Is There A Bellocian Response For Today’s Economic Crisis?

Written in early 2009 as the effects of the 2008 economic crash were worsening, this article gives a Distributist response to the crisis.

From the ChesterBelloc Mandate

Dear readers of The Distributist Review,

Paul Likoudis, News Editor for The Wanderer -the oldest Catholic newspaper in the United States- recently conducted an interview with yours truly regarding "Bellocian Economics," and has kindly granted us permission to reprint it here. Our thanks go to Mr. Likoudis for the opportunity. We would also like to applaud The Wanderer for their recent defense of distributism. 

Is There A Bellocian Response For Today’s Economic Crisis? 
By PAUL LIKOUDIS 

One of the signs of the times of the past two decades is a growing interest in Distributism, often de­scribed as a “third way” economic philosophy opposed to both capi­talism and socialism. It was chiefly formulated by the British historian and journalist Hilaire Belloc and is firmly grounded in Catholic social teaching, especially Pope Leo XIII’s encyclical Rerum Novarum. 

Belloc never claimed he was in­venting a new system; rather he wanted to return to an economic arrangement of society that pre­vailed in Europe before the rise of post- Reformation capitalism and the big banking houses that pros­pered on the poverty of the masses and war.

With the rise of globalization and the spread of “democratic cap­italism” after the fall of the Berlin Wall, capitalism — as we all see much too clearly today — is in cri­sis. Catholics looking for a solution are looking to Belloc, his associ­ates G.K. Chesterton and Fr. Vincent McNabb, OP, and the Americans Dorothy Day and Peter Maurin, founders of the Catholic Worker Movement.

One sign of the Belloc/Distribut­ism revival is The ChesterBelloc Mandate, put up by a 34-year-old New Yorker, Rich Aleman. This of­fers viewers an extensive library of writings by Belloc, Chesterton, Fr. McNabb, Day, papal encyclicals, and other Church documents, and contemporary expositors of Dis­tributism such as John Sharpe, Thomas Storck, John Medaille, Jo­seph Pearce, Dr. William Fahey, among others.

“There is definitely a resurgence in interest in Belloc,” said Aleman, “which can be seen in the growing number of online web sites devot­ed to his work, the reprinting of his books, and many organizations in existence modeled on Distributist ideals. One example is the E. F. Schumacher Society, named after the German economist and Catho­lic convert, E.F. Schumacher. Their development of the Community Land Trust Model has proven itself a terrific method for restoring local farming.

“In such a scheme, the Land Trust purchases the land, while the farmer is responsible only for his home and barn; the land trust then establishes as a lease contract be­tween the farmer and the trust for 99 years, thus removing the mort­gage and tax burden from the farm­er. The benefits of this as a transi­tional solution toward agricultural restoration are multiple.

“Then there are other Distribut­ist ideas offered such as measured and small- scale technology, the creation of agricultural schools, the support for credit unions, micro­lending, and land associations tasked with relieving unemploy­ment and home ownership,” said Aleman.

There are also political ideas that reflect the Bellocian ideal, Aleman added, such as the discontent on the part of the average citizen with the narrow difference between the politicians from both major parties, or that the left and right, Aleman said, “ are fashionable political markers with no true bearing on in­dividuals. Our lawmakers are either pro-life while undermining the ma­terial necessities of the family, or pro-death and at the same time championing the legitimate rights of the workers.

“However, today the individual­ist and collectivist dichotomies of old are fading, and are replaced in­stead with a restored concern for in­dependence for the family and so­cial interdependence for the com­munity, with a proper understand­ing that our material needs are sub­ordinate to our spiritual ones. Thus, the alternative to the materialism of capitalism and socialism is a social and economic policy centered on a wealth- producing society through family and cooperative ownership.

“This last takes the form of work­er- owned businesses, where the workplace is owned by the work­ers who produce the goods and ser­vices of society, such as the Arizmendi Bakery project that started in San Francisco and is spreading across California.”

