobler condition save by the enormous and combined toil of all the people, both those who manage work and those who carry out directions. But it is no less evident that, had not God the Creator of all things, in keeping with His goodness, first generously bestowed natural riches and resources - the wealth and forces of nature - such supreme efforts would have been idle and vain, indeed could never even have begun. For what else is work but to use or exercise the energies of mind and body on or through these very things? And in the application of natural resources to human use the law of nature, or rather God's will promulgated by it, demands that right order be observed. This order consists in this: that each thing have its proper owner. Hence it follows that unless a man is expending labor on his own property, the labor of one person and the property of another must be associated, for neither can produce anything without the other. Leo XIII certainly had this in mind when he wrote: "Neither capital can do without labor, nor labor without capital."[39] Wherefore it is wholly false to ascribe to property alone or to labor alone whatever has been obtained through the combined effort of both, and it is wholly unjust for either, denying the efficacy of the other, to arrogate to itself whatever has been produced.

54. Property, that is, "capital," has undoubtedly long been able to appropriate too much to itself. Whatever was produced, whatever returns accrued, capital claimed for itself, hardly leaving to the worker enough to restore and renew his strength. For the doctrine was preached that all accumulation of capital falls by an absolutely insuperable economic law to the rich, and that by the same law the workers are given over and bound to perpetual want, to the scantiest of livelihoods. It is true, indeed, that things have not always and everywhere corresponded with this sort of teaching of the so-called Manchesterian Liberals; yet it cannot be denied that economic social institutions have moved steadily in that direction. That these false ideas, these erroneous suppositions, have been vigorously assailed, and not by those alone who through them were being deprived of their innate right to obtain better conditions, will surprise no one.

* * *

57. But not every distribution among human beings of property and wealth is of a character to attain either completely or to a satisfactory degree of perfection the end which God intends. Therefore, the riches that economic-social developments constantly increase ought to be so distributed among individual persons and classes that the common advantage of all, which Leo XIII had praised, will be safeguarded; in other words, that the common good of all society will be kept inviolate. By this law of social justice, one class is forbidden to exclude the other from sharing in the benefits. Hence the class of the wealthy violates this law no less, when, as if free from care on account of its wealth, it thinks it the right order of things for it to get everything and the worker nothing, than does the non-owning working class when, angered deeply at outraged justice and too ready to assert wrongly the one right it is conscious of, it demands for itself everything as if produced by its own hands, and attacks and seeks to abolish, therefore, all property and returns or incomes, of whatever kind they are or whatever the function they perform in human society, that have not been obtained by labor, and for no other reason save that they are of such a nature. And in this connection We must not pass over the unwarranted and unmerited appeal made by some to the Apostle when he said: "If any man will not work neither let him eat."[41] For the Apostle is passing judgment on those who are unwilling to work, although they can and ought to, and he admonishes us that we ought diligently to use our time and energies of body, and mind and not be a burden to others when we can provide for ourselves. But the Apostle in no wise teaches that labor is the sole title to a living or an income.[42]

58. To each, therefore, must be given his own share of goods, and the distribution of created goods, which, as every discerning person knows, is laboring today under the gravest evils due to the huge disparity between the few exceedingly rich and the unnumbered propertyless, must be effectively called back to and brought into conformity with the norms of the common good, that is, social justice.

59. The redemption of the non-owning workers - this is the goal that Our Predecessor declared must necessarily be sought. And the point is the more emphatically to be asserted and more insistently repeated because the commands of the Pontiff, salutary as they are, have not infrequently been consigned to oblivion either because they were deliberately suppressed by silence or thought impracticable although they both can and ought to be put into effect. And these commands have not lost their force and wisdom for our time because that "pauperism" which Leo XIII beheld in all its horror is less widespread. Certainly the condition of the workers has been improved and made more equitable especially in the more civilized and wealthy countries where the workers can no longer be considered universally overwhelmed with misery and lacking the necessities of life. But since manufacturing and industry have so rapidly pervaded and occupied countless regions, not only in the countries called new, but also in the realms of the Far East that have been civilized from antiquity, the number of the non-owning working poor has increased enormously and their groans cry to God from the earth. Added to them is the huge army of rural wage workers, pushed to the lowest level of existence and deprived of all hope of ever acquiring "some property in land,"[43] and, therefore, permanently bound to the status of non-owning worker unless suitable and effective remedies are applied.

60. Yet while it is true that the status of non owning worker is to be carefully distinguished from pauperism, nevertheless the immense multitude of the non-owning workers on the one hand and the enormous riches of certain very wealthy men on the other establish an unanswerable argument that the riches which are so abundantly produced in our age of "industrialism," as it is called, are not rightly distributed and equitably made available to the various classes of the people.

