Distributism Basics: Distributist Economic Society

In the introduction to this series, I stated that distributism is not a middle ground between capitalism on the one side and socialism on the other. Distributism is not an attempt to compromise between them. Instead, distributism stands outside of and completely apart from those systems. The goal of distributism is not to negotiate a common ground between the two, but to establish something completely different and alien to both.

There are two things that must be stated at the beginning of this last article in the series. First is the admission that capitalism could be accomplished in a just way. I affirm the fundamental right to private property and assert that, just as personal freedom is best guaranteed if it includes economic freedom, economic freedom is best guaranteed if the ownership of the majority of productive property in a society is distributed among as many of its citizens as possible. However, I acknowledge that a form of capitalism that accepted economics as a sub-field of an ethical system and that recognized the primacy of people in society as a whole over personal monetary or material gain could be a just system. It has at least the potential to be one for which there would be few grounds for complaint. The main problem with capitalism is that the philosophical foundation behind it is essentially a utilitarian view that allows people to separate economics from ethics and can result in tremendous injustices for the common man.

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Keynesian capitalism attempts to correct these injustices by giving greater authority to the government to help the poor at the expense of the wealthy while leaving as much as possible of the capitalist economic system in place. This attempted correction has resulted in an increasingly totalitarian state that is “bought and sold” by the wealthy, who use the power of government to further their own interests even more than the original capitalists. At the same time government establishes programs to help the poor, it also subsidizes big business and caters laws to the desires of big business even at the expense of the common man. In the end, Keynesian capitalism appears to be taking us on the road to either socialism or the Servile State described by Hilaire Belloc.

The second thing that must be said is that socialism, despite its noble intent to alleviate the injustices that working classes experienced under capitalism, inevitably creates an even more unjust society by denying the right to private ownership of productive property and by turning upside down the structure of political society, allowing the state to interfere with the inner workings of the lower orders of communities to the point of interfering with the very heart of societythe family. Socialism inevitably establishes a totalitarian state and merely transfers the unjust economic power of the very wealthy into the hands of an already unjust state structure.

The basis for saying that distributism stands on one side and both capitalism and socialism on the other is that both capitalism and socialism consolidate the ownership and control of productive property into the hands of a small minority of the citizens. Although it must be admitted that capitalism does not require the consolidation of ownership of productive property, acceptance of that consolidation is necessary to accept capitalism because it results naturally from what capitalists call free market competition.

Some may argue that under socialism, ownership is not consolidated because it is owned by the people. However, without the ability to effectively direct and influence the use of productive property, you cannot say that you really have ownership. Therefore, the ownership of productive property under socialism is, realistically speaking, concentrated into the hands of the state officials. While, under socialism, those who control the overwhelming majority of economic power are the same as those who wield political power, the result of capitalism is that those who control the overwhelming majority of economic power use that power to exert control over those who wield political power.

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The goal of distributism is to establish a greater distribution of both economic and political power. As I have stated elsewhere, this is not merely “a new plan.” It is an entirely different philosophical view of the relationship between economics and the people and also between society and the people. Because distributism is so different, movement from the type of economic and political society we currently have to the distributist view will necessarily be gradual as (hopefully) more and more people accept the distributist view. This transformation will not begin from the top of society; transformation will have to come from the people at the “grass roots” of society making changes on a personal level and then exerting pressure up the levels of society to adapt to what they want for the common good. This progression should be natural, as the higher levels of society exist to serve the lower ones.

In the article on the roles and nature of government, I explained how authority in civil government is structured according to the principle of subsidiarity. That same principle applies to authority in a distributist economic society. The principle function of economics is to provide for the needs of the family. Economics means household management. Even though most economic activity appears to be only indirectly supporting the needs of the family, securing those needs is the fundamental basis without which there would be no economic activity. If you didn’t need to secure food, you would not go out to buy it. If you didn’t need to earn an income with which to buy the things you need and want from others, you would not need to work to earn that income. It does not matter if you are talking about international trade, interstate trade within a federation or empire, intrastate trade between regions or counties or other communities, or local trade with businesses within your own community: All economic activity ultimately takes place so that individuals can provide for the needs and wants of their families. It is important to keep this in mind, because it seems that many economists forget this very basic point and talk about economics and families as though they are only incidentally related.

Because of this mistake, local orders of society need to exert the most control over local economic matters; as such, distributists advocate the guild system with locally owned shops that are directly answerable to the local community. Higher orders of society should not be able to interfere in local economic matters to the extent they currently do. Take, for example, the Farm Bill in the United States. This is a collection of laws at the highest level of political society that directly interferes in local economic decisions. It subsidizes certain types of farm activitykeeping those prices artificially lowand makes alternate farming activity appear inefficient and expensive by comparison.

Why do you think locally grown organic products are more expensive? Why would it be more expensive to not use chemical fertilizers, antibiotics, processes like pasteurization and homogenization, patented genetically modified seeds, warehouse storage, and long distance shipping? Each of these things adds to the cost of production, yet the products that use some or all of these things somehow cost less than those that don’t. This is because the U.S. government not only subsidizes giant farms that make use of these processes: It and state governments routinely interfere with the small farms that don’tespecially if they dare to offer something like raw dairy products. In a distributist society, federal, state, and even county governments would have less authority to interfere with local economic issues, leaving the majority of the authority with the citizens of the local community who live in and depend upon that local economic environment. These communities are quite capable of devising health and safety standards.

The principle of subsidiarity does not require that higher levels of authority never involve themselves in the functioning of the lower levels. Instead, the principle of subsidiarity provides the grounds for the local community to protect its own interests, thereby limiting the corrupting influence of big business on government policy. Higher levels of government can assist in times of need and even offer guidance, but without taking over.

Other practices that we now consider normal might also be changed to benefit the local economy. For example, zoning laws can be reconsidered so as to not unnecessarily force people to commute. While it is reasonable for a community to decide that certain types of businesses should not be located near schools or places where people live, this reasoning makes no sense with respect to other businesses. Why cannot a baker live in the same building, or at least on the same property, as his bakery? The notion that residential areas must be strictly separated from all business activities is one that not only creates more inconvenience for the local community, but forces a greater expense as prospective entrepreneurs must acquire two properties on which to live and work, instead of just one. Eliminating this status quo, when practical, would not only lower business costs, but would decrease traffic by relocating many businesses at which we work and shop to within walking distance of home.

Distributism is economics as if families mattered. It is economics as if the local community mattered. It is economics that protects the small local business against the large one. It is economics that is not predatory. It is economics governed by ethics.