Handmade Toy Alliance

Handmade toys may soon be illegal in the United States.

That's the bad news. The good news is that they would already be illegal, if toymakers and others hadn't gotten together and fought back. Now they need our help.

Illegal handmade toys?

Illegal handmade toys may sound like an embarrassing attempt at satire. Or the more embarrassing ravings of an unembarrassed consipracy theorist. But it's the sober fact. As the toymakers explain:

In 2007, large toy manufacturers who outsource their production to China and other developing countries violated the public's trust. They were selling toys with dangerously high lead content, toys with unsafe small part, toys with improperly secured and easily swallowed small magnets, and toys made from chemicals that made kids sick. Almost every problem toy in 2007 was made in China.

The United States Congress rightly recognized that the Consumer Products Safety Commission (CPSC) lacked the authority and staffing to prevent dangerous toys from being imported into the US. So, they passed the Consumer Product Safety Improvement Act (CPSIA) in August, 2008. Among other things, the CPSIA bans lead and phthalates in toys, mandates third-party testing and certification for all toys and requires toy makers to permanently label each toy with a date and batch number.

All of these changes will be fairly easy for large, multinational toy manufacturers to comply with. Large manufacturers who make thousands of units of each toy have very little incremental cost to pay for testing and update their molds to include batch labels.

For small toymakers and manufacturers of children's products, however, the costs of mandatory testing will likely drive them out of business.

A toymaker, for example, who makes wooden cars in his garage in Maine to supplement his income cannot afford the $300 - $4,000 fee per toy that testing labs are charging to assure compliance with the CPSIA.

Precisely because the toys are handmade, the new law requires that they be tested individually. At $300 to $4,000 per toy.

This is beyond Kafkaesque. Because factories in China were churning out poisoned toys by the thousands, you can't make and sell a wooden car in your garage.

Get more details here: http://www.handmadetoyalliance.org

Yes, we need to make sure more kids don't get poisoned by their toys. But let's focus on the source of the problem -- toxic mass-produced junk from Chinese factories.

If we had any real national conscience about conditions for workers besides ourselves, we wouldn't be buying from most of these sweatshops anyway. Maybe all this can be a catalyst towards change on that front too.

Fighting back

Independent toymakers aren't the only ones who've resisted this new law. Garment makers and even the publishing industry are also threatened by the insanely expensive requirements.

Together, these people have gotten a stay of execution for one year. That's right -- the original deadline for mandatory testing got pushed back a year. Because people resisted.

So let's help keep pushing till we topple the guillotine. Here's how you can help:

http://www.handmadetoyalliance.org/how-you-can-help

This page includes a petition (watch your step after you sign it -- the third-party petition site asks for a donation). Also includes a sample letter to your Congressfolk, and a link to contact the U.S. Consumer Product Safety Commission about CPSIA.

It'll take maybe five or ten minutes. Thanks. :)

Content by Bill Powell in this work is licensed under a Creative Commons Attribution 3.0 United States License.

Read more...

Distributism and Modern Economics, Part II

2 Our Current System

We have just examined an economic system which is based on the application of labor upon land and capital in order to produce wealth. Implicit in that discussion was the fact of consumption of wealth; that is, that the wealth which is produced in this way is produced for the use of man, and that that use often results in the wealth being consumed. (Sometimes, of course, it does not, as in the use of tools.) However, this consumption of wealth clearly cannot occur without that wealth first being produced; therefore, it is clear that the human economy is based fundamentally upon production rather than upon consumption; that is, that it is based primarily upon the fields, the forests, the factories, and the mines rather than upon the supermarkets, the home improvement superstores, the retail malls, and the jewelers’ shops within them.

In other words, the whole purpose of this is to produce wealth; that is, to take nature and make it more, rather than less, useful for man.

Our current system, however, turns this framework on its head. Rather than attempting to produce more wealth, our system attempts to produce more capital; hence, it is referred to as capitalism. This emphasis on capital and not upon wealth makes it focus on consumption rather than production, also earning it the name of consumerism. Our system arrived at these strange conclusions primarily through confusing wealth and capital, which (as we have seen) are two very different concepts. The main culprit of this confusion is money, a topic which we shall now examine.

2.1 The Nature of Money

As we have seen, an economic system produces wealth. In producing wealth, we often create stores of labor, known as capital. Different individuals also produce different types of wealth; the farmer produces food, the shoemaker shoes, and so on. However, individuals need types of wealth which they personally are not able to produce. Thus, they will exchange one type of wealth, which they can produce, for another, which they cannot. This simple form of trade is known as barter, exchanging one thing for another.

Though this trade is effective, it is also crude. Often, goods will be incommensurable, or at least difficult to compare. How many shoes, for example, will buy a bushel of wheat? Furthermore, producers of one form of wealth may not be in need of the form of wealth offered in exchange; once a farmer has shoes, for example, he will be loath to trade his wheat for more shoes. Yet the shoemaker still needs to eat. Thus, barter is insufficient for any society of significant complexity, and consequently money is created.

Money is nothing more nor less than a measure of value. Traditionally, for example, precious metals were used for money, most especially gold and silver. A farmer agrees that his bushel of wheat is worth one silver coin; a shoemaker agrees that five pairs of shoes is also worth one silver coin. However, the farmer already has all the shoes he needs. The shoemaker can instead sell five pairs of shoes to those who need them and thus earn one silver coin, then give that silver coin to the farmer in exchange for the wheat which he needs, and the farmer can use that silver coin to buy whatever else he might need that the shoemaker cannot provide. The silver is, considered simply as metal, useless to both the farmer and the shoemaker; however, because it has an agreed-upon value, it becomes something that they both want and are willing to accept as payment for the wealth they’ve created.

It’s important to remember, however, that money is simply a measure of value; it is not value itself. In other words, money is not wealth; it is a way of measuring wealth. Such a measure of wealth is useful, even necessary, for a sensible system of exchange of wealth. However, no matter how useful it becomes, money never becomes wealth itself. The proof of this is in the pudding. Wealth, things like food and clothing, is necessary to man for his survival; but no amount of money will keep the stomach full or the body warm if there is not real wealth to exchange it for.

In other words, money is a form of capital; that is, stored-up labor. The community as a whole agrees that this otherwise worthless thing (or which otherwise has a very limited usefulness) will serve as a measure of value; the money then represents the value that its holder can obtain for it. Just as the farmer stores up some of his crop to guard against a weak crop the next year, so he also stores up money to purchase what he needs in the event that he cannot sell enough wheat to provide for himself. The money, like the stored food, is labor stored up for future use. The difference is that it is valueless in itself; unlike real wealth, such as stored food, the money will not fill his stomach. But it can be used to buy something to fill his stomach, and that is its only usefulness.

Money, as long as it is treated as merely representing real wealth and not as wealth itself, is a reasonable and necessary part of a functional economy. However, our society has taken it far beyond this sensible role.

2.2 Money and the Capitalist System

As mentioned before, our own system lets money go far beyond this reasonable role that we’ve identified for it. In our society, money is wealth;he who has the most money is considered the wealthiest, even though he may have no actual wealth to his name at all. Men who have never produced a lick of real wealth in their entire lives—that is, they have never taken land or capital and made it more useful to man—are yet often the wealthiest men in the world.

Take as an example the way that our economy has been bifurcated into the “real”economy and the “financial” economy. The real economy deals with real things; it can only function by the production of real wealth. This includes things like Ford plants and cornfields. The financial economy, on the other hand, deals not with real wealth, but merely with the representation of wealth known as money. The financial economy, in other words, deals entirely with trading, insuring, lending, and otherwise manipulating mere symbols of wealth, adding absolutely no actual wealth to the economy at all. And yet,despite this fact, the financial economy is increasingly the focus of all our economic efforts; indeed, in the recent bailouts we have dedicated untold trillions of dollars to the financial sector, while we gag uncontrollably at the thought of mere tens of billions to the auto industry, a portion of the real economy.

Indeed, the financial economy is more and more seen as the economy, and this is a direct consequence of modern capitalism’s conflation of money with wealth. The result of this is that production of wealth is derogated, seen as the domain of the poor, the shiftless, the stupid, and the foreign, while the really important tasks—increasing the quantity of money that one holds—is the job for an educated and enlightened person. That money, the assumption goes, is really wealth;every extra dollar one makes is another dollar of real wealth that one has. The fact that one hasn’t actually produced any wealth, but merely managed to grab onto another representation of wealth, never enters the mind.

The difficulties this sort of system and thinking can lead to are apparent. Take,as an example, the recent stock market crash. The money-is-wealth types had been ensuring that their stocks were worth more and more money for some time. They were enormously assisted in this task by the federal government.They crowed that the value of their holdings was increasing and boasted of how wealthy they were because of how much money they could get for their stocks. Eventually, however,people began to realize that there really wasn’t anything behind this enormous increase in“value,” but rather that it was merely the fruit of financial trickery and speculation. As a result, people dumped the stocks, prices tanked, stockholders lost their money, and then they proceeded to complain that their wealth had disappeared.

