The culture of separation...

According to traditional western metaphysics, death is the separation of a person's body and soul. According to Cartesian dualism, by contrast, a person's life consists in precisely the radical existential cleft between body and soul. In so far as our culture is still pervaded by Cartesian conditioning, our culture is rightly labelled a culture of death. The ideology of death, aka nihilism, is driven by the underlying principle that plurality means discord, that difference entails disunity. Hence, divorce is a tendril of separationist nihilism, because it severs the bond between free commitment and eternal transcendence. Abortion is likewise a tendril of dichotomous nihilism, as it severs the bond between a woman's good and her child's. Contraception similarly forces a wedge between the distinct yet inseparable goods of sex and procreation.

By the same token, any movement which promotes homosexual intimacy as an equally valid form of human family life, is implicitly trying to reduce the awkward plurality of the male-female unity into a more manageable system of genderized uniformity, and as such is just as much a tendril of separationist nihilism as the others I have mentioned. It is precisely the distinction between an axe and wood which gives them a unity that finds its purpose quite literally in the family hearth. With an axe man may chop lumber and build a home, in which he can, in turn, make a family. With an axe he likewise may chop wood to make a fire, over which, in turn, a meal may be made to feed his family. What will not suit the man is an axe only or wood only. He can only make his home by unifying the difference between an axe and wood in the service of a higher end.

What the same-sex movement strives for, alas, is effectively endorsing axes to chop axes and wood to split wood, out of which I believe can only be made a heap of scrap parts, or, ultimately, tinder for an everlasting fire fueled by the inquenchable flame of self-love, which is the apotheosis of same-love. If a man cannot find himself (which is to say, lose himself) in a woman, it won't do him much good to seek himself in a man, on the assumption that men can love each other as well as if not better than men can love women, since, you see, the former bond is free of the complexity and political phoniness of the "male-female" dichotomy. If a man funds utter easier to love someone who is more like him, he may as well go the whole way and admit he loves the person more like him than anyone else, namely, himself. That he is more attracted to men than women is one thing; that his attraction can legitimize a whole alternative way of the human family is something else completely. An axe may fit better on the shelf with another axe, but thus does not mean heaping axes together is a valid alternative to using axes to chop wood for the good of homemaking.

That, of course, is the fundamental difference which must be acknowledged, and the basis for every person's fundamental choice between worldviews. The world is either a place for making homes ur for making heaps. At the heart of the Christian worldview is an icon of unity in plurality, of harmony based on difference, of a family of unique persons. The regnant worldview of our mass culture, by contrast, enshrines the supremacy of unity based on uniformity (the collective heaping of axes) or, if uniformity cannot be satisfactorily commodified or imposed, sacrifices harmony for the unqualified blind good of plurality for its own sake (the nominalistic scrapping of all).

Note the parallels he draws between education and industrialization...

Freedom, schmeedom…

U.S. Bishops Vow to Fight HHS Edict

January 20, 2012

The Catholic bishops of the United States called “literally unconscionable” a decision by the Obama Administration to continue to demand that sterilization, abortifacients and contraception be included in virtually all health plans. Today's announcement means that this mandate and its very narrow exemption will not change at all; instead there will only be a delay in enforcement against some employers.

“In effect, the president is saying we have a year to figure out how to violate our consciences,” said Cardinal-designate Timothy M. Dolan, archbishop of New York and president of the U.S. Conference of Catholic Bishops.

The cardinal-designate continued, “To force American citizens to choose between violating their consciences and forgoing their healthcare is literally unconscionable. It is as much an attack on access to health care as on religious freedom. Historically this represents a challenge and a compromise of our religious liberty. … The government should not force Americans to act as if pregnancy is a disease to be prevented at all costs….”

“This is nothing less than a direct attack on religion and First Amendment rights,” said Franciscan Sister Jane Marie Klein, chairperson of the board at Franciscan Alliance, Inc., a system of 13 Catholic hospitals. …

Daughter of Charity Sister Carol Keehan, president and chief executive officer of the Catholic Health Association of the United States, voiced disappointment with the decision[:] … “This was a missed opportunity to be clear on appropriate conscience protection….”

Pay up…

Get ready to pay. …

Secretary of Health and Human Services and pro-abortion Catholic Kathleen Sebelius [has] announced that the proposed mandate requiring all insurance plans to pay for contraception, sterilization and some abortion drugs is official -- and Catholics cannot escape….

Cardinal-designate Timothy M. Dolan responded…: “In effect, the president is saying we have a year to figure out how to violate our consciences.”

Beginning August 1, 2012…, the insurance premiums we pay, including the insurance premiums paid by Catholics for employees of churches and schools … will be used to cover drugs and procedures that are in direct conflict with the teachings of our Church. … Our government will now force us to pay for insurance coverage for birth control, sterilization and even some abortion drugs. …

Make no mistake, this decision is a direct attack on you, our Church, and the religious liberty of all Americans.

… Pope Benedict XVI addressed the bishops from the United States who were completing their "Ad Limina" visit in Rome. The Holy Father specifically cited the "grave threats" to the freedom of the Church in America, and urged the Catholic community to respond, especially with "an engaged, articulate and well-formed Catholic laity." …

[In twelve] months, America will welcome a new president, or usher in four more years of Barack Obama and his assault on our liberties. This irony is not lost on us. … The Catholic vote must rise up like never before.

Sincerely,

Brian Burch, President
CatholicVote.org

The heart of the social order…

"The rural family needs to regain its rightful place at the heart of the social order. The moral principles and values which govern it belong to the heritage of humanity, and must take priority over legislation. They are concerned with individual conduct, relations between husband and wife and between generations, and the sense of family solidarity. Investment in the agricultural sector has to allow the family to assume its proper place and function, avoiding the damaging consequences of hedonism and materialism that can place marriage and family life at risk."

-- Benedict XVI, 16 Oct 2006

MESSAGE OF HIS HOLINESS BENEDICT XVI
TO THE DIRECTOR GENERAL
OF THE FOOD AND AGRICULTURE ORGANIZATION (FAO)
FOR THE CELEBRATION OF WORLD FOOD DAY

Natural capital…

"The twin pillars of the capitalist system – private ownership and free markets – are undergoing a significant shift as a result of the financial meltdown. The days of companies "privatizing the profits" and governments "socializing the losses" are gone forever. … Capitalism is dooming itself because it is polluting and depleting its resource base – natural capital – in its frenetic pursuit of profits and growth. The tragedy of modern capitalism lies in its denial that there is a biophysical limit to exponential consumption and growth. … [We must revise] statistical accounting systems, such as Gross Domestic Product, so that they reflect externalities like pollution and public health. … Capitalism cannot be reformed until we reform our own consumption behaviour: until we learn to live with less, until we reduce our bloated ecological footprints and until we lower our material expectations."

-- Hugh Robertson, "Capitalism and Sustainability" - www.future-generations-party.org

Expropriation in Taiwan…

"Elderly farmers... said the proposed amendments to the Act of Eminent Domain are still tilted toward corporations. Tsai Pei-hui, a professor of Social Transformation Studies at Shih Hsin University who joined the protest, said a dozen of the controversial land expropriation cases in special agricultural zones are related to major government construction projects. The draft amendment... allows the government to acquire private lands in agricultural zones, which means farmers' properties can be expropriated at will.... One of the main points of the amendment bill is that land expropriation must be in the 'public interest....'" However, the draft bill, which was scheduled for a second reading Tuesday, did not take into consideration the public's opinions on what constitutes 'public interest,' [Tsai] said."

Farmers say draft bill fails to address land expropriation woes - Taiwan News Online

www.taiwannews.com.tw

Unless we first reclaim ourselves...

An Introduction to Distributism, Part II

 Posted By Donald P. Goodman III On October 17, 2011 6:54 AM 

(For Part I, click here.)

The widespread distribution of productive property is the primary goal of Distributism; however, other principles also inform Distributism’s pursuit of this goal. The first of these is the principle of subsidiarity... [which is] the simple notion that  

[J]ust as it is a crime to take away and hand over to the community those things which can be done with proper struggle and industry by single men, so also it is an injury, a grave fault, and a disruption of right order to summon to the larger and higher society those things which can be done and excelled by smaller and lower communities.35 

... [W]hatever can be done by a smaller unit should not be done by a larger one ... [which] clearly leads to the greater distribution of productive property. There is no reason for much of our production of wealth to be so concentrated; Distributism would encourage this overconcentration to be remedied, spreading ownership of productive property more broadly throughout the populace. 


