Economic Systems

[Dream]

It's so hard to be able to choose which economic system will morally be the best for a nation. Unfortunately, it's not black and white. No matter which system is chosen, it will likely lead to selfish behavior since people are always looking out for their own well-being, and not others. For example, let's just take a look at the extremes:

On the far left, we have communism. Since people will be guarenteed a job, they will not always have a good work ethic. The sin of sloth is encouraged, because those who slack off and never put in a full day of work will get the same pay as somebody who works their hardest in order to deserve the money they earn. It's just easier to sit back and let somebody else do your work.

On the far right, we have pure capitalism. Since there absolutely no guarentee of an income, people will often do unethical things to make sure that they always have food on the table. The sin of greed is encouraged, because there is no limit in sight. People are encouraged to make as much money as they can without the worry of how that money is obtained.

Of course, most economic systems fall in the middle of the spectrum, but will have varying degrees of communism and capitalism. It can be so difficult trying to find the system that leads to the most morallistic behavior, while still having an economy that provides for everyone.

 

[Lifesaver]

Indeed, you have hit the nail on the head: the economic system (if it can be called that) ought to provide for all and encourage virtuous behaviour.
What is to be done then?

Clearly, as you have shown, complete economic freedom will make it so that people will not even have their own food guaranteed, and may be encouraged to immorality in order to provide for their families.
Still, we know that economic freedom is what guarantees the highest production, lower prices, lower waste and that it encourages such virtues as responsibility, trustworthiness, honesty, earnestness and also other positive things as creativity.

The answer, it seems to me, is to have a nation in which even the poorest person has access to food, a clean shelter, basic education and culture (libraries, museums). If that is guaranteed (either by State, or preferably, by the Church), the economy can be allowed to be as free as possible, with obviously some restrictions in order not to allow unfairness, such as anti-dumping laws.

This way, the nation will be as wealthy as possible, and the number of people with a job will be maximized; and thus the general people, if they want, will be able to start their own small enterprises.
They will also probably freely form associations and groups to better defend their trades and have a bargaining power. The State, however, ought not to interfere with them, either repressing or encouraging, as both create inneficiency and unfairness; and the result, as usual, is more poverty, less jobs, higher prices and lower quality of goods.

In the end, I defend the right of property, free initiative and free trade.

Communism, regardless its encouragement of sloth, enforces social and economic equality, which are bad things.
We must strive for a society which is unequal, with a gradual and almost continuous transition from the poorest to the richest.

The usual criticism that this encourages materialism, consumerism and greed is false. It merely gives people the freedom to be materialist; in socialistic nations, or even in the "Welfare State" or "social-democracies", the State officially upholds materialism, and erects filling the bellies of the people as its supreme goal. Ironically, they create even more poverty and unemployment.

I hope I have been able to write a coherent sequence of paragraphs. Anyway, good night.

 

[PeterPaul]

I agree with most of what has been said.

The only difference is that I see dependency on wage as bad as dependency on State. Encouraging self ownership is, IMO, the key to allowing the most poor and the richest to exist and have. It is not by some egalitarian rule or by a survival of the fittest that we reach the reality of the organic man, his needs and his abilities/creativities.

Man does not reach the maximum of his potential when the means of production are not in his hands. When they are in the hands of the State, or in the hands of another (employer) man is limited to dependence instead of self-reliance.

This doesn't mean working for someone else is always bad, but it has restrictions and depends on the ethics of that other person/owner (one which we have seen, with the lack of ethical behaviour in most businesses, the inability for man in today's day in age to have any security).

One of the things capitalism can never explain is how to provide those "lower prices" without cutting its labour cost, something we see today consistantly happening (outsourcing and firing of higher end salaries in exchange for young, fresh lower salaries). And then of course, we have what exists today, the mechanical replacement of man as well as the slow destruction of the consumer by destroying the employee.

Marxism and Communism, both atheistic economic systems, and which deploy the means of production at the hands of the State have created dependency which has restricted the creativity and ownership of property (something prohibited by the RCC), as well as created the illusion of equality based on existance (if we are all animals, they argue, why would one lion have more than another?). This was attacked severely by Hilaire Belloc as being unrealistic and failing to acknowledge the man socially as organic and realistic.

Both systems have flaws and surely we can debate them amongst ourselves. But what I can't stand on either side, is when they both (which they do) claim economics is something neutral and somehow above morality and that the economy is objective, and away from Church scrutiny.

