Note:  In The Outline of Sanity, making the case for Distributism, G.K. Chesterton argued,

“They say it is Utopian; and they are right. They say it is idealistic; and they are right. They say it is quixotic; and they are right. It deserves every name that will indicate how completely they have driven justice out of the world; every name that will measure how remote from them and their sort is the standard of honourable living; every name that will emphasize and repeat the fact that property and liberty are sundered from them and theirs, by an abyss between heaven and hell.

“Distributism may be a dream; three acres and a cow may be a joke; cows may be fabulous animals; liberty may be a name; private enterprise may be a wild goose chase on which the world can go no further. But as for the people who talk as if property and private enterprise were the principles now in operation-those people are so blind and deaf and dead to all the realities of their own daily existence, that they can be dismissed from the debate.”

Distributism: Equidistant from both Socialism and Capitalism which constantly provoke each other into existence by a dismally failed and inhuman dialectic, Distributism is the viable and moral alternative whose time must come if justice and mercy matter — SH.

What is Distributism?

By Thomas Storck

Much of the history of the Western world since the middle of the nineteenth century has been the history of the clash of competing economic systems. Ever since the Communist Manifesto of 1848, when it was claimed that a “specter is haunting Europe,” a specter indeed has been haunting not only Europe, but the whole world. This is the specter not just of communism, but of rival economic and social systems which many times since then have convulsed mankind. But in the minds of many this rivalry of economic systems has come to an end: communism and socialism have both been defeated, and therefore only capitalism is left to reign triumphantly throughout the entire world. However, this is not the casey.

In a neglected passage of the encyclical Centesimus Annus, John Paul II points out that mankind’s choices are not restricted to capitalism and the now discredited socialism. “We have seen that it is unacceptable to say that the defeat of so-called `Real Socialism’ leaves capitalism as the only model of economic organization” (no. 35).

If this is the case, then it behooves Catholics to take a look at distributism, an economic system championed by many of the best minds in the Church in the first part of the twentieth century, men such as G. K. Chesterton, Hilaire Belloc, Fr. Vincent McNabb and many others. Let us see exactly what distributism is and why many Catholics see it as more akin to Catholic thought than capitalism.

In the first place, we would do well to make a few definitions of the chief terms we will be using, and especially of capitalism. Too often this word is left undefined, and each person gives it some sort of connotation in his mind, good or bad, depending on his own beliefs, but never clearly defined. Now first, what is capitalism not? Capitalism is not private ownership of property, even of productive property, for such ownership has existed in most of the world at most times, and capitalism is generally held to have come into existence only toward the end of the Middle Ages in Europe. Perhaps the best way to proceed is to take our definition from a very weighty source, and then we will see how that definition does indeed fit the facts of history.

We will turn, then, to the encyclical of Pope Pius XI, Quadragesimo Anno (1931), in which capitalism is defined or characterized as “that economic system in which were provided by different people the capital and labor jointly needed for production” (no. 100).

In other words, under capitalism normally people work for someone else. Someone, the capitalist, pays others, the workers, to work for him, and receives the profits of this enterprise, that is, whatever is left over after he has paid for his labor, his raw materials, his overhead, any debt he owes, etc.

Now is there anything wrong with capitalism, with the separation of ownership and work? In itself there is nothing unjust about my owning a factory or a farm and employing others to work for me, as long as I pay them a just and living wage. But nonetheless, the capitalistic system is dangerous and unwise, its fruits have been harmful for mankind, and the supreme pontiffs have often called for changes which would, in effect, eliminate capitalism, or at least reduce its scope and power.

Purpose of Economic Activity

Let me explain and justify the assertions I have just made. And in order to do so, I must first make a brief detour to talk about the purpose of economic activity. Why has God given to men the possibility and need for producing and using economic goods? The answer to this is obvious: we need these goods and services in order to live a human life. Thus economic activity produces goods and services for the sake of serving all of mankind, and any economic arrangements must be judged by how well they fulfill that purpose.