It’s important to remember that this principle works both ways. Pius XI notes that “it is rightly argued that certain types of goods must be reserved to the republic since they bear such great power with them, [power] so great that it cannot be permitted to private men by a sound republic.”36 ... Subsidiarity does not exclude higher authorities from all functioning in society; it simply ensures that lower authorities are not deprived of their rightful role. Distributists respect both sides of the subsidiarity coin....  


It is true that modern industries are often not amenable to wide scale distribution in the traditional sense; after all, an aircraft factory is not a shoemaker’s shop. But this does not mean that the workers in such factories cannot become owners. ... Spain’s Mondragon37 and the many cooperatives in Italy’s Emilia Romagna region38 have proven to the world that worker-owned cooperative production can be just as successful, or even more successful, than the highly centralized production that has unfortunately characterized the industrial age. ... 


The other vital principle which forms Distributism’s pursuit of widely distributed productive property is solidarity ... [which] is the recognition that a state is a single whole that is possessed not only of many individual goods, but also a single common good.39 It recognizes the fundamental precept of traditional and Catholic social thinking that the man “who by nature and not by mere accident is without a state, is either a bad man or above humanity; he is. . . either a beast or a god.”40 ... The organization entrusted with ensuring that particular goods are kept within proper limits and directed toward the common good is the state.42 Therefore, keeping in mind the principle of subsidiarity, the state guides economic life, including its subsidiary corporations (such as workingmen’s associations43), toward the common good, while individual corporations pursue their own particular goods within that framework. This notion of many particular goods subordinated to and cooperating toward a single common good is what we mean by solidarity.


Solidarity has many repercussions in economic thought. ... [C]ompetition, though just within certain limits,44 cannot serve as the basis for a just economic order45; in other words, whatever benefit that businesses seek to obtain by competition cannot come at the cost of the public good. Truly, this is anathema in an age when corporations routinely justify their butchering of the national and even international economies by their obligations to make profits for their shareholders.... 


Furthermore, what has traditionally been known as the preferential option for the poor follows directly from the notion of solidarity. Leo XIII stated that “when there is question of defending the rights of individuals, the poor and badly off have a claim to especial consideration…[, hence] wage-earners, since they mostly belong in the mass of the needy, should be specially cared for and protected by the government.”46 ... [S]pecial care should be taken by the whole for those parts which are least able to help themselves.


So how is a Distributist society to be established? That question is impossible to answer generally. ... Means for encouraging widespread ownership of productive property, always respectful of the principles of subsidiarity and solidarity, will vary by place, condition, climate, economy, culture, government, and innumerable other variables. Catholics need to dedicate themselves to consideration of these measures in their own areas and situations, tailoring them to specific conditions. One condition, however, will be the same always and everywhere, a condition identified by Pope Leo well over a century ago:

[S]ince religion alone, as We said at the beginning, can avail to destroy the evil at its root, all men should rest persuaded that [the] main thing needful is to re-establish Christian morals, apart from which all the plans and devices of the wisest will prove of little avail.48

We cannot reclaim society for Christ unless we first reclaim ourselves. To that task, first and foremost, distributists, like all men, must devote all their strength.


Notes
1 St. Luke 10:7.
2 Didache: The Teaching of the Twelve Apostles (Peter Kirby, trans.; 2001), available at http://earlychristianwritings.com/text/didache-roberts.html.
3 Id.
4 A superb example of such thinking is St. Thomas Aquinas, De Regimine Principum; vel De Regno, available at http://gorpub.freeshell.org/books.html#deregno.
5 See, e.g., Dr. William Luckey, The Intellectual Origins of Modern Catholic Social Teaching on Economics: An Extension of a Theme of Jes us Huerta de Soto 9 (speech given to the Austrian Scholars Conference at Auburn University, 23-25 March 2000) (arguing that given research “which ought to have been available to [the pope],” “it is hard to excuse Leo XIII”).
6 See, e.g., id. at 1; see also Rev. Maciej Zieba, O. P., From Leo XIII’s Rerum novarum to John Paul II’s Centesimus Annus 5:1 Journal of Markets & Morality 159 (Spring 2002) (arguing that part of Rerum novarum‘s “tendency is brought to a halt and partly turned around in the first two social encyclicals of John Paul II”).
7 Pope St. Pius X, Singulari quadam (24 September 1912) (“[i]taque primo loco edicimus catholicorum omnium o cium esse. . . tenere rmiter pro terique non timide christian veritatis principia, Ecclesi catholic magisterio tradita, ea pr sertim qu Decessor Noster sapientissime in Encyclicis Literris Rerum novarum exposuit”). All translations from the Latin in this work are the author’s, unless otherwise noted.
8 Leo XIII, Rerum novarum, no. 47 (teaching that “[t]he right to possess private property is derived from nature, not from man”). All citations from Rerum novarum are from the English translation available at http://www.vatican.va.
9 Id. (teaching that “the State has the right to control its [private property's] use in the interests of the public good”).
10 Id. at no. 45.
11 Id. at no. 20 (teaching that “before deciding whether wages [are] fair… wealthy owners and all masters of labor should be mindful… that to exercise pressure upon the indigent and destitute for the sake of gain, and to gather one’s profi t out of the need of another, is condemned by all laws, human and divine”); see also nos. 43{45.
12 Id. at no. 37.
13 Id. (teaching that “[t]he richer class have many ways of shielding themselves,… whereas the mass of the poor have no resources of their own… for this reason [ ] wage-earners, since they mostly belong in the mass of the needy, should be specially cared for and protected by the government”).
14 Id. at no. 39.
15 Id. at no. 41.
16 Id. at no. 3.
17 Id. at no. 42.
18 Id. at no. 45.
19 Id. at no. 3.
20 John M edaille, Neo-Feudalism and the Invisible Fist in The Distributist Review, available at http://www.distributistreview.com/mag.
21 Duane D. Stanford, InBev to Buy Anheuser-Busch, Gains Top Market Share in Bloomberg (14 July 2008), available at http://\-www.\-bloomberg.\-com/\-apps/\-news?pid=newsarchive\&sid=aDm1PPbwrdHc.
22 Tom Daykin, InBev looks at SABMiller in JSOnline (May 29, 2008), available at http://www.jsonline.com/business/29568214.html.
23 Dmitry Krasny, And Then There were Eight: 25 Years of Media Mergers, from GE-NBC in Mother Jones (March/April 2007).
24 James Niccolai, Intel grabs server market share from AMD, says IDC in Network World (19 August 2010), available at http://www.networkworld.com.
25 Leo XIII, Rerum novarum, no. 3.
26 Hilaire Belloc, The Servile State (The Liberty Fund, 1977).
27 Id. at no. 62.
28 Aristotle, Ethica Nicomachea in The Basic Works of Aristotle 1003 (Benjamin Jowett trans., Richard McKeon ed., Random House 1941).
29 St. Thomas Aquinas, Summa Theologica Ia, Q. 21, Art. 1 (“secundum quam aliquis gubernator vel dispensator dat unicuique secundum suam dignitatem”).
30 Leo XIII, Rerum novarum, no. 33.
31 Id. at no. 46.
32 Id. at no. 47.
33 Id.
34 Hilaire Belloc, The Servile State (The Liberty Fund 1977).
35 Pius XI, Quadragesimo Anno, no. 79 (“sicut qu a singularibus hominibus proprio marte et propria industria possunt per ci, nefas est eisdem eripere et communitati demandare, ita qu a minoribus et inferioribus communitatibus e ci pr starique possunt, ea ad maiorem et altiorem societatem avocare iniuria est simulque grave damnum ac recti ordinis perturbatio”.
36 Pius XI, Quadragesimo Anno, no. 114 (“Etenim certa qu dam bonorum genera rei public reservanda merito contenditur, cum tam magnum secum ferant potentatum, quantus pravatis hominibus, salva re publica, permitti non possit”)
37 See, e.g., Dr. Race Matthews, Mondrag on and the Global Economic Meltdown in The Distributist Review (6 June 2010), available at http://distributistreview.com/mag.
38 See, e.g., John Restakis, The Lessons of Emilia Romagna (30 April 2005), available at http://www.geo.coop/ les/BolognaVisits Lessons ER.pdf.
39 For a lengthier discussion of this, see the author’s Individualism and the State (23 July 2010), available at http://distributistreview.com/mag.
40 Aristotle, Politics 1131{32 (Benjamin Jowett trans.) in The Basic Works of
Aristotle (Richard McKeon ed., New York: 1941).
41 Leo XIII, Rerum novarum, no. 51.
42 Pius XI, Quadragesimo Anno, no. 49 (“[o] cia vero h c singillatim de nire, ubi id necessitas postulaverit neque ipsa lex naturalis pr stiterit, eorum est qui rei public pr sunt”).
43 Leo XIII, Rerum novarum, no. 49.
44 Pius XI, Quadragesimo Anno, no. 88 (“[a]t liberum certamen, quamquam dum certis nibus contineatur, quum sit et sane utile”).
45 Id. (“rei conomic rectus ordo non potest permitti libero virium certamini”).
46 Leo XIII, Rerum novarum, no. 37.
47 Pius XI, Quadragesimo Anno, no. 25 (“in ipsis protegendis privatorum iuribus, pr cipue in rmorum atque inopum rationem esse habendam”).