It reminds me of the parallels that shares with those who refuse to obey and allow the Church to guide them theologically or biblically. It appears that for some the Church is no one to tell them how to interpet laws, both fiscal and social and that is nonsense. The Church is competent to speak on all matters.

 

[PolskiKrol]

Wow im surprised we havent heard from the distributism guys yet...

Personally im all for capitalism, with some limitations.

 

[Dream]

Indeed Lifesaver, it is a difficult concept to try to sort out. Nothing works perfectly.

Of course, having a free economy will have many advantages, but those who are at the bottom are hit very hard. In a communist economy, the bottom just choose not to work hard, which leads to an economy that just deterierates and falls apart.

A lot has to do with individual benefits versus societal benefits.

 

[PeterPaul]

Wow im surprised we havent heard from the distributism guys yet...

Personally im all for capitalism, with some limitations.

You did. I'm a distributist.

 

[Dream]

PeterPaul, isn't self ownership also dependent on wage? Even more so than an employee for a corporation, since a weekly paycheck is not guarenteed.

 

[PeterPaul]

PeterPaul, isn't self ownership also dependent on wage? Even more so than an employee for a corporation, since a weekly paycheck is not guarenteed.

Dream, I used to think the same thing. I used to think that it was a big risk to start my own business versus working for a company. All things being equal, if we were talking maybe 20 years ago, I would probably agree with you (though the banking system is to blame for that).

However, in today's day it is quite possible that one can end up like Enron. It is quite possible that one will not make retirement because of "cuts" or outsourcing.

Take my boss for example. He has a travel company. They provide, as one part of their service, a travel "hotline" for distressed passengers. He thought he could make more money by saving on the "help" and outsourcing to Ireland (the man is an idiot who thinks Ireland is still in the late 19th century with everyone starving). So, he thinks, he'll keep the NY office until Ireland is trained and fully staffed and then start cutting NY out of the picture. Well, long story short, Ireland is not working out, and he is fuming because he is losing money. The other day he said "I think I'm going to shut Ireland down!"

Well...what does this mean to the Irish who were proposed a career and who have livelihoods? With one swift move he can "destroy" their lives all because of a whim.

IMO, there is no difference today between the risk of being an employee and being an owner (and my mother has owned a business for 20 years and agrees).

In addition, working for others has created a consumer society and high cost of living which can no longer support a one person income but requires, depending on the state, a two member income. This has had disasterous results.

Ebay is a great example of the desire on the part of people to be self-sufficient, and so successful the State is fuming and looking at it very closely.

The Popes knew this and this is why the discussed it at length. Dependency on the ownership of another or of the State is dangerous.

 

[Dream]

Dream, I used to think the same thing. I used to think that it was a big risk to start my own business versus working for a company. All things being equal, if we were talking maybe 20 years ago, I would probably agree with you (though the banking system is to blame for that).

However, in today's day it is quite possible that one can end up like Enron. It is quite possible that one will not make retirement because of "cuts" or outsourcing.

Take my boss for example. He has a travel company. They provide, as one part of their service, a travel "hotline" for distressed passengers. He thought he could make more money by saving on the "help" and outsourcing to Ireland (the man is an idiot who thinks Ireland is still in the late 19th century with everyone starving). So, he thinks, he'll keep the NY office until Ireland is trained and fully staffed and then start cutting NY out of the picture. Well, long story short, Ireland is not working out, and he is fuming because he is losing money. The other day he said "I think I'm going to shut Ireland down!"

Well...what does this mean to the Irish who were proposed a career and who have livelihoods? With one swift move he can "destroy" their lives all because of a whim.

IMO, there is no difference today between the risk of being an employee and being an owner (and my mother has owned a business for 20 years and agrees).

In addition, working for others has created a consumer society and high cost of living which can no longer support a one person income but requires, depending on the state, a two member income. This has had disasterous results.

Ebay is a great example of the desire on the part of people to be self-sufficient, and so successful the State is fuming and looking at it very closely.

The Popes knew this and this is why the discussed it at length. Dependency on the ownership of another or of the State is dangerous.

But now your talking about job security and not dependency on wage, which are two different things.

When you run your own business, you have all but complete job security, but you also have a huge dependency on wage. You don't have to be worried about suddenly being fired by your boss because your job is outsourced, but you need to continously worry about making enough money. There is no guarentee that you will even make anything. You could end up losing money in the process.