Now when ownership and work are separated there necessarily exists a class of men, capitalists, who are one step removed from the production process itself. Stockholders, for example, typically do not care about what the company they are formal owners of actually makes or does, but only whether its stock price is rising or how large a dividend it pays. In fact, on the stock exchange, shares change hands thousands of times a day, that is, different individuals or entities, such as pension funds, are part owners of companies for a few minutes or hours or days, and then the stock is sold to someone else and they become owners of some new entity. Thus this class of capitalists naturally comes to see the economic system as a mechanism by which money, stocks, bonds, futures, and other surrogates for real wealth, can be manipulated in order to enrich themselves, instead of serving society by producing needed goods and services. As a result, men have made fortunes by hostile takeovers, mergers, shutting down factories, etc., in other words, by taking advantage of private property rights, not in order to engage in productive economic activity, but to enrich themselves regardless of its effect on consumers or workers. [Italics supplied here. SH]

The popes have indeed justified the ownership of private property, but if we examine how and why they have done so, we will see that the logic of their position is far from the logic of capitalism. Let us look, for example, at a famous passage from the encyclical of Leo XIII, Rerum Novarum (1891).

Men always work harder and more readily when they work on that which is their own; nay, they learn to love the very soil which yields in response to the labor of their hands, not only food to eat, but an abundance of the good things for themselves and those that are dear to them. (no. 35)

But what happens under capitalism? Do men learn to love the very stock certificates which yield cold cash, in response to the labor of someone else’s hands? The justification of private property that the popes have made is always tied, at least as an ideal, to ownership and work being joined. Thus Leo XIII: “The law, therefore, should favor ownership, and its policy should be to induce as many people as possible to become owners” (Rerum Novarum, no. 35), and this teaching is repeated by Pius XI in Quadragesimo Anno (nos. 59-62, 65), by John XXIII in Mater et Magistra (nos. 85-89, 91-93, 111-115), and by John Paul II in Laborem Exercens (no. 14). If “as many people as possible…become owners,” then that fatal separation of ownership and work will be, if not removed, at least its extent and influence will be lessened. It will no longer be the hallmark of our economic system, even if it still exists to some extent. [Italics supplied here. SH]

The Crux

And this brings us directly to distributism. For distributism is nothing more than an economic system in which private property is well distributed, in which “as many people as possible” are in fact owners. Probably the most complete statement of distributism can be found in Hilaire Belloc’s book, The Restoration of Property (1936). Note the title, The Restoration of Property. For the distributists argued that under capitalism property, certainly productive property, was the preserve of the rich, and that this gave them an influence and power in society far beyond what they had any right to. Yes, the formal right to private property exists for all under capitalism, but in practice it is restricted to the rich.

A further feature of distributism that follows from this, is that in a distributist economy, the amassing of property will have limits placed on it. Before one objects that this sounds like socialism, he would do well to remember Chesterton’s remark (in What’s Wrong With the World, chap. 6), that the institution of private property no more means the right to unlimited property than the institution of marriage means the right to unlimited wives!

In the Middle Ages those quintessential Catholic institutions, the craft guilds, very often limited the amount of property each owner/worker could have (for example, by limiting the number of his employees), precisely in the interest of preventing anyone from expanding his own workshop so much that he was likely to drive others out of business. For if private property has a purpose and end, as Aristotle and St. Thomas would insist, it surely is to allow a man to make a decent living for himself and his family by serving society. But one living, not two or three. If my business supports myself and my family, then what right do I have to expand that business so as to deprive others of the means of supporting themselves and their families? For the medievals saw those in the same line of work, not as rivals or competitors, but as brothers, brothers engaged in the very important work of providing the public with a needed good or service. And as brothers they joined together into guilds, engaged priests to pray for their dead, supported their widows and orphans with insurance funds, and generally looked after one another. Who would not admit that this conception of economic activity is more akin to the Catholic faith than the dog eat dog ethic of capitalism?