The Arizmendi Bakery takes its name from Fr. Jose Maria Arizmen­diarrieta, a Basque priest who founded Mondragón Corporation in 1943, a self-managed worker co­operative which currently makes $16 billion in a range of products, including appliances and small parts manufacturing, and has some 77,000 worker-owners.

Another example, Aleman said, is Confcooperative in Bologna, Italy, a Catholic cooperative inspired by Rerum Novarum. That and other cooperatives in the Emilia-Roma­gna region make over 40% of the region’s GDP.

A model of a renaissance in non­industrial local agriculture is Polyface Farms in Staunton, Va., a Protestant endeavor to promote lo­cal farming through their school of husbandry. People who want to learn farming are provided room and board for various terms of appren­ticeship, and upon completion of their term, these apprentices return to their own region able to apply what they learn.

In another case, there is the Cath­olic Homesteading Movement lo­cated in Oxford, N.Y., also instruct­ing in the fundamentals of living off the land. Operated by Richard Fahey and his family, day and weeklong workshops are offered on topics ranging from organic garden­ing to fruit-tree grafting.

“People are willing to listen to al­ternatives such as Belloc and Chesterton proposed due to the fi­nancial crisis we are in,” said Ale­man. “I believe the Distributists and other like-minded reformers of their time, spoke clearly to the hearts and minds of the common man, unlike anything seen before or since, and the reemergence of their work is once again popular and necessary.” 

Belloc’s Economics 

For Catholics who are complete­ly unaware of Distributism, and Catholic social teaching, the basic thing to understand is that Belloc took as a personal mission Pope Leo XIII’s exhortation that “ the law, therefore, should favor ownership, and its policy should be to induce as many as possible of the people to become owners.”

Man always fully dedicates him­self to the work and land that be­long to him, as Chesterton reiterat­ed through the parable of the Good Shepherd. Today most men have been convinced to pick between thousands of careers just to work for someone else, but the Distributists recalled to memory the natural de­sire for man to work and own for himself.

Money has been transformed from a means of exchange backed by commodities produced by the economy, to property. But money in itself is unproductive, as Belloc re­minds us. Only productive proper­ty is a generator of real wealth and strength for the family and the lo­cal community. Land allows us to secure something for ourselves and is a shelter against the gap between poverty and wealth. Most of us work and save money for that purpose, so we can plant our roots and raise our families in a home, because its val­ue to us transcends what the market tells us it is worth. For Belloc, a na­tion founded on micro-property is a stable and fruitful nation.

“Belloc believed that the conse­quences of narrowing the division between ownership and work pre­sents for the family an autonomy from the consolidation of power, and wealth for the community, which man, as a corporeal being would always be partially depen­dent on. This productive property supplies the requisites for domestic autonomy, which in turn provides for a greater means toward achiev­ing the ends of life, e.g., the eternal vision, or our original purpose,” said Aleman.

“By the family and workers own­ing the means of production — the tools, equipment, etc. — needed for labor to transform raw resources into goods and services, the family and the worker could be independent from big business and big govern­ment and pursue thrift as well as en­joy a robust spiritual life. After all, the ultimate goal of the ‘restoration of property’ — the title of another Belloc book — would lead to the Christian reform of morals, just as Pope Pius XI reiterated in Quadrag­esimo Anno, through the quest for a life of virtue, instead of the dog-eat-dog world.”

Through the lens of Belloc’s anal­yses, people today can gain a bet­ter understanding of the economic, political, and social crisis this coun­try is facing.

Belloc formulated his views on the coming of the Servile State, and the need for a Distributist society from the contemporary crisis En­gland was experiencing due to over producing as a consequence of the embrace of mass production in lieu of the small producer, Aleman ob­served.

“The problem with overproduc­tion is that it creates under- con­sumption; large- scale business needs to churn out as many goods as it can create, while consumers are unable to match the volume of pro­duction dispensed. As a result, wag­es decline as the capitalist cuts la­bor costs in order to maximize profit. This cost reduction and de­sire of the capitalist to increase his purse leads him to ship his labor overseas.