So, you ask, what's all this about economics and social ethics lately?

A few things:

0. I'm not a communist! I'm a capitalist... with qualms. My tentative thesis: capitalism rests on the free-market mechanism (FMM), but is self-defeating as soon as it is applied in a necessarily limiting social context (i.e., capitalism requires market-external intervention), whereas distributism protects the FMM but in a radically different form (i.e., the ecological analogue of 'distributed cognition/processing'). Since both theories consist in the FMM, there cannot be a clash between them, unless/until the former rejects the structure of the latter in favor of politically abetted concentration, a concentration which denatures the 'neural' tissue of the FMM. Capitalism emphasizes the mechanism of the FMM at the expense of a sustainable structure, while distributism emphasizes the structure of how the FMM can persist.

1. I don't capitalize "distributism". It's too tendentious/pugnacious, otherwise. Marxism, Darwinism, Georgism, etc. Okay. But let's stick to socialism, capitalism, distirbutism, institutionalism, solidarism, etc.

1a. Georgism and distributism, dear cousins!

2. Even mentioning "distribution" scares otherwise receptive conservative/traditionalist minds, so distributism needs a new name. I propose: "[Darwinian] niche capitalism" or "radically parallel-process capitalism" or "ecomodular capitalism".

3. I'm not a bought-and-sold distributist. Not yet, anyway. I really am just reading in all directions, and basically making up for a mediocre economic education along the way. I'm a big fan of the free market and, as an American, I'm hugely biased towards capitalism. I am gravely dissatisfied, however, with the historically regular and increasingly manifest link between "capital concentration" and "political centralization" (and vice versa!) If, however, the Magisterium indicates that neoclassical liberalism (NL) is heresy, let NL burn.

4. As John Médaille argues, economic reform is only possible after political reform, and political structure follows economic dynamics. The rise of federal hegemony over states' rights is a parallel development of the corporatist centralization of capital in the USA. Likewise, the dismantling of federal debt and welfare statism can only come by (re)distributing the political power to the states, cities, and boroughs of the USA. In turn, once these local (!) powers regain their power, they will regain their revenue responsibility in the republic. Away with kicking problems upstairs to Uncle Sam!

4a. There is a crucial link between states' rights and truly free markets, since (classical) federalism is just political distributism. This is why I believe the "Austrian–distributist" debate among Catholics is a new kind of De Auxiliis for the Church. If they are ever going to find each other (as kissing cousins, indeed), Austrianism and distributism will do so in the domain of states' rights, at least in the USA.

It's illegal to prosper…

"[M]y observation is that it is typically illegal for low income people to do the things they used to do to increase the quality of food in their diets. You can’t raise pigs and chickens in your back yard anymore. OK, maybe we’re seeing some small evolution in some areas on chickens, but not a lot. Nobody is keeping a milk cow in cities and selling the milk and cream to their neighbors. And everywhere, there is a war on the territory presently occupied by low income people. … [P]oor people also can’t build their own housing anymore. That’s against the law too."

The Six Hands of Community Food Security « BobWaldrop.net

Man in his entirety...

From Teacher to Farmer: Why I Went Back to the Land
Posted By Kevin Ford On November 11, 2011 8:54 AM

A little more than a year ago, I quit my job as a theology teacher at a Catholic high school to become a full-time organic farmer. I like to call myself a “Catholic farmer”, because I am striving to live out the Church’s teachings on marriage and the family, as well as Catholic social teaching, in my work and in the daily life of my family. I had been contemplating a return to the land for several years, and I finally opened myself to the grace needed to take such a leap of faith. I feel as though my story is a microcosm of the Catholic Land Movement as a whole. I doubt if any will follow exactly the same path, but hopefully some will end up on the land, working to restore Catholic culture, just as I did. After much prayer and discernment, I have narrowed my reasons for returning to the land to the following: restoring Catholic family life, bringing wholeness to our lives, regaining simplicity, and building Catholic community.

In our world today, nothing comes under attack more often than marriage and the family. In this modern assault, I felt it necessary to flee to the fields in order to provide an environment that is natural for family life, one where my children could flourish. City life with its “damnable conveniences” as Fr. McNabb, O.P., called them, is often a source of great temptation. The pagan temples and idols of today are not so clearly perceived, because they are often disguised in masks of pleasure, convenience, and materialism. To me, a return to the land marks a radical departure from the frivolity of modern city life as I seek to live a life that is meaningfully fruitful. Pope Benedict XVI has stated: “The rural family must regain its place at the heart of the social order.”(1) The rural family has traditionally been the backbone of healthy cultures. Never in history has the mass of humanity been concentrated in the cities as they are today. Pope Pius XII speaks very wisely of the benefits of rural life for families in his address to Italian farm laborers:

Your lives are rooted in the family...; consequently, they conform very closely to nature. In this fact lies your economic strength and your ability to withstand adversity in critical times ... [and] the importance of your contribution to the correct development of the private and public order of society. You are called upon for this reason to perform an indispensable function as source and defense of a stainless moral and religious life. For the land is a kind of nursery which supplies men, sound in soul and body, for all occupations, for the Church, and for the State.(2) 

... I sought a place for my family to live out its life in totality without the distractions that city life often brings..., way out in the country whose nights are lit by heavenly lights alone.

... As I taught theology to high school students, I would often find myself thinking about my own children and the difficulty I would have passing on the faith to them, simply because of how much time I must spend at school. I did not doubt the dignity of the teaching profession. However, I doubted the wisdom of our modern age that insists on men working separate from their families, and always seeking after a wage. ... I began to realize that the breakdown of the family could be traced to the implementation of the wage system. ... [T]he family didn’t start to fall apart when mothers left the home for the work place. Rather, the family’s disintegration began when fathers left the home and the land for the convenience of a city wage. 

... The etymology of the word husband was absolutely fascinating. Hus-Band literally means house-bound. When a man was married he became house bound. There in the home with his wife he would bring forth a family. There in the home he would work and provide for the family; everything was centered around the home. The home was not a place to return to after work, but rather it was the place of work, it was the center of life, and it was the stability that fostered healthy families. I realized that what I wanted was a life that was whole, one that had integrity. I wanted to live, work, and pray with my family all the time, not just in the evenings or when I was off work. I wanted to be a husband in the true sense of the word, and I wanted to be a father who was always there. Working towards a self-sufficient life on the land offers me the opportunity to truly be a father to my children. I can’t express in words how beautiful this has been.

The third reason I returned to the land was to regain simplicity. Reading Eric Brende’s book, Better Off: Flipping the Switch on Technology, profoundly impacted my views on modern technologically-saturated life. ... It is not that all machines are bad, but the scale to which technology has infiltrated our lives led me to take my family down a different path. Now we analyze our technology piece by piece and look carefully at its effects on family life. If it is truly more harmful to family life than helpful, then we simply don’t need it. Too often a machine has taken the place of meaningful human and family interaction. 