However, no wealth had disappeared because there was no wealth there to begin with. What had changed was that people were starting to reevaluate paying higher and higher prices for the same amount of wealth. The recent real estate bubble is a case in point. A house which was once priced at $100,000 is made more “valuable”(by which they mean not that it contains or produces more wealth, but merely that it will fetch more money at sale) by the use of financial shenanigans too complex to describe here. Now, the house can sell for $300,000. Our financial system considers this an increase in wealth; however, our review of basic concepts above makes it clear that this is merely an increase in money. The house itself still represents the same quantity of real wealth, and it is not producing more wealth than before; they’ve merely jiggered things so that people are willing to pay more money for it. However, potential buyers realize this suddenly, and the house again sells for $100,000. The financial system claims that its wealth, represented in this particular house, has decreased to a third of its former value.Clearly, however, their actual wealth is precisely the same; it is only the quantity of money which is different. No wealth has disappeared at all.

The financial system might well reply that we’ve just decided that money represents wealth, and has value insofar as it may be exchanged for real wealth. Cannot $300,000 fetch more real wealth than a mere $100,000? Has not, then, the owner of this house lost two-thirds of his wealth, since he has lost two-thirds of his money?

No, he has not. If the increase in his house’s price reflected a real increase in his house’s wealth—either through improvements to the property, or an increase in the property’s productivity, or some other cause—then he has indeed lost two-thirds of his wealth. If, on the other hand, the value of the house increased merely through speculation and trickery, then his wealth is precisely the same. While he has less money, he has the same amount of stuff which has been made more,rather than less, useful for man; thus, he has the same amount of wealth. Money represents wealth as a congressman (theoretically) represents his district. Sending two congressmen to Washington does nothing to increase a district’s population.

In other words, an increase in money is only an increase in real wealth if the wealth that the money represents has also increased. In this case, as in countless others, that real wealth has not changed.

And yet our entire economy is built upon such increases in money rather than in producing wealth.More and more, in the West we produce less real wealth and spend more of our time passing money back and forth and pretending that we’re adding value to it every time it leaves our hands. Our banks, for example, become rich merely by creating money through a concept called fractional reserve banking. The nature of this process is too complex to describe here, but suffice to say that the bank produces no wealth when it creates this new money; it merely produces new money. Yet it is rich from it. This sort of system is clearly out of accord with the basic principles we examined above, and thus must be fundamentally wrong.

Still, it seems to work, at least to a limited extent. Don’t we have more things than ever before? Better medical care? More plentiful food? Better heating and clothing? So what’s the problem?

The problem is that it’s not natural, and thus it is not sustainable. Our current economic system may still be struggling on, but it violates nature, and thus it must inevitably fall.

2.3 The Failures of Capitalism

Capitalism fails on a number of levels philosophically; however, here we will limit ourselves to its failures due to its fundamental misunderstanding of the nature of human economy,based on the principles we’ve discussed above.

When a society begins to mistake money for wealth, it begins to dedicate itself to the production of money rather than to the production of wealth. The accumulation of money is seen as the acquisition of wealth, and the constant flow of money is seen as the lifeblood of the economy. Because money must be constantly moving, this system requires the greatest amount of spending by the greatest number of people possible. This encourages everyone to continue accumulating still more money, and soon, ad infinitum.

The capitalist, of course, argues that this fact also encourages production. After all, people have to be spending their money on something, and someone has to produce that something. This argument,however, misses the material point, which is that the purpose of this corrupted system is to produce money, not wealth. While people certainly spend a good deal of their money on things, and that those things must be produced, people also spend large quantities of money on things which have little or no real wealth behind them.

The current system is interested in producing money, not necessarily in producing wealth. So men in our system naturally turn to those professions which can produce the greatest amount of money in the shortest amount of time. Needless to say, this does not include farming or shoemaking; rather, it consists largely in finance. Short selling, ludicrously complex derivative packages, credit default swaps, and various esoteric types of insurance are the lifeblood of such a system. Trading money back and forth to each other while selling each other insurance on the packages occupies an astoundingly large portion of our population. Meanwhile, the portion engaged in such tasks as growing food and making tools continues to dwindle.

In other words, it’s clear that people still consume as they always did; however, what they consume, how much they consume,and what’s behind that consumption are quite different.

First,people are driven to consume large quantities of useless things that they do not need. This sort of consumption is encouraged by the enormous quantities of advertising required by the consumptive capitalist society, which is needed to induce the populace to keep buying things that they don’t really require. This is often accompanied by huge, tragic cultural losses, losses which are largely,if not entirely, ignored by our society. For example, the average citizen owns a large quantity of purchased music, in the form of tapes, compact discs, and digital files. Yet the average citizen rarely gets together with others in a pub and makes music for himself anymore, so distracted is he by the bought music he constantly pumps into his ears.

Second, people consume enormously more than they once did. They have to, or the system would come crashing down about itself, depending as it does upon the unending flow of large quantities of money. And so while people once saved for years to buy a home, which they would live in for decades at a minimum,people now get mortgages to pay for the entire cost of the home, or more, and yet leave it within only a few years.This also encourages massive personal debt and discourages personal savings, as it’s necessary to constantly buy to get the things that we “need,” while thrift and saving only delay the gratification that our society and the constant barrage of advertising tell us ought to be immediate.

Finally,what’s behind the consumption is often merely a veneer of actual wealth. Production simply doesn’t produce money fast enough; this has encouraged our citizens to avoid the productive trades and pursue others, which yield larger quantities of money more quickly. Because production doesn’t pay enough to fuel our highly consumptive lives, production has increasingly left our shores and been“outsourced” to other lands. We are thus left physically dependent upon others for the wealth that we require for our survival. We also further the spiral of debt, consumption, and costs that’s been briefly outlined above, aggravating still more our society’s descent into hedonism.

Furthermore, behind all our reckless consumption lies an untold ocean of exploitation and injustice. To keep us constantly buying more and more stuff, prices must be kept down and durability must be kept minimal. The cheaper things are, the more likely we are to buy them; the quicker they break, the more often we will purchase replacements. Not only does this run roughshod over all the traditions of craftsmanship in each particular trade, it also exploits the populations of other lands than ours. Those who do our production for us must do so at near-slave wages, for paying a living wage would remove the price benefit of producing there in the first place, and fewer of us would buy the goods produced. More and more, rather than producing wealth for their own countries, foreigners are led into borderline slavery to produce unnecessary flotsam for ours. In this way, while we corrupt ourselves, we also impoverish our neighbors.

Finally,our current system largely takes away the freedom of families and local communities within our society. Since goods are generally produced quite far from where they are sold (since they are generally produced in foreign countries, and even overseas), sale of those goods tends to become limited to those who can afford to transport them most cheaply. Huge retail monstrosities thus arise, vending the generally foreign and often useless garbage that advertising assures the populace that they need, as well as the few necessities which people cannot avoid buying. Families and local communities are thus led outside of themselves, not into themselves in solidarity. Rather than communities producing most of what they need themselves, and supporting one another with their money by buying what their neighbors have produced, communities are constantly split apart by the necessity to stray farther and farther away from home to make any purchase. These families and communities thus become absolutely dependent upon others, who are usually based far away and have little concern for them other than for their money. Communities dissolve, and small producers based in those communities become increasingly unable to survive.

Nor is this situation sustainable; we’ve seen recently just how fragile and ultimately doomed it really is. We’ve equated our wealth with our money; however, while we’ve based our entire society on our ever-increasing piles of cash, we have not accumulated real wealth to give that money any true meaning. This works for a time, as people get heady in their own richness; however, eventually they realize that there’s nothing behind their money,and they flee from it as quickly as they can. This happened in housing; it happened in the financial markets; it will happen in all segments of our economy. We may be able to stave it off, but we cannot make it flee forever. One can only violate the nature of things for so long.

But what can be done? How can we free ourselves from the endless cycle of consumption designed solely to produce more and more money which in itself holds absolutely no value? That is where distributism enters the picture.

Note: This is published under the Creative Commons Attribution-Share Alike 3.0 United States License.

Read more...

Conference Announcement: Religion and the Recession

For all of our readers in England, the following is an announcement of a conference at which your humble correspondent will be giving a speech on Distributism. Our Capitalist and Libertarian friends will no doubt find it amusing that a conference on this subject should be held in Robin Hood's hometown, but they are welcome to come as well.

