Wednesday, December 17, 2008

Addressing the Financial Crisis in Ireland

Yesterday, at the suggestion of Mr. Chris O'Connor, Financial Secretary of the local division of the Ancient Order of Hibernians, we sent out a letter via e-mail to each member of Dáil Éireann and Seanad Éireann (the House of Deputies and the Senate of Ireland, respectively). As of this posting, we've gotten 9 responses, one even being from the Taoiseach, or Prime Minister, Mr. Brian Cowen. We don't know if it will lead to anything, but at least the effort has the potential to inform the leadership of a country that an alternative exists to the traditional reliance on bankrupt and bankrupting Keynesian solutions. Today we followed up with a press release to a number of newspapers in Ireland, as well as some Irish American publications. If you are in Éire, you might want to send your own note to your Deputy and Senator asking him or her to look into Capital Homesteading as a serious alternative to current attempts to address the situation. If you're in the United States or another country, please feel free to adapt the text to your particular situation, and send something to your own representative.

Dear Sir/Madam (we inserted the actual names):

The world financial disaster has thrown into chaos every economy across the face of the globe. As serious as the situation is, however, this crisis presents a unique opportunity to explore new economic ideas, sound policies and practical applications that will allow the people of Ireland to grow their economy and attain a more just, prosperous and sustainable future for themselves and their families.

I am writing you as a concerned citizen of the United States of America and President of the Center for Economic and Social Justice (CESJ), based outside of Washington, D.C. Founded in 1984, CESJ is a non-partisan, non-profit think tank that disseminates concepts and applications for universalizing citizen and worker access to ownership of productive assets. Information on CESJ's concepts, achievements and global network is provided on our web site at

Our scholars have been following the housing, pension and credit crises in Ireland, which share the same institutional roots as the economic crises in the U.S. As you know, today's economic collapse cannot be fixed by employing the same tired tools and methods that brought about the crisis in the first place. Only an economic program based firmly on common sense, with principles that respect the dignity and promote the empowerment of each and every human person, can succeed in turning this situation around.

Because of your responsibilities as a policymaker and decision-maker, we wish to bring to your attention an innovative approach called "Capital Homesteading." What is Capital Homesteading?

- A system that allows low-income citizens to attain ownership of their homes.

- A system that allows citizens to become shareholders in corporations and owners of other businesses and enterprises with real assets and income.

- A system that delivers justice and hope to those most affected by the financial crisis.

- A system that grows the economy over the long-term, but offers some immediate solutions to the current crisis.

Capital Homesteading is based on the principle that every human being has a natural and equal right to the legal and institutional means to acquire and possess capital assets sufficient to provide an adequate and secure income. A policy summary of Capital Homesteading is available at: A more complete proposed blueprint for turning an economy around can be accessed at:

One practical application that may be of immediate interest to you addresses the housing and credit crisis. You can access this proposal at: We hope that every member of Dáil Éireann and Seanad Éireann, as well as all members of the government and everyone interested in the welfare of the citizens of Ireland will consider Capital Homesteading and its related proposals.

If you have any questions or if CESJ can assist you in these matters, please feel free to contact me directly at or by telephone at 703-243-5155.


Norman G. Kurland, President
Center for Economic and Social Justice


Anonymous said...

"Capital Homesteading is based on the principle that every human being has a natural and equal right to the legal and institutional means to acquire and possess capital assets sufficient to provide an adequate and secure income."

What is the right to life? In economics, it is the right to earn income to support life.* As the production of goods and services changes from labor intensive to capital intensive, the way in which every person -- not just a few, but every person -- earns his or her income must change in the same way. You can't do that unless two things happen: (1) you have to broaden the ownership of capital, and (2) you have to tighten up the laws of property so that the capital owners collect the wages of their capital with the same faithfulness that the labor workers now collect the wages of their labor.

The Jewish philosopher Maimonides long ago identified the enlightened man’s duty to the poor. Giving, he said, has eight degrees. Of these, seven have to do with the way the act is done and the spirit of the giver. A rich man may give to the poor man reluctantly, cheerfully, generously, stingily, voluntarily, ostentatiously, tactfully, secretly, or anonymously. But the last and highest degree of helpfulness is to eliminate the need for kindness by preventing poverty from arising. The truly charitable man, said Maimonides, helps the poor man to become economically productive so that he will not need to beg.

