Thursday, July 29, 2010

Money and Morals after the Crash

Geoff Gneuhs, Guest Blogger

The following correspondence was between Geoffrey Gneuhs, a CESJ founding member, and Raymond Waddle, Editor of Reflections, the journal of the Yale Divinity School.

Dear Editors:

I would like to thank you for the fine issue of Reflections, "Money and Morals after the Crash" (Spring 2010).

A number of the essays touched upon the deficiencies of our culture: solipsism and gross self-interest and a lack of any asceticism and self-sacrifice. In a culture where there is no truth, it is not surprising that people cannot nor do not want to reach outward.

I would like, however, to offer a practical tool that could be the basis of systemic change in our atrophied capitalist system, which has not been reformed by President Obama since the very players who brought this crisis on are still involved in policy and decisions, for example, Timothy Geithner, treasury secretary, Ben Bernanke of the Federal Reserve, and the members of Congress.

The idea is Capital Homesteading Accounts (CHAs). Let me give some background.

In 1984 my article "Chesterton's Distributism: Something Elvish" appeared in the Catholic Worker newspaper, of which I was then an editor. Shortly after, Dr. Norman Kurland, lawyer and economist, contacted me. He was forming what was to become the Center for Economic and Social Justice and believed that Chesterton's distributism and emphasis on ownership for all was in line with his ideas for expanded capital ownership and invited me to join him. Kurland had helped develop the legislation for the first Employee Stock Ownership Plans (ESOPs). He had been a colleague of Louis Kelso, economist, and Mortimer Adler, the Aristotelian and Thomistic scholar.

Their book, The Capitalist Manifesto (1958), despite its title, is in fact a critique of capitalism and offers practical ways to enable all citizens to participate in a free economy rooted in principles of justice, fairness, and the common good.

A few years later Hannah Arendt in her essay "Thoughts on Politics and Revolution" in her Crises of the Republic bluntly pointed out: "Our problem today is not how to expropriate the expropriators but, rather, how to arrange matters so that the masses, dispossessed by industrial society [now technological] in capitalist and socialist systems, can regain property. For this reason alone, the alternative between capitalism and socialism is false-not only because neither exists anywhere in its pure state anyhow, but because we have here twins, each wearing different hats."

CESJ's concept of Capital Homesteading Account respects the principle of subsidiarity of Catholic social teaching as well as individual freedom and creativity. It allows for qualified interest free loans for every man, woman, and child to invest in their local business, shop, bodega, and so forth, to be paid back by future earnings. Each year loans would be made to these accounts. In other words credit becomes available for all (right now there is no credit, and when banks start lending again it will not be to the storekeeper, the small farmer, and so on. CHAs address this gross inequity. For a more detailed explanation visit the CESJ website.

Socialism is the politics of envy, and capitalism (or extreme capitalism as Pope John Paul II called it in his encyclical Laborem Exercens) is the politics of greed.

Expanded capital ownership can help build economic democracy within the free market.

Sincerely,

Geoffrey Gneuhs '78 (STM)


Mr. Gneuhs:

Thank you for the note about the Reflections (Spring 2010) issue, "Money and Morals after the Crash," and your thoughts on the economy. I happen to be a fan of both Chesterton and Arendt, so I'm interested in their insights on these elusive but urgent matters. Thanks for sharing the idea of CHAs; it is worth exploring further.

Best wishes,
Ray

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