Christian Social Teaching and the Politics of Money
An International Conference on Religion and the Recession

University of Nottingham, 9 and 10 July, 2009

In July, the Department of Theology and Religious Studies and the Centre of Theology and Philosophy, University of Nottingham, shall be hosting a conference on religion, the Church, and the global recession. Many prominent and international speakers shall be attending, including:

The Archbishop of Granada, Mons. Javier Martínez
The Bishop of Worcester, Rt. Rev. Dr. John Inge
Dr. Peter Selby
John Cruddas MP
Norman Wirza, Duke Divinity School
Stefano Zamagni, Università di Bologna
Michael Northcott, University of Edinburgh
John Milbank, University of Nottingham
John Médaille, University of Dallas

Over the past year, fundamental questions have arisen concerning the moral use of money and the potential for alternatives to the prevailing models.

For example, it has been suggested that the economic system commonly referred to as capitalism is secular because it redefines the sacred. Thinkers from Walter Benjamin to Karl Polanyi have argued that the capitalist market economy in general and global finance in particular subordinate the sanctity of life and land to a belief in idealised and abstract commodities.

Christians of different denominations claim that Christian social teaching can help provide answers to these questions, a position that is viewed with scepticism by secular economists, politicians and commentators.

However, a closer examination of these positions shows that each is moving in similar directions: long-term economic security, sustainability, localism, and accountability in the market today. There is thus a clear need for economists, theologians and Church leaders to debate new economic models and to discuss an ethical framework for markets. With this in mind, the conference aims to bring together some of the leading figures in economics and theology, as well as politicians and representatives from other religions.

The working hypothesis of the conference is that there is there is a ‘middle’ position between an exclusively religious and a strictly secular perspective: faith can lead to a strong notion of the common good and a belief that human behaviour, when disciplined and directed, can start to act more charitably. There can also be secular intimations of this: the more faith-inspired practices are successful even in secular terms (more equality, more consensus, more human happiness, a better ecology), the easier it will be for secular institutions to adopt such a regulatory framework without having fully to embrace its religious basis.

All are welcome. For further information, including costs, registration and the full list of speakers, please visit www.theologyphilosophycentre.co.uk/ or contact adrian.pabst@nottingham.ac.uk / james.noyes@nottingham.ac.uk

Read more...

The Midas Touch

A friend of mine sent this to me. It is a modern morality play, if the term “modern morals” is not itself a contradiction in terms.

PBS - Gold Futures - Rosia Montana from Lee Wilkins on Vimeo.

It is 54 minutes long. But if you haven't time to watch the film, let me summarize it for you.

Very simply, there is a gold mine in Rosia Montana, a village in Romania. This is not news; there has always been a gold mine Rosia Montana, and one can still explore the tunnels dug by the Romans, from whom Romania is named. Gold is not Rosia Monana's only form of wealth. The mountain also gives silver and copper, but even that is not the end of it. It is a place of stunning beauty, as you may see in the film, but it also has fertile fields, verdant pastures, and rivers brimming with fish. There is no end of the natural wealth and there ought to be no end of natural prosperity and happiness.

But there is not. There is, in fact, poverty. None of this is news. What is new is that a Canadian company wants to mine in Rosia Montana. But “mine” is perhaps not the right word. Rather, they want to destroy the mountain, and in destroying the mountain they must destroy the village. They want to replace the village with a lake of cyanide to reduce a ton of rock to a grain of gold. In only 17 years, it is their plan to reduce the mountain of gold to a heap of slag. This is not to say that the Canadians are being unfair; they are more than willing to pay the villagers. Some have accepted, others are resisting. And they promise to turn the slag into a garden.

Now, it is not my place to tell the villagers what they should do. It is neither my village nor my country, and these are decisions which only the people of Rosia Montana and the government of Romania can make. But whether the villagers decide to stay or go, the decision they make is a sign and symbol of something much wider, and part of something much greater. To be specific, it is part of a great joke about capitalism. But it is a joke that no one seems to get. So here is the punchline: Rosia Montana is a place of great natural wealth, BUT THERE IS NO INCOME (as one of the villagers in the film put it). Now, here is a place that has received every gift that a loving God could bestow on any piece of ground: mountains full of minerals, valleys full of farms, pastures full of animals, rivers full of fish. It is a place that could—and has—supported tens of thousands in peace and prosperity, but under capitalism, it cannot provide work for a thousand. An area that should be prosperous and happy becomes an area of forced idleness. There is wealth, real wealth, but there are no jobs, and people, young people especially—that is, the future—feel they must leave. And if they leave with a few Euros provided by the Canadians, who can blame them?

But still there is the joke. The joke is that while the villagers have real wealth, the Canadians have financial wealth, and under capitalism, the latter is more important than the former. The bits of paper with the € printed on them are heavier than gold; the sterile bankers notes more fecund than fertile fields. We may laugh at the joke; we may even laugh at the Romanians, but we are caught in the same joke. In this country, no less than in Romania, men who make naught but bits of paper (called “financial derivatives”) have brought a great country to its knees. These men contributed not so much as a grain of wheat to the commonwealth, but from our common wealth we have paid them 100's of billions of dollars, and will pay them more still as a reward for their failures. At least the Canadians will pay something for their destruction of the village; we must pay for the rope they will use to hang us, and pay a monopoly price at that.

Under capitalism, the natural order of things is reversed. The money that should serve as a convenience for the trade of real things becomes the master of real things—and real people. The natural connection between wealth and work is broken, and those who hold real wealth got with real work become the servants of those with financial wealth who do no work.

The situation is Rosia Montana is repeated all over the world, wherever there is wealth that can be exploited. The obvious example is oil. Oil also holds the promise of easy money, of wealth without work, but the usual result for a nation rich in oil is neither wealth nor work. Or rather, the wealth is confined to a few, usually foreigners and their local political servants, while the rest have no work and hence no wealth. A bit of a dole is all they can expect. It may be a generous dole, as it used to be in Saudi Arabia; sometimes it is a pittance; more often it is nothing. Only a few places, such as Norway, have treated such wealth as the common property of the nation and attempted to use it to expand the real wealth of the nation, as token against the day when the oil runs out.

Gold comes out of the ground very slowly. That is as it should be. It is a resource for the ages, and not just for one generation, and certainly not for a generation of foreigners. To each generation, the mountain gives a few flakes, so that they might make merry at the end of the day, or bring the wife and children some small gifts. And the children will grow up to bring a gift to their wives. But the Canadians want to compress 2,000 years of mining into 17 years, to take all the wealth of the red mountains in one fell swoop, and leave behind a desert. True, they say they will leave behind a garden, and they may actually mean that. But once all the battles are over, once the gold is gone, there will be little reason to fulfill the promises. Soon after the mine is opened and the mountain begins to shrink, the Canadian director will call the Romanian manager and tell him, “We made €100 million, last year; we need to make €120 this year. Cut the budget.” And the next year they will say 140, and then 200. What budget do you think they will cut?

They made the same promises in Baia Mare, in the North of Romania. But in the year 2000, the cyanide lake broke, and wound its way into the valley and the river Tisza and the Danube, rendering the valley sterile and dangerous and the fish poisoned. It was the biggest environmental disaster in Europe since Chernobyl. They cannot farm or fish the area for 20 years. Some garden. “Ah, but here it will be different. Our lake will never break; we will break the mountain, but it will not break our lake; we are stronger than nature.” Maybe, but the cyanide must go somewhere, some day.

This whole process is called “investment,” which means that nations like Romania with real wealth must go hat in hand to countries with financial wealth. They must beg in Bruxelles for permission to eat their own bread, for the bits of paper without which (apparently) wheat will not grow and fish will not bite. As it is, the farmers and factories cannot compete with the system of organized subsidies and exploitation known as “globalization,” a system meant to suck the life out of poor countries for the benefit of (financially) rich ones. If things proceed as the usually do in these cases, it will be impossible for the government of Romania to resist the pressure to sell the real wealth of Romania for the “investment” wealth of the Canadians. Yet there is something else that may stop the project: the death of a system that demands such projects.

There are people in Romania who are old enough to have witnessed the death of empires; they have see the passing of the kingdom, of the fascists, of the communists, and soon, I am convinced, the passing of the capitalists; that system, like the others, cannot survive its own “success”; the bits of paper aren't real wealth, and the people who have real wealth got with real work will tire of working for others and demand to work for themselves.

It should be a trivial matter to organize the wealth of Romania into a real economic system. It should not be much of problem to make fertile fields prosperous, to make good and useful things for their neighbors, to trade with the other cities of Romania and with the neighboring countries, all of whom need some of what Romania has, just as Romania can use something of their surplus. If bits of paper are all that stand in the way, then such paper can be printed in Bucharest, backed by the real wealth of the nation. It takes only the will to do so. If small nations can realize their own wealth, no one can stop them; if not, they must work for Canadians, for such work as can be found, and there won't be much of it. For the rest, they must go to Spain or Germany; they must enrich another country and forget their own language.

