The Case for the Workers’ Cooperative

Catholic social teaching has consistently held as its core principle that economic activity is to be subordinated to the common good, which the Catechism defines as “the sum total of social conditions which allow people, either as groups or as individuals, to reach their fulfillment more fully and more easily.” Debate over precisely how the common good should be served by the economy has seen the promotion of different economic theories, ranging from liberal approaches that tend to focus on regulation and intervention in the market, to conservative theories that advocate open markets and private property rights free from government interference.
But both sides in this debate have overlooked important alternatives, some of which have already been explored by previous pontiffs and implemented by lay and clerical Catholics. It is possible to combine regulated markets and even command economies with private property, and social forms of ownership with free markets. It is the latter model that is best aligned with both Catholic social teaching as well as sound economics.
In his encyclical Laborem Exercens, Pope John Paul II rejected the idea that “private ownership of the means of production” should remain an “untouchable dogma” of economic life. He also rejects a mere conversion of private property into state property and the creation of a command economy. His vision of an alternative is captured in the following lines:
Merely converting the means of production into State property in the collectivist system is by no means equivalent to “socializing” that property. We can speak of socializing only when the subject character of society is ensured, that is to say, when on the basis of his work each person is fully entitled to consider himself a part-owner of the great workbench at which he is working with every one else . . . the members of each body would be looked upon and treated as persons and encouraged to take an active part in the life of the body.
There is little said here about markets — in fact, the word “market” does not appear even once throughout the entire encyclical. Thus the “socializing” of the economy is evidently a task that can take place without excessive and ultimately harmful interference in the market. Instead, it can come about through the proliferation of organizations wherein the “subject character of society is ensured,” where “each person is fully entitled to consider himself a part-owner” of his place of work, and where the members are “encouraged to take an active part in the life of the body.” These are the underlying principles of workers’ cooperatives.
One example of the cooperative principle in action is the Mondragón, a cluster of cooperatives in the Basque region of Spain. It can’t be mere coincidence that this organization, which is the largest and most successful cooperative in the world, was founded by a Catholic priest by the name of José María Arizmendiarrieta. To me it suggests that there is something in the Catholic view of society and justice that is naturally hospitable to the idea of the workers’ cooperative.
From a social and economic standpoint, it shouldn’t be hard to understand the benefits of worker ownership and control of economic firms. The workers’ cooperative is proof positive that workers can participate in making decisions, erroneously thought to be the privileged domain of a handful of executive officers. They will be just as concerned with meeting the needs of the consumer as a traditional capitalist firm. Their incentive to do so will be far greater, in fact, since they will reap greater rewards as owners than they ever would as mere wage laborers. While Pope Leo XIII may have been condemning an onerous form of state socialism in Rerum Novarum, he also argued that ownership of property should be diffused as widely as possible for just these reasons. He wrote,
If working people can be encouraged to look forward to obtaining a share in the land, the consequence will be that the gulf between vast wealth and sheer poverty will be bridged over, and the respective classes will be brought nearer to one another. A further consequence will result in the great abundance of the fruits of the earth. Men always work harder and more readily when they work on that which belongs to them; nay, they learn to love the very soil that yields in response to the labor of their hands, not only food to eat, but an abundance of good things for themselves and those that are dear to them.
What Leo recognizes as true for agriculture is also true for modern industries and services.
There are also political benefits. As political philosopher Robert Dahl argues in his work A Preface to Economic Democracy, it seems rather strange that we should expect a healthy political democracy to emerge from what is essentially an autocratic or oligarchic economic framework. Most workers spend at least a third of their day in an undemocratic environment, having no opportunities to participate in making the decisions that affect their very livelihoods. The workers’ cooperative improves the health of our political democracy by bringing it into an important and unavoidable area of life: our economic activity.
Important for those who wish to avoid unnecessary tampering with the market, workers’ cooperatives can exist and thrive in a competitive marketplace. Historically they have had a hard time competing against traditional capitalist firms, and there is considerable academic debate as to why this has been the case. The Mondragón is a good example of what can happen when several such firms band together, and it remains a competitive enterprise today. It cites on its Web site one of the many reasons for its success: “a decidedly business-like approach to the co-operative phenomenon, in which company profitability and planned, rigorous and demanding management efficiency are seen as basic principles.”
Most importantly, however, the cooperative form restores human dignity to labor. The separation of the workers from the means of production and the decision-making process can be spiritually demoralizing and alienating. To the extent that labor is viewed by its purchasers as a mere “production cost,” it can become faceless and dehumanized. A workers’ cooperative has the potential to become a genuine community, where each member is valued as something more than a repository of labor power.
In addition to serving the common good, the Church now calls us to build a culture of life. A culture can neither be imposed from above by the state, nor can it simply be a matter of leaving everyone to their individual conscience. It is by its nature a collective task, and it cannot be accomplished apart from an effort to reshape economic structures that have contributed to the prevailing culture of death. The traditional capitalist firm, like the market, is not evil in and of itself. But we do have a responsibility to seek out and implement alternatives that would be more conducive to our spiritual aims. Because the cooperative form emphasizes the importance of community, as well as the humanity and dignity of the individual laborer, it is an obvious complement to the tasks facing those who would build a lasting culture of life.

Joe Hargrave

By

Joe Hargrave is an adjunct professor of political science at Rio Salado Community College in Tempe, Arizona.

  • JC

    Common ownership does not have to be government ownership, and a “free market” does not come from robber barons pulling all the strings.

    Employee stock plans were promoted by the Popes in encyclicals like _Mater et Magistra_, and are now standard employee benefits.

    In fact, since the Church clls for workers to have ownership in their work, it is hard to see how socialism, as such, gives workers ownership. One need only ask public school teachers how much “ownership” they feel in their jobs!

  • Joe H

    JC,

    Regarding your last paragraph, it all depends upon how you define “socialism.” Since meaningful political and philosophical discussions depend upon accurate and mutually acceptable definitions, socialism, like anything else, has to be defined before it can be rejected or accepted.

    I don’t accept the system that most Americans would call “socialism” – big government, high taxes, nationalization of all industry, price controls, and dogmatic secularism.

    I do accept what JP II called “socialization”; I think the foundation of socialization is the gradual replacement of the labor market with worker owned enterprise. Also see Pius XI’s “Quadragesimo Anno”, where it is argued that the labor market is a “grave evil” which must be transcended by this socializing approach. This encyclical, by the way, inspired the founders of the Mondragon, the cooperative I used as an example in the piece.

    Needless to say, abolishing the market in human labor doesn’t mean abolishing it in all things. The beauty of Catholic social teaching is that, following Aristotle, it strives to find a balance between extremes, and to incorporate the most useful aspects of various approaches while rejecting those that are clear affronts to human dignity.

  • Ender

    Hargrave wrote: It is the latter model that is best aligned with both Catholic social teaching as well as sound economics.

    I have no problem with any policy that represents sound economics and it’s good to know that Catholic social teaching is in fact economically sound … but suppose it wasn’t? It seems to me that the Church’s social teaching in this area is sufficiently vague – perhaps I should say broad – that I would be very wary of insisting that it required a specific approach.

