News from the Network, Vol. 5, No. 26

We're tempted to call it "Roberts's Rules of Disorder." Yesterday's ruling by the United States Supreme Court — essentially a one-man decision — overturned the very basis of the U.S. Constitution. It permits either Congress or the Court to do anything it wants under the guise of a tax for not doing something! As the great constitutional scholar William Crosskey commented on similarly revolutionary actions by the Court in the 19th century in Scott v. Sandford (1857 — the Dred Scott decision) and the Slaughterhouse Cases (1873),

"This, to the present-day mind, seems an unbelievable decision; but to those familiar with the political demands of the South of the time when the decision was rendered, such a tenor in the Court's holding will not be difficult to credit. For it was exactly what the South, for a long time, had been demanding.1 (William Winslow Crosskey, Politics and the Constitution in the History of the United States. Chicago, Illinois: The University of Chicago Press, 1953, 1089.)

For "the South," substitute "Liberals," and Crosskey's statement can stand unchanged, assuming that we as a nation in some future "present-day" ever regain our sanity. We find Roberts's reasoning calls to mind the situation that prevailed in England when the Church of England was established as a branch of the government. Catholics and Dissenters were subject to heavy fines for not attending official State-sanctioned religious services if they chose, instead, to obey their consciences.

Nevertheless, there is a bright side to this. Assuming a presidential candidate realizes that anyone offering a politically and economically viable solution to "Obamacare" would pretty much be a shoo-in, Capital Homesteading and the Just Third Way are ready and waiting for him or her to adopt as a plank in a platform. And, in addition —

• The CESJ core group is even now putting the final touches on a substantial revision of the healthcare proposal from four years ago. The sole remaining mandate (to cover the "free rider" problem) has been removed, and the tax reforms and monetary and fiscal policies clarified and refined. We expect to have the paper ready for final editing by the close of business today, for "official" release on the symbolic July 4th date.

• Michael D. Greaney, CESJ's Director of Research, attended a reception at the residence of His Excellency Michael Collins, Ireland's ambassador to the United States, to launch "Connect Ireland," an innovative new program by the Irish government that has already demonstrated its effectiveness. A significant number of dignitaries from the local Irish-American and Irish community attended, including Keith Carney, a National Director in the Ancient Order of Hibernians, and Mr. Lawrence Simms, First Secretary for Economics, with whom Mike had met briefly at an AOH Virginia State Board function a while back. The ambassador's acceptance of a presentation copy of CESJ's annotated edition of William Thomas Thornton's 1848 classic, A Plea for Peasant Proprietors was particularly gracious.

• In a short introductory speech that demonstrated an inherent understanding of the act of social justice as analyzed by CESJ co-founder Father William J. Ferree, His Excellency stressed the need for people throughout the world to organize to rebuild the economy so as to enable everyone to engage in productive activity and be justly compensated. Other countries are closely watching the Connect Ireland program, so that its positive beginnings are a very good sign that governments are starting to shed outdated paradigms and may be prepared to listen to something new, such as Capital Homesteading and the Just Third Way. Adding the Kelso-Adler three principles of economic justice (Participation, Distribution and Social Justice) to something like the Connect Ireland program, and integrating advanced methods of finance that would (as Kelso and Adler put it) "free economic growth from the slavery of [past] savings" would make the effort truly irresistible to any company wanting to do business in Europe.

• Monica W., "Our Friend in the Real Estate Business in Cleveland," has arranged for a meeting with the Director of Research and Development for ESOP, which stands for "Empowering & Strengthening Ohio's People." To prepare them, she gave them materials on the Homeowners Equity Corporation (HEC) and Norman Kurland's bio.

• Dave Kelly and Norman Kurland met with an attorney to discuss pro bono work on the Harris Neck project.

• The CESJ monthly Executive Committee meeting, while somewhat truncated due to the press of time and other commitments, reemphasized CESJ's commitment to pushing for an opening to meet with President Obama with the goal of getting his support for demonstration models for Capital Homesteading.

• The Core Group also reaffirmed the goal of having a series of meetings with Vatican prime movers to introduce key people to the potential for change embodied in the Kelso-Adler principles of economic justice, and to recommend that the pope consider an encyclical on economic justice to clarify some of the massive confusion today.

• The Core Group also resolved to develop a growth and succession strategy for CESJ, especially in light of events that seem to make the message of the Just Third Way even more critical to economic and political recovery than ever before.

• As of this morning, we have had visitors from 58 different countries and 51 states and provinces in the United States and Canada to this blog over the past two months. Most visitors are from the United States, the UK, Canada, India, and Australia. People in Sweden, Cambodia, Belgium, Qatar and Syria spent the most average time on the blog. The most popular postings this past week were "Thomas Hobbes on Private Property," "Catholic Social Teaching and Economic Justice, I: Introduction," "Aristotle on Private Property," "CESJ's Orientation in Brief," and "Own or Be Owned: Capital Homesteading Now."

Those are the happenings for this week, at least that we know about. If you have an accomplishment that you think should be listed, send us a note about it at publications [at] cesj [dot] org, and we'll see that it gets into the next "issue." If you have a short (250-400 word) comment on a specific posting, please enter your comments in the blog — do not send them to us to post for you. All comments are moderated anyway, so we'll see it before it goes up.