61. Therefore, with all our strength and effort we must strive that at least in the future the abundant fruits of production will accrue equitably to those who are rich and will be distributed in ample sufficiency among the workers - not that these may become remiss in work, for man is born to labor as the bird to fly - but that they may increase their property by thrift, that they may bear, by wise management of this increase in property, the burdens of family life with greater ease and security, and that, emerging from the insecure lot in life in whose uncertainties non-owning workers are cast, they may be able not only to endure the vicissitudes of earthly existence but have also assurance that when their lives are ended they will provide in some measure for those they leave after them.

62. All these things which Our Predecessor has not only suggested but clearly and openly proclaimed, We emphasize with renewed insistence in our present Encyclical; and unless utmost efforts are made without delay to put them into effect, let no one persuade himself that public order, peace, and the tranquillity of human society can be effectively defended against agitators of revolution.

* * *

64. First of all, those who declare that a contract of hiring and being hired is unjust of its own nature, and hence a partnership-contract must take its place, are certainly in error and gravely misrepresent Our Predecessor whose Encyclical not only accepts working for wages or salaries but deals at some length with it regulation in accordance with the rules of justice.

65. We consider it more advisable, however, in the present condition of human society that, so far as is possible, the work-contract be somewhat modified by a partnership-contract, as is already being done in various ways and with no small advantage to workers and owners. Workers and other employees thus become sharers in ownership or management or participate in some fashion in the profits received.

66. The just amount of pay, however, must be calculated not on a single basis but on several, as Leo XIII already wisely declared in these words: "To establish a rule of pay in accord with justice, many factors must be taken into account."[45]

67. By this statement he plainly condemned the shallowness of those who think that this most difficult matter is easily solved by the application of a single rule or measure - and one quite false.

68. For they are greatly in error who do not hesitate to spread the principle that labor is worth and must be paid as much as its products are worth, and that consequently the one who hires out his labor has the right to demand all that is produced through his labor. How far this is from the truth is evident from that We have already explained in treating of property and labor.

69. It is obvious that, as in the case of ownership, so in the case of work, especially work hired out to others, there is a social aspect also to be considered in addition to the personal or individual aspect. For man's productive effort cannot yield its fruits unless a truly social and organic body exists, unless a social and juridical order watches over the exercise of work, unless the various occupations, being interdependent, cooperate with and mutually complete one another, and, what is still more important, unless mind, material things, and work combine and form as it were a single whole. Therefore, where the social and individual nature of work is neglected, it will be impossible to evaluate work justly and pay it according to justice.

70. Conclusions of the greatest importance follow from this twofold character which nature has impressed on human work, and it is in accordance with these that wages ought to be regulated and established.

71. In the first place, the worker must be paid a wage sufficient to support him and his family.[46] That the rest of the family should also contribute to the common support, according to the capacity of each, is certainly right, as can be observed especially in the families of farmers, but also in the families of many craftsmen and small shopkeepers. But to abuse the years of childhood and the limited strength of women is grossly wrong. Mothers, concentrating on household duties, should work primarily in the home or in its immediate vicinity. It is an intolerable abuse, and to be abolished at all cost, for mothers on account of the father's low wage to be forced to engage in gainful occupations outside the home to the neglect of their proper cares and duties, especially the training of children. Every effort must therefore be made that fathers of families receive a wage large enough to meet ordinary family needs adequately. But if this cannot always be done under existing circumstances, social justice demands that changes be introduced as soon as possible whereby such a wage will be assured to every adult workingman. It will not be out of place here to render merited praise to all, who with a wise and useful purpose, have tried and tested various ways of adjusting the pay for work to family burdens in such a way that, as these increase, the former may be raised and indeed, if the contingency arises, there may be enough to meet extraordinary needs.

72. In determining the amount of the wage, the condition of a business and of the one carrying it on must also be taken into account; for it would be unjust to demand excessive wages which a business cannot stand without its ruin and consequent calamity to the workers. If, however, a business makes too little money, because of lack of energy or lack of initiative or because of indifference to technical and economic progress, that must not be regarded a just reason for reducing the compensation of the workers. But if the business in question is not making enough money to pay the workers an equitable wage because it is being crushed by unjust burdens or forced to sell its product at less than a just price, those who are thus the cause of the injury are guilty of grave wrong, for they deprive workers of their just wage and force them under the pinch of necessity to accept a wage less than fair.

73. Let, then, both workers and employers strive with united strength and counsel to overcome the difficulties and obstacles and let a wise provision on the part of public authority aid them in so salutary a work. If, however, matters come to an extreme crisis, it must be finally considered whether the business can continue or the workers are to be cared for in some other way. In such a situation, certainly most serious, a feeling of close relationship and a Christian concord of minds ought to prevail and function effectively among employers and workers.