    It is not an economically viable business practice to exploit your workers; generally speaking when a company is successful so are its employees. Generally speaking I am comfortable that sound economics meet the requirements of the Church’s social teachings.

  • Joe H

    Ender,

    I don’t think the social teaching is vague at all. It establishes a clear hierarchy of priorities, with human dignity and social stability being at the top of that list.

    To the extent that the pure capitalist model, based upon individual or investor ownership of the means of production, disrupts both of these aims it has been rightly criticized by a succession of Popes.

    Employees can really only share in a company’s success in any sort of long-term sense if they are part owners. I don’t think the 10% of Americans that are unemployed (this is the real rate), or the employees of Wal-Mart or any number of international companies, would share your view about the relationship between company and employee success. Their wages are set by the international labor market, not the arbitrary preference of their employers.

  • R.C.

    It’s true: Individuals can voluntarily form cooperatives with salutary results.

    It’s also true: Individuals can voluntarily give their property away to their fellow man.

    Note: The operative word in the preceding two statements is “voluntarily.”

    The two ways the Church can engineer change in society are:

    (1.) Change hearts and minds of individuals through teaching and example, so that they voluntarily behave in accord with the mind and heart of Christ; or,

    (2.) Lobby the government to use its power (that is, its monopoly on the use of force) to compel people to behave differently.

    The article proposes an outcome, but not a specific mans to achieve it. It describes a result (more broadly-owned wealth, which sounds great!) but tip-toes around the question of which of the two methods (teaching or force) is to be used to engineer this outcome.

    Here is reality:
    – In a free society, some persons will make different decisions than others;
    – Some decisions will result in greater accumulation of wealth, others in lesser accumulation, still others in a constant loss of it;
    – Therefore, a free society must be expected to have wealth inequalities: It is an expression of the free will of individuals.

    It is tempting to use force to alleviate wealth inequality, but this is a temptation, wrong on three grounds:

    (1.) It is not Christ’s way to use force to compel charity. Christ told people to give (in the case of the “rich young ruler,” to sell all he had and give the proceeds to the poor), and then, if they failed to obey, He…let them go! (Even if they “went away sad.”)

    (2.) Use of force does inevitably limit freedom; it therefore ought to be advocated by the Church only when required to protect a greater or more vulnerable freedom. For example, the jailing of murderers (a limitation of freedom) prevents murder (an even worse limitation of freedom).

    Free will was God’s gift at man’s creation; we are “mini-creators” made in His likeness. God is so unwilling to limit our freedom that He was willing to risk the Fall. (Actually, He knew the Fall would occur, and still thought it worthwhile to make His children free.)

    The point: If even God is unwilling to restrict freedom to avoid nasty outcomes (even with perfect authority to do so, perfect wisdom to do so correctly, and perfect power to do so irresistibly!) then we should ourselves be very reticent about it! (No matter how wonderful we think the outcome would be!)

    (3.) Using force to engineer more equal distributions of wealth does not actually work. We are talking about societies of men, here, not angels. (Communism would have been a perfect system, if imposed on angels: A system in which people did productive high-quality work even though they had no incentive to do so, and in which the leadership did not hoard power and wealth, even though they had great power to do so! But Soviet party chiefs had opulent dachas; the people starved.)

    IN SUMMARY: If the author is proposing a voluntary system of cooperatives, I have no qualms. If he wants to compel it, he is wrong: It is not Christlike, and it restricts freedom without, in the end, producing the intended result.

    “The poor ye will always have with you.” Give alms generously, but accept this fact.

  • R.C.

    I should add that my use of Soviet communism as an extremely clear demonstration of how compulsion in the name of wealth equality does not, in the end, produce wealth equality, SHOULD NOT be construed as my equating Joe Hargrave’s ideas with communism.

    Joe is not, nor has he ever been, a communist. [smiley=laugh]

    Still, the question remains open: If he is advocating anything other than a voluntary shift to cooperatives and the like, then what legal changes does he propose?

    If those legal changes are in the realm of legalizing something which is not legal now, then perhaps he is not curtailing freedom in the name of wealth equalization. (Perhaps there is some onerous law which prevents employee ownership of businesses, of which I am unaware?)

    But if the legal changes are in the direction of requiring, on penalty of fines or imprisonment, property owners to “give” ownership to their employees, then my argument stands: It’s not Christlike, and it won’t actually work.

    Hence my slightly fatalistic (but entirely Scriptural, if a Dominical Utterance is worth anything!) view that we are morally obligated to give to the poor, but (because free human beings sometimes make wealth-reducing choices) we’ll always have the poor with us.

    P.S. I should note that my family business, in which I have a share of ownership, DOES implement profit-sharing with employees. But, note: we implemented that voluntarily.

    P.P.S. More than half of all Americans own stock in publicly-traded firms (often through 401K or similar accounts). Clearly, the American method has achieved what the Communists could only dream of: Having the people share ownership of the means of production!

  • RG

    Get Real.
    Why is it that catholic social teaching often sounds to me like Marx lite?
    Clearly, church teaching has been influenced by Marx and Engels. These two guys could not run a lemonade stand but their hair-brained ideas are still taken seriously today. And this in spite of the human misery and millions of deaths their ideas precipitated.
    But there is another reason. Most clergy, and catholic clergy is no exception, know little about economics, entrepreneurship, risk-taking, or the modern enterprise. Have you ever heard of a catholic bishop visiting a high-tech company? I have not.
    When I risk my money to build up a company, I look for the best employees I can find and afford. To succeed, I need first of all their ideas, their participation in the enterprise. Competition forces me to reward them as best as I can and my company is capable of. When I look for a model, I look at other well-run companies, I look to Silicone Valley, I look at other high-tech areas in this country, in Japan, and in Europe. But I would not dream to look at a backward economy in the Pyrenees. Give me a break.

  • Joe H

    RC,

    Thank you for the lengthy feed-back. I was hoping to generate a discussion along these lines.

    I thought it would go without saying that my preference would be for voluntary change – certainly neither Pope Leo XIII nor JP II, or any of the Pontiffs in-between, ever gave their blessing to violent revolution!

    Where we may disagree, and where you and others might come into conflict with CST, is when all government measures, because they rest to some degree on coercion, are morally illegitimate. This is a relatively new libertarian moral axiom; for centuries the Church has sanctioned and blessed a diverse spectrum of governmental forms from feudalism to the modern democratic state, all of which were based on some sort of force.

    That said, my preference is always for teaching. Nothing lasting can be built on the basis of coercion. At the same time, when conditions become intolerable, people will not be pacified with moral axioms.

    Finally, profit-sharing is not the same as establishing a workers cooperative, though I think it is a step in the right direction. And, cooperatives are already perfectly legal in the US, and operate in a number of industries; the problem is that they are a) mostly rural and hence b) not much a part of the mainstream consciousness.

    In addition to workers cooperatives there are housing cooperatives, credit cooperatives, etc. In my ideal view, they would all be combined and function in the same community. I encourage you to read JP II’s Laborem Exercens, where I think you’ll see that a cooperative economy is really most in tune with the Catholic social vision.