#30#

Lies, Damned Lies, and Definitions, VIII: Abandonment of the Natural Law

In their natural law analysis of politics, both Mortimer Adler and Heinrich Rommen claimed that abandoning the Aristotelian/Thomist understanding of the natural law as the basis for human positive law leads inevitably to tyranny. To this we can add the Aristotelian philosophy of Moses Maimonides and Ibn Khaldûn.

This is because the Aristotelian understanding of the natural law is that the natural law is based on God's Nature. Because God is (by definition) a perfect Being, His Nature is "self-realized" in His Intellect, that is, in His Reason. As Christians and adherents of many other faiths would put it, "God is Love." That is, God's Nature is so perfect that He cannot be less than what He is — the embodiment of absolutely pure perfection.

Paradoxically, God the Supreme Being cannot do everything. There is one thing that God cannot do. That is to be less than God, i.e., embody an imperfection. An imperfection is a contradiction in a perfect being. God cannot, therefore, contradict Himself in any way, or He would, ipso facto, not be God. This might seem an esoteric or unimportant point to make, but it is at the heart of the problem with the moral relativism that is, in turn, the foundation for Keynesian economics.

It all goes back to definition, as we might expect. That is, what is the natural law? How we answer that question determines in large measure our view of reality. This was one of the most burning questions of the Middle Ages. No, really. The definition we use of the natural law affects how we view God, religion, the State, the family, even (or especially, for our purposes) money, credit, banking and finance.

To try and be brief, if we define the natural law as God's Nature, self-realized in His Intellect (and therefore discernible by reason alone), we cannot go around changing that definition, even when it proves to be inconvenient or embarrassing. If life, liberty and property are natural rights — as the common consent of humanity has agreed for millennia — then we cannot change the definitions of life, liberty and property without claiming to subordinate God Himself to our personal will — our private opinion.

Abandoning the understanding of the natural law based on God's Nature self-realized in His Intellect, and adopting our opinion as to what constitutes God's Will effectively abolishes the natural law. To apply to all of humanity, the precepts of the natural law must be "written in the heart of every man."

Humanity being the animal that reasons, that means the law must be discernible by reason alone. It cannot be tied to any article of faith, as Pius XII pointed out in Humani Generis, even if faith is necessary for reason to make "efficient and fruitful use of its natural ability."

Opening by stating that the principles of Christian culture are today being attacked on all sides, the pope identified the modern rejection of the natural law based on God's Nature, self-realized in His Intellect as first among the "false opinions threatening to undermine the foundations of Catholic doctrine." As Pius XII explained,

"[A]bsolutely speaking, human reason by its own natural force and light can arrive at a true and certain knowledge of the one personal God, Who by His providence watches over and governs the world, and also of the natural law, which the Creator has written in our hearts." (Humani Generis, § 2.)

#30#

Lies, Damned Lies, and Definitions, VII: Re-Editing the Dictionary

One of the most frustrating problems we encounter when dealing with the world from a natural law or Just Third Way perspective is the ease with which (other) people change definitions to suit their own purposes. While this would appear to be simply another manifestation of the moral relativism so widespread today, it does have "practical" considerations — one of which is that it becomes virtually impossible to figure out what somebody is talking about if he or she constantly changes definitions of terms.

With any discussion built on such shifting sand, objective evaluation of the problem becomes virtually impossible. The relativist will, like Humpty Dumpty in Through the Looking the Looking Glass, simply tailor terms to suit him- or herself, if that's what it takes to "win" an argument or close off a discussion — and gain power over another.

Nowhere is this more evident than in the roots of the current financial and economic crisis. It can with justification be said that, with the near-universal adoption of Keynesian economics with the "New Deal" of the 1930s, "the whole world groaned and was astonished to find itself Keynesian."

The problem is that Keynesian economics is, to all intents and purposes, an application of pure moral relativism to economics and finance. Keynes himself acknowledged this in the book he intended as his magnum opus, the Treatise on Money (1930). As "the Great Defunct Economist" announced in the opening passages of that work,

"It is a peculiar characteristic of money contracts that it is the State or Community not only which enforces delivery, but also which decides what it is that must be delivered as a lawful or customary discharge of a contract which has been concluded in terms of the money-of-account. The State, therefore, comes in first of all as the authority of law which enforces the payment of the thing which corresponds to the name or description in the contract. But it comes in doubly when, in addition, it claims the right to determine and declare what thing corresponds to the name, and to vary its declaration from time to time — when, that is to say, it claims the right to re-edit the dictionary. This right is claimed by all modern States and has been so claimed for some four thousand years at least. It is when this stage in the evolution of money has been reached that Knapp's Chartalism — the doctrine that money is peculiarly a creation of the State — is fully realized." (John Maynard Keynes, A Treatise on Money, Volume I: The Pure Theory of Money. New York: Harcourt, Brace and Company, 1930, 4.)

Most people reading this passage simply do not realize the utter enormity of what Keynes claimed. For that reason, while we've presented our arguments many times before, we will examine the Keynesian revelations once again in this series, and test them against our understanding of the natural law common to all humanity.