Dishwashers haven’t decreased the dish loads, but rather increased the sinks full of dishes and decreased important interaction between people, especially children, as they learn to work together. ... We find that with less technology, we suddenly have time for activities we previously couldn’t squeeze in. Without the time in front of the television, we find time to read together, sing and dance with the piano, or simply sit out back in the evenings and watch the chickens scratch about (chickens can be a source of great hilarity, believe it or not). This simplicity gets rid of excess distractions and leaves us with more time for one another.

The final reason I returned to the land was in hope of rebuilding Catholic rural community. ... Today Catholic communal life is gravely lacking. ... [My wife and I] sought a Catholic village. Starting something like this from scratch was simply out of the question. ... We are still seeking ways to build Catholic community wherever God leads us. It is a dream of ours that one day we will have many neighbors farming and doing their various crafts next door, but until then we will have to wait for the right door to open.

Our faith is sacramental, and therefore it is not meant to be only a spiritual reality. Catholicism with its sacraments corresponds to man in his entirety. We who are embodied souls need a faith that is both physical and spiritual. Thus we seek in some way to incarnate our Catholic life on the land and to share that life with others. ... 

Going back to the land has radically changed my life and my goals. It has transformed my way of thinking, and it daily encourages me to be a better man. By throwing myself into the hands of providence, I am forced to give my fiat or give up. ... Yet, I have never done anything so rewarding and at the same time so difficult. I hope many others will follow in my footsteps, and that one day we may have a countryside filled with Catholic smallholdings once again. Vivat Christus Rex!

Notes


(1) Message of his Holiness BENEDICT XVI to the Director General of the Food and Agriculture Organization (FAO) for the Celebration of World Food Day, from the Vatican, 16 October, 2006


(2) Speech delivered by His Holiness to the delegates at the Convention of the National Confederation of Farm Owner-Operators in Rome on November 15, 1946, #4.

Production coterminous with consumption...

‘The Distributive Alternative’

Posted By Russell Sparkes On November 6, 2010 7:09 AM

... Probably the greatest and most persistent attack on Distributism was the notion ... that it was an otherworldly invention by Chesterton and Belloc as part of their romantic attachment to the Middle Ages, and alleged desire to return there. This was often caricatured as policy of giving everybody ‘three acres and a cow’, which was in fact a policy slogan of Joseph Chamberlain in the 1880s.

There is little truth in this argument, for, as we shall see later, Chesterton and Belloc did not reject modern technology, but they did fundamentally disagree with the economic system on which modern society is based. As we shall see, they called it ‘plutocracy’, or rule by the rich.

Probably the original inspiration behind Distributism, was both Chesterton and Belloc’s keen interest in English political, social, and economic history. I believe that Chesterton was also struck by a vein of social commentary in literary men like Dickens ... [and] William Cobbett, that doughty fighter for the poor of England. Chesterton describes Dickens’ hated [sic] of the way the free-market economists of the Nineteenth Century, the so-called ‘Manchester School’, advocated starvation and misery for the poor as a necessary evil:

‘He didn’t like the mean side of the Manchester philosophy: the preaching of an impossible thrift and an intolerable temperance…. Thus, for instance, he hated that Little Bethel (a workhouse) to which Kit’s mother went: he hated it simply as Kit hated it. ... [i]

It was also inspired by the recent practical success of Land Reform in Ireland as they were impressed by the peaceful and successful redistribution of land in Ireland which was carried out following the 1903 Wyndham Act. They both knew its author, the Conservative Minister George Wyndham, who became a great friend of Belloc. Finally, both Belloc and Chesterton were Catholics, and they were certainly inspired by the formidable figure of Cardinal Manning, of whom more later.

Hence the ‘received wisdom’ on Distributism—that its main proponents were well-meaning idealists ignorant of the real world of politics and economics is quite wrong. Hilaire Belloc was a Member of Parliament from 1906-1910 before he resigned his seat in disgust. Chesterton was a well-known and widely respected journalist whose views helped shape popular opinion.... In 1927 Chesterton was invited to lecture at the London School of Economics.... 

 In 1936 Keynes revolutionalised economics by inventing macroeconomics in his The General Theory of Employment, Interest, and Money. Keynes’ great discovery was that the focus of previous economists on the individual firm meant that they had ignored the fact that the economy was an organic whole; what to an individual firm was a cut in costs (wages) was to the worker a cut in income. Chesterton made exactly the same point in 1926, before the Great Depression began in 1929 -- but then he was not blinkered by having absorbed the doctrines of economics:

‘Capitalism is contradictory as soon as it is complete; because it is dealing with the mass of men in two different ways at once. When most men are wage-earners, it is more and more difficult for most men to be customers. For the capitalist is always trying to cut down what his servant demands, and in doing so is cutting down what his customer can spend. As soon as his business is in any difficulties, as at present in the coal business, he tries to reduce what he has to spend on wages, and in doing so reduces what others have to spend on coal. He is wanting the same man to be rich and poor at the same time.’ [iii]

One last point about classical economics is how it has often mirrored the wishes of the rich and powerful, contradicting its earlier teaching to do so. ... As Chesterton wrote in 1927:

‘But what is interesting to note is the way in which the sophistry of political economy changes and adapts itself to the needs of the luxurious at any particular moment. Whatever the politician may want to do, there is always a political economist beside him to say that it must be done, and whenever the rich want to be luxurious, it is always opportunely discovered that luxury is a form of economy.’ [iv]

They pointed out that Adam Smith’s insistence on the need to specialize and trade, rather than to produce locally, led economics to neglect transport costs, the uncertainty involved in trade, and broader environmental considerations. As Vincent McNabb pointed out, in the language of economics, Smith’s error: 

‘I have often said that the most efficient social and economic unit is one wherein the area of production tends to be co-terminous with the area of consumption; i.e. that things will be produced where they are to be consumed.’ [v] 

[i] G.K. Chesterton, The Victorian Age in Literature, London, Home University Press, 1910. 

[iii] G.K. Chesterton, The Outline of Sanity, (first published 1926), reprinted Ignatius Press 1992, page 59 

[iv] G.K. Chesterton, ‘Very Political Economy’, from G.K.’s Weekly, 5 August 1927. 

[v] Fr Vincent McNabb, Old Principles and the New Order, Sheed and Ward 1942, page 12.

Let it rust...

What We Are Getting At


G. K. Chesterton — Posted On July 3, 2011 11:07 AM

Distributists ... are not out to improve the present industrial system, but to destroy it. We want to shift the center of gravity from the machine to the craftsman, from the factory to the farm. We want to decentralize production, so that each district may tend to be self-supporting, we want to have little knots of craftsmen everywhere supplying the needs of the district which feeds them. 

While we admit the existence of certain exceptional forms of ownership, as in a mine or a factory, we insist that they are exceptions, and even here we make a distinction between a mine, which we must have, and a factory, which perhaps we need not have. We may find it useful to prepare definite plans for the Distributist working of mines. There is no sense in preparing detailed plans for the Distributist working of a factory. ...

We can start dealing with the small owner in industry and agriculture and, wherever possible, with owners in our own district. ... Some can, if they have the courage of giants, help to form groups of craftsmen, like the Distributing group. Others, again with the courage of giants, can start tilling the land. 

... [R]equests have been received from Distributists for a complete plan of how our theory is to be applied to the modern conditions of industry and agriculture. We are accused of being vague, of having nothing to offer the vast army of people employed in factories and offices. Well, we have nothing to offer them—except a way out. We do not intend to devise schemes for making life in a factory or an office tolerable; that is what the monopolists intend to do, and no doubt they will do it. Our business, so far as the factory and office employee are concerned, is to make them desire freedom and to show them how they may be free. 

... We hope to turn back the tide of monopoly, we hope to change England from a nation of machine-miners, clerks and carriers to a nation of farmers and craftsmen. But we do not hope to do it all at once. The change, if it is made, will be made piecemeal—by converting Englishmen to Distributism, and by gradually building up a Distributist community outside monopolist organization. 

That may appear to place us at a debating disadvantage with the Socialists, who know precisely how they will take over and work monopoly. But the reason for their precise knowledge is that they are themselves monopolists. We don’t intend to take over monopoly. We intend to destroy it by starting an exodus from its factories. 

Our main immediate concern is to gain converts ... [a]nd when a likely subject asks what we shall do with the steel trade or what not, we must not be ashamed to say: “We shall do nothing with it. We shall leave it to rust.”

... We think that something can be done through Parliament to make small ownership easier to gain and to hold. But we are not a Party, and our main effort must be always outside Parliament. ...