    As for the comments of RG, all I can say is, it must be uncomfortable to finally have to show your cards. When the Church teaches something you don’t like, they’re a bunch of inexperienced rubes tampering with institutions they would do well to leave alone, right?

    And, you know, Engels actually ran a successful business. Not that it makes a difference.

  • JD

    I put a lot of weight into what AC would say about this proposal.. perhaps, Acton Powerblog could comment on it??

  • JC

    Joe,

    Note that I said “Socialism as such,” meaning government ownership of businesses. I can never remember the title of “Quadragesimo Anno,” which is what I was actually referring to 🙂 I did an article last year on Mater et Magistra and studied Quadragesimo Anno, and used to grade papers on Rerum Novarum for Seton.

    RG, *official* Catholic social teaching is not influenced by Marx and Engel, though many Catholic bishops and activists *are* influenced by Marx and Engel in their interpretations.

    JPII said that, between the two, capitalism is much more amenable to authentic Catholic social teaching than socialism.

    The way I like to phrase it is to paraphrase Mater et Magistra: everyone has a right to private property; that right does not, however, include the right to as much property as we want.

  • Jack Picknell

    I would love to see the Collecivist Concept applied to a Catholic HMO in the USA.

    There are enough Catholics in postion to form such an HMO and operate it as an ethical HMO should be operated by Catholics for Catholics, following Catholic teachings.

    It would certainly curtain the secularist demands to provide services which are offensive to our consciences.

    There are thousands of Catholic Institutions already established, and hundreds of thousands of professionals who would love to practice according to their consciences freely without fear of reprisals.

    That’s a sorely needed collective.

  • David W.

    …you’re not getting enough Fiber in your diet.

    Economics can never trump Morality…ever. If a Business engages in an immoral practice to maximize profit, they are wrong, pure and simple. Rock beats scissors, Church teaching beats the board room…PERIOD. Doesn’t mean the Church thinks the state should confiscate everything, it just means that businesses have a social responsibility. I personally find cooperatives to be a compelling idea…and it need not be compulsory.

  • Joe H

    JC,

    Everything I’ve read by JP II is enough to suggest that the distance between capitalism – at least the traditional model that most Americans accept – and CST is only a little less than the distance between “socialism” and CST.

    I would supplement this claim by pointing to the Christian Democratic parties of Europe, which sought to put CST into practice. All of them (until recently) supported the “social democratic” (that is socialist) consensus in post-war Europe.

    Love them or hate them, official Catholic social teaching is influenced by Marx and Engels, in two ways. First, the concept of workers alienation which was a touchstone of the young Marx’s thought is clearly at play. Secondly the Marxist movement has always existed as competition and exerted a pressure on the Church to recognize the depth and scope of the conflicts in modern society. If you read QA again, you see a description of the battle lines between labor and capital that is very reminiscent of Marx.

    In so far as Marx and Engels pointed to certain undeniable truths, neither the Church nor anyone else can fail to notice them too! Unfortunately some people seem to be under a strange spell that causes them to assume that acceptance of one or two things in a vast sea of a social system means that one must agree with all of it.

  • TMLutas

    Mondragon has favorable tax treatments. It’s success, to an extent I’m not sure of because I’m not an economist, is built on the backs of subsidies forcibly extracted from all Basques. And it’s that forcible extraction of resources that is the big problem with the social democratic tradition of Europe. It’s only a difference in degree from the more harsh versions of socialism.

    Taxation is not necessarily theft but for the worker in a non-Mondragon company to pay tax to subsidize his competitor until he loses his job is certainly not any sort of authentic Catholic social justice that I can recognize.

    The free market is compatible with all sorts of non-traditional arrangements. Nobody particularly cares if the economic unit is based on family (family owned businesses), joint-ownership via shares (public stock corporations), or worker ownership (Employee owned enterprises). In the end, the enterprise needs to make efficient use of capital or it will be vulnerable and taken out by a more efficient competitor sooner or later.

    Insofar as this article stands for anything not traditionally capitalist, it stands for an implied plea for subsidy, forcibly extracted from someone, in violation of some of the best principles of Catholicism to make some sort of visible veneer of solidarity covering a rotten, inefficient economic mess.

    The truth is that there is a capital shortage. We do not have enough money to make enough goods for a decent life for all in a sustainable way. Inefficient producers make the problem worse and, at the margin, are indirectly responsible for increased suffering among the world’s poor.

    The Church needs to stand for true solidarity and for economic efficiency so capital can be redeployed as quickly as possible to pull the poor of the less developed world out of their grinding poverty. Too often, we get worker’s cooperative pap instead.

  • R.C.

    Joe:

    Thanks for your gracious reply.

    Yes, I’m aware that my argument comes across as “libertarian.” But, lest that impression be an impediment, consider:

    (a.) Libertarian does not equal Libertine. (I think you know this, but I write it for the occasional Christian who equates libertarians with either pot-smoking layabouts or rapacious robber barons.) There is an obvious difference between what government forbids by compulsion and what is forbidden by moral law, and a Libertarian who isn’t also a reprobate can, without self-contradiction, advocate a narrow range for the former while obeying all Church teachings with regards to the latter;

    (b.) I made a point of stating that freedom can be curtailed with moral legitimacy when doing so produces greater freedom elsewhere; e.g., imprisoning murderers because not doing so leads to more victims and a society in which no-one is free from fear and coercion. So, I am not going for anarchy here, but rather, for a maximizing of overall freedom, where the freedom of each individual in the society is equally valued, and where, whenever possible, we opt to change people’s behavior through persuasion (treating them like the intellectual beings God made them to be) instead of by compulsion (pushing them about like so many billiard balls).

    That said, there are two questions to be answered:

    (1.) Is this goal of maximizing freedom better accomplished through our current system of laws, or through one which encourages cooperatives of the type you describe…where “encourages” can be interpreted weakly (incentives), moderately (fines) or strongly (imprisonment)?

    (2.) Is this notion of maximizing freedom, or my own inclination that the free-market does it best, in opposition to the social teachings of the Church?

    About the first question, I sense that you are not advocating imprisonment for business owners who employ someone without making them a partner. That would be “strong” coercion, and although it’s an inexact match, I think we can use the results of communist government as a pretty good empirical study of what would result! Not good.

    I gather, then, that you favor either fines (moderate coercion) or a system of tax incentives (weak coercion)?

    I have no empirical data from which to argue the benefits or drawbacks either of these being implemented large-scale.

    There may be ways to implement them which would (a.) achieve the desired result and (b.) not be too onerous. But it may also be that any means which are sufficient to achieve the desired results are too onerous, and reduce freedoms unacceptably in other areas.

    Also, have you considered the “camel’s nose under the tent” issue? Government power expands on the strength of precedent. Give the government the power to say, “Thou shalt not own any more than X% of Y,” and, well, you’ve given government a power which can be expanded and applied to many different values of X or Y: A dangerous move.

    As for the second question, well, I’m running out of space in this post to answer it. More in my next post….

  • R.C.