#30#

Lies, Damned Lies, and Definitions, VI: Misdefining Money

In the previous posting in this series we defined money as anything that can be accepted in settlement of a debt. All money is thus a contract, just as (in a sense) all contracts are money. What happens, however, when we change the definition of money by removing or changing one of the elements of a contract?

Clearly, a contract is not really a contract if any one of the three essential elements (offer, acceptance, consideration) is missing. If the maker of a contract or drawer of a bill does not own that which he or she promises to deliver on maturity of the bill, the promised item has no present value, or bills are drawn with a face value greater than that of the consideration at the time the bill is drawn, the bill is fraudulent or "fictitious."

Right away we can see problems with backing the money supply with government debt, that is, with public sector bills of credit instead of private sector bills of exchange. Every one of the elements of a valid contract — a real bill — is missing.

This is because the State does not own the future taxes it hopes to collect to redeem its bills. Taxation is a grant from the citizens. It is not the exercise of a right of property. The present value of future tax collections is thus backed not by existing marketable goods and services in the economy as many believe, thereby making State-issued money a general claim on the wealth of society. Rather, State-issued bills of credit are backed by the ability of the government to collect taxes.

Taxes are in turn collected out of future private sector production that may or may not take place if the government has undermined the capacity of the economy to produce marketable goods and services. Bills of credit are therefore backed indirectly (and at two removes) by the general wealth of the economy, which the State may or may not be able to tax in order to make good on its promises.

When emitting bills of credit, then, the State is not making a genuine offer, for it does not yet own that which it is offering, the present value of future tax collections. Nor is there actual acceptance, for no one can truly accept an offer that is not really made or which conveys something that the offerer does not own. Finally, instead of the present value of a specific good or service being conveyed by the bill of credit, there is only a vague promise that the bill will be redeemed — there is no actual consideration.

This is why the "currency principle" — that money consists exclusively of State-issued or authorized coin, banknotes, demand deposits, and some time deposits — always requires that the State have the power to force acceptance of its bills of credit on the economy. Lacking the essential elements of a valid contract, such "money" can only be accepted on compulsion. It is, to all intents and purposes, a legal form of counterfeiting, as Keynesian economist and Nobel Laureate Paul Samuelson admitted.

Under the currency principle, all money that is not issued directly by the State is, paradoxically, considered fraudulent, for private issuers of bills of exchange do not have the legal power to force people to accept their bills, and can thus create money without the permission of the State. A private sector bill of exchange represents dangerous competition to the presumed State monopoly over money creation. Having real value behind them instead of vague promises, bills of exchange endanger State control of the economy and the ability of the government to manipulate the money supply for political ends.

The problem with State control of the economy for political purposes is painfully evident. As governments emit increasing numbers of bills of credit to finance deficits and redistribute existing wealth, the chance that there will be sufficient marketable goods and services produced by the private sector both to generate enough wealth to provide for the material needs of those who are productive and meet increasing demands for taxes decreases dramatically. Obviously, we are here construing the inflation induced by emitting bills of credit as a "hidden tax" that transfers wealth to government and wealthy producers through "forced savings." (General Theory, II.7.iv, IV.14.i, V.21.i, VI.22.vi.)

#30#

Lies, Damned Lies, and Definitions, V: The Real Bills Doctrine

As we saw in the previous posting in this series, the Keynesian approach to economic growth embodies a number of self-defeating assumptions and redefinitions. Given the assumption that human labor is the sole input to production, for example, Say's Law of Markets not only cannot function, it doesn't even make sense. When added to the Keynesian/currency principle redefinition of money, the necessity of every child, woman and man becoming an owner of capital as well as labor is perceived as delusional.

The line of reasoning seems to be that because it is impossible to finance new capital formation except by cutting consumption, all proposals to make propertyless people into capital owners are doomed to failure. This is because if capital ownership is widespread, people will use capital incomes for consumption, not reinvestment.

This is, in fact, why Keynes advocated the elimination of small ownership. As he explained the benefits of the disappearance of small owners — "rentiers" — "functionless investors" who use their capital incomes for consumption instead of reinvestment,

"I see, therefore, the rentier aspect of capitalism as a transitional phase which will disappear when it has done its work. And with the disappearance of its rentier aspect much else in it besides will suffer a sea-change. It will be, moreover, a great advantage of the order of events which I am advocating, that the euthanasia of the rentier, of the functionless investor, will be nothing sudden, merely a gradual but prolonged continuance of what we have seen recently in Great Britain, and will need no revolution." (General Theory, VI.24.ii.)

Two, the only real money is coin or certificates of some sort issued or authorized by the State; all economic transactions are therefore either directly or indirectly under State control.

Keynes's analysis falls apart, however, the moment we realize, one, that new capital formation can be financed using future increases in production instead of past reductions in consumption, and, two, that money is anything that can be accepted in settlement of a debt.

People used to incur and settle debts in the same transaction, without any medium of exchange other than the actual goods and services being exchanged. This is barter. People soon realized, however, that they can make exchanges easier by drawing up contracts offering marketable goods and services that they own or will own at the agreed upon time, and offer the contracts in trade for things they want. If the offer is accepted, money has been created. If the offer is not accepted, no money has been created.