When you work for a corporation, you exchange job security for wage dependency. Just like in your example, your job could be lost in the blink of an eye. But while you are working, you are not constantly worrying about money (unless you have a gambling addiction ). You will get a paycheck every week, or every other week. Your boss won't say to you: "Our company didn't do too well this week, so I'm not going to pay you.

Granted they are both related, but they are two different aspects.

BTW, I wish you the best of luck if you do end up going into your own business.

 

[QuagDabPeg]

I'm for a combination. I definately think capitalism is nice. I think competition is healthy and the only way to see improvements made. However, I don't think certain things (like insurance companies) should be a for-profit captialistic institute. I also don't believe anyone should be denied health care. I think that private health care should be available for those who want it/can pay for it, but I beieve we should have a socialized health care system for those who can't afford private. I don't believe there's any excuse to deny a peson the right to health care because they are poor.

 

[Stefania777]

democratic socialist here.

 

[Dream]

I'm for a combination. I definately think capitalism is nice. I think competition is healthy and the only way to see improvements made. However, I don't think certain things (like insurance companies) should be a for-profit captialistic institute. I also don't believe anyone should be denied health care. I think that private health care should be available for those who want it/can pay for it, but I beieve we should have a socialized health care system for those who can't afford private. I don't believe there's any excuse to deny a peson the right to health care because they are poor.

I think you'll find that very few people are on the extreme sides. Most people try to fit themselves somewhere in the middle trying to balance human rights with freedom and economic opportunity.

 

[PeterPaul]

But now your talking about job security and not dependency on wage, which are two different things.

When you run your own business, you have all but complete job security, but you also have a huge dependency on wage. You don't have to be worried about suddenly being fired by your boss because your job is outsourced, but you need to continously worry about making enough money. There is no guarentee that you will even make anything. You could end up losing money in the process.

When you work for a corporation, you exchange job security for wage dependency. Just like in your example, your job could be lost in the blink of an eye. But while you are working, you are not constantly worrying about money (unless you have a gambling addiction ). You will get a paycheck every week, or every other week. Your boss won't say to you: "Our company didn't do too well this week, so I'm not going to pay you.

Granted they are both related, but they are two different aspects.

BTW, I wish you the best of luck if you do end up going into your own business.

Thank you.

There are several factors to consider when owning and that dependency on wage. One, all business has a concept of income, however the difference now becomes a moral one. Does one start a business because he wishes to make money and seeks the avenue which will provide him the greatest avenue for it, or does he start it for the purpose of providing a service to the community and relies on wage to provide himself with a good (living expenses)?

I would say primarily man should (and this is where morals come in) provide society with a product/service. Man is dependent on finances as so far as they provide him with the means to survive, but work is edifying and should be that which makes him holier and leads to salvation.

Private ownership and property provide much more than any liquid asset, because they are stable. One rarely will lose the home they own even in the worst of depressions.

You make a good point, and that is whether man becomes dependent on a wage regardless of who they work for, whether themselves or someone else. I would argue that it is, in order to provide that good to society, important to acquire income. At least temporarily. However I would say that income from a secondary source (that of another owner) is temporal and much weaker against nature (that of the owner or of the market). Sure, an owner, depending on his demographic in today's society, may not make the money an employee will make (so he may not have a Lexus, or have a stack of DVD's) but in the long run, if successful (and that risk is the same for both), his will determine the stakes of his future through his creativity and resourcefulness and will endure.

What I mean by a "wage slave" is one who depends on another for his wage.

The most damage done to self ownership has been a result of usury and the inability on the part of the State to halt Home Depots, Walmarts, and Barnes N' Nobles that have torn apart the small business. They didn't desintegrate by themselves. For example:

My mother for example, was destroyed by these conglomerates (capitalists with bulk pricing) and by the lonely false business (the socialists who claimed selling books on the street was freedom of expression).

I always remember the voice of Pope Leo XIII


"Men always work harder and more readily when they work on that which is their own; nay, they learn to love the very soil which yields in response to the labor of their hands, not only food to eat, but an abundance of the good things for themselves and those that are dear to them."

 

[Stefania777]

democratic socialist here.

oops! wrong thread, I do this all the time

 

[PeterPaul]

I'm for a combination. I definately think capitalism is nice. I think competition is healthy and the only way to see improvements made. However, I don't think certain things (like insurance companies) should be a for-profit captialistic institute. I also don't believe anyone should be denied health care. I think that private health care should be available for those who want it/can pay for it, but I beieve we should have a socialized health care system for those who can't afford private. I don't believe there's any excuse to deny a peson the right to health care because they are poor.