    Joe:

    About the second question, you note:

    Where we may disagree, and where you and others might come into conflict with CST, is when all government measures, because they rest to some degree on coercion, are morally illegitimate. This is a relatively new libertarian moral axiom; for centuries the Church has sanctioned and blessed a diverse spectrum of governmental forms from feudalism to the modern democratic state, all of which were based on some sort of force.

    Again, let me protest that I didn’t say all government measures were morally illegitimate, just those in which the limitation of freedom in area X doesn’t produce a greater increase of freedom in area Y.

    So my concerns don’t axiomatically exclude your idea. (You can still argue for legal incentivization of cooperatives on the basis that this results in greater freedom overall.)

    But as to your observations about the Church sanctioning and blessing different governmental forms, including those (such as feudalism) which didn’t protect property rights so diligently as we do today:

    You’re correct. But that doesn’t mean the Church doesn’t prefer some of those previously-blessed governmental forms over others that came still earlier.

    I don’t know if the Church has taught this in so many words, but I think it’s possible that the Church (a.) approved of the form of Roman Imperial government under Constantine; (b.) thought of early Middle Ages feudalism as being inferior to the Roman Imperial form; (c.) preferred the pan-European mercantile system as it evolved later to both feudalism and the Empire; (d.) and now prefers the modern Constitutionally-Limited Democratically-Elected Republican form of government to all of the above.

    I think the Church preferred the pre-Maoist form of government in China to Mao’s government, or even the tsars, nasty as they sometimes were, to the Soviet Socialists.

    The point is: The Church herself can approve of a governmental or economic form now as “the best thing going” and yet, ten years later, she can judge that a change to an even newer form is a change for the better. If she does so judge, then, once that change occurs, she will also judge that a reversion to the older form is a change for the worse, even though she previously blessed it.

    That’s what history shows us, and it leads inexorably to a second conclusion:

    If we are currently using the best economic system yet invented, then a change to something different, even if it’s closer to something the Church previously blessed, could be a “change for the worse” in the eyes of the Church.

    So, when I note that even “weak” and “moderate” forms of compulsion in favor of cooperatives are a governmental limitation of freedom, it is no defense to point out that the Church blessed earlier forms which imposed greater limits than those we have now.

    What was good then ain’t necessarily good now. New wine in new wineskins, y’know.

  • R.C.

    RG:

    It’s “Silicon” Valley, not “Silicone” Valley.

    The former is a hotbed of capitalist entrepreneurial spirit nestled ironically in the midst of an island of socialism.

    The latter is what you get when a low-cut neckline surmounts a surgically-enhanced bosom.

    *cough*

    (Apologies to my wife, who first used the phrase “silicone valley” to refer to a woman we saw in the line at Chick-Fil-A. I nearly spluttered a mouthful of lemonade on her as a result.)

  • JC

    Joe,
    I think that the issue here is the spectre of laissez-faire. JPII clearly said that *regulated* capitalism was better than socialism. Even Reagan said, “We are all Keynesians now.”

    As someone who has been on SSI and Medicaid, and knows both the necessity, and the real problems, of government assistance to the poor, I am no fan of laissez-faire.

    I have yet to see anywhere in the encyclicals that necessarily requires government ownership, as opposed to *group* ownership (which is what you’re speaking of).

    A more fundamental economic point is the clear teaching of sacred scripture: “Happy the man who takes no interest on a loan and accepts no bribe against the innocent.” “You fool! Don’t you know that tonight your very life will be demanded of you?” (Let’s ignore the parable of the talents for now).

    I still maintain that the essential problem is a lack of distinction between “capitalism” and the “free market”. Laissez-faire is not a truly free market. Huge corporations do not constitute “free market”.

    A free market allows equal participation both of workers and of consumers. And, if we truly adhere to the repeated condemnations of interest in Sacred Scripture (and not just justify it by saying that “interest” means “exorbitant interest”), we will see that individuals or organizatiosn buying stocks in companies they have no direct participation in is just not write. Stocks should only be owned by people who are employees of the companies.

    As for Marx and Engel, all heresies and all false religiosn have some ray of truth. But to say that Marx and Engels “influenced” Catholic social teaching is like saying that Buddha “influenced” Catholic mysticism or moral law or that Mohammed “influenced” Catholic modesty.

    People only say these things from a Western perspective. I’m sure if you talked to a Communist in Cuba, or China, or the former Soviet Union, you would hear that the Popes were teaching “Adam Smith Lite.”

    St. John Bosco was hated by the aristocracy because they called him a socialist for helping the poor. He was called an aristocrat by the Socialists because he was teaching the poor to find their hope in the Church and to lead responsible lives.

  • Joe H

    TM,

    You write:

    “Insofar as this article stands for anything not traditionally capitalist, it stands for an implied plea for subsidy, forcibly extracted from someone, in violation of some of the best principles of Catholicism to make some sort of visible veneer of solidarity covering a rotten, inefficient economic mess.”

    It seems that all the people who have a problem with the cooperative perspective are on an implication hunt.

    There are few large economic enterprises in the US and probably in the world that do not receive government help in some form, subsidies being one of them. “Traditional capitalism” barely exists anymore, if it ever did.

    All this argument amounts to is the libertarian nostrum that “taxes are theft.” The Church has certainly never held this view of the state. Contrary to your deepest wishes, libertarian moral and political axioms are not and never will be the core of CST. The aim of economic activity is to serve the common good, not to ensure the unlimited accumulation of personal wealth. A large, complex economy will necessarily require some rational oversight if it is going to serve these moral and ethical ends.

    It is obvious that whether the individual ownership or absentee investor model prevails, or the cooperative model, government involvement will be a fact of economic life. Our choice is not between taxes or no taxes, but between this policy or that policy. That is reality.

    That said, I am all for moving away from subsidies and reducing dependence upon government. But we have to start somewhere, and if investment is lacking, subsidies may have to cover the cost. I’d rather see taxes spent on the formation of cooperatives than a war with Iran.

  • Joe H

    JC,

    Reagan also initiated the dismantling of the welfare state, which was partially based upon Keyensian economic theories. And was there any greater repudiation of Keyensianism than “supply side” economics? I think the remark you cite was made as a criticism!

    As for the word “influenced”, how do you want to define it? They had an effect on CST, and some of their (Marx and Engels) observations surface at various points. No point in denying it.

    But it doesn’t bother me to say that the Popes teach “Adam Smith lite” or “Marx lite” – as I said before, CST methodology is to incorporate the best aspects of each system (insofar as they align with the core moral teachings of the Church) and reject the worst. The Church understands that while, taken as a whole, two systems might be mutually exclusive, broken down into their constituent parts they can be combined into a better and stronger system.

  • Joe H

    RC,

    I’ll answer your two questions.

    “(1.) Is this goal of maximizing freedom better accomplished through our current system of laws, or through one which encourages cooperatives of the type you describe…where “encourages” can be interpreted weakly (incentives), moderately (fines) or strongly (imprisonment)?”

    I’ll say first, that I know libertarians and libertines are different; I actually consider myself to be somewhat of a libertarian, without the individualism. I believe in liberty for communities (from state coercion), and I reject the idea that we can truly be free as disconnected individuals.