This becomes understandable once we realize that all contracts consist of an offer, an acceptance, and consideration. (Consideration is the inducement to enter into a contract, the thing of value being conveyed.) If all money consists of good promises, that is, offer, acceptance, and consideration, then there can always be exactly as much money as an economy requires, and there will be neither inflation nor deflation.

This is the "real bills doctrine," an application of Say's Law of Markets. It is the essence of what is called "the banking principle," and is based on the natural rights of liberty (freedom of association/contract) and private property.

We have to understand that property is not the thing owned, but the natural right every person has to be an owner, and the socially determined bundle of rights that define how an owner may exercise or use what he or she owns.

Obviously, this is not the understanding of money that prevails throughout the world today, and serious problems have resulted from that misunderstanding. The most immediate of these is the global debt crisis, which governments keep trying to solve by creating even more debt. There is also, however, the question of the role of the State in the economy, and whether governments should be in the business of money creation at all, or should be limited to a regulatory function.

#30#

News from the Network, Vol. 5, No. 25

A number of important initiatives have moved forward this past week. Things remain difficult for everyone — e.g., the "official" unemployment rate of 8.2% or so reported for May 2012 by the Bureau of Labor Statistics seems surreal when compared with the 24.3% of the workforce that doesn't have jobs ("Prime-Age Workers Still Lost in the Recession's Undertow," Washington Post, 05/30/12, A1, A12). Just don't ask us what the difference is between the unemployment rate and the rate of people in the workforce who don't have jobs. We're still trying to figure that one out. It may just be a way of staving off angry villagers who approach with torches and guns for all we know.

Anyway, to counter this sort of bureaucratic silliness that misuses the power of positive thinking and slips over into the delusional, people in the Just Third Way network are doing things that reflect the true power of thinking positively — and of backing up thoughts and words with deeds:

• Monica in Cleveland has been pushing forward with making contacts and opening doors for telephone conferences with key gatekeepers and prime movers to lay the groundwork for a Just Third Way approach to reviving the city economically. While the proposal is based on a completely different paradigm — don't think that agreement on superficial similarities affects the fundamental differences between binary economics based on the banking principle, and, say, Keynesian economics based on the currency principle — door-openers don't have to grasp the whole picture. They only need enough to be able to intrigue others. Let us answer the questions, and don't be afraid to admit you don't know. As sages throughout the ages have explained, realizing and admitting your ignorance is the beginning of wisdom.

• In the "Party Like It's 1929" Department, the Wall Street Journal reported today that in light of the ongoing debt crisis in Europe and to encourage lending, the European Central Bank is "poised to relax its collateral rules for central bank loans." (06/22/12, A9) This means that the security for the bad loans that Europe's banks have been making to governments will be downgraded, making a default even worse than otherwise. This is similar to what happened following the Crash of 1929, when the securities offered as collateral on commercial loans suffered a drastic loss in value. As the value of collateral decreased, banks began demanding settlement of their call loans and stopped lending. Borrowers with term loans either could not get them renewed or get credit in the first place, while others went into default as business activity went into a tailspin. Kelso's idea of collateralizing pure credit loans with capital credit insurance and reinsurance would have solved the problem caused by the Crash, while the mass purchasing power generated by widespread capital ownership would have kept demand at a level sufficient to forestall the Great Depression and allowed banks to lend to businesses.

• The CESJ core group had two days of intensive work sessions with Dave Kelly, who has been working with award-winning cartoonist Bert Dodson (The Way Life Works, 1998). Dave and Bert have been integrating Just Third Way monetary theory into an explanation of Capital Homesteading and its benefits for a cartoon presentation.

• The first issue in the new series of the newsletter of the Irish Special Interest Group ("SIG") of American Mensa, Litir Scéala an tSIG Gaelach, that went out on June 17, 2012 (including a feature article applying Just Third Way concepts to Ireland), was a reasonable success. The 28 subscribers (at least, those who "validated" their subscription) all got their copies of the newsletter delivered to their e-mail addresses — not a link, but the actual newsletter, in full — and, to date, more than 300 people have visited the website, making for quite a healthy circulation for a newsletter, the last issue of which was four years ago. Keep in mind that the more people who subscribe to the Irish SIG newsletter, the more people will receive the quarterly CESJ publications flyer, which is all to the good (at least for CESJ).

• The CESJ core group began work on revising the healthcare proposal currently on the website. Especially in view of the mandates in the "Obamacare" proposal, it was essential to remove any sort of mandate and let people make their own choices about the type of healthcare they want. Taking it off the back of the employer and making it a personal expenditure not only gives more freedom and keeps the State out, it makes people directly accountable for their own actions.

• As of this morning, we have had visitors from 64 different countries and 49 states and provinces in the United States and Canada to this blog over the past two months. Most visitors are from the United States, the UK, Canada, India, and Australia. People in Sweden, Cambodia, Qatar, Syria, and Spain spent the most average time on the blog. The most popular postings this past week were "Thomas Hobbes on Private Property," "Catholic Social Teaching and Economic Justice, I: Introduction," "CESJ's Orientation in Brief," "Aristotle on Private Property," and "Own or Be Owned: Capital Homesteading Now."