The other joke about such projects is that they are not good investments. They are too capital intensive, and depend on gold staying at or above a certain price. But ten years ago, the price was only $250/oz., and if the current troubles pass without incident, it may be that again, in which case the mine would be unprofitable. But if this really is the passing of an era, the fall of an empire, then the price might go to $5,000/oz. In that case, Romania will need its gold, and whoever rules Romania will will not let it out, whatever promises they have made to the Canadians. The Canadians have no army to enforce their claims, and the rest of Europe will have concerns of its own. The Canadians will lose their investment, just as the people of Rosia Montana lost their village.

I have called capitalism a great joke, but it is also a grand myth, namely the Myth of Midas, he whose touch turned everything to gold. Capitalism also turns all it touches into gold, but a strange gold that, as for the King, can not feed itself, and which turns every beloved thing, everything of real value, into something cold and heartless and still. Nobody knows what will happen, but it would be dangerous to think that what worked yesterday will work in the future. But it is a myth that these things ever worked for places like Romania, and a greater myth to think that Romania needs them to work. She has both the gold and the food to feed herself, and feed on a grand scale.

Read more...

Solidarity Economy

http://www.solidarityeconomy.net/2009/05/19/community-organizing-and-the-solidarity-economy/#more-495

Read more...

Distributism and Modern Economics, Part I

Man is a creature incapable of survival without the use of his intellect to form his environment. Other animals on this earth were gifted with substantial natural powers; they have thick fur or blubber to protect them from exposure, sharp claws or teeth to enable them to feed, swift feet to enable them to escape their predators, and superb senses to enable them to detect and explore the world around them. Man, the highest of animals, has none of these things. His skin is thin, his hair scarce, his teeth small, his claws flimsy, his feet slow, and his senses mediocre at best. God does not intend man to survive solely by use of his physical prowess; He intends him to survive wittily, by the use of his reason to aid his strength.

But man does not survive wittily in this way merely by using his intellect to take advantage of his existing environment, like a wolf with an abnormally high IQ. No; man survives wittily by changing his environment, by molding it to his will. He ought not to violate his environment, forcing it to be contrary to its nature; rather, he ought to perfect it, making it what it needs to be so as to be most useful to him.

God Himself has instructed man thus, and in no uncertain terms:

And he [God] said: Let us make man to our image and likeness:and let him have dominion over the fishes of the sea, and the fowls of the air, and the beasts, and the whole earth, and every creeping creature that moveth upon the earth. And God created man to his own image: to the image of God he created him: male and female he created them. And God blessed them, saying: Increase and multiply, and fill the earth, and subdue it, and rule over the fishes of the sea, and the fowls of the air, and all living creatures that move upon the earth. And God said: Behold I have given you every herb bearing seed upon the earth, and all trees that have in themselves seed of their own kind, to be your meat.[1]

Man is to rule and to fill creation; more, he is to subdue it, not violating its nature, but making it better serve man, its lord.

This necessity of forming nature to a condition more useful to ourselves is not merely a product of sin. After creating man and the Garden of Eden, "the Lord God took man, and put him into the paradise for pleasure, to dress it, and keep it."[2] Thus, even in his primordial and innocent state, man could not live merely by plucking the fruits of the earth, like a beast or an insect. Even in his innocence, man was set to work, to improve the nature he was given ("to dress it"), and to preserve it in its improved state ("to keep it"). Making nature more useful to himself is in the nature of man and of nature itself; nature exists to serve us, and we exist to rule it.

This is all, of course, very general; however, traditional Catholic philosophy has become very specific about much of this thinking, and has even attached names to some of these concepts. That which has been made more useful to us, when once it was less useful, we call wealth. When one picks up a board, one is holding wealth; it is a tree has been made more useful to man by means of man's wits and abilities. When one eats an apple, one is making use of wealth; the nutrients of the soil have been transformed, through the deliberate cultivation of an apple tree, to a condition more useful to man than their original form. The process itself, by which nature is made more useful and valuable to man, is called the production of wealth, or sometimes the shorthand production. The farmer, in growing his apple crop, is producing wealth, as is the lumberjack and the miller who turn trees into boards.

Man achieves the process of making nature more useful to him---that is, of producing wealth---by means of his labor. Labor is simply man doing things with nature, like the rancher who herds his cattle to better pastures, or the blacksmith who renders wrought iron into a useful tool. The great Catholic economic thinker Hilaire Belloc described labor as "human energy...applicable to the material world and its forces."[3] Labor is the means by which man fulfils his God-given task of subduing and ruling nature; as such, labor is clearly sacred, among man's highest acts. Furthermore, it is the means by which man becomes prosperous; "it is incontestable that the wealth of nations originates from no other source than from the labor of workers."[4]

Sometimes, however, labor exercised upon some object is not immediately expended. For example, rather than eat all the food that he produces, a farmer may choose to store some quantity of it for the next year, as a guard against poor crops. A blacksmith who produces a good, strong draw-hoe has certainly exercised his labor upon iron, but that labor will continue to assist the production of wealth for many years. In other words, the labor is stored for a time, held aside for future production, either because the labor has great longevity (as in the case of a good tool, like the draw-hoe) or because its consumption has been deferred to assist in future production (as in stores of food). This type of labor, which has been stored in some way for future use in producing wealth, we call capital.

Finally, before one can produce wealth with labor and capital, one must have something to which the labor, with the assistance of the capital, can be applied. A farmer may work all he likes, but without land he will grow no food. A lumberjack can swing his axe until his arms wear out, but without trees he'll produce no timber. Throughout the course of this essay we have referred to this simply as nature; as in, man makes nature more useful to him (that is, produces wealth) by the application of labor.Traditionally, however, nature in this equation has been termed land. Land is the ultimate source of all wealth, as all things upon which man exercises his dominion proceed, either directly or indirectly, from it. Therefore, nature is fittingly referred to as "land" when discussing the production of wealth.

Therefore, there are three main factors in man's dominion as given by God: land, labor, and capital. The land is the clay which man has been designed to mold; labor is the means by which man molds it; and capital is past labor which sustains and assists man while he exercises his current labor. These two, land and capital, have a great deal in common which they do not share with labor. For example, often man exercises his labor upon the results of other labor; that is, upon capital, as when a miller turns timber into boards.Therefore, we can see that land and capital are, in a certain sense, types of the same thing; that is, they are both objects to which man applies his labor, the means by which labor makes things more useful to man. Thus,when we speak of the means of production, we are speaking of land and capital combined, the two things which man, by his labor, can make more useful to himself. Labor, on the other hand, is different; it is the action of man itself, and thus is sacred in a way that even land and capital cannot be.

To sum up: man's dominion over nature is given by God, a dominion which requires him to perfect nature by making it more useful to man, thus producing wealth. Man does this by applying his labor to land, which includes the fruits of the land. Often man stores his labor for future use, either in the form of tools, which are not quickly consumed, or in the form of stores to sustain future production. This stored-up labor is called capital. Man can apply his labor to capital as well as to land; thus, land and capital together are called the means of production.

Thus, we have a basic outline of the economy of man; that is, of how man uses the resources God gave him to produce the wealth that he requires for his flourishing. It does not, however, take an astute reader to notice that our current system seems quite far removed from this description. This situation is not merely the inevitable consequence of our complex society; it is rather a positive rejection of the true nature of man's dominion over creation, and a deliberate distancing of man from the creation which he rules. This rejection and distancing prevents man from truly flourishing. We will now proceed to an examination of our current system and how it is built upon a rejection of the principles we've just reviewed, and see what negative results that has had for our society.

Note: This is published under the Creative Commons Attribution-Share Alike 3.0 United States License.

Read more...