The one thing needful is to preach steadily and work steadily for small ownership and the localization of production and consumption, while refusing to consider the irrelevant problem of the big town. ... 

Germany, Greece, and the Euro...

Let the Greeks ruin themselves

Germany has Europe’s deepest pockets, but it does not want to pay to save troubled euro-zone economies

Feb 18th 2010 | BERLIN | from the print edition

LESS than a year before the euro became the currency of 11 European countries in January 1999, a declaration signed by 155 German-speaking economists called for an “orderly”—ie, long—delay. The prospective euro members, they said, had not yet reduced their debt and deficits to suit a workable monetary union; some were using “creative accounting” to get there, and a casual attitude towards deficits would undermine confidence in the euro’s stability.

Now the prediction is coming true, says Wim Kösters, of the Ruhr University in Bochum and one of the original signatories. ...

This dilemma is felt especially keenly in Germany. It was a wrench to surrender the Deutschmark, symbol of post-war recovery and economic success. On the eve of monetary union 55% of Germans were against it, making their nation the euro zone’s most reluctant founders. When a “rescue” is mentioned, all eyes fix on Germany, Europe’s biggest economy and most creditworthy borrower. Germans fear that a rescue of Greece would, in effect, extend their welfare state to the Mediterranean.

... A harsh austerity plan, they hope, will be enough to deter speculators—and to reassure their voters at home that Greece is not getting off lightly. The model is Ireland, whose brutal spending cuts restored market confidence without aid from its European neighbours.

A bail-out, Mrs Merkel fears, would break the bargain Germany struck in accepting the euro: that the single currency’s members would never jeopardise its stability nor ask Germans to pay for anyone else’s mismanagement. ...

The path out of the crisis is unclear. Greek bonds remain under pressure (see chart). Arguments rage over which chain reaction would be more damaging: serial bail-outs or serial defaults. ...

+ + + 

How to save the euro


It requires urgent action on a huge scale. Unless Germany rises to the challenge, disaster looms


Sep 17th 2011 | from the print edition

... It is a sobering thought that so much depends on the leadership of squabbling European politicians who still consistently underestimate what confronts them (see article). But the only way to stop the downward spiral now is an act of supreme collective will by euro-zone governments to erect a barrage of financial measures to stave off the crisis and put the governance of the euro on a sounder footing.

The costs will be large. Few people, least of all this newspaper, want either vast intervention in financial markets or a big shift of national sovereignty to Europe. Nor do many welcome a bigger divide between the 17 countries of the euro zone and the EU’s remaining ten. It is just that the alternatives are far worse. That is the blunt truth that Germany’s Angela Merkel, in particular, urgently needs to explain to her people.

... A rescue must do four things fast. First, it must make clear which of Europe’s governments are deemed illiquid and which are insolvent, giving unlimited backing to the solvent governments but restructuring the debt of those that can never repay it. Second, it has to shore up Europe’s banks to ensure they can withstand a sovereign default. Third, it needs to shift the euro zone’s macroeconomic policy from its obsession with budget-cutting towards an agenda for growth. And finally, it must start the process of designing a new system to stop such a mess ever being created again.

... So far the euro zone’s response has relied too much on two things: austerity and pretence. Sharply cutting budget deficits has been the priority—hence the tax rises and spending cuts. But this collectively huge fiscal contraction is self-defeating. By driving enfeebled economies into recession it only increases worries about both government debts and European banks (see article). And mere budget-cutting does not deal with the real cause of the mess, which is a loss of credibility.

... Instead of austerity and pretence, a credible rescue should start with growth and, where it is unavoidable, a serious restructuring of debt. Europe must make an honest judgment about which side of the line countries are on. Greece, which is unambiguously insolvent, ought to have a hard but orderly write-down. ... Freeing up services and professions, privatising companies, cutting bureaucracy and delaying retirement will create conditions for renewed growth—and that is the best way to reduce debts.

How to prevent contagion? ... Core countries like Germany and the Netherlands have enough cash to look after their own banks, but peripheral governments may need euro-zone money. Ideally that would come from the European Financial Stability Facility (EFSF).... But it also makes sense to set up a euro-zone bank fund, together with a euro-zone bank-resolution authority. ...

None of this will work unless the Europeans create a firewall around the solvent governments. That means shoring up euro-zone sovereign debt. Spain and Italy owe €2.5 trillion. ... The ECB must declare that it stands behind all solvent countries’ sovereign debts and that it is ready to use unlimited resources to ward off market panic. That is consistent with the ECB’s goal to ensure price and financial stability for the euro zone as a whole. ...

Even so, this is a huge step. The ECB’s German officials have taken to resigning in protest at the limited bond-buying undertaken so far. ...

The issue now is not whether the euro was mis-sold or whether it was a terrible idea in the first place; it is whether it is worth saving. Would it be cheaper to break it up now? ... The sobering truth about the single currency is that getting in is a lot easier than getting out again. Legally, the euro has no exit clause. ...

Attaching hard numbers to any of this is difficult. Analysts at UBS, a bank, reckon that euro break-up could cost a peripheral country 40-50% of GDP in the first year, and a core country 20-25% (see article). ... [T]he immediate bill for a break-up of the single currency would surely be in the trillions of euros. By contrast, a successful rescue would seem a bargain. ...

German taxpayers might accept that the immediate costs of our rescue plan are smaller than break-up. But what they detest is the idea that it might let feckless Italians and Portuguese off the hook. Safe in the knowledge that the ECB stands behind their bonds, they may shy away from reform and rectitude.

Two risks flow from this. The immediate (and real) one is that furious Germans will demand that Greece is thrown out (or bullied out) of the euro to frighten the others. Such a horrific event would indeed scare Portugal and Ireland, but a threat to expel Italy or Spain is empty: they are too big and too tightly tied into the EU. Simply chucking out Greece because it was convenient would permanently undermine the security of small members of the EU. Besides, once Greece defaults and restructures, its economy stands a good chance of making a credible start on its long journey to economic health.

The longer-term risk has to do with “more Europe”. Fans of political integration say that the only way to enforce discipline is to create a United States of Europe (see Charlemagne). ... The ten countries, including Sweden, Poland and Britain, that kept their own currencies may face a choice: to join the euro or be excluded from a new “core Europe”, which in effect starts setting policies. ...

... The euro has reached the point where nobody is going to get what they want—something that needs to be spelled out to the Germans more than anybody. ... For the ECB to stand behind less prudent countries may be unwelcome to Germans; but letting the euro fall to bits is much, much worse. Spell that out clearly to your voters, Mrs Merkel.

+ + +

The future of the EU


Two-speed Europe, or two Europes?


Nov 10th 2011, 2:23 by Charlemagne | BRUSSELS

NICOLAS Sarkozy is causing a big stir after calling on November 8th for a two-speed Europe: a “federal” core of the 17 members of the euro zone, with a looser “confederal” outer band of the ten non-euro members. ...

You cannot make a single currency without economic convergence and economic integration. It's impossible. But on the contrary, one cannot plead for federalism and at the same time for the enlargement of Europe. It's impossible. ... We are 27. We will obviously have to open up to the Balkans. We will be 32, 33 or 34. I imagine that nobody thinks that federalism—total integration—is possible at 33, 34, 35 countries. ... [T]he single currency is a wonderful idea, but it was strange to create it without asking oneself the question of its governance, and without asking oneself about economic convergence. 

... The European Union is, in a sense, made up not of two but of multiple speeds. ... But Mr Sarkozy’s comments are more worrying because, one suspects, he wants to create an exclusivist, protectionist euro zone that seeks to detach itself from the rest of the European Union. ...

In other words, France, or Mr Sarkozy at any rate, does not appear to have got over its resentment of the EU’s enlargement. At 27 nations-strong, the European Union is too big for France to lord it over the rest and is too liberal in economic terms for France’s protectionist leanings. Hence Mr Sarkozy’s yearning for a smaller, cosier, “federalist” euro zone.

This chimes with the idea of a Kerneuropa ("core Europe") promoted in 1994 by Karl Lamers and Wolfgang Schäuble, who happens to be Germany's current finance minister. Intriguingly, it is the first time that Mr Sarkozy, once something of a sceptic of European integration, has spoken publicly about “federalism”.... It echoes the views of Mr Sarkozy's Socialist predecessor, François Mitterrand.