Those are the happenings for this week, at least that we know about. If you have an accomplishment that you think should be listed, send us a note about it at mgreaney [at] cesj [dot] org, and we'll see that it gets into the next "issue." If you have a short (250-400 word) comment on a specific posting, please enter your comments in the blog — do not send them to us to post for you. All comments are moderated anyway, so we'll see it before it goes up.

#30#

Lies, Damned Lies, and Definitions, IV: The Economic Dilemma

In the previous posting in this series we saw that Say's Law does not function in a modern industrial economy. Keynes claimed that this is because there are obstacles to full employment of labor that only the State can remedy by manipulating the money supply. Keynes's analysis of Say's Law, however, assumed as a given that labor alone is responsible for all production.

Say, however, specifically stated that production is the result of employing both labor and capital. His "law" assumed as a given that there were no obstacles to full employment of either labor or capital.

The remedy for the failure of Say's Law to function is thus not to try and reach the ephemeral goal of full employment of labor in an economy in which capital is taking over the burden of production of labor. That is impossible in any event. The remedy to the non-functioning of Say's Law is to remove obstacles to full ownership of capital, especially for people whose labor is falling in value relative to the capital that is displacing them. As Pope Leo XIII pointed out,

"We have seen that this great labor question cannot be solved save by assuming as a principle that private ownership must be held sacred and inviolable. The law, therefore, should favor ownership, and its policy should be to induce as many as possible of the people to become owners." (Rerum Novarum, § 46.)

It is easy to understand why Say's Law does not function when capital ownership is concentrated. Capital does not consume in the same sense as human beings do. Owners of capital consume, of course, but they are constrained by physical reality as to how much they can consume. Wealth piles up for those who own capital, at the same time that people who do not own capital are in want. The problem is how to turn non-owners of capital into owners of capital without violating the rights of existing owners by redistributing their capital or its fruits, or by consuming the financial capital — savings — believed to be essential to invest in new capital.

This is a form of what Harold Moulton called the "economic dilemma." As Moulton described the "Catch-22" into which most modern schools of economics have trapped themselves, "The dilemma may be summarily stated as follows: In order to accumulate money savings, we must decrease our expenditures for consumption; but in order to expand capital goods profitably, we must increase our expenditures for consumption." (The Formation of Capital, 28.)

Moulton demonstrated the falsity of this "dilemma" by pointing out that rapid economic growth and capital expansion had taken place in the past (notably in the United States from 1865 to 1893) at a time when the currency was being deflated, savings depleted, and prices were falling — a combination of circumstances that, according to Keynesian analysis, is impossible.

It is not impossible, and what was really happening shows how capital ownership can be financed for propertyless workers without redistributing existing savings through either taxation or inflation.

#30#

Lies, Damned Lies, and Definitions, III: What is Money?

It's beginning to look as if "What is Money?" may be the most common title for postings on this blog. This is understandable, for misunderstandings of money are widespread, with confusion mounting day by day. This is especially troubling in light of the continuing belief that we can solve the world debt crisis by creating and spending more money backed by government debt to finance consumption, rather than creating and investing money backed by private sector assets to finance production.

Let's begin at the beginning. Money is anything that can be used in settlement of a debt. In accordance with Say's Law of Markets, we neither sell what we produce, nor purchase what others produce with "money." Money is the medium through which we exchange what we produce for what others produce — the "medium of exchange."

Money is simply a symbol of the wealth that someone promises to deliver when presented with the money in accordance with the terms of the agreement under which the money was issued. All money is thus a contract, a promise, just as (in a sense) all contracts are money.

That being the case (and everything else being equal), we cannot consume more than we have produced with our labor or capital, purchase what others have produced with their labor or capital in excess of what we have produced, nor sell to others more than they have produced with their labor or capital. "Supply" and "demand" are necessarily in balance. If some goods remain unsold, it is because other goods for which they can be exchanged are not produced.

Keynes rejected Say's Law on the grounds that supply and demand are clearly not in balance. This has become a sort of economic orthodoxy, and justifies government manipulation of the currency to try and equalize supply and demand.

The problem is that Keynes was dishonest in his analysis. He restated Say's Law, declaring, "Thus Say's law, that the aggregate demand price of output as a whole is equal to its aggregate supply price for all volumes of output, is equivalent to the proposition that there is no obstacle to full employment." (General Theory, I.3.i.)


In other words, Keynes did not keep everything else equal, meaning equal access to ownership of capital as well as labor that Say assumed.  Keynes changed the parameters of the question by ignoring equal access to ownership of capital as critical to the functioning of Say's Law, and asserted without proof that equal access to ownership of labor was the only factor worth considering.

Keynes seized on "chartalism" (now called "Modern Monetary Theory") as the cure-all for this disequilibrium. If the State would redistribute effective demand by artificially inflating or deflating the currency by emitting bills of credit or taxing away any excess, respectively, the economy would always be on an even keel — the Keynesian "counter-cyclical" approach to monetary and fiscal policy.