“But of course here is the conun­drum. The consumer and the em­ployee are the same people, so as costs are reduced, the worker finds himself with a declining wage, and the employer expects the same worker to consume the goods he and other capitalists produce,” Aleman explained.

The only “solution” to overpro­duction is usury. The people with the profits lend them to people with the low wages. This sustains consump­tion for a while, but is ultimately self defeating, so the government ab­sorbs the excess production. It fails because the government cannot per­form this task as the productive base on which its taxes depend has been shipped overseas. So now we borrow money from nations that are making things to sustain consumption. But of course, that can’t go on forever. There is a limit. The results are stag­gering. Today our nation is two­thirds consumption, and one-third production.

Stagnant wages, institutionalized usury, derivatives, impersonal in­vestment, planned obsolescence, waste, and consumer debt trans­formed a nation of small businesses and small farmers into over-indul­gent consumers, pitted between cor­porations passing their liabilities to taxpayers, an obliging government protecting them from liability, and the “stimulus” of Keynesian poli­cies which inflated government in the first place.

Belloc’s solution to big govern­ment is decentralization. “Distribut­ists are decentralists who believe most functions should occur at the smallest level as possible. In a Distributist state, the role of central government addresses challenges outside the scope of locality, such as defense, or international trade, amongst other things. Local guilds and other institutions exist to re­strain the concentration of power or property, whether bureaucratic or commercial,” said Aleman.

The early movement and Belloc believed the implementation of Distributism would not come from above, but from below, in other words, not by government force but by a proselytizing popular move­ment convinced and eager to real­ize the various facets of Distributist living. 

The Mandate 

“What I strive to do with The ChesterBelloc Mandate,” Aleman said, “is to create a fountain of in­formation for the academic and lay­man on the subject of Distributism and Catholic social teaching. Be­sides the work of Chesterton, Belloc, and Fr. McNabb, I’ve also included some of the work of Amintore Fanfani, Fr. Heinrich Pesch, A.J. Penty, B.A. Santamaria, Hilary Pepler, Cardinal Manning, and my favorite, K.L. Kenrick.

“The first time I ever heard the word ‘ Distributism’ was on Dale Ahlquist’s (president of the Ameri­can Chesterton Society) show on EWTN about six years ago. My cu­riosity led me to an article by Thomas Storck, called ‘ What is Distributism?’ Storck’s work left a lasting impression on me, as did some of the great work of the now defunct Caelum et Terra. 

“However, I found information on Distributism to be scarce and often piecemeal. Luckily, after reading the republishing of the Distributists’ work by IHS Press — another sign of the Bellocian revival underway today — I decided to consolidate as many essays and articles as I could find on the topic. Some of these ma­terials required constant trips to the library, while others I searched for in schools across the country. I want­ed to prove to the readers of the site that Distributist thought wasn’t lim­ited to the classics, but extended to other publications such as America, Blackfriars, Commonweal, Orate Fratres, etc.

“I also wanted my readers to real­ize that Distributism wasn’t a small movement in Great Britain. From the various Catholic Land associations, the 24 branches of the Distributist League, the Guild of St. Joseph and St. Dominic, and the massive con­tributions from various columnists for Chesterton’s G.K.’s Weekly, Dis­tributism permeated across the Brit­ish Isle, and in Ireland where simi­lar features of a Distributist rural economy were already in place.

“The feedback has been very pos­itive, and over the years Distribut­ism has risen rapidly amongst Cath­olics and other Christians. Online and print journals are often chatting about it on a worldwide level. As a result, I’ve added a foreign-language section dedicated to contemporary articles about Distributism I’ve found from Spain, Argentina, France, Poland, and the Czech Republic, among many others.

“But The Mandate and the re­prints on it are one-half the topic. John Medaille, author of ‘The Voca­tion of Business: Social Justice in the Workplace,’ and I collaborate at The Distributist Review, a contem­porary online web site discussing contemporary politics and socioeco­nomic issues from a Distributist per­spective. We believe we offer sound analysis about the current crisis in the Bellocian tradition.”