I realize that much of what I say here must sound strange to many readers. Most Americans are acquainted only with capitalism and socialism. But a little knowledge of Catholic economic history and of traditional Catholic economic thought will be enough to convince any fair minded reader that there is an entire world out there of genuine Catholic thought on this subject nearly unknown in the United States. And if the current “science” of economics contradicts this thought, then ask yourself, what authority does that “science” have? It arose from the deistic philosophy of the so-called Enlightenment of the eighteenth century, and it is curious that some Catholics, while condemning (rightly) the philosophy of that unfortunate century, warmly embrace its economic theories, not realizing that those economic theories arise from the same poisoned well as Voltaire and the Encyclopedists. But it is not too late to remake our thinking after the very pattern of Jesus Christ and his Church–if we are willing to banish from our lives the idols that are worshiped in our own country and embark on the fascinating journey of discovering Catholic economic thinking.

Thomas Storck is the author of An Economics of Justice and Charity, Foundations of a Catholic Political Order and The Catholic Milieu. He is a contributing editor of New Oxford Review and a member of the editorial board of The Chesterton Review. — Source: The University Concourse

The good of distributism: a reply to critics by Thomas Storck

I appreciate the opportunity to respond to the replies to my article, “What is Distributism?” which appeared in the January issue of the Concourse. I will reply to Mr. Harold first. I welcome his comments on the evils of consumerism and the dangers inherent in the notion that property rights are absolute. He very rightly notes that it is necessary that individual and social attitudes toward these must change. “Structures are a function of attitudes, and it is capitalist attitudes which must be changed before capitalist structures can change.” However, he and I differ, apparently, when it comes to the question of whether the state can have any positive role in bringing about such changes. Mr. Harold writes, “This is all very different, however, from any type of government coercion or political action to change structures, which is the approach of Marxism, and which seems to me the prime danger of distributism as explicated by Mr. Storck. It is one approach to try to conform our own attitudes and actions to the truth, and another to imagine that this strenuous task can be bypassed by blunt political action.”

I have never advocated that state action should attempt to bypass conversion of heart, but I do not think there is any necessary opposition between these two modes of acting either. Just as the state can have a tremendous influence on opinion via bad laws—Roe v. Wade is a prime example—so by promoting good laws the state can influence opinion to the better. The 1931 encyclical of Pius XI, Quadragesimo Anno, in which the Pontiff called for a thorough renewal of society upon the basis of Christian morality, advocated both conversion of heart and legal action on behalf of social justice. Such sentiments have been echoed by numerous popes, as in these words of Pius XII:

And, while the State in the nineteenth century, through excessive exaltation of liberty, considered as its exclusive scope the safe-guarding of liberty by the law, Leo XIII admonished it that it had also the duty to interest itself in social welfare, taking care of the entire people and of all its members, especially the weak and the dispossessed, through a generous social programme and the creation of a labor code. (Address to Italian workers on the Feast of Pentecost, June 1, 1941)

Since, as St. Thomas taught, man is by nature a social and political being, we cannot ignore the role of the state in promoting a just society. It is true, as Mr. Harold states, that governmental action will accomplish little in the absense of a true conversion of hearts, but the point is that both are needed. One of Satan’s biggest successes in the modern world has been to divide Catholics, and indeed many others, into two groups: those who look to the state for obtaining everything, and those who look only to individual or private activity or charity. But in fact neither of these two groups is correct.

Moreover, distributism, unlike socialism, does not look to the state to accomplish everything, but primarily works for the establishment of groups—modern “guilds”—which are not organs of the state and which are to play the most important role in ensuring that property serves its true end, namely, the promotion of human welfare.

Mr. Zoric and Mr. Welker, however, unlike Mr. Harold, do not seem to understand that the mere celebration of material riches hardly comports well with the gospel message. Yes, capitalism is certainly responsible for the creation of mounds of material goods. Mr. Zoric and Mr. Welker celebrate the ubiquity of telephones and electricity, cars, VCRs, microwaves, air conditioning, cable TV, washers and dryers. While I would not dispute that many of the inventions of the industrial revolution have done good, one wonders, however, if the indiscriminate production of all the above products really has brought men closer to our Lord, has helped to create a Christian society, has increased charity and justice in our hearts. Perhaps a few quotes would put the matter into perspective.