Keynes's "re-editing" of Say's Law is painfully obvious, and accounts in large measure for the current global debt crisis. Where Say was very careful to specify that production is the result of employing both labor and capital (we include land under "capital"), Keynes implied that production is due to labor alone.

This amounts to a pertinacious rejection of reality. As people have known for millennia, as technology advances, human labor is displaced from the production process and becomes less valuable relative to capital as an input to production. Wages, the return to owners of labor — and thus (in a predominantly proletarian economy) mass purchasing power — decline.

Profits, the return to owners of capital, increase proportionately as capital takes over more and more direct production of marketable goods and services. People who depend solely on selling their labor to gain income and generate mass purchasing power to sustain the economy are shut out of participating in production as they own none of the capital that is carrying out that production. They are forced to rely increasingly on State-supported or subsidized wages and welfare.

The failure of Say's Law to function is not due to any obstacles to full employment of labor, but to obstacles to full ownership of capital. Keynes's assumption that wealth must be concentrated if society is to advance ends up being the very thing that prevents society from advancing!

#30#

Lies, Damned Lies, and Definitions, II: Keynes's Redefinition of Money

In yesterday's posting we looked at the fundamental assumption underpinning Keynesian economics: that it is impossible to finance new capital formation except by cutting consumption and accumulating cash. This assumption leads inevitably to the belief that, in order to be able to finance increasingly expensive capital as technology advances, ownership of that capital must be concentrated in a small elite. To ensure that people are taken care of, however, ownership and control must be separated, so that disposal of income (control) rests with the State, which redistributes enough wealth through taxation or inflation, at the same time ensuring that there is sufficient financial capital available to form new productive capital and create jobs.

On examination, however, we discovered that Keynes drew his conclusions based on what can only be described as a changed or "re-edited" definition of savings: the excess of income over the costs of consumption in the past. Keynes explicitly rejected the idea that savings could be anything else, e.g., the excess of income over the costs of production in the future. Keynes's restricted definition of savings implicitly limits the amount of financing for new capital to what has been withheld from consumption in the past — "past savings."

By including the excess of income over the costs of production in the definition of savings, however, any new capital that has the reasonable potential to pay for itself out of increases in future production can be financed without regard to prior reductions in consumption — "future savings." Reducing consumption in order to finance new capital is, in point of fact, harmful to the financial feasibility of the new capital. If people are saving, they aren't spending, and there's no demand for new products or greater quantities. This accounts for the slow rates of growth experienced before the reinvention of commercial banking and invention of central banking in the 17th century.

As Dr. Harold Moulton, president of the Brookings Institution from 1916 to 1952, demonstrated in The Formation of Capital (1935), however, in periods of rapid economic growth, financing for new capital formation does not come from previous reductions in consumption. Instead, through the proper functioning of the commercial and central banking systems, financing for new capital formation is obtained by creating negotiable instruments called "bills of exchange."

Bills of exchange are based on the creditworthiness of the issuer. They turn future increases in production, rather than past reductions in consumption, into money. The soundness of the money depends on the accuracy of the projections about future productions and sales, and the collateral that backs up the projections.

In contrast, Keynesian economics rejects private sector bills of exchange as money. Consistent with the principles of Georg Friedrich Knapp's "chartalism" (now called "Modern Monetary Theory"), only public sector bills of credit are money. Where private sector bills of exchange are backed directly by the present value of existing and future marketable goods and services in which the drawer of a bill has a private property stake, public sector bills of credit are backed by the present value of future tax collections which the taxpayer may or may not grant — or have to grant in the first place.

Why backing the money supply with government bills of credit instead of private sector bills of exchange is fundamentally unsound is the question we will address in the next posting in this series.

#30#

Lies, Damned Lies, and Definitions, I: The Problem

On June 11, 2012 Dr. Joseph Stiglitz, Nobel Laureate in economics, went on "Russian Television" (RTV) to plug his new book, The Price of Inequality, and announce the end of hope in America through the presumed need to increase State control of the economy in order to increase opportunities for good education, nutrition, and healthcare so as to diminish the wealth gap.

The fact that these and other things often touted as the cause of prosperity are actually the result of it was not raised. The only way to fix America's (and the world's) broken economy is for the State to take over and run things properly.

The problem is that Dr. Stiglitz is absolutely correct . . . if we accept the truth of the assumptions of the Keynesian paradigm within which he operates.

As Keynes explained, given the assumption that the only way to finance new capital formation is to cut consumption and accumulate cash (General Theory, II.6.ii), there is no way that the world can advance economically unless wealth is concentrated. As Keynes declared in 1919 in The Economic Consequences of the Peace, the book that established his reputation,

"The immense accumulations of fixed capital which, to the great benefit of mankind, were built up during the half century before the war, could never have come about in a Society where wealth was divided equitably." (2.iii.)

The problem becomes what degree of State control is required to redistribute just enough wealth through taxation and inflation to keep the economy running without depriving business of adequate investment capital to finance new capital formation and create jobs. (General Theory, VI.24.ii.)

