E. Michael Jones: Pope Francis good with economics?

[trentcath]

Jacob is correct and this is not uncommon amongst traditionalists.

There is a prominent Catholic 'traditionalist' professor, whose name I will retain, who has gone overboard in a) critiquing every aspect of America's capitalistic system b) celebrating Pope Francis's blatantly socialist economic program and c) appealing to 'distributism' as a very thin artifice to cover what effectively is an endorsement of another evil.

Human nature what it is, we tend to have the most problems with those things (or people) closest to us.  So, since capitalism and its usurious, craft-destroying, greed-enhancing attributes are most obvious to us, there is a temptation to think that the grass is greener on the other side.

The devil that we don't know, some half baked 'redistribution' that some trads pine for will not end well for any of us.  Perhaps some think that the powers that be really could be coaxed into breaking their mechanism of control and equitably distributing property (in my view, a purely insane perspective to take.)  Others think that a civil war/rebellion led by the likes of George Soros's Occupy Wall Street is going to lead to better days (again, purely insane.)

Practical and morally sound advice?  Work within the environment you find yourself and do what you can. 

The Rockefellers will not be breaking up there holdings to fairly give to people anytime soon (and even if they did, within two generations there will be tiers of socio-economic classes, which is why so-called Distributism is not a real solution.)  And I highly doubt that the sick dreams of a rebellion will go any farther than the imaginations of leftists.

God placed us here and thus did not make a mistake.  So, that practical advice: Become technically skilled and after a time, offer such services independently.  Not easy, not something most people are willing to commit to.  But if you want to support a family, and have some modicum of autonomy, and own your production, that's your option.

But none of that stops us from looking and theorising about other possible solutions. Besides which you presume that the current system is sustainable and we will just have to put up with it, it is not and consequently its prudent to consider alternatives when the system eventually comes tumbling down.

[james03]

Besides which you presume that the current system is sustainable and we will just have to put up with it, it is not and consequently its prudent to consider alternatives when the system eventually comes tumbling down.

My fear is that it IS sustainable.  We turn into some corporatist slackwater like Latin America where the idea of a man working hard and becoming successful in his trade is treated like a faire tale.  Instead you wait in line to get your allotment of government beans.

[trentcath]

Besides which you presume that the current system is sustainable and we will just have to put up with it, it is not and consequently its prudent to consider alternatives when the system eventually comes tumbling down.

My fear is that it IS sustainable.  We turn into some corporatist slackwater like Latin America where the idea of a man working hard and becoming successful in his trade is treated like a faire tale.  Instead you wait in line to get your allotment of government beans.

Don't be silly, no system which relies on something that is inherently worthless i.e.debt, can last forever.

[Angelorum]

Don't be silly, no system which relies on something that is inherently worthless i.e.debt, can last forever.

Whatever debt is in the system is a result of central banking and not of capitalism. Actually, our economic system is not capitalism but rather corporatism - which shows that government control of the economy always leads to disaster.

[Amor Rosaria]

I know one thing - I'll never take Chris Ferrara and the Distributists seriously when it comes to economics. His attempt at refuting Murray Rothbard was laughable at best.

[trentcath]

Don't be silly, no system which relies on something that is inherently worthless i.e.debt, can last forever.

Whatever debt is in the system is a result of central banking and not of capitalism

No it's not. Governments, corporations, people, all run on debt whether it be loans from the IMF, government selling their own debt, companies borrowing through loan syndicates to buy other companies or consumers using credit cards, debt is the very lifeblood of our current economy.

Actually, our economic system is not capitalism but rather corporatism - which shows that government control of the economy always leads to disaster.

Perhaps but either way the issue is that capitalism as its been understood since the reformation is fundamentally flawed.

[james03]

Don't be silly, no system which relies on something that is inherently worthless i.e.debt, can last forever.

Debt is not inherently worthless.  It can be productive and generate a return.  Easy example, if I loan you my lawnmower, and you cut the grass with it, you have been productive.  From the time you pick up the lawnmower to the time you return it, you are in my debt -- (1) lawnmower.

Usury, by its very definition, is inherently worthless.

[james03]

capitalism as its been understood since the reformation is fundamentally flawed.

There are a host of "understandings".  If capitalism means a system of subsidiarity coupled with the respect for private property, and a dedication to commutative justice, it is not fundamentally flawed, it is instead very Catholic.

If capitalism is instead synonymous with usury, then it is beyond flawed, it is sinful.

[trentcath]

capitalism as its been understood since the reformation is fundamentally flawed.

There are a host of "understandings".  If capitalism means a system of subsidiarity coupled with the respect for private property, and a dedication to commutative justice, it is not fundamentally flawed, it is instead very Catholic.

If capitalism is instead synonymous with usury, then it is beyond flawed, it is sinful.

I am not sure anyone would ever define Capitalism as you have above. There are other systems that meet that definition but not capitalism.

[trentcath]

Don't be silly, no system which relies on something that is inherently worthless i.e.debt, can last forever.

Debt is not inherently worthless.  It can be productive and generate a return.  Easy example, if I loan you my lawnmower, and you cut the grass with it, you have been productive.  From the time you pick up the lawnmower to the time you return it, you are in my debt -- (1) lawnmower.

Usury, by its very definition, is inherently worthless.

Debt in the abstract is worthless. I'm also not sure I would described the situation above as 'debt' rather I would say the person has an obligation to return the lawnmower.