Meek & Mild vs. Toughies

Where is President Barack Obama's economic Recovery team?
The simple answers
Summary of J.W. Smith's one hour presentation at the United Nations General Assembly Hall 03/05/2009, providing those answers
UNIS-UN International Students Conference
http://www.ustream.tv/recorded/1215100 Fast forward 70 minutes
Those Simple Answers are in 168 bold faced words below

Visualize a fertile valley 10,000 years ago with fruits, nuts and vegetables growing wild along with lush thatch for building shelters. The new settlers have only to pick their food, build their thatch homes, and, once that home is built, relax most the day.
A cunning cabal form and each lay claim to a part of the land. They make a pact with toughies that they will share the spoils if they protect their unequal and unjust “property rights.” The meek, mild, and law abiding now have to share the food they pick with those “owners,” have to build their houses, and provide any and all other services.
The primary cause of poverty among plenty is uncovered. Those cunning go on to claim their unearned wealth on through history and those are the property rights laws, as applied to nature’s resources and technologies, denying others their rightful share of what nature offers to all for free, that is in place today.
This exposes most current finance capital as unearned wealth. In the thesis below, note how, even as taxes disappear and honest capitalism is fully retained, those rental values paid to ourselves will fully fund all social services currently starved for funds.
The economic thesis to eliminate this unequal economic structure created by many many cabals over the centuries, and they claiming your and my wealth yet today, can be summarized in these 168 words:

By paying land (resource) rents to ourselves, meaning socially collected, a citizenry is quintuply repaid through those massive funds building roads, railroads, water systems, sewer systems, and electric grids (any natural monopoly) as well as fund governments, provide education, health care and retirement. Infrastructure and population, not capitalists, establish the use-value of land and resources and their rental values fund those same required infrastructures as well as essential social services (the community process). Restructure to the just described honest capitalism and taxes disappear as your employed working hours drop by half and all enjoy a quality, secure, life. This requires sharing the remaining “productive” jobs and equal pay for equally productive labor. Each region of the world, each nation, each region of a nation, each state, each county, each community, and each entrepreneur must have equal rights to their share of both created and saved finance capital (created money and savings). With those rights, entrepreneurs (private industry), will fill every niche within the production-distribution process.

You can follow those flows of money and commerce within this efficient economy in your head. Both the community process operating those natural monopolies and efficient private industry producing consumer products and services are fully visible.
Both taxes and poverty disappear even as our employed working hours drop by half and the pressures on our resources and the environment are alleviated roughly to the same degree. Over half our labors and resources are wasted within the superstructures operating those monopolies we are told do not exist.
The two books below that tell this story were started five years ago under the assumption this financial crash was coming. Both demonstrate how easy it would be to stop this crash in its tracks by pouring created money at the real economy, that is you and me if we are unemployed, and restructure the economy as outlined in this thesis.
Currently trillions are being poured at the very people who created this crisis while the real economy is left to fend for itself and that may fail. The answers are simple. Where is President Barack Obama’s economic recovery team?
Thank you. The Institute for Economic Democracy
Virtual tear sheet appreciated
Available for lectures and workshops

Economic Democracy: A Grand Strategy for World Peace and Prosperity ($35, 2009 edition) and Money: A Mirror Image of the Economy. ($32, 2009 edition) by J.W. Smith, can be ordered from any bookstore or Amazon.com. Signed copies, each 30% off (plus $5 S&H) if ordered from the address below. Thank you.

For Book Reviews, the manuscripts are at: Economic Democracy: A Grand Strategy for World Peace and Prosperity and Money: A Mirror Image of the Economy

The Institute for Economic Democracy
13851 N 103 Ave, Sun City, AZ 85351
623.583.2518 ied@ied.info www.ied.info
Please forward to others you think might be interested. Thank you
More IED books

Read more...

More Worker/Owners

http://www.theworkingworld.org/index.php?action=home

Read more...

Economic Autarchy and Buying American

The Distributist Review's own Tom Laney has presented some questions about the "Buy American" campaigns that have recently, in these tougher economic times, been gaining some considerable traction. It's sometimes hard to believe that there was a time when no less an enormous Chinese goods retailer than Wal-Mart advertised itself as virtuous seller of American-made goods. (Obviously, that's an ad campaign that they've long since completely abandoned.) But the "Buy American" campaigns, along with the broken promise of President Obama to renegotiate NAFTA, touch on a subject which is very deeply ingrained in traditional Catholic, and indeed generally Western, political thought. That subject has been known for some time as economic autarchy.

Economic autarchy ("autarchy" is just philosopher-speak for "self-sufficiency") has a long pedigree in Thomistic (the most prominent strain of Catholic) philosophy. It goes back, indeed, at the very least to the man St. Thomas called simply "the Philosopher," Aristotle, and continued unabated through St. Thomas himself, who elaborated on it in some detail. While it goes very strongly against globalization, of which most moderns from Austrian-school economists to Keynesians are unreconstructed fanboys, there is great reasoning behind it, which ought to be carefully considered by anyone thinking about the foundations of society.

Aristotle based his argument in favor of economic autarchy (and, indeed, autarchy in general) upon the nature of the state itself. Human society is made up not merely of the state, but of many levels of human community. (This discussion is from Book I, Chapter 2 of the Politics.) There is, of course, first and foremost the marriage, the unit of society which is ordered primarily toward procreation. (Unfortunately, Aristotle's errors justifying slavery confuse this issue somewhat, but once those errors have been purged, that's the bottom line.) From marriage arises the family, the community which is ordered to supplying day-to-day wants. Then comes the "village," which St. Thomas called the vicus, made up of several families for the purpose of providing for those material needs which the family cannot fulfill. Finally, when villages unite into a complete community, we have the state, which exists for the purpose of the good life (which is, remember, the end of the men who are its members).

This state is a complete community, which contains everything that is necessary for the flourishing of its members. However, its members cannot flourish without fulfilling their material needs. Thus, the means for providing for the material necessities of its members must exist within the state. This is economic autarchy: the state must be self-sufficient in this way. Insofar as the state lacks what is necessary for human flourishing, it is defective. So goes Aristotle's argument.

St. Thomas Aquinas naturally expands upon and perfects Aristotle's argument, while accepting that argument on its own terms, as well. In the De Regno, St. Thomas goes on for some time about the self-sufficiency that is appropriate for the state (which he calls the kingdom) in the context of the production of food. St. Thomas begins by observing that a city (which is the political unit of the state, a topic which is more complex than this simple article will tolerate) may acquire its necessary food by one of two means: either by producing it itself, or by importing it. St. Thomas states unequivocally that it is much better to produce it than to import it.

Adopting Aristotle's argument without even fully explicating it, St. Thomas agrees that the city which is more self-sufficient is better than the one which is less self-sufficient. Thus, since it's important to be as good as possible, the city should endeavor to produce as much of its own food as it can, if possible all of it (at least the necessary foodstuffs).

However, St. Thomas adds further to Aristotle's arguments. He notes that self-sufficiency is safer, because import routes are easily disrupted by war and by natural disaster, thus imperiling what the city needs to survive. He further notes that it's bad for a city to have too many foreigners about (another argument taken from Aristotle), and that importing large quantities of goods increases the presence of foreigners. And he notes that tradesmen, not being engaged in physical activity, make poorer soldiers, should defense of the city be necessary, and that therefore having more tradesmen in the city would be a detriment. He further observes that having everyone packed closer together within the city proper, which is more likely when there is too much importation of goods, is more productive of civil unrest than having people more spread out, as will be the case when many of the people are engaged in food production.

His strongest argument, however, is that importation tends to produce vice in the city, and thus one should avoid it as much as possible. He states, "Since the foremost tendency of tradesmen is to make money, greed is awakened in the hearts of the citizens through the pursuit of trade." One can find extensive justifications of this general thesis in other writings of St. Thomas, such as the Summa Theologica IIa-IIae Q. 77 Art. 4, with some illuminating discussing in Ia-IIae Q. 2, Art. 1. Aristotle also spoke on the same theme; for example, in the Politics Book I Chapters 7 and 8, concerning the unlimited nature of getting money with money. St. Thomas argues very forcefully that this is disastrous:

The result is that everything in the city will become venal; good faith will be destroyed and the way opened to all kinds of trickery; each one will work only for his own profit, despising the public good; the cultivation of virtue will fail since honour, virtue's reward, will be bestowed upon the rich. Thus, in such a city, civic life will necessarily be corrupted.

Aren't these exactly the problems with our own society? Isn't America as a nation obsessed with money; don't we permit as legitimate all kinds of trickery in the pursuit of money; don't we grant the greatest honors upon the richest, rather than upon the most virtuous? No better example of St. Thomas's warning about a city based entirely on trade, rather than on producing one's own goods, could be imagined than the bulk of modernity.

We might add in our own day to St. Thomas's justifications, that self-production allows full quality controls to be imposed. Recent difficulties with Chinese-made products in the United States come immediately to mind.

Now, St. Thomas did not argue that all trade was bad; indeed, such a proposition would be foolish. St. Thomas noted that "trade must not be entirely kept out of a city, since one cannot easily find any place so overflowing with the necessaries of life as not to need some commodities from other parts." He concludes that "the perfect city will make a moderate use of merchants." However, he provides very powerful arguments that the good state should seek the greatest possible degree of self-sufficiency.

So is it, as Mr. Laney asks, "more principled to shop close to home and buy products that our neighbors make?" I think that, unquestionably, this great Catholic tradition of economic autarchy that this little essay has barely touched on reveals an answer of "Unequivocally, yes." It would be much better, of course, if our society were so arranged as to produce most of its own goods, so that a "buy American" campaign would not be necessary. However, given our society's current sad state, the citizen seeking to improve his country must do the best he can. Produce wealth wherever one can; buy locally wherever one can; if one cannot buy truly locally, by as locally as one can manage. In this way, we can reduce the harmful effects of too much trade and not enough production, and, God willing, substantially improve the health, both economic and spiritual, of our beloved country.