If abundance of riches were the ultimate end [of life], an economist would be ruler of the people…The purpose [finis] of the people having come together however seems to be to live according to virtue. For to this men come together, that they may live well together, which each one living by himself is not able to obtain; the good life however is according to virtue; the virtuous life therefore is the end [finis] of human society. (St. Thomas Aquinas, De Regimine Principum, I, 14)

John Paul II, speaking of the attempt by non-communist nations to rival communism in the years after World War II, wrote,

Another kind of response, practical in nature, is represented by the affluent society or the consumer society. It seeks to defeat Marxism on the level of pure materialism by showing how a free-market society can achieve a greater satisfaction of material human needs than Communism, while equally excluding spiritual values. In reality, while on the one hand it is true that this social model shows the failure of Marxism to contribute to a humane and better society, on the other hand, insofar as it denies an autonomous existence and value to morality, law, culture and religion, it agrees with Marxism, in the sense that it totally reduces man to the sphere of economics and the satisfaction of material needs. (Encyclical Centesimus Annus, no. 19)

And from the same encyclical,

It is not wrong to want to live better; what is wrong is a style of life which is presumed to be better when it is directed towards “having” rather than “being,” and which wants to have more, not in order to be more but in order to spend life in enjoyment as an end in itself. (Encyclical Centesimus Annus, no. 36)

And lastly, from one of our separated brethren, John Wesley: “I fear, wherever riches have increased, the essence of religion has decreased in the same proportion…. But as riches increase, so will pride, anger, and love of the world in all its branches.” (Quoted by Max Weber in The Protestant Ethic and the Spirit of Capitalism.)

After their praise of the material products of capitalism, Mr. Zoric and Mr. Welker deal with some of the specifics of my article. They argue, for example, that my account of the stock market is incorrect. But the notion of a real connection between the investor/owner and the company is largely a capitalist fairy tale. If, as they argue, most investors hold stocks on a long-term basis, why do thousands of shares change hands every day, and why is the minute by minute rise and fall in stocks so eagerly watched by both traders and investors? In fact, there is little similarity between private property as the popes have championed it and private property as it exists via shares of stock.

I also stated the following: “If my business supports myself and my family, then what right do I have to expand that business so as to deprive others of the means of supporting themselves and their families?” Mr. Zoric and Mr. Welker argue that “business expansion does not deprive others of the means of supporting themselves; rather, it offers additional opportunities for those seeking such means.” But do Mr. Zoric and Mr. Welker really believe that Wal-marts have never put any small shops out of business? That chain stores have never caused mom and pop stores to close? Economists must look at the real facts of the economy, not simply at deductions from their econometric model of what is supposed to happen.

Moreover, distributism is not the enemy of technological development as Mr. Zoric and Mr. Welker seem to think it is, though perhaps it would slow such development down a bit and give us a means of looking more closely at alleged improvements. After all, does mankind really need a new release of Windows every year—often with very little improvement over the old system, but with lots of money for Bill Gates? Does all the money spent on continual computer “upgrades” really represent a wise use of the resources God has given us?

As I indicated above, although Catholicism has always condemned the classical liberal notion that the state and state action are to be reduced to the smallest role possible, nevertheless distributism is not a statist system. It is not a form of socialism nor does it owe anything at all to the Marxist tradition. Rather, this social philosophy would seek to restore to individuals the actual possibility of owning productive property, so that the system of private ownership would work for the common good. Then we would see that it is not for the mere piling up of consumer goods that the economy exists, but for supplying our necessary material needs so that we can turn our minds to things much more important. For after all, “a man’s life does not consist in the abundance of his possessions” (Luke 12:15).

Mr. Storck lives in Greenbelt, Maryland

Source: The University Concourse

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