... Mr Sarkozy probably wants to create a euro zone in France’s image, with power (and much discretion) concentrated in the hands of leaders, where the “Merkozy” duo (Angela Merkel and Nicolas Sarkozy) will dominate. Germany will no doubt want a replica of its own federal system, with strong rules and powerful independent institutions to constrain politicians. ...

Done properly, by keeping the euro open to countries that want to join (like Poland) and deepening the single market for those that do not (like Britain), the creation of a more flexible EU of variable geometry could ease many of the existing tensions. ... But done wrongly, as one fears Mr Sarkozy would have it, this will be a recipe for breaking up Europe. Not two-speed Europe but two separate Europes. ...

Mr Sarkozy’s words seem to have caught the attention of Joschka Fischer, elder statesman of Germany's Green party and a former foreign minister, who said that the EU at 27 had become too unwieldy. “Let’s just forget about the EU with 27 members—unfortunately,” he told Die Zeit, a German weekly newspaper. “I just don’t see how these 27 states will ever come up with any meaningful reforms.” Indeed, some think the euro zone itself might be smaller than the 17 members (Greece may soon default and leave the euro).

The speech that everybody is waiting for now is Mrs Merkel’s. The chancellor wants to change the treaties, and on November 9th she called for “a breakthrough to a new Europe”. ...

+ + +

The German problem


To save the single currency, Angela Merkel must take on her own country’s economic establishment


Nov 19th 2011 | from the print edition

... At her party’s conference on November 14th the chancellor, Angela Merkel, left no doubt about the gravity of the euro crisis (see Charlemagne). “If the euro fails, then Europe fails,” she said.

On the same day Jens Weidmann, the president of the Bundesbank, roiled financial markets with hardline comments ... [ruling out reliance on] the European Central Bank (ECB) as a lender of last resort to governments, arguing it would be illegal and wrong for the bank to hold down bond yields. ...

Mr Weidmann is not a lone ideologue. Mario Draghi, the ECB’s new Italian president, has ruled out acting as a lender of last resort to governments, albeit less categorically (see article). Mr Weidmann has his supporters among the Finns and the Dutch, too. But the rigidity of his argument is embedded in the solid rock that is Germany’s economic establishment, which holds that big rescues are counterproductive because they both dull governments’ incentives to act and create new dangers. ...

The problem is that the dogmatic prescriptions of the “German orthodoxy” are pushing the single currency towards collapse. If Mrs Merkel wants to save the euro, therefore, she must challenge her country’s economic establishment, and explain to voters why the revered Bundesbank’s rigidity is wrong. ... German orthodoxy ignores the possibility that rising bond yields are being driven by a self-fulfilling panic in financial markets. ...

The euro zone’s most recent plan—to amplify the existing rescue fund with financial engineering and money from China—has failed miserably. ... Either Europe’s governments will have to assume explicitly some joint liability for each other’s debts. Or they will have to do so implicitly, by allowing the ECB to counter a panic with purchases of government bonds: in effect, letting it act as a lender of last resort. The danger lies in eschewing both options. ...

+ + +

Is this really the end?

Unless Germany and the ECB move quickly, the single currency’s collapse is looming

Nov 26th 2011 | from the print edition

EVEN as the euro zone hurtles towards a crash, most people are assuming that, in the end, European leaders will do whatever it takes to save the single currency. That is because the consequences of the euro’s destruction are so catastrophic that no sensible policymaker could stand by and let it happen.

A euro break-up would cause a global bust worse even than the one in 2008-09. The world’s most financially integrated region would be ripped apart by defaults, bank failures and the imposition of capital controls (see article). ...

Yet the threat of a disaster does not always stop it from happening. The chances of the euro zone being smashed apart have risen alarmingly, thanks to financial panic, a rapidly weakening economic outlook and pigheaded brinkmanship. ...

Add the ever greater fiscal austerity being imposed across Europe and a collapse in business and consumer confidence, and there is little doubt that the euro zone will see a deep recession in 2012—with a fall in output of perhaps as much as 2%. That will lead to a vicious feedback loop in which recession widens budget deficits, swells government debts and feeds popular opposition to austerity and reform. Fear of the consequences will then drive investors even faster towards the exits.

Past financial crises show that this downward spiral can be arrested only by bold policies to regain market confidence. ...

Without a dramatic change of heart by the ECB and by European leaders, the single currency could break up within weeks. Any number of events, from the failure of a big bank to the collapse of a government to more dud bond auctions, could cause its demise. ...

The only institution that can provide immediate relief is the ECB. As the lender of last resort, it must do more to save the banks by offering unlimited liquidity for longer duration against a broader range of collateral. ... One promising idea, from Germany’s Council of Economic Experts, is to mutualise all euro-zone debt above 60% of each country’s GDP, and to set aside a tranche of tax revenue to pay it off over the next 25 years. Yet Germany, still fretful about turning a currency union into a transfer union in which it forever supports the weaker members, has dismissed the idea.

This attitude has to change, or the euro will break up. ... Debt mutualisation can be devised to stop short of a permanent transfer union. Mrs Merkel and the ECB cannot continue to threaten feckless economies with exclusion from the euro in one breath and reassure markets by promising the euro’s salvation with the next. Unless she chooses soon, Germany’s chancellor will find that the choice has been made for her.

+ + +

HOW GERMANY COULD SAVE THE EURO

25 NOVEMBER 2011

BY John Muellbauer, Official Fellow, Nuffield College; Professor of Economics, Oxford University (Originally published at VOXEU)

For months economists have been arguing that Germany holds the key to ending the Eurozone crisis. Should it relax its anti-inflation stance and allow the ECB to inflate away sovereign debt? Or should it write a cheque of its own to the EFSF? Neither, says this column. ... Eurobonds are the answer – but with conditions.

... The German Ministry of Finance could offer a two-year loan to the Italian government at 3% above what it pays, and promise that next year, if the Italian reform programme is showing visible signs of success, the spread could fall to 2.5% and then to 2% if progress continues. With backsliding, the cost would rise. This solidarity gesture would be highly profitable for the German taxpayer. The conditionality of the offer would keep the new Italian government committed to reform, aiding Italy’s credibility as a Eurozone member. Conventional Eurobonds, meanwhile, with the same funding costs for every country but with risk collectively underwritten, would likely be a recipe for disaster. They would encourage lax fiscal policy, backsliding on reform, and moral hazard. ...

Conditional Eurobonds would institutionalise, for all Eurozone countries, the simple example above of Germany lending to Italy. The conditional Eurobonds, issued on new borrowing, would be collectively underwritten by member governments of the Eurozone. ... The proceeds of the payments could be distributed in several ways. In the simple example of a bilateral loan from Germany to Italy, Germany would retain the entire spread. With multilateral underwriting, all Eurozone countries would receive shares of the payments into the central fund. The shares would be determined by the size of their own borrowings and their spreads relative to Germany. Per unit of borrowing, less risky countries such as France would receive more than riskier countries such as Belgium, but less than Germany itself. ...

A hugely important point about conditional Eurobonds with spreads is that they address the German fear about the Eurozone becoming ‘a transfer union’. The point is also not made clearly enough that this kind of bond, by creating the right fiscal incentives, allows a kind of fiscal decentralisation or subsidiarity....

+ + +

Beware of falling masonry

The crisis in the euro area is turning into a panic and dragging the zone into recession. The risk that the currency disintegrates within weeks is alarmingly high

Nov 26th 2011 | from the print edition

FIRST Greece; then Ireland and Portugal; then Italy and Spain. Month by month, the crisis in the euro area has crept from the vulnerable periphery of the currency zone towards its core, helped by denial, misdiagnosis and procrastination by the euro-zone’s policymakers. Recently Belgian and French government bonds have been in the financial markets’ bad books. Investors are even sniffy about German bonds....

Worse, there are signs that the euro zone’s economy is heading for recession, if it is not there already. Industrial orders in the euro zone fell by 6.4% in September, the steepest decline since the dark days of December 2008. ...

European banks are dumping the bonds of the least creditworthy, and other assets, in an attempt to conserve capital and improve cashflow as a full-blown funding crisis looms. Governments are promising ever more severe budget cuts in the hope of pacifying bond markets. The direct result of these scrambles is a credit crunch and a squeeze on aggregate demand that is forcing Europe into recession. ...