    I think it is obvious that we have to have a system that encourages the cooperative model as the basis of a genuine community. Until we get one, though, we have to use our own resources or acquire them by seeking investors and coming to terms with them on mutually acceptable grounds. This means that the ideal cooperative may be some ways away.

    I don’t think anyone needs to be fined or punished for running a non-cooperative business. Perhaps I didn’t make it clear – I think this should be a bottom-up initiative that takes place at the grassroots level. If the state wanted to help I wouldn’t reject it, but I think it is always best to be as independent from it as possible.

    “(2.) Is this notion of maximizing freedom, or my own inclination that the free-market does it best, in opposition to the social teachings of the Church?”

    It may be, if it is taken to the extreme. I think the key issue is to get human beings themselves out of this market. A market is fine for goods, for immaterial objects, for the allocation of scarce resources – but a human being and their laboring power are a cut above these things. That is why I believe JP II, Pius XI, and other Popes have sharply condemned the labor market and encouraged the cooperative model. It elevates man above the level of a commodity, but it retains the market as an efficient allocator of resources.

    This is the balance I believe Catholics ought to be striving for, and while I hate to sound as if I’m holding up a holy shield in my defense, it is as plain as day to me that this is what the Popes were striving for as well. After all, you write,

    “The point is: The Church herself can approve of a governmental or economic form now as “the best thing going” and yet, ten years later, she can judge that a change to an even newer form is a change for the better”

    I think they “approve” of capitalism now as “the best thing going” but in the encyclicals on social teaching make quite clear that this is not the ideal system, not even close to it. To say that a system is better than Stalinist Russia isn’t saying much.

  • R.C.

    Joe:

    You say to Ender:

    Joe wrote: I don’t think the social teaching is vague at all. It establishes a clear hierarchy of priorities, with human dignity and social stability being at the top of that list.

    True. I’ll set aside “social stability” for the moment because I’m not sure exactly what is meant by the term (lack of social change? or just avoidance of anarchy?). But which economic system best respects human dignity?

    I think that coercion always injures human dignity. To use a phrase I used before, it involves “pushing men around like so many billiard balls” instead of, as persuasion does, treating them as the free intellectual beings God designed them to be.

    That doesn’t mean coercion is always wrong! In the case of just laws, the coercion involved is less freedom-limiting than what would happen if those laws were absent. Our dignity has been injured, but less than it would have been.

    As an example: In which case is a man more “pushed around”: When he pays his taxes, or when he negotiates a wage change with his employer?

    Now, a man may feel his employer is pushier than his government, because he meets the employer face-to-face, and perhaps the employer in question is a jerk. (And perhaps the employee is a bit prideful and covetous, and gets grumpy when associating with someone wealthier than he?)

    But that feeling is deceptive when you compare the actual costs of a disagreement with the employer versus a disagreement with government.

    If a man doesn’t like the deal his employer offers, he can go work elsewhere. If he doesn’t like the deal the government offers, he can go to jail.

    If he wants a new employer, he bargains as one man bargaining with a management team of, at most, a few dozen other men. If he wants a new government, he negotiates as one man whose voice may be lost amid three hundred million other voices.

    If he doesn’t like jobs in this town, he can move to that town. If he doesn’t like laws in this country, he can move to that country. Both are difficult, but which of those two moves is harder on him?

    So, again: I do not argue that coercion is always bad. I do not even say that a system of incentives to encourage cooperatives is necessarily bad. I say only that it is bad if it results in less freedom, and that you should make your argument on that basis.

    This is the mode of reasoning which most firmly respects human freedom, and therefore, human dignity.

    And I think it usually leads to the same conclusion: The free market system. While imperfect, this system allows the employer and the employee the freedom to do what each thinks is right or wise…or to be merely selfish, if that is what he chooses.

    And that is Christ’s way: The rich young ruler went away “very sad, for he was very wealthy” and Christ did nothing to stop him. Christ allowed him the dignity of choice.

  • Ender

    As R.C. pointed out, Catholic social teaching is long on objectives and short on procedures. My comment was directed at the fact that, while it may be comforting to believe that one’s activities are in line with that teaching, I think the most beneficial results generally come from policies that are economically defensible. That is, the proof is in the pudding.

    I worked deep in the bowels of a major international corporation for years and my economic security was intimately tied to the success of that corporation. If workers coops are beneficial they deserve support on that basis; if they aren’t particularly successful, however, there is nothing in Church teaching that recommends them over what is successful.

  • R.C.

    Joe:

    First, let me say: I’m enjoying this tremendously. Granted, this is InsideCatholic, but still…do you know how rare it is to have a reasoned discussion of big ideas without it degenerating into flamewar? Kudos to you, sir!

    To continue: In response to my question:

    R.C. wrote: (2.) Is this notion of maximizing freedom, or my own inclination that the free-market does it best, in opposition to the social teachings of the Church?

    …you answer,

    Joe wrote: It may be, if it is taken to the extreme. I think the key issue is to get human beings themselves out of this market. A market is fine for goods, for immaterial objects, for the allocation of scarce resources – but a human being and their laboring power are a cut above these things.

    You say “a human being” is not to be marketed, and of course I agree. But you then add “and their laboring power,” and that requires discussion.

    Human beings should not be bought and sold. While not taught by the apostles, this is a development in doctrine which was inevitable once the core doctrines had been assimilated into the hearts of men, resulting in the outlawing of slavery throughout Christendom.

    But what about the labor service a human can provide?

    Clearly it can, and often should, be bought and sold (see Proverbs re: “the sluggard” and “look to the ant”: a man ought to work).

    So, I think you jump a step by conflating the two. A man is not his work. “He” is more than “what he does for his own and his family’s betterment, and for those to whom he gives alms.”

    We cannot “take humans out of the market”: They already are. And we cannot take the services they provide out of the market, either: When the Church teaches that men should work, and that “the servant is worth his hire,” she, Mother Church, tells them to put their services on the market.

    There is, however, something unique about what a man does, as opposed to what he makes or finds. (We have two different terms: “Goods” and “Services,” and there is usually wisdom in such language distinctions.)

    And there are some services a man should not offer, nor any other man compel. Prostitution is an example; there are others.

    So while we must not say that “a man is the same as his work,” or that “his work should never be part of a market,” I am willing to accept an argument which shows that:

    (a.) A man’s services, compared to all other marketable things, are special; and,

    (b.) That the particular way in which they’re special leads us inescapably to the conclusion that a man is morally obligated to refuse to work unless his compensation includes some degree of ownership in the whole enterprise.

    I think (a.) is easy: It’s not hard to find ways that a man’s work is more special to him than his stuff. Heck, “there must be fifty ways” (to borrow from Paul Simon), but I don’t know of any of them that lead inexorably to (b.).

    But perhaps you do. If so, lay it on me!

  • R.C.

    Joe:

    One other point I want to raise. You say,

    Joe wrote: I think they “approve” of capitalism now as “the best thing going” but in the encyclicals on social teaching make quite clear that this is not the ideal system, not even close to it. To say that a system is better than Stalinist Russia isn’t saying much.