Maimonides belonged to the twelfth century, when human labor was the principal factor of production; toil was a moral and economic duty and economic opportunity meant opportunity to work. Thus, he thought in terms of helping a sick man to become well enough to work again or of finding an unemployed man a job. This approach is both unrealistic and grossly inadequate in an economy where the bulk of goods and services is produced not by the human factor of production but by the nonhuman factor – things external to man which harness the forces of nature to produce material wealth.

Solving the problem of poverty requires us to solve the problem of enabling every family and individual consumer unit to participate in production both through employment (where a technical demand for such employment exists) and through the ownership of productive capital.
This is not the place to demonstrate that this can be done and how it can be done, for we have done so in other writings. (See The New Capitalists, by Kelso and Adler, Two-Factor Theory: The Economics of Reality, by Kelso and Hetter, and “Uprooting World Poverty: A Job for Business,” by Kelso and Hetter.) If men and women of good will understand they are searching in the wrong quarter for a solution, they can correct the direction of their search.

*That's not the way it's being interpreted today. It's being interpreted as the right to biological life, supported on other people's earnings — "entitlements." It means the "right" to be a dependent under the ever-more-dominant economic policy of coerced redistribution. Mere "trickle-down" isn't the way it works; "coerced trickle-down" is.


"Copyright © 2000 by Patricia Hetter Kelso. All rights reserved, domestic and international. Contents may be downloaded, printed or reproduced only for non-commercial, non-profit, educational purposes. "

Michael D. Greaney said...

Dear Anonymous:

You're right. Particularly considering the state of education in the world today, we should all be more precise in how we communicate our ideas. Even the "right" word can be taken wrongly, especially if a reader is not favorably inclined to begin with, or has decided to pick a fight. The difference between "a right to acquire and possess capital assets sufficient to provide an adequate and secure income" and "a right to acquire and possess capital assets that earn the owner an adequate and secure income" may seem unimportant or even non-existent to many people, but (again) far too many people today are bent on twisting the words, even the thought of others to support an otherwise unsupportable agenda of their own, for purposes of their own.

We have seen this recently even in binary economics, where far too many people leave it to others to correct distortions and misstatements of fact, or "duck and cover," evidently hoping that such controversies will eventually blow over. For example, there are those in other countries who claim to be "binary economists," but who evidently don't see any difference between the Kelsonian and the Keynesian models, or even (in extreme cases) between Kelso and Karl Marx.

Thus, the more we can make the basic documents of binary economics available as widely as possible, and communicate the essential principles as clearly as possible, the better off everyone will be. That is why the Center for Economic and Social Justice has been working very hard to get as many "economic justice classics" as possible into print as fast as possible. A case in point is the upcoming release of William Cobbett's "The Emigrant's Guide" from 1829. Cobbett was an early advocate of expanded capital ownership, and is regarded as a kind of "patron saint" of the distributist movement. Dr. Norman Kurland, president of CESJ, thinks the foreword we wrote for "The Emigrant's Guide" may be a little too long for today's reader, but your 500-word commentary on what at first glance might seem to be a trivial matter highlights the importance of making certain that readers are properly and adequately oriented before they venture into an economic paradigm that, as far as most people today are concerned, is unexplored territory.

With the generous permission of the Brookings Institution, which holds the copyright, we're also working on republishing Dr. Harold Moulton's important monograph, "The Formation of Capital" from 1935, a solid and unarguable defense of the Real Bills doctrine, which Keynes was only able to counter ineffectually with a bare ipse dixit. A big publisher or well-endowed think tank might not see any market in making such an esoteric volume available to the general public, but the book is a critical factor in the effort to advance binary economics as a viable alternative to today's Keynesian insanity.

We've even made an effort to persuade the Kelso Institute to allow us to undertake the republication of Louis Kelso's and Mortimer Adler's two pivotal books, "The Capitalist Manifesto" (of which the 50th anniversary is this year, having first been published in 1958), and "The New Capitalists," from 1961. True, there doesn't seem to be a great number of people clamoring for copies of the books, but (in accordance with Say's Law of Markets), supply would generate its own demand; if we could make it available, people would buy it, at least enough to cover the costs of making it available.

So, Anonymous, thanks for your comments. It is always useful to have how we express ourselves clarified.

Max Weismann said...

Tell Kelso that I agree with a republication. Their work was before its time and needed now.

Max Weismann

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