I agree, however, we must not then make a health care system that embodies everyone and that they must pay twice, once for themselves publically and a second time for themselves privately. Let's just focus on the poor.

I also don't think it should be at the hands of the State to provide this.

Competition is excellent insofar it is healthy. When it denigerates to who can outperform the other, then it fails morally.

Competition is a reflection of the realities of man and the uniqueness of the individual. When I seek to provide an apologia different than say Geocajun's, it is great and provides a service to society. When I choose to squash him, and make myself king of the mountain, then I have not only sinned against him, I have provided a disservice to the community.

 

[PeterPaul]

I think you'll find that very few people are on the extreme sides. Most people try to fit themselves somewhere in the middle trying to balance human rights with freedom and economic opportunity.

Exactly.

 

[Dream]

Thank you.

There are several factors to consider when owning and that dependency on wage. One, all business has a concept of income, however the difference now becomes a moral one. Does one start a business because he wishes to make money and seeks the avenue which will provide him the greatest avenue for it, or does he start it for the purpose of providing a service to the community and relies on wage to provide himself with a good (living expenses)?

I would say primarily man should (and this is where morals come in) provide society with a product/service. Man is dependent on finances as so far as they provide him with the means to survive, but work is edifying and should be that which makes him holier and leads to salvation.

Private ownership and property provide much more than any liquid asset, because they are stable. One rarely will lose the home they own even in the worst of depressions.

You make a good point, and that is whether man becomes dependent on a wage regardless of who they work for, whether themselves or someone else. I would argue that it is, in order to provide that good to society, important to acquire income. At least temporarily. However I would say that income from a secondary source (that of another owner) is temporal and much weaker against nature (that of the owner or of the market). Sure, an owner, depending on his demographic in today's society, may not make the money an employee will make (so he may not have a Lexus, or have a stack of DVD's) but in the long run, if successful (and that risk is the same for both), his will determine the stakes of his future through his creativity and resourcefulness and will endure.

The most damage done to self ownership has been a result of usury and the inability on the part of the State to halt Home Depots, Walmarts, and Barnes N' Nobles that have torn apart the small business. They didn't desintegrate by themselves. For example:

My mother for example, was destroyed by these conglomerates (capitalists with bulk pricing) and by the lonely false business (the socialists who claimed selling books on the street was freedom of expression).

I always remember the voice of Pope Leo XIII


"Men always work harder and more readily when they work on that which is their own; nay, they learn to love the very soil which yields in response to the labor of their hands, not only food to eat, but an abundance of the good things for themselves and those that are dear to them."

Very interesting points. I always enjoy reading your posts because they are always full of wisdom.

It would be wonderful to think that everybody who worked did so in order to provide a good or service to society, but unfortunately that is not always the case. Business owners will see the oportunity for more money and more income and jump at the chance before they miss is. When this continually happens, more and more people are making a greating income, which we lead to more money being put into the economy. Of course, when an economy has too much money in it, inflation is inevidible. Then PeterPaul, the businessman who was more interested in providing a service to society than income, is now falling behind economically.

Again, if a nation was full of people who were out for the good of society and not their own self interest, many economic systems would work fine, including socialism.

But we have to face the grim truth: most people are only concerned about themselves.

 

[PeterPaul]

Very interesting points. I always enjoy reading your posts because they are always full of wisdom.

It would be wonderful to think that everybody who worked did so in order to provide a good or service to society, but unfortunately that is not always the case. Business owners will see the oportunity for more money and more income and jump at the chance before they miss is. When this continually happens, more and more people are making a greating income, which we lead to more money being put into the economy. Of course, when an economy has too much money in it, inflation is inevidible. Then PeterPaul, the businessman who was more interested in providing a service to society than income, is now falling behind economically.

Again, if a nation was full of people who were out for the good of society and not their own self interest, many economic systems would work fine, including socialism.

But we have to face the grim truth: most people are only concerned about themselves.

Thank you Dream, I appreciate your posts also.

I understand what you mean. Presently, the state of affairs is very much what you describe. I am always willing to concede that the distributist vision may well be something we may never see again from now until Christ comes (as we probably will continue to decay until our Master arrives).