    I agree with you. But consider this: It is a fallen world, populated by men not angels, in which all our choices are fraught with a mix of benefits and drawbacks, and none of them are perfect (save the choice to love God and one another).

    When the tone of Church teaching indicates that the free market system (which is not quite the same as capitalism, but let’s use them interchangeably for the moment) is “not even close” to being “the ideal system,” don’t you think that the “ideal system” the Church has in mind is the system of relationship and cooperation that would exist in a perfect world to come?

    If so, then no capitalist will argue with her! No economic libertarian ever thought his favored system was anywhere close to being that good! (Save perhaps Ayn Rand, but then, she didn’t believe in “the world to come,” so it doesn’t count!)

    No, economic libertarians who’re Christians only argue that, in this fallen world, the free market is the best thing available, the best thing yet seen, and that, for philosophical reasons related to the dignity of man and his free will, you probably can’t get much better until the Lord returns.

    Now, if the Church really says that the free market is “not even close” to some ideal solution that’s possible in this fallen world, why, then, the economic libertarians are in conflict with the Church, and the economic libertarians must be wrong.

    But I don’t see that. For the Church to argue as much, she would need to have a real-world economic system in mind: Only then could she compare it with capitalism, in order to see whether the two were, in fact, “not even close.”

    And the hints of Distributivism in Chesterton, or your own preference for cooperatives, is not yet solid enough for such a comparison to be made. I am taller than my wife: we’re both solid enough to compare. But I’ve no idea whether I’m taller than the steam from my shower, for I’ve no way to measure vapor.

    As Ender, I think, noted, “Catholic social teaching is long on objectives and short on procedures.” Until you can propose, concretely, some actual laws and regulations and show them to be better at obtaining those objectives, I think it’s premature to argue the Church is blessing your procedures.

  • Joe H

    RC,

    I’m glad you’re enjoying the discussion, and I am also glad it has remained civil. Usually you can’t talk about economics and morality without things getting ugly.

    Social stability generally means, peace between the classes. I don’t like making arguments from authority over and over again, but this, to me, is just the ABC of CST. Time and again the Popes have stressed the need to develop economic solutions that result in class harmony, not class warfare. The difference between the Popes and say, the supply siders, is that they expect the solution to require sacrifice on both ends – because they recognize that our system the way it is makes class conflict inevitable. I don’t want to go mining for quotes, but nothing I am saying is a radical reinterpretation of what has already been said.

    Not all workers – in fact I would say the majority of workers – can meaningfully “bargain” with an employer over the price of their labor. Union workers, professionals, and workers who happen to be in short supply but high demand for the moment, perhaps. At any given time this will be a relatively small section of the workforce, and an even smaller fraction of the international workforce.

    Companies don’t move to China because they like the weather there. They go there because labor is cheap, for economic and political reasons. So workers all over the world are in fact limited in what they can “negotiate” by the lowest bidder. Workers in cooperatives, regardless of whatever else they face, will not face this problem.

    About dignity and human work: again, I think it would be worthwhile to check out Quadragesimo Anno and Laborem Excercens. Labor is an energy, a force, that a human being transfers into a product. From Locke to Pope Leo XIII and beyond it has been understood that labor is what makes something “properly mine”, i.e. property. The question is how to establish economic arrangements in a modern industrial society that embody this truth. The labor market doesn’t do it, because when you sell your labor you sell a part of yourself, your vital energy and effort as it becomes embodied in various products.

  • Joe H

    Now you can argue that this is done voluntarily, and I won’t deny that it is – at the same time, I think most people around the world would rather be part-owners with substantive decision making power in an economic enterprise than wage laborers twisting in the winds of supply and demand.

    I think the moral obligation of society, then, is to provide exits from the labor market and entrances into communities of property ownership. I think this can be done without violent expropriations. I don’t think the state will be much help and so interested groups of workers will have to rely on socially-conscious investors for their initial capital. What I would hope is that there would be a snowball effect and each wave of successful cooperatives would propagate the system with a portion of their profits.

    Finally, with regards to Church blessings – I am going on what I have read. The quote I provided in my piece alone should be enough to suggest that JP II was talking about cooperatives. He didn’t say we had an obligation to start them, but the entire encyclical makes clear that a move in this direction IS in fact the best way to serve the common good as the Catholic Church understands it. That is all I suggest as well. The details are important too, but we can’t start talking about implementation until we have a commitment, right?

    So, in closing, it might be premature for you to say I don’t have the Church’s blessing until you’ve read what I’ve read 🙂

  • R.C.

    …if you’re still reading posts on this thread.

    We were starting to hog the bandwidth over in the “The Case Against Barack Obama” thread.

    Re: Your case for cooperatives:

    You seem to think that the Church teaching leans not just toward helping workers (which everyone wants to do) but helping them in a particular way (which may or may not be wise, depending on what particular technique it is).

    Your “cooperatives” idea is intended to be an implementation of this, right?

    Here’s my question: Do you think that the Church teaching requires that workers specifically own shares of ownership in the particular business for which they work?

    Or are shares in businesses in general sufficient?

    Here is why I ask. My own emphasis for helping the poor, apart from my own almsgiving, has always been on expanding ownership in general, through securities, in combination with discouraging debt and needless consumerism (living above one’s means).

    Now various forms of investment accounts, promoting ownership of a mix of index funds, bonds, CD’s, and the like, is the type of ownership that I promote. This means that the worker does not own shares in his own business alone, but in the market in general.

    I think this is wiser than ownership in one’s own business alone, because it “diversifies out risk.”

    I mean, what if 100 workers in a cooperative have their savings in that cooperative, and it goes bankrupt? They’re toast. (Which is why investment advisors always say not to put one’s eggs in one basket.) What if the industry in which that cooperative participates falls apart? Then scores of coops, with all their employee owners, go bust.

    But what if the ownership is diversified? They lose whatever is associated with their business, sure, …but as long as that’s no more than 10% of their entire portfolio, they can probably roll with the punches and move on.

    So: In your ideal cooperatives system, how will you ensure that employee ownership in cooperatives does not expose the owner-employees to financial ruin if that coop or business sector dies?

    And, if general investments throughout all markets can cause much of the world’s businesses to be owned by “little people,” but with each individual having a safely diversified portfolio, will that, in your view, satisfy Church teaching?

  • Joe H

    RC,

    You write,

  • Joe H
  • R.C.

    Hey, Joe….

    (“Where ya’ goin’ with that…guninyourhand?”)

    Okay. Sorry. Couldn’t help myself.

    Anyhow, I saw the note you posted in the other thread, shortly before you saw my “change the channel” message.

    I wanted to reply to this item:
    [quote]…people going into debt is what keeps the capitalist economy running! It

  • R.C.

    I just finished Pius XI’s Quadragesimo Anno, by the way.

    Anyhow, I wanted to make two clarifications. The short one first: When I said, “If the workers of the world get into coops, they’ll learn soon enough, too.” …I was not intending that to sound ominous, as if I was saying that coops were necessarily a bad idea.