Praise be to Christ the King!

Note: This is published under the Creative Commons Attribution-Share Alike 3.0 United States License. The vast majority has been drawn from my earlier essay Economic Autarchy.

Read more...

Buying American

There is presently some positioning by the Left, on another forum, in opposition to the "Buy American" idea and in partiuclar, to the Steelworkers Campaign for Buy American.

The Left says the Buy American campaigns are "chauvinistic" and only support the corporations that are killing us and stand in the way of "International Solidarity".

I say it may take some time yet to fix better ownership of the corps, that we need to work to support our families, that it is more principled to shop close to home and buy products that our neighbors make, that it is a good thing that many American home bodies are turning to E.F. Schumacher and the principles of Subsidiarity and Distributism.

It's kind of amazing to me how the Left in the auto industry clings to their anti-common sense.

What do you think?

Read more...

Is this Socialism or Distributism?

http://www.nytimes.com/2009/05/14/business/global/14frugal.html?ref=business

Read more...

Free Cars for the Poor?

When I first saw this story, I was surprised. Then I was vaguely sympathetic, for a few seconds. Then, I became completely incredulous that anyone could think about this for more than a minute and still believe that it's a good idea:

Free cars for poor fuel road rage

Not only did somebody apparently think that that "fuel" pun would be even mildly amusing, but somebody thought that the program this story describes was just a capital idea. Not only somebody, but a large enough number of somebodies to get it through a legislature and then signed into law. This is truly incredible. Robert A. Heinlein, a writer whose ideas are of at best mixed merit, once quipped, "A committee is a life form with six or more legs and no brain." I've often equated this with the great American author Mark Twain's famous appeal to his readers: "Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself." (Seek elsewhere for a number of other amusing Mark Twain quotations concerning this institution.) But this legislative program really does underline the point like few others in recent history do.

Let me begin by saying that, working in the criminal justice field, I repeatedly see the difficulty that poor people have when they lack their own motor vehicle. They get in trouble for something, their license to drive is suspended, and then they have trouble finding work because they can't drive around looking for jobs. Then, when they drive despite this in order to get a job, they get pulled over because the broken-down hoopties they've managed to borrow have dead headlights, are written a ticket for driving while suspended as well as for the dead headlight, and then, when they're convicted, their license gets suspended again. This happens all the time, and it's a real problem for the poor. Of course, many of the poor lack cars for another, and much simpler, reason: they just can't pay for one without a job, but they can't hold down a job without a reliable car.

But the problem is not that they don't have cars; it's that they need cars. It's a fact of modern American life that, except in our largest cities (and then only those old enough to have a decent public transportation system), it's more or less impossible to live prosperously without an automobile. This means that every American, more or less, is required in order to support himself and his family not only to secure food, housing, health care, and the various other necessities of life, but also to plunk thousands of dollars of his supposedly disposable income down on at least one automobile. He is further required by law to insure it sufficiently to cover likely liabilities, which means shelling out at least several hundred dollars a year. He is further required to keep that vehicle in maintenance---oil changes, oil filters, air filters, new tires, brakes, windshield wiper fluid, brake fluid, power steering fluid, electrical system, and on and on and on---not to mention to keep it full of that ever-increasingly expensive commodity, gasoline. If he does not do this, he is extremely limited in the jobs he can get; the places he can live; the places he can shop; and the places he can go to socialize.

In other words, the poor need to get jobs in order to improve themselves. But before they can get a job, they need to have a car; but before they can get a car, they need to have a job to pay for that car.

And the Massachusetts legislature thinks, "Hey! Solution! Give away a bunch of cars!"

How about this: how about we try to set up our society so that we don't end up requiring every citizen to purchase a monstrously expensive piece of equipment to perform the normal functions of civic life?

At this point the familiar objection floats in: but our society didn't set itself up this way on purpose; it was just the free choices of individuals. People wanted to live in suburbs, and they needed cars to do that. So everything got spread out. So now everybody needs a car, because everything's spread out. Surely you're not advocating limiting the free choices of individuals?

The most obvious reply to this objection is that it itself limits the free choice of individuals. That is, it limits the choices, quite severely, of the individual who doesn't want to have to own a car. Like myself; I'd much prefer not to own a car, I've selected a place to live that's within walking distance of my workplace, but I still can't reasonably live without an automobile because everything is so spread out nowadays. And I live in a relatively compact community compared to many in this country.

But second, the answer is, of course I'm willing to limit the free choices of individuals. We do it all the time; it's called zoning. Oh, and other people's property. And lots of other things. I can't build a home wherever I want. There are zoning restrictions in most communities governing where I can build it. There's land that belongs to other people that I can't build on. Even unoccupied land that belongs to other people; even land that the owner hasn't touched, or even seen, for decades, I'm forbidden to build on. What's wrong with limiting the choices of individuals? Absolutely nothing, in itself; the question is whether the limitation is reasonable, not whether it exists.

Finally, one answers by saying that our current milieu uses legislation to encourage this incredible spreading out, which really isn't natural or desirable considered in itself. Think not? Think about roads for a minute. What are these but massive subsidies given by the government to automotive transportation? These enormous subsidies might as well be direct gifts to Wal-Mart and other big-box stores; local retailers, who have great incentives to set up small shops in heavily-populated (read: walkable) districts, don't need massive freeways to get their products because they're buying more local products. But Wal-Mart, which ships its products from China and then trucks them to its stores around the country, needs enormous roads for its business model to work. It certainly can't pay for these roads itself; no, the government needs to build roads for them and for other large stores that require enormous amounts of ground shipping.

But Wal-Marts are huge, because they have to be for their ridiculous business model to be profitable. So they build away from the populated centers---those places where people actually live. So roads need to be built to accomodate the Wal-Mart, as they always are. So anybody who can afford a car goes to Wal-Mart. So the local shops lose their business and go out of business. So there's no reason for people to keep living in the population centers. So they migrate out to the suburbs. So more and more businesses move out to the suburbs, farther and farther apart. So, once again, you need to get a car if you're to have any hope of living a normal life.

Think about our idiotic zoning laws, as well. (I said I liked zoning in principle, not in its current common form.) We zone "commercial" separate from "residential." Why? Why can't people actually live near the stores they're going to? This forces businesses to move out of residential areas and into special "commercial" zones. It further forces manufacturers to move out of neighborhoods and into special "industrial" zones. So rather than walking five blocks to work and hitting a bar for a beer and then a bakery for some bread on the way home, people have to hop in their cars, drive several miles to their work, drive several more miles if they want to get to a bar, then drive several more miles if they need to stop for bread, which they will have to buy at a large, omnibus supermarket rather than at a bakery. Then, an hour later, they finally get home exhausted from dealing with ridiculous traffic as well as worn out from their long day at work. Isn't this forcing people to buy cars?

There are certainly many other reasons people keep moving farther and farther away from everything but their beds, and some of them aren't put it place by government (at least, not deliberately). But the least we can do is to stop encouraging such irrational expansion, even if we don't actively discourage it.

My solution: zone things to encourage businesses and residences in the same general areas. Certain businesses, of course, will need to be separated: those which are particularly loud, particularly smokey, or otherwise cause some particular nuisance. But for the most part, people should be able to work, shop, and live in the same general area. And I'm not talking about slums; I'm talking about real, habitable dwellings. Let people live above their shops. When businesses apply for a building permit, don't give it to them if there's already too many businesses in the area in which they want to build. In this way, discourage large clumps of businesses from building close to one another. Stop subsidizing enormous businesses by funding huge roads that make distant, non-local, slave-labor production economically feasible. Rather, make those roads payable by toll, and make the toll sufficient to fully pay for them, so that Wal-Mart and Target (and you and I, for that matter) are paying for their own transportation and not getting enormous gifts from the public coffers. Cut or eliminate the tax on local goods sold by local retailers. And do any number of other things that our ingenuity might suggest to us. That way, people won't need to buy a car unless they want one.

We all want to improve the condition of the poor. And by "improve the condition," I don't mean "give them money." I mean help to find or make work for themselves, to help them pull themselves up and become productive citizens of society.

Plato famously said that the worst thing that could happen to the Republic would be the development of a class of people who contribute nothing to the body politic. We have that today, in many of our non-working poor. However, many of these poor are not in this situation by choice. They're in this situation because they were forced into it, often largely because they couldn't afford reliable transportation. They truly want to work, to produce, to contribute, but they can't because our society is built around an incredibly expensive machine that everybody must have. And that, my friends, is an injustice.