[Akavit]

Don't be silly, no system which relies on something that is inherently worthless i.e.debt, can last forever.

Debt is not inherently worthless.  It can be productive and generate a return.  Easy example, if I loan you my lawnmower, and you cut the grass with it, you have been productive.  From the time you pick up the lawnmower to the time you return it, you are in my debt -- (1) lawnmower.

Usury, by its very definition, is inherently worthless.

Debt in the abstract is worthless. I'm also not sure I would described the situation above as 'debt' rather I would say the person has an obligation to return the lawnmower.

Modify the scenario slightly.  Joe borrows a $2,000 mower from Dan, then proceeds to mow the lawns of 20 suburban homes over a week-long period.  Each homeowner nets Joe $20 profit so he collects $400 then returns the mower to Dan along with a $100 check to cover wear and tear and compensate for Dan's inability to use the mower for a week.

Effectively, Joe borrowed $2,000 over a week period, was productive and paid back the principle plus interest yet came out $300 ahead.  This is how loans can be used to benefit society.

[Francisco Suárez]

Debt in the abstract is worthless. I'm also not sure I would described the situation above as 'debt' rather I would say the person has an obligation to return the lawnmower.

This is just engaging in word games. The statement 'Debt in the abstract is worthless' is so vague and undefined that it is impossible to understand what you're trying to say.

[Greg]

Don't be silly, no system which relies on something that is inherently worthless i.e.debt, can last forever.

Debt is not inherently worthless.  It can be productive and generate a return.  Easy example, if I loan you my lawnmower, and you cut the grass with it, you have been productive.  From the time you pick up the lawnmower to the time you return it, you are in my debt -- (1) lawnmower.

Usury, by its very definition, is inherently worthless.

Debt in the abstract is worthless. I'm also not sure I would described the situation above as 'debt' rather I would say the person has an obligation to return the lawnmower.

Modify the scenario slightly.  Joe borrows a $2,000 mower from Dan, then proceeds to mow the lawns of 20 suburban homes over a week-long period.  Each homeowner nets Joe $20 profit so he collects $400 then returns the mower to Dan along with a $100 check to cover wear and tear and compensate for Dan's inability to use the mower for a week.

Effectively, Joe borrowed $2,000 over a week period, was productive and paid back the principle plus interest yet came out $300 ahead.  This is how loans can be used to benefit society.

Here is a real world scenario.

Roofer's $800 Makita chop saw breaks down, motor burn out, on a Friday afternoon.  He spends the rest of the afternoon fitting beams and checking his angles and marking up.  On the way home he borrows $800 from a PayDay lender, (thanks to the technology I sold them for real-time credit checking and automated decisions and payments) it is in his account in 15 minutes.  Saturday he buys the new chop saw and negotiates a $40 discount for cash and Monday he is back at work making $200 per day, cash in hand, because he is working for someone who likes paying cash.

On Thursday he is paid and pays the PayDay lender back 800 dollars plus $70 in interest and fees.

Next few weeks he quits going out on Friday nights and blowing his pay check and pays his credit card off.

In a state with no payday lending, like Montana, the guy takes 10 days to get a loan approval from a bank or credit union, loses his job and finds another job 4 weeks later because he is a skilled roofer with good connections.

In a system that allows payday lending he has a $70 loss, in a system where the government "protect him" from "usurious' (free market) loan rates he loses $3635 dollars.

[Greg]

Realistically the heavy use of a $2000 mower for a week, probably costs more than $100, you also have to factor in the lender's time, the possibility of it not being returned, the fact that many people don't care about or look after tools that don't belong to them.  $100 probably would not cover an oil change and the blades being sharpened, which they are certainly going to need after 20 jobs.

Consider a tool hire place.  What do they charge for the loan of a $2000 lawn mower for a week?  They need to cover, rent of premises, capital depreciation, employment costs, business rates and a bunch of other stuff, like profit for the investors.

http://www.hss.com/g/62246/Flail-Mower.html

Flail mower hire for 1 week is over 400 dollars.  Joe better put his prices up to $40 per cut if he wants to come out ahead.  Or, save his capital and buy his own flail mower, if he is smart, from someone on ebay.

For there to be a mower that every Dan can borrow there has to be a less than ideal system where a man waits around at a counter for someone to show up and rent his equipment or money is lent to bad credit risks by people who are willing to put their capital at significant risk of not being paid back or having to chase up people who cannot get their act together or keep a promise.

So yes, it would be "nithe" if we could all get interest free loans and people were willing to build low-margin businesses merely to make a reasonable income but that is never going to happen in this lifetime.

What you need to decide is whether you want a world where the mower and the money are available to you to borrow, like the UK or the USA or where they are not, like Honduras or North Korea.

I would prefer to live in a world with a myriad of options where I could generate income by freely delivering the goods and services that people wanted in a way that I thought was best.  This allows for innovation.  It means that a couple of teenagers in California can start a computer company from their garage.

Meantime IBM can become just another shitty consulting company.

[DrBill]

To put what KingTheoden said in another way, if you want to have an influence for the better on the economy, you have to do the work yourself.  It's better to become a fair and just employer than to agitate for radical social changes that attempt to force others to be fair and just.  The latter cannot be done effectively as there are always ways to game any system.

Also, if you don't like abortion, don't have one.