Consider the three ingredients for recession: a credit crunch, tighter fiscal policy and a dearth of confidence. ... A downturn of such severity will hugely increase the pressures within the zone. Investors will be even less willing to finance banks, as more garden-variety loans to businesses and householders turn bad. As unemployment rises, tax receipts will go down and welfare payments up, making it harder for governments to rein in their deficits and hit the targets they have set, and causing bond markets to question their solvency more pointedly still.

... With a few exceptions, the benchmark cost of credit in each euro-zone country is related to the balance of its international debts. Germany, which is owed more than it owes, still has low bond yields; Greece, which is heavily in debt to foreigners, has a high cost of borrowing (see chart 2). Portugal, Greece and (to a lesser extent) Spain still have big current-account deficits, and so are still adding to their already high foreign liabilities. Refinancing these is becoming harder and putting strain on local banks and credit availability.

The higher the cost of funding becomes, the more money flows out to foreigners to service these debts. This is why the issue of national solvency goes beyond what governments owe. The euro zone is showing the symptoms of an internal balance-of-payments crisis, with self-fulfilling runs on countries, because at bottom that is the nature of its troubles. ...

The prospect that one country might break its ties to the euro, voluntarily or not, would cause widespread bank runs in other weak economies. Depositors would rush to get their savings out of the country to pre-empt a forced conversion to a new, weaker currency. Governments would have to impose limits on bank withdrawals or close banks temporarily. Capital controls and even travel restrictions would be needed to stanch the bleeding of money from the economy. Such restrictions would slow the circulation of money around the economy, deepening the recession.

External sources of credit would dry up because foreign investors, banks and companies would fear that their money would be trapped. A government cut off from capital-market funding would need to find other ways of bridging the gap between tax receipts and public spending. It might meet part of its obligations, including public-sector wages, by issuing small-denomination IOUs that could in turn be used to buy goods and pay bills. ... Scrip of this kind becomes, in effect, a proto-currency. In a stricken euro-zone country, it would change hands at a discount to the remaining euros in circulation, foreshadowing the devaluation to come. To pre-empt further capital outflows, a government would have to pass a law swiftly to say all financial dealings would henceforth be carried out in a new currency, at a one-for-one exchange rate with the euro. The new currency would then “float” (ie, sink) to a lower level against the abandoned euro. The size of that devaluation would be the extent of the country’s effective default against its creditors.

... [T]he likeliest trigger for a disintegration of the euro is unknowable. But there are plenty of candidates. One is a failed bond auction that forces a country into default and sends a shock wave through the European banking system. ... Another danger is a disagreement between Greece and its trio of rescuers (the EU, the IMF and the ECB) over the conditions of its bail-out. ...

The few left in the euro (Germany and perhaps a few other creditor countries) would be at a competitive disadvantage to the new cheaper currencies on their doorstep. As well as imposing capital controls, countries might retreat towards autarky, by raising retaliatory tariffs. The survival of the European single market and of the EU itself would then be under threat.

Such a disaster can still be averted. The ECB might launch a programme of bond-buying on the pretext that a deep recession in the euro area threatens deflation. If done on the scale that the Bank of England has undertaken, it could restore stability to Europe’s panicky bond markets. ... But any lasting stability for the euro must lie with governments, particularly in the degree to which they are willing to give up fiscal sovereignty in return for pooling liabilities. Germany stands firmly at one extreme of this debate. Its chancellor, Angela Merkel, wants big changes to force probity..., but has opposed the idea of jointly guaranteed “Eurobonds”. German officials have argued that any open-ended commitment to joint liabilities would encourage errant governments to profligacy, violate Germany’s constitution and raise its borrowing costs. Even now, the head of the Bundesbank, Jens Weidmann, appears to believe that the imposition of fiscal rigour will be enough to restore calm to Europe’s bond markets.

... Another new proposal is intriguing—thanks, in part, to its provenance. Germany’s Council of Economic Experts recently proposed a “European Redemption Pact”. This scheme would place the debt, in excess of 60% of GDP, of all euro-zone governments not already in IMF rescue plans into a jointly guaranteed fund that would be paid off over 25 years. Modelled in part on the federal government’s assumption of the debt of America’s states begun by Alexander Hamilton in 1790, the fund would provide joint liability for these debts under strict conditions. ...

At its peak, the redemption pact would be huge: the joint liability would amount to €2.3 trillion. But it would technically be temporary. For all these safeguards, Germany’s government has so far poured cold water on the idea. But time is running out. And the scale of the impending catastrophe demands radical answers.

+ + +

Can Germany save Europe? Will it?

By Thomas Mucha, Created 6220-11-29 13:22

An extraordinary plea today aimed at Berlin. It comes from an unlikely place.

Europe's ongoing debt crisis took another very dramatic turn today.

And it came from a most unlikely place, considering Germany's long and difficult history: Poland.

Here's what Polish foreign minister Radoslaw Sikorski said in a speech Monday in the German capital, as reported by the Financial Times [3]:

"I demand of Germany that, for your own sake and for ours, you help it survive and prosper,” he said. “You know full well that nobody else can do it. I will probably be the first Polish foreign minister in history to say so, but here it is: I fear German power less than I am beginning to fear German inactivity. You have become Europe’s indispensable nation."

... It's an incredibly lucid and forthright account of the troubles facing Europe (and Germany) right now, so I'll point you to three more key points that the Polish diplomat made.

... Sikorski ended his Polish pep talk with this dire warning:

"What, as Poland’s foreign minister, do I regard as the biggest threat to the security and prosperity of Poland in the last week of November 2011? It’s not terrorism, and it’s certainly not German tanks. It’s not even Russian missiles which President Dmitry Medvedev has just threatened to deploy on the EU’s border. The biggest threat to the security of Poland would be the collapse of the eurozone."

This is where my head is...

Up with economy, down with chrematistics!

Below is the TED Talk for Open Source Ecology. Have a gander. It has me drooling.

The book that got my wheels spinning in this direction is Eric Brende's Better Off: Flipping the Switch on Technology. My recent posting of Matthew Crawford's essay on "the case for working with your hands" is also part of this impulse. Wendell Barry's new book What Matters? Economics for a Renewed Commonwealth is also good stuff.

My larger philosophical impulse is an increasing absorption with distributism, as my recent various quotations about economic matters should indicate. Distributism is often mocked for being impractical, but the Open Source Ecology shows how hollow that accusation is. I have been reading numerous posts at The Distributist Review and have a stack of books on economics and social equity ahead of me. I have long been skeptical of the ideology of overpopulation fear-mongering, and one aspect of the debate is hunger and economic equity. The problem with global population is not whether resources are adequate--they are!--but how the resources are distributed and tended by global peoples. It was not until recently, however, that I realized the direct link between my own standard-and-style of living and the problem of unjust economic distribution.

There is a lot of talk nowadays about redistribution, but I think that misses the point on two fronts. First, since America long ago ceased being a quasi-distributist polity, the redistribution many people want remains confined in the capitalistic strictures that distributism opposes. Second, distributism allows for economic prosperity and entrepreneurship--indeed, distributists believe a distributist economy is what grounds entrepreneurship in the first place!



Hence, distributism avoids the errors of socialism (i.e. negation of private property and absolute centralized regulation of property development) and avoids the errors of capitalism (i.e. the intrinsic centralization of capital apart from individual families' autonomy over their own property as a potentially total domain of "real value"). It is a central tenet of Catholic social teaching that the family is the nucleus of human society, and in so far as distributism puts families, as opposed to the state or consumers, first, puts me largely in the distributist camp.



In any event, perhaps being a husband and father-to-be has given me the focus and personal attachment to see how simply living and living simply are great sources of joy, and how I myself can live out our abiding Adamic call to stewardship of Creation.

Working with your hands...

May 24, 2009

The Case for Working With Your Hands

By MATTHEW B. CRAWFORD

... Many of us do work that feels more surreal than real. Working in an office, you often find it difficult to see any tangible result from your efforts. What exactly have you accomplished at the end of any given day? Where the chain of cause and effect is opaque and responsibility diffuse, the experience of individual agency can be elusive. ... 