    The reason I said it is because if the workers are also owners, then they start to see the world as owners do. And they’ll find out just how much they hate debt, and how much it can sometimes damage their effort to just do their business to the best of their ability and the glory of God.

    The second clarification: When I said consumer debt sends false pricing data I didn’t explain myself.

    As you know, business set prices according to “what the market will bear.” That’s tough enough already: They try a price, try it at a different level, see how demand responds and what fits. Business owners get major brain cramps trying to do what’s best for their stockholders and (if they do profit-sharing like my family business does) for their workers. (Keep in mind that a majority of workers in America work for businesses with 100 or fewer employees. Business owners aren’t all corporate stiffs. Most of us know our employees. When you know, unless you are a jerk, you care.)

    Anyhow, prices are a brain-cramp no matter what; but what does consumer debt, of the kind the consumer can’t actually afford, do? It artificially inflates demand, but only temporarily. That means you get a false pricing signal: The market will bear this price…until, whoops! Months later when production is ramped up and inventories are backing up, you find out it’s really that price.

    Markets are finely-tuned to transmit information to interested parties about the value of/need for goods and services. That information arrives in the form of the market’s sensitivity to prices. Excess debt hashes those signals. Debt is fine; excess debt is poison, and capitalists could easily live without it. Would rather live without it.

    Part of the problem here is that there’s so much misunderstanding by non-conservatives of how conservatives actually think.

    The kinds of things I’m telling you now were taught to me over the breakfast and dinner table my whole childhood. It’s the “Rich Dad, Poor Dad” syndrome (book by Robert Kiyosaki; look it up if you’re not aware of it, it’s an easy read): Conservatives get raised a certain way, and they understand certain things that aren’t usually taught in schools, except business schools.

    It’s why conservatives want tighter bankruptcy laws, to discourage excess debt. (Why would they want that, if they’re so addicted to consumer debt?) It’s why they want private accounts for everyone (the more people invest, the less they are in need) but want to be sure to insist on diversification (so nobody goes bust all at once).

    But now I’m off on a different subject, so I’ll save it for a separate post. I just wanted to clarify those two things.

  • R.C.

    I’ve got the following on my list now:

    -Quadragesimo Anno (finished, but need to re-read and analyze)
    -Centesimus Annus
    -Rerum Novarum
    -The Outline of Sanity (G.K.Chesterton)
    -The Servile State (H. Belloc)
    -What’s Wrong With The World (G.K.Chesterton)

    Let me know what else I need to add.

    Meanwhile, I thought I’d summarize some reading I’ve referred to previously:

    Knowledge and Decisions (Thomas Sowell; also Economic Facts and Fallacies and Basic Economics by the same author)
    The Total Money Makeover and Financial Peace Revisited by Dave Ramsey.
    – “Rich Dad, Poor Dad” (Robert Kiyosaki, but watch out. I think a lot of it is nonsense, especially regarding the real estate market. And some of the personal biography may be exaggerated: This is a self-help guru, and I don’t trust those. But sell-jobs, like the devil’s lies, require a grain of truth, and the difference between “assets” and “liabilities,” and how entrepreneur culture thinks and raises kids, is the chief issue here.
    The Millionaire Next Door (Stanley and Danko; basically the same lesson as “Rich Dad, Poor Dad”)

    The Sowell books are about economics and businesses by an economist. If you’re the kind that’s impatient with reading intended for the “everyman” and want something scholarly, go for Knowledge and Decisions because the rest of my list is plebian.

    The Ramsey book is an introduction to the conservative culture re: debt. And the other two are less important and illustrative of the conservative culture regarding purchases and financial responsibility (which, honestly, is discussed by Ramsey as well.)

  • Joe H

    Is it really just a popular myth, what I stated?

    I don’t think so. I think the real myth, and I say this respectfully, is that there is broad concern among competitive businesses with the long-term integrity of the market place. Not every business man is some sort of economic theorist concerned with what will be good for the economy 5, 10, or heaven forbid, 50 years down the line, at least in the United States (other countries may be better in this regard).

    That is to say, I think the facts you present are accurate but not terribly relevant, given that most people in the market are driven by the prospects for immediate gain for themselves. The question is whether or not these private vices become public virtues, as Mandeville originally wrote, or whether or not they eventually lead to the collapse of society, as Marx theorized.

    The way it is currently organized, on the basis of what I identified as philosophical individualism, or possessive individualism, I think the market unfettered leads not only to public vices but public collapse. Whether or not it would on the basis of communitarian principles remains to be seen.

    Frankly I think its pointless to argue about what “markets like” and what they “don’t like.” Libertarians are fond of saying that there is no society, only individuals who choose to associate with one another. Well, there are no markets either, just individuals engaging in exchange with one another. “Society” and “market” are abstractions, in other words.

    And what individuals like is not going to be the same as what an abstract entity such as society would benefit from, or markets for that matter, in spite of Mandeville and Adam Smith. It may work this way for a time, under certain optimal conditions. But the big mistake some economists make is total ahistoricism, making generalizations where it is entirely inappropriate and where historical evidence proves the provisional and exceptional nature of a particular principle.

    So, even if this debt accumulation is bad for capitalism as a system – and here I agree and never meant to imply otherwise – it is GOOD for many particular individuals in the market at any given time, and only by resorting to government coercion (which libertarians are generally against) could you align their interests with those of the market. When you talk about “shifts in fiscal policy”, it means, shifts in what the government says businesses can and can’t do with their capital, their assets, their property.

    I don’t see the industries that are dependent upon consumer debt – and there are a lot of them – simply fading away for the greater good of the market or quietly acquisecing to a “shift in fiscal policy.” And besides, our policy thus far has been to throw money down the sinkhole to prop up crumbling enterprises with bailouts and subsidies; is the welfare-state really worse than this?

    Now it turns out Bear-Sterns, bailed out by the government, was engaged in massive fraud, 1.6 billion dollars embezzled and gone. They didn’t care about the market, and when the people who practically keep the market together with the equivalent of saftey-pins and maskng tape don’t care anymore, why should anyone else? As I said before, the increase in corporate crime is a vote of no confidience in the American economy.

  • Joe H

    So, given you finished QA, what do you think about the labor market? Or will we be treated to another argument in the vein of Thomas Woods, where the Papcy is revealed to know next-to-nothing about how the economy works?

    Again, RC, I understand the nuts-and-bolts economics that you are explaining here.

    Again, my simple objection is that, a) you don

  • Joe H

    Well, you might think some of my sources are biased, and they probably are.

    I usually get my hard economic data from the Economic Policy Institute. They publish a bi-annual book called “The State of Working America” which focuses on economic indicators that right-leaning economists minimize or ignore.

    There is an excellent book that covers a lot of the economic ideas I hold, “Studies in Mutualist Political Economy” by Kevin Carson. He, like I, was influenced by the work of economists such as Maurcie Dobb and Ronald Meek, who wrote “Studies in the Labor Theory of Value.”

    Of course, I think everyone, whether they like, are indifferent to, or hate Karl Marx, should read “Value, Price and Profit.”