74. Lastly, the amount of the pay must be adjusted to the public economic good. We have shown above how much it helps the common good for workers and other employees, by setting aside some part of their income which remains after necessary expenditures, to attain gradually to the possession of a moderate amount of wealth. But another point, scarcely less important, and especially vital in our times, must not be overlooked: namely, that the opportunity to work be provided to those who are able and willing to work. This opportunity depends largely on the wage and salary rate, which can help as long as it is kept within proper limits, but which on the other hand can be an obstacle if it exceeds these limits. For everyone knows that an excessive lowering of wages, or their increase beyond due measure, causes unemployment. This evil, indeed, especially as we see it prolonged and injuring so many during the years of Our Pontificate, has plunged workers into misery and temptations, ruined the prosperity of nations, and put in jeopardy the public order, peace, and tranquillity of the whole world. Hence it is contrary to social justice when, for the sake of personal gain and without regard for the common good, wages and salaries are excessively lowered or raised; and this same social justice demands that wages and salaries be so managed, through agreement of plans and wills, in so far as can be done, as to offer to the greatest possible number the opportunity of getting work and obtaining suitable means of livelihood.

75. A right proportion among wages and salaries also contributes directly to the same result; and with this is closely connected a right proportion in the prices at which the goods are sold that are produced by the various occupations, such as agriculture, manufacturing, and others. If all these relations are properly maintained, the various occupations will combine and coalesce into, as it were, a single body and like members of the body mutually aid and complete one another. For then only will the social economy be rightly established and attain its purposes when all and each are supplied with all the goods that the wealth and resources of nature, technical achievement, and the social organization of economic life can furnish. And these goods ought indeed to be enough both to meet the demands of necessity and decent comfort and to advance people to that happier and fuller condition of life which, when it is wisely cared for, is not only no hindrance to virtue but helps it greatly.[47]

76. What We have thus far stated regarding an equitable distribution of property and regarding just wages concerns individual persons and only indirectly touches social order, to the restoration of which according to the principles of sound philosophy and to its perfection according to the sublime precepts of the law of the Gospel, Our Predecessor, Leo XIII, devoted all his thought and care.

* * *

79. As history abundantly proves, it is true that on account of changed conditions many things which were done by small associations in former times cannot be done now save by large associations. Still, that most weighty principle, which cannot be set aside or changed, remains fixed and unshaken in social philosophy: Just as it is gravely wrong to take from individuals what they can accomplish by their own initiative and industry and give it to the community, so also it is an injustice and at the same time a grave evil and disturbance of right order to assign to a greater and higher association what lesser and subordinate organizations can do. For every social activity ought of its very nature to furnish help to the members of the body social, and never destroy and absorb them.

80. The supreme authority of the State ought, therefore, to let subordinate groups handle matters and concerns of lesser importance, which would otherwise dissipate its efforts greatly. Thereby the State will more freely, powerfully, and effectively do all those things that belong to it alone because it alone can do them: directing, watching, urging, restraining, as occasion requires and necessity demands. Therefore, those in power should be sure that the more perfectly a graduated order is kept among the various associations, in observance of the principle of "subsidiary function," the stronger social authority and effectiveness will be the happier and more prosperous the condition of the State.

* * *

Given at Rome, at Saint Peter's, the fifteenth day of May, in the year 1931, the tenth year of Our Pontificate.

PIUS XI

And hence the irony. Pope Pius XI was pointing towards a more democratic, more distributist and more free market economy than any economist or politician in the American mainstream today.  Robert Reich may rail against corporate profits, but he's not going to go there.  Harriet Hageman may note that "she grew up on a ranch", but she's not going to work towards an economy that would remove corporate interests from the agricultural picture.  President Biden isn't going there either, and neither will candidate Trump.

So today we have Small Business Saturday.

At least there's this day in the year.  But it's worth pondering that, in spite of what Americans like to claim, we do not have a truly free market economy, but a capitalistic corpratized one.  This is so much the case, that most Americans aren't capable of realizing that this is a government created and supported structure, or the reasons therefore.  Indeed, ironically the same people who run around erroneously claiming that "we're a republic, not a democracy", apparently not knowing that we're a democratic republic, will note the glories of the free market system in contrast with what they deem "socialism", apparently not realizing at all that our economy is a capitalistic economic system with heavy doses of the old American System.

Small business provide a huge amount of the national employment. They suffer the most in the economy even when it's good, and suffer more yet when the economy is bad.

Give them a chance.  If you are shopping today, visit a small business.

Related Threads:

Distributist of the world unite! National Small Business Saturday.