... High-school shop-class programs were widely dismantled in the 1990s as educators prepared students to become “knowledge workers.” The imperative of the last 20 years to round up every warm body and send it to college, then to the cubicle, was tied to a vision of the future in which we somehow take leave of material reality and glide about in a pure information economy. This has not come to pass. To begin with, such work often feels more enervating than gliding. More fundamentally, now as ever, somebody has to actually do things: fix our cars, unclog our toilets, build our houses. 

When we praise people who do work that is straightforwardly useful, the praise often betrays an assumption that they had no other options. We idealize them as the salt of the earth and emphasize the sacrifice for others their work may entail. ... But what if such work answers as well to a basic human need of the one who does it? ... Beneath our gratitude for the lineman may rest envy. 

This seems to be a moment when the useful arts have an especially compelling economic rationale. ... The current downturn is likely to pass eventually. But there are also systemic changes in the economy, arising from information technology, that have the surprising effect of making the manual trades — plumbing, electrical work, car repair — more attractive as careers. The Princeton economist Alan Blinder argues that the crucial distinction in the emerging labor market is not between those with more or less education, but between those whose services can be delivered over a wire and those who must do their work in person or on site. The latter will find their livelihoods more secure against outsourcing to distant countries. As Blinder puts it, “You can’t hammer a nail over the Internet.” Nor can the Indians fix your car. Because they are in India. 

... One shop teacher suggested to me that “in schools, we create artificial learning environments for our children that they know to be contrived and undeserving of their full attention and engagement. Without the opportunity to learn through the hands, the world remains abstract and distant, and the passions for learning will not be engaged.”  

A gifted young person who chooses to become a mechanic rather than to accumulate academic credentials is viewed as eccentric, if not self-destructive. There is a pervasive anxiety among parents that there is only one track to success for their children. ... Further, there is wide use of drugs to medicate boys, especially, against their natural tendency toward action, the better to “keep things on track.” I taught briefly in a public high school and would have loved to have set up a Ritalin fogger in my classroom. It is a rare person, male or female, who is naturally inclined to sit still for 17 years in school, and then indefinitely at work.  

The trades suffer from low prestige, and I believe this is based on a simple mistake. Because the work is dirty, many people assume it is also stupid. This is not my experience. I have a small business as a motorcycle mechanic in Richmond, Va., which I started in 2002. ... I have found the satisfactions of the work to be very much bound up with the intellectual challenges it presents. ...  

After finishing a Ph.D. in political philosophy at the University of Chicago in 2000, I managed to stay on with a one-year postdoctoral fellowship at the university’s Committee on Social Thought. The academic job market was utterly bleak. In a state of professional panic, I retreated to a makeshift workshop I set up in the basement of a Hyde Park apartment building, where I spent the winter tearing down an old Honda motorcycle and rebuilding it. The physicality of it, and the clear specificity of what the project required of me, was a balm. Stumped by a starter motor..., I started asking around at Honda dealerships. Nobody had an answer; finally one service manager told me to call Fred Cousins of Triple O Service. “If anyone can help you, Fred can.” ...  

Over the next six months I spent a lot of time at Fred’s shop, learning, and put in only occasional appearances at the university. ... I was rediscovering the intensely absorbing nature of the work, and it got me thinking about possible livelihoods. 

As it happened, in the spring I landed a job as executive director of a policy organization in Washington. This felt like a coup. But certain perversities became apparent as I settled into the job. ... As its figurehead, I was making arguments I didn’t fully buy myself. Further, my boss seemed intent on retraining me according to a certain cognitive style — that of the corporate world, from which he had recently come. This style demanded that I project an image of rationality but not indulge too much in actual reasoning. As I sat in my K Street office, Fred’s life as an independent tradesman gave me an image that I kept coming back to: someone who really knows what he is doing, losing himself in work that is genuinely useful and has a certain integrity to it. He also seemed to be having a lot of fun. ... 

After five months at the think tank, I’d saved enough money to buy some tools I needed, and I quit and went into business fixing bikes. ... The business goes up and down; when it is down I have supplemented it with writing. The work is sometimes frustrating, but it is never irrational. ...
As in any learned profession, you just have to know a lot ... [and] you have to be embedded in a community of mechanic-antiquarians. ... My most reliable source, Fred, has such an encyclopedic knowledge of obscure European motorcycles that all I have been able to offer him in exchange is deliveries of obscure European beer. ... 

[M]echanical work has required me to cultivate different intellectual habits. Further, habits of mind have an ethical dimension that we don’t often think about. Good diagnosis requires attentiveness to the machine, almost a conversation with it, rather than assertiveness, as in the position papers produced on K Street. Cognitive psychologists speak of “metacognition,” which is the activity of stepping back and thinking about your own thinking. It is what you do when you stop for a moment in your pursuit of a solution, and wonder whether your understanding of the problem is adequate. ...  

This active concern for the motorcycle is reinforced by the social aspects of the job. As is the case with many independent mechanics, my business is based entirely on word of mouth. I sometimes barter services with machinists and metal fabricators. This has a very different feel than transactions with money; it situates me in a community. The result is that I really don’t want to mess up anybody’s motorcycle or charge more than a fair price. ... The core experience is one of individual responsibility, supported by face-to-face interactions between tradesman and customer. 

Contrast the experience of being a middle manager. ... Like the mechanic, the manager faces the possibility of disaster at any time. But in his case these disasters feel arbitrary; they are typically a result of corporate restructurings, not of physics. ... Survival depends on a crucial insight: you can’t back down from an argument that you initially made in straightforward language, with moral conviction, without seeming to lose your integrity. So managers learn the art of provisional thinking and feeling, expressed in corporate doublespeak, and cultivate a lack of commitment to their own actions. ...  

How was it that I, once a proudly self-employed electrician, had ended up ... a “knowledge worker” at a salary of $23,000? I had a master’s degree, and it needed to be used. The escalating demand for academic credentials in the job market gives the impression of an ever-more-knowledgeable society, whose members perform cognitive feats their unschooled parents could scarcely conceive of. On paper, my abstracting job, multiplied a millionfold, is precisely what puts the futurologist in a rapture: we are getting to be so smart! Yet my M.A. obscures a more real stupidification of the work I secured with that credential, and a wage to match. When I first got the degree, I felt as if I had been inducted to a certain order of society. But ... it turned out to be a more proletarian existence than I had known as an electrician. In that job I had made quite a bit more money. I also felt free and active, rather than confined and stultified.  

A good job requires a field of action where you can put your best capacities to work and see an effect in the world. Academic credentials do not guarantee this.
Nor can big business or big government — those idols of the right and the left — reliably secure such work for us. Everyone is rightly concerned about economic growth on the one hand or unemployment and wages on the other, but the character of work doesn’t figure much in political debate. ... Yet work forms us, and deforms us, with broad public consequences.  

The visceral experience of failure seems to have been edited out of the career trajectories of gifted students. It stands to reason, then, that those who end up making big decisions that affect all of us don’t seem to have much sense of their own fallibility, and of how badly things can go wrong even with the best of intentions.... In the boardrooms of Wall Street and the corridors of Pennsylvania Avenue, I don’t think you’ll see a yellow sign that says “Think Safety!” as you do on job sites and in many repair shops, no doubt because those who sit on the swivel chairs tend to live remote from the consequences of the decisions they make. Why not encourage gifted students to learn a trade, if only in the summers, so that their fingers will be crushed once or twice before they go on to run the country?  

There is good reason to suppose that responsibility has to be installed in the foundation of your mental equipment — at the level of perception and habit. There is an ethic of paying attention that develops in the trades through hard experience. It inflects your perception of the world and your habitual responses to it. This is due to the immediate feedback you get from material objects and to the fact that the work is typically situated in face-to-face interactions between tradesman and customer. ...  

Ultimately it is enlightened self-interest, then, not a harangue about humility or public-spiritedness, that will compel us to take a fresh look at the trades. The good life comes in a variety of forms. This variety has become difficult to see; our field of aspiration has narrowed into certain channels. But the current perplexity in the economy seems to be softening our gaze. Our peripheral vision is perhaps recovering, allowing us to consider the full range of lives worth choosing. For anyone who feels ill suited by disposition to spend his days sitting in an office, the question of what a good job looks like is now wide open.

Matthew B. Crawford lives in Richmond, Va. His book, “Shop Class as Soulcraft: An Inquiry Into the Value of Work,” from which this essay is adapted, will be published this week by Penguin Press.