But, things that seem its gloomiest sometimes have a knack for radical change. Surely, those in historic times never thought the guilds would be removed, or that lands would be leased as they are today, or that credit would factor into real estate and well being. Tomorrow is a question mark.

However, I do see some sparks of change in different parts of the country who are tired of relying on a steel mill for work because it is the only business in their towns. I see people upstate NY like my mother, who after having a business in a mini mall, have opted to close it and open a business on her own property (a great way to cut costs and own the very property she sells from). And distributism is slowly rising (some political groups in Europe advocate it).

I think of it this way. My primary focus in life is our Lord and bring people to his Church. My secondary effort is to help people understand the social vision of the Church historic. Just as I see society as a big mole that has rejected our Saviour, and is a tall mountain to climb, so I have some optimism that even those who reject our Lord may come to know him, and will one day also see his justice in the economic and political sphere.

 

[Dream]

Thank you Dream, I appreciate your posts also.

I understand what you mean. Presently, the state of affairs is very much what you describe. I am always willing to concede that the distributist vision may well be something we may never see again from now until Christ comes (as we probably will continue to decay until our Master arrives).

But, things that seem its gloomiest sometimes have a knack for radical change. Surely, those in historic times never thought the guilds would be removed, or that lands would be leased as they are today, or that credit would factor into real estate and well being. Tomorrow is a question mark.

However, I do see some sparks of change in different parts of the country who are tired of relying on a steel mill for work because it is the only business in their towns. I see people upstate NY like my mother, who after having a business in a mini mall, have opted to close it and open a business on her own property (a great way to cut costs and own the very property she sells from). And distributism is slowly rising (some political groups in Europe advocate it).

I will have to take your word for this. I am admitely ignorant when it comes to regional economic and political trends.

I think of it this way. My primary focus in life is our Lord and bring people to his Church. My secondary effort is to help people understand the social vision of the Church historic. Just as I see society as a big mole that has rejected our Saviour, and is a tall mountain to climb, so I have some optimism that even those who reject our Lord may come to know him, and will one day also see his justice in the economic and political sphere.

Yes, this should be the primary focus for all of us. When discussing an economic system, it is important to always consider the teachings of Jesus and ponder how He would deal with such situations.

...A sort of off-topic question for you. Who did you vote for in the 2004 election? (I'm assuming you're a US Citizen). Forgive me if I am being intrusive and please don't answer if you feel compelled not to.

 

[PeterPaul]

...A sort of off-topic question for you. Who did you vote for in the 2004 election? (I'm assuming you're a US Citizen). Forgive me if I am being intrusive and please don't answer if you feel compelled not to.

Oh, no I'm a Spaniard. I can't vote, though I have thought I may request a dual citizenship.

No, its ok, I have no problem with the question. I could say who I would have voted for if I had the opportunity. I'm an independent, yet most likely I would have voted for Bush. I'm currently trying to find a party that may stand for the convictions of the Church, however I'm at the "good luck" stage LOL.

I believe as Chesterton did, that Hudge (socialists) and Gudge (capitalists) have no intention on serious reform and one destroys society while the other does nothing to clean up the mess.

There is an interesting party in the U.K. called "Third Way" that's pretty interesting, though like all things, they promote somethings I don't agree with.

I believe the State should reflect the eternal law, and am quite suspicious of a separation of Church/State and find that very flawed .Not that the State should be headed by Bishops, but I believe it must be accountable to the Church and her wisdom/laws. I realise this isn't very popular amongst "democratics" who view any official authority as either unrealistic (that it will never happen) or unfair (political pluralists), but I remain convicted that any State which does not hold to an absolute (at the very least the eternal law) is bound to be relativist and have the consequences we have today (both in Europe and America). The question often haunting me is 'where do I prefer to be in, a Catholic state with errors or this?' when I think of most first world nations.

This isn't a very popular view, especially in societies that view peace as the most important aspect of society over error and the slow decomposition of the law in exchange for the "spirit of the law" that is eating away at our very fabric.

Sometimes Catholics don't realise the hypocrisy in attacking Protestants for not adhering to the full truth, yet maintain the very universalism in the political world. No, we can't force people to be Catholic, nor can we have cops enter people's houses to make sure they are not masterbating, but that doesn't mean the law must be one of concensus or that which the State claims it can not "touch" (abortion, defining marriage as eternal law, or cloning as illegal).