    Finally, I can’t recommened enough John Paul II’s “Laborem Exercens.”

  • R.C.

    Actually, you needn’t worry, at this point, that I’d interpret something you say as being “a harsh judgment on [me].”

    Throughout our discussion you’ve been perfectly courteous, and more than willing to listen: That much can be seen in the fact that, when I raise a point you actually read, understand, and respond to it!

    So if you do intend, at some point, to give me a verbal slap, you’ll have to make an extra-specially blunt effort. I’m too used, at this point, to your courtesy to interpret it that way at first read!

    All of which is to say, it’s rather late (early, actually, where I am) so I need to call it a night, soon. But thanks for the ongoing discussion, in content and in tone.

    Re: Systemic versus Particular: Hmm, it’s interesting you bring up that distinction. I was thinking of introducing an argument along those lines, in fact: Something defending, as both moral and effective, a structure in which:

    (a.) The system of economic laws is designed purely in order to punish rights-violations; protect contracts, property, and trade; and to put helpful incentives in place; and,

    (b.) The parallel system of voluntary charity is designed to assist individuals whose circumstances are dire as a result of being fairly treated by the system.

    In this separation there’s a cleanness that’s required here to ensure justice — meaning equal protection under law — and honesty.

    I instinctively — though I cannot at 2AM give articulate voice to why — see a parallel in my own policy regarding charity to friends and employees.

    Which is: I keep charity entirely separate from my friendships and my business relationship. I won’t hire anyone who can’t do the job and doesn’t deserve it. I will however give them money — as anonymously as circumstances allow. I won’t give them a job they didn’t earn as an act of charity; that would mix the two. Honesty demands that a job not be sinecure. One day I might fire someone and then replace their income entirely with anonymous charity…but the two will be separate: That is justice, and mercy: Both are required.

    Similarly, it seems to me that the law is The Law. It is not intended to produce Cosmic Justice; it is not intended to produce equal outcomes; it is not even intended to produce equal opportunity from equal starting points; it is intended to produce equal opportunity from whatever starting point you may find yourself in. Anything more than that seems dishonest and evil to me.

    People should receive help. They should receive it abundantly…but it should come from a system which is kept distinct from the system which sets the rules of fair play. Otherwise the referee becomes a player, for one team or another.

    Rrr. I’m mixing metaphors, drifting into generalities, and expressing intuition rather than argument. It is now a quarter-to-three in the morning. Time to give this up and sleep.

    And, yes, I’ll put “Laborem Exercens” on the list.

  • Joe H

    There has been a lot of buzz in the news about Bill Gates and philantrhopy. I wrote a new blog on this version of “charity”, which I don’t think is anywhere near what the Church is calling for in its social teaching.

    Individual acts of charity are wonderful, but they are no substitute for serious efforts to break the cycle of dependency and establish genuine self-sufficiency of persons and communities (which “philanthropy” never does).

    In short, when charity is used as a cover to neglect and avoid social responsibility, it does more harm than good. Instead of handouts in the form of either welfare checks OR charity money, our charitable efforts should be directed at building the sort of communities for the poor and working class that are economically self-sustainable. Both the left and right have failed miserably here.

  • R.C.

    Joe:

    I concur.

    My own charitable contributions (apart from tithe, which as I understand it is intended for maintenance specifically of the church) are through Christian charities that promote sustainable benefits rather than one-time handouts; e.g., wells in villages, teaching construction techniques, schooling, English-language instruction (quite the job skill in Romania, I found out), and so on. Goats and cows and seed for feed-corn, rather than a shipment of milk. You get the idea.

    Of course, raw cash can be used for these and better things, also; so there is some hope that Bill Gates’ contributions, no doubt well-meaning, will not go entirely awry.

    Perhaps the biggest aggravation for me is how much almsgiving is appropriated by corrupt governments in-country; e.g. the outright taking, and later the “rebranding” with their names, of all the aid packages sent to Burma by the military junta. And of course bribes.

    Poverty will not be eliminated in such places until people have incentive to be entrepreneurs rather than warlords. But that comes requires property rights and contract enforcement, which, in turn, comes from government.

    So whaddaya do…take over their government? That is apparently out of the question nowadays (and for good reason…though one can’t help noticing that any land that was once a British colony is wealthier and happier than it otherwise would have been without the Brits.)

    But if you’re not going to fix the government problem, you can’t fix the poverty problem long-term, so again, whaddaya do?

    You do the best you can, I think; and you pray; and you remember that if Jesus was correct in saying “the poor ye shall always have with you” then the problem will never be permanently solved, only ameliorated.

  • R.C.

    On a related note, here’s C.S.Lewis:

    [quote=Jack]It may be asked whether, faint as the hope is of abolishing war by Pacifism, there is any other hope. But the question belongs to a mode of thought which I find quite alien to me. It consists in assuming that the great permanent miseries in human life must be curable if only we can find the right cure; and it then proceeds by elimination and concludes that whatever is left, however unlikely to prove a cure, must nevertheless do so.

  • Joe H

    I still think the economic ties between the US (and the West in general) and the “global south” need to be examined. The right always wants to pass the buck to local corrupt governments – not just because it is partially true, but because it fits with the “government doesn’t work” ideology. Meanwhile there is a history of militaristic and economic coercion, which was until 91 often pursued under the aegis of “containment of communism.”

    Meanwhile we still have an obligation to at least try and implement systems that stand a chance of working well. And charity doesn’t generally do that, though I don’t see why it can’t.

  • R.C.

    Joe:

    When you say “Charity doesn’t generally [work well]” are you thinking of its effectiveness at dealing with domestic poverty, or third-world poverty, or both?

    On the theory that you’ll answer “both,” I’ll say:

    (1.) Re: Domestic “Poverty”: Here I think the problem is a combination of consumerism, the stories of rampant welfare and disability fraud, the often bad life-choices of the recipients, and the “I gave at the office” attitude which comes from thinking that it’s the government’s job, not our own, to give alms. Unless we’re careful to “give more alms before we buy more stuff,” and to remember that frauds are the exception not the rule, and that not every gift to a person who makes bad choices thereby enables their choices, and that it’s not government’s job but ours, our domestic giving will be insufficient and therefore unsuccessful.

    (On these items I note the studies showing conservatives give rather more than liberals: Isn’t this quite likely because they don’t view it as government’s job?)

    (BTW, I put “Poverty” in quotes not because it’s a total lie, but because what we call “poverty” in the U.S. is usually not half-bad when compared against its third-world equivalent.)

    (2.) Third-World Poverty: This is the type of poverty which is resistant to almsgiving, no matter how vast, because of corruption and hoarding by warlords and soldiers, and the lack of protection for property rights and trade and contracts.

    Robert Mugabe’s conversion of the breadbasket of Africa into a starving famine-wracked wasteland, the generals in Burma, and of course Kim in North Korea, are examples. Short of “regime change” there is no sustainable solution, and as we are not going to effect that the quick way (by arms) we must be content to do it the slow way: Persuasion, bribing the soldiers into letting us deliver medicine to the people, prayer, and waiting for their regime to, on some unforeseeable day, fall.

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