Unfortunately for Dr. Stiglitz's analysis (and for the world that has allowed itself to be cozened by the glamour of Keynesian promises), the Keynes's assumptions and the unsoundness of the monetary and fiscal policy based on those assumptions have been disproved many times. For example, anyone bothering to look and see what Jean-Baptiste Say actually said in his statement of the "law" of economics named for him would instantly see that Keynes restated Say's Law of Markets so as to construct a "straw man" that he then proceeded to demolish.

Nor did the Keynesian penchant for redefinition of basic terms and concepts and illogic end there. Keynes's definition of saving — "the excess of income over expenditure for consumption" — simply ignores the possibility that "savings" can be (and frequently is) the excess of income over the costs of production that can be used to repay the financing of the capital that generated that same production.

Misunderstanding such a basic fact of finance virtually guarantees that the economy will not function properly, any more than filling an automobile's gas tank with hay or feeding a horse gasoline will do anything but harm. We need to understand how capital is actually financed before we can know what to do to correct today's situation.

#30#

News from the Network, Vol. 5, No. 24

We have had some important breakthroughs this week. For one, parallels between events preceding the Crash of 1929 and the antics of the stock market in 2012 are becoming every day more obvious. Not only that, but the insistence of the powers-that-be that the way to get out of debt is to spend more money has reached the point at which it merits a chapter in Charles MacKay's Extraordinary Popular Delusions and the Madness of Crowds (1841).

Be that as it may, here's what we've been doing to try and counter the increasingly hallucinogenic global monetary and fiscal policy:

• In what even the financial mavens are declaring to be a display of utter perversity, the impending bailouts in Europe and the continuing crises in [fill in the blank] has caused a surge in the U.S. stock market. Of course, some of this is the inflationary pressure caused by the transfer of investment funds from Europe as the situation becomes increasingly uncertain, but the gambling urge is exerting very strong pressure at this point. So far this year, the swings in the market have duplicated events of late 1928 to early-to-mid 1929 for anyone to have a real level of comfort.

• The Irish SIG newsletter — Litir Scéala an tSIG Gaelach — that we're viewing as a "test case" to determine the potential viability of reviving CESJ's Economic Justice Monitor as a similar "e-zine," has the first issue in the new series scheduled for release on Sunday. If you subscribed and verified your subscription, you will receive an e-mail containing the full text of the newsletter, not a link to the newsletter. We've received several questions on that, and yes, subscribers (assuming they clicked on the validation link in the e-mail that Google sent to the stated e-mail address), will receive an actual newsletter in electronic form, not a link. (Did you click on that, even though it clearly says, "not a link"?)

• Recently we located eight books by Dr. Harold Moulton of which we were previously unaware, and ordered them. We also located two reasonably priced copies of his 1943 pamphlet, The New Philosophy of Public Debt that exposes the thinking behind today's global debt crisis.

• Not by coincidence, we also recently discovered the "missing link" in the chain leading from Jean-Baptiste of "Say's Law of Markets" to Louis Kelso's application of the theory of pure credit to the problem of financing expanded capital ownership without redistribution or redefining property or money. Thomas Tooke was an early 19th century economist whose work in pure credit that modern commentators trapped in the slavery of past savings have seriously misunderstood. Tooke provided the basis for John Fullarton's critique of the British Bank Charter Act in On the Regulation of the Currencies of the Bank of England (1845), however, and even though erroneously credited with being an inspiration for Georg Friedrich Knapp's "chartalism" — the reductio ad absurdum of the British Currency School, reaching its nadir in Keynesian economics, was one of the primary contributors to the theory behind the British Banking School, of which binary economics is the only survivor today of which we're aware.

• As of this morning, we have had visitors from 60 different countries and 47 states and provinces in the United States and Canada to this blog over the past two months. Most visitors are from the United States, the UK, Canada, India, and Australia. People in Swden, Qatar, Syria, Egypt, and Belgium spent the most average time on the blog. The most popular postings this past week were "Thomas Hobbes on Private Property," "Aristotle on Private Property," "CESJ's Orientation in Brief," "The Global Debt Crisis VII: A Permanent Solution." and "Common Cause, Part XIII: The German Monetary Union of 1871."

Those are the happenings for this week, at least that we know about. If you have an accomplishment that you think should be listed, send us a note about it at mgreaney [at] cesj [dot] org, and we'll see that it gets into the next "issue." If you have a short (250-400 word) comment on a specific posting, please enter your comments in the blog — do not send them to us to post for you. All comments are moderated anyway, so we'll see it before it goes up.

#30#

Catholic Social Teaching and Economic Justice, IX: Bills and Money

Yesterday we looked at the need for propertyless workers to become capital owners as well as labor owners. The problem is that most workers cannot afford to meet their needs with their wages, much less set aside something with which to purchase capital. Raising wages simply increases prices, usually faster than wages increase, leaving the workers worse off than before.

We find the solution to this conundrum in an application of Say's Law of Markets called "the real bills doctrine." The real bills doctrine relies on the nature of this thing we call "money."

Money is anything that can be accepted in settlement of a debt.

All money is a promise, a contract to deliver the value of some marketable good or service. All money is a contract, just as, in a sense, all contracts are money.