Remedying that injustice by giving the poor cars is like remedying a fire by pouring gasoline on it. Let's rather encourage local, livable communities in which a car is not really needed; not only would it do wonders for our obesity problem, it would do wonders to help our would-be-working poor.

Praise be to Christ the King!

Note: This is published under the Creative Commons Attribution-Share Alike 3.0 United States License.

Read more...

What is Socialism?

Lately, there has been a lot of labeling government officials, and Obama in particular as socialists, and decrying government interventions as socialist per se. Now, I will not deny that Obama is probably a socialist of some sort at heart, and that he has many of the aberrant moral ideas as the socialists. However, the characterization of the government’s present behavior as “socialist” is a misnomer of the highest order, as we shall see later.

I myself have described Obama as a National Socialist (NAZI), but that is not because he is a true socialist, but because the Nazis were not true socialists. They agreed with many of Marx’s propositions, and were a movement of the left (something that is often forgotten), but in practice the Nazis did not create a socialist government, they created a tyrannical government which functioned on a capitalist system. Likewise, what we see today with the administration forcing the CEO of GM to step down in exchange for government aid, is not an expression of socialism. In my opinion it is not even an expression of tyranny since the government is entering into a free contract with GM, and GM is freely accepting it to get the funds. Moreover, even if the government would decide without loaning any money out, that certain CEOs needed to go this would not be an expression of socialism, but of raw state power which is called Statism. Statism is where the state is essentially all powerful and trusted to do the good. Such a system may indeed be or become tyrannical, but it is not Socialist in any sense.

Incidents where Libertarians claim Distributism is some kind of veiled socialism because of the predication of government intervention in the economy betrays the same failure to grasp what socialism is even all about. Socialism was never defined as government intervention into economic life or the running of businesses. If it was then virtually every government in history would have to be socialist, even the Bush administration. Every government has regulated trade to a greater or lesser extent. Rather, Socialism as predicated by its founder, Louis Blanc, and its most well known advocate (Marx) is when the government becomes the universal capitalist. In every system, for wealth to be created, capital must be expended to produce the wealth. This is something as simple as the food a man must eat and the tractors, plows, and livestock he must use in order to produce wheat, or as complex as the scientists that must be paid to develop a drug. The amount of goods consumed in creating new wealth is always capital. The person laboring on it brings the human labor and together with that capital creates wealth.

This is true whether we are talking about Distributism, Capitalism, slavery or Socialism. There must be capital, and there must be labor to produce wealth regardless of where it comes from. Now in Distributism a large portion or a majority of members of society both own the capital (which is not mere money but the means of production) and the labor, as in it is the same person. In Capitalism however these are often divided, so that some men somewhere own the capital, and some men somewhere else labor on it, and the former keep the wealth while the latter get very little of the wealth that is produced. This produces a whole host of social evils and insecurities which go from the top down. Socialism proposes to solve all the problems of capitalism by making the state a universal capitalist. This means that the state will own all the capital, that is, all the means of production available in society.

For instance Marx and Engles declared in the Communist Manifesto:

“When therefore, Capital is converted into common property, into the property of all members of society, personal property is not thereby transformed into social property. It is only the social character of the property that is changed. It loses its class character.” (Marx-Engles Reader, pg. 489)

Marx's thought is simply that capital will be socialized by the state, not that every man's piece of property will become that of the state per se, only if it is productive property. For Blanc, Marx and other socialists the state should not be concerned with my pipe or a picture of my family, or even a book. Rather, the state will own all the horses, tractors, plows, tools, food and housing which a farmer uses to produce wheat or corn or other crops. The state will own the factory equipment and belts, gears, cogs, etc. which laborers will use to produce machinery, assembly line products, or any other type of factory equipment, as well as the metal, wire, and all raw materials utilized in production. This is what is meant by Socialism. It is not that the state will tell a CEO to pack his things as a condition for government aid which he as asked for nor is it that the state will start behaving in a tyrannical way. The state may very well behave tyrannically without a hint of socialism.

Of course this is neither to say that tyranny is good nor that socialism is good. Ultimately, an attempt to implement socialism only leads us to the Servile State; that is back to slavery. It takes us there faster than Capitalism, which must at some point re-introduce slavery to bring stability to markets and keep the bottom classes consuming. Socialism soon discovers that the means of maintaining itself are impossible. To make the state the sole capitalist, two things are necessary. The state must be absolutely just and people must be content being told what to do in all things relating to business by the state (which is the owner). Hilaire Belloc describes it this way:

“Now the Socialist scheme requires both these very strong emotions, common to all mankind, to be suppressed. The people who run the State- that is the politicians-are to be absolutely just (although there is no one to force them to be just), they are to forget all personal wishes and to think of nothing but the good of those whose labour they direct and among whom they share out the wealth that is produced. We know by experience that politicians are not angels of this sort… You can not give this enormous power to men without their abusing it.

[Second], you will never get the run of men and women contented to live their whole lieves entirely under orders. In exceptional moments a large part of individual freedom will be given up to the necessity of the State-as during the Great War; for if the State did not survive the individual’s life and that of his children would not be worth living. The individual in abnormal crises goes trhough a great deal of suffering for a moment in order that he and his should have less pain in the long run. But even in such crises a large part of liberty remains to him. Under Socialism he would have none. He would have to do what he has told by his task-masters, much more than even the poorest labourers now have to do what they are told by task-masters. And there would be also this difference: that everyone would be in that situation and there would be no way out.” (Economics for Helen, pg. 109-110)

Certain Catholic libertarians try and act as though Socialism is entirely condemned and that Capitalism has been praised by the Church. This is simply not the case. It is a simple and ridiculous principle. If anything other than Capitalism is socialist, and the Church has condemned socialism, then it is possible to say that anything that is not capitalism is condemned. However, this overlooks both that the Church has condemned the grave separation between rich and poor as well as the control of the means of production by a few, present everywhere under capitalism (Rerum Novarum, Quadragesimo Anno and Centessimus Annus), and that the Church has described socialism only as the belief that all means of production should be transferred to the state (abolition of private property) and a belief in class warfare only solvable by the state owning capital. (Rerum Novarum no.9)

Hence, if any real progress is going to be made in solving economic woes, it is important to speak with the same terms. The debate as it is framed today often is useless since it does not clearly define the terms it uses, and often obfuscates meanings. It is one thing to identify the abuse of state power which began under Bush, and is being expanded under Obama with the same evils of fascists and communists, it is quite another to say that the US is becoming a socialist state. Ironically, by defining socialism as anything contrary to free market capitalism, as the right attempts to do today, is to say that the US has been a socialist country longer than there have even been socialists.

Read more...

Cultivating a Local Food System

As the War Mercantilist Socialism economy continues its downward grind, one of the most important tasks for distributists is to ensure local food security. I see six important elements that work together to support local food security:

(1) preparing meals from basic ingredients,
(2) frugal supermarket shopping,
(3) gardening,
(4) food storage,
(5) home preservation of food.
(6) buying local foods,

My posts in this Distributist Review over the next couple months will look at each of these aspects in detail. Since it is hard to "order" these principles in terms of "most important", I have listed them in a "functional" order. In other words, if you are coming at this brand new, this is probably the order of development for most households.

So lets begin at the beginning: preparing meals from basic ingredients.

Processed and packaged foods add money to the grocery bill, support large centralized food industries, and beggar the farmers while enriching transnational agribidness* corporations. This is not a distributist activity. Instead of buying the ersatz convenience of packaged foods -- which are typically larded with extra fat, salt, sugar, and more chemicals than I am able to understand -- a better idea is to prepare meals from basic ingredients. If you want bread -- and who doesn't -- bake your own. Indeed, baking your own bread is one of the best places to start. Many people think that baking is some kind of a mysterious art that is complicated but that's a kitchen myth. Here's a link to the Better Times Almanac Bread page. And here's a link to the easiest bread method ever -- Artisan Bread Making in 5 Minutes, which is a no-knead method. Another excellent bread-learning site is Breadtopia , which also has short instructional videos on various bread recipes and focuses on no-knead recipes.

NB: If your family does not habitually eat whole wheat bread, then don't start your bread making experience with whole wheat bread. You can add that later as your skills develop. Start where your family is, and if that means white bread, by all means bake your own white flour breads and biscuits.

The next trick to add to your distributist "Slow Food" kitchen is making your own sauces, stocks, and gravies. Like bread-baking, this is considered much more mysterious than it really is. Here are links to the Better Times Almanac pages on sauces/gravies and making your own stock.

But doesn't this take a lot of time? Well, all things have a learning curve. The first time you bake a loaf of bread or a pan of biscuits, it will take longer than it will once you have made 100 loaves of bread. If your first attempt isn't the best, remember the advice of my grandmother Dovie Waldrop when I complained about the poor quality of my pie crusts. "Bobby Max, the reason you can't make a good pie crust is because you haven't made enough pies. When you have made 100 pies, I bet your pie crust is as good as mine." Having made more than 100 pies, I don't know that I would claim it was as good as hers, but they are good enough to serve to company.

I also use my freezer extensively to make my own convenience foods. If I am making bread, I don't make one loaf, I make a bunch, and freeze most of the dough for cooking later. The various no-knead recipes make extra dough which is kept in the refrigerator and can be used every day! I make my own breakfast and lunch "pockets" and freeze them for fast eating later. If I am making beans or chili, I make a lot and freeze some for later. If I make a casserole, I make two and freeze one. I fry hamburger and package it in smaller packages for quick eating later. Etc., etc., etc. OK, so if this is hard to do at first -- practice makes perfect! The more you practice, the better you will get, and your family will love the way your food develops.

Our War Mercantilist Socialist culture considers food merely as fuel. Any cultural or familial content has been emptied out and discarded as irrelevant to modern times. Food should be acquired as quickly and conveniently as possible, and taste and nutrition are in the back seat. And so it comes to pass that baking your own bread can become a truly revolutionary, as well as a culinary, delight.

Read more...

More on Auto ESOP from WSJ

DETROIT -- A group of current and former Chrysler LLC workers who have long sought to have employees buy the auto maker are appealing to the Obama administration's auto task in a long-shot bit to win support for the idea.

The group was hoping to have a meeting with the task force on Wednesday but the session was canceled, said Michele Mauder, president of the American Auto Worker Ownership Committee, the group leading the effort.

The group led a similar bid to purchase the company in 2007 but were unsuccessful. Chrysler instead was acquired by Cerberus Capital Management LP from its previous owners, Daimler AG.

The 2007 effort was mainly led by members of the United Auto Workers union who opposed the acquisition by Cerberus, a private equity firm.

The current effort includes a broader band of Chrysler stakeholders, including former managers, small retiree groups and a number of suppliers, Ms. Mauder said.

The United Auto Workers has agreed to a deal with Chrysler that cuts labor costs and would leave a union-controlled health care trust owning 55% of the company, if its planned restructuring proceeds as hoped.

Mr. Mauder said she and others in her group oppose union ownership of the company. They see the tentative agreement with the UAW as handing the company over to UAW leadership rather than rank and file union members or non-UAW employees, she said.

"They're going to be the ones that have a vote, not the employees," said Ms. Mauder. "So it will be business as usual."

Mrs. Mauder, a former UAW member, from Toledo says those in favor of an employee purchase of Chrysler reorganized in recent months. The AAWOC has more than 200 active volunteers.

"We really want full ownership," she said. "We can have a new Detroit, not the same business as usual."

Ms. Mauder's effort is backed by civil rights icon Walter Fauntroy, a former congressman and advocate of employee stock ownership plans, or ESOPs.

Write to Alex P. Kellogg at alex.kellogg@wsj.com

Read more...

Autoworkers Push for Big 3 Ownership

Retired Jeep Chrysler worker Michele Mauder knows hers is an uphill struggle, but it is one she is tackling with gusto. In quick visits to Washington, D.C., to lobby members of Congress, and in house meetings in Michigan and Ohio, Mauder is struggling to save the American autoworker.

“No one else is talking about saving jobs,” Mauder says. Pointing to Chrysler’s proposed deal with Fiat, “they’re talking about Fiat building small cars and shipping them here to sell through Chrysler’s dealer network. That doesn’t help taxpayers, workers or retirees,” she says.

While any number of corporate and government committees are discussing ways to save America’s “Big 3” auto companies — GM, Ford, and Chrysler — Mauder says the only way to do it that benefits workers, communities, and taxpayers, is to fundamentally restructure the way the companies do business and make the employees the owners. Together with about 200 active and retired autoworkers, including some former members of Chrysler’s senior management, she has formed the American Auto Workers Ownership Committee (AAWOC) to promote the idea of employee ownership. Mauder is president of the committee. Robert Mason, who says he formerly helped plan corporate strategy in the office of the CEO of Daimler/Chrysler, is the chairman of the group.

“I am hopeful, with a new administration, that they will look at some new alternatives,” Mauder says. The group’s efforts to meet with the administration’s auto task force have been unsuccessful so far.

Mauder’s basic idea is simple: the federal government should take over GM, Ford and Chrysler; finance retooling for smaller, greener cars, and sell companies to their workers. “Let’s cut out the big gas guzzlers that aren’t selling and replace them with fuel efficient cars,” she says. Instead of importing electric or fuel-efficient cars, “we want our people to build them,” she says.

Current plans being floated by GM and Chrysler call for the federal government and the United Auto Workers union (UAW) to own the majority of each company. The AAWOC opposes those plans. “We want all of the workers, from the lowest-paid line worker up through senior management, to own the companies, not the Union,” says Mauder, who was a union representative for four years while she worked at Jeep. “Right now, the International Union has negotiated nothing for the employees,” she says.

Mason points out that the federal government already controls GM and Chrysler and is restructuring their long-term debt. The question everyone is looking at is what happens after that. The AAWOC says: issue new equity and put it in a trust fund to distribute to employees under an employee stock ownership plan (ESOP). Employees then would buy the stock with the profits the companies make. Mauder and Mason recommend structuring concessions to assure a profit. They say base pay and benefit package should allow the companies to make “one dollar profit” at current sales levels.

“We all know employees have to give concessions, but we should get something in return so that when the companies become viable again we get something for our concessions,” Mauder says. And that “something” should be ownership. Mauder adds, however, that labor and labor-related costs account for only one-third of the auto companies’ fixed costs, and only 5 percent of their corporate budgets. Cutting management costs and trimming product lines also have to be part of the restructuring plan, she says.

According to the ESOP Association, approximately 11,500 U.S. companies have ESOPs, and they involve over 10 million employees. At 7,000 of those companies, the ESOPs are large enough to affect corporate strategy, and about 2,500 of those companies are 100 percent employee-owned through ESOPs.

Mauder argues that 100 percent employee ownership through an ESOP will reorient the corporate strategies of the domestic car companies away from short-term stock prices and towards their long-term viability. In part, that is because employees can’t cash out their stock until they leave the company or retire, at which time the company buys it back from them. As stockholders with limited cash out opportunities, employees would have an incentive to work for the company’s long-term health and to select directors, who do the same. She looks to employee ownership as model for growing auto and other manufacturing jobs in the U.S. and revitalizing communities that depend on them.

This is Mauder’s second ESOP proposal. When Daimler decided to sell Chrysler in 2007, Mauder put together a proposal for buying the company with a leveraged ESOP. She got help from experts at Kent State University and had the backing of her local union. The International Union, however, opposed the plan, she says, and supported the sale of the company to Cerebus, a private equity firm. “Jeep has had numerous owners. We made money for Chrysler, but we were just getting swallowed up in their mess,” she said in explaining her initial motivation for looking into employee ownership.

AAWOC is Mason’s second attempt to shop employee ownership, too. Independently of Mauder, he says he championed the idea of an ESOP in senior management when Daimler decided to sell the American automaker and even put together a model of how it could work. But, “the notion of 100 percent employee ownership wasn’t popular,” he says. Later, he learned about Mauder’s effort. In December 2008, he contacted her through work after the crisis at Chrysler had become public knowledge. “I told her this was the only thing that could work,” he says.

“This is the only solution with an upside potential for workers,” Mauder says, and by developing production and new technologies in the U.S., it is also the only solution with an “upside potential” for U.S. taxpayers and communities.

AAWOC’s model is for national auto companies that “right-size production” to the market instead of “super-sizing demand” with incentives, as Mauder and Mason explained in a recent pitch to Congressional leaders. “We believe in competition, but we also believe the Big 3 should cooperate more,” she said. “Instead of competing so drastically, they should complement each other. Each one should do what they do best. So, if Chrysler makes a good minivan and Ford and GM don’t, Ford and GM should stop making minivans,” she says, “and then let’s cooperate on research and development.”

Pointing to the $7 million that the Obama administration has allocated for a study by the Boston Consulting Group of the future of the auto industry, Mason says, “They are going to come up with the traditional recommendation to cut your way to prosperity. All we’re saying is let’s at least look at another way. Carve out some of that money for a minority report. If it is not viable, we’ll go home.”

“We want our people to be a part of the process and for them to get something in return for what they give up,” Mauder says. – Peter Downs (pdowns@speakeasy.net)

Peter Downs, a writer and editor based in St. Louis, is a former autoworker and former local UAW officer. In 1988, he authored a commentary, published by the St. Louis Post-Dispatch, that called on General Motors to start production of hybrid gas/electric cars.

Read more...