All contracts consist of offer, acceptance, and consideration. "Consideration" is the inducement to enter into a contract — what someone expects to get as a result of entering into the contract.

The key to the financial feasibility of a program to turn owners of labor into owners of capital is the soundness of the method of creating money, an application of classic banking theory.

Creating money involves someone making an offer called a "bill of exchange." The offer is based on the present value of the future marketable goods and services the maker of the offer reasonably expects to produce and sell, backed by his or her "creditworthiness": the confidence on the part of whoever accepts the offer has that the maker of the offer will be able to keep his or her promise.

The offer can be made — "tendered" — to someone who accepts the offer in payment for whatever goods or services the acceptor provides to the one making the offer. In a program of expanded capital ownership, the offer is made to someone who will accept the offer and provide what is needed to form new capital to be owned by the one making the offer. When someone or something other than a commercial bank accepts an offer, it is called a "merchants" or "trade" acceptance. When the offer is accepted by a commercial bank, it is called a "bankers acceptance."

When an offer is accepted by someone/thing other than a bank, it can be used as money in other transactions on indorsement by each "holder in due course," that is, by each person accepting the offer in turn when assured by the previous person who accepted it that the promise is good. ("Indorsement" is the usual spelling in law and finance; "endorsement" is the usual spelling otherwise. Either is generally accepted as correct, though.)

When a bank accepts an offer, the bank issues a promissory note. The promissory note can be used as money, or it can be used to back smaller denomination promissory notes called "banknotes" or a demand deposit.

The first offer and acceptance of an offer — a bill of exchange — is called "discounting." This is because the present value of a bill of exchange is almost always less than the face value at maturity, when the bill must be redeemed. Subsequent transactions involving the same bill are called "rediscounting." A central bank adds a layer of security by rediscounting bills discounted by its member banks and issuing its own promissory notes.

As this is applied in a program of expanded capital ownership, the government or some delegated agency can estimate the amount of new capital formation to take place in a specified period, probably on a quarterly basis. This amount could be divided equally among citizens. Each citizen would get a "voucher" entitling him or her to capital credit in the pro rata amount IF (and only if) a feasible capital investment can be located, usually with the help of a banker or financial analyst.

THIS VOUCHER WOULD NOT BE MONEY. The citizen would take the voucher and make an offer — draw a bill of exchange — to purchase shares in new capital that has been approved by the bank that will provide the financing, and a capital credit insurance company that will provide the collateral in the form of an insurance policy. The commercial bank can then create the money to purchase the new capital by accepting — "discounting" — the bill of exchange and issuing a promissory note to the borrower.

The commercial bank could then take the bill of exchange to a central bank and offer it. Assuming the bill is deemed "qualified paper," the central bank would issue a promissory note to the bank, transferring the borrower's liability on the bill of exchange from the commercial bank to the central bank by replacing the bank's promissory note to the borrower, with the central bank's promissory note to the commercial bank.

As far as the borrower is concerned, he would pay the bank and redeem the debt. The commercial bank, however, must remit the payment to the central bank to redeem its debt to the central bank, canceling the money originally created to finance the new capital.

By applying these principles consistently and democratically, everyone could become an owner of capital, and thus participate in the economic common good to the fullest degree possible, but without having to cut consumption or redistribute wealth belonging to others.

#30#

Catholic Social Teaching and Economic Justice, VIII: Pillars and Laws

Having determined that the three principles of economic justice as developed by Louis Kelso and Mortimer Adler are not only consistent with Catholic social teaching, but are actually implied in papal encyclicals, we are faced with two final problems. That is, problems apart from developing a specific program to implement the principles — something that is beyond the purpose of this series and, in any event, is outside the scope of the Church's sphere of activity. The Catholic Church does not endorse any specific program implementing principles of economic and social justice, however much she may insist that the principles be implemented.

We need to state — in general terms — what specifics need to be present in society for the principles of economic justice to function, and then what means may be used to implement and maintain these specifics. On reflection, we discern four essential "pillars" of an economically just society, all of which are also consistent with Catholic social teaching:

1. A limited economic role for the State. Someone's first recourse for meeting his or her material needs and those of his or her dependents is the person him- or herself. As Leo XIII explained, "There is no need to bring in the State. Man precedes the State, and possesses, prior to the formation of any State, the right of providing for the substance of his body." (Rerum Novarum, § 7.)

2. Free and open markets within a strict juridical framework as the best means for determining just wages, just prices, and just profits. Even though the free market doesn't exist anywhere — yet — that does not invalidate this principle. As Pius XI explained, "Certainly the laws of economics, as they are termed, being based on the very nature of material things and on the capacities of the human body and mind, determine the limits of what productive human effort cannot, and of what it can attain in the economic field and by what means." (Quadragesimo Anno, § 42.)

3. Restoration of the rights of private property, especially in corporate equity and other forms of business organization. Being nominally an owner without the rights of ownership is, effectively, not to be an owner at all. As Leo XIII explained, "a working man's little estate thus purchased should be as completely at his full disposal as are the wages he receives for his labor. But it is precisely in such power of disposal that ownership obtains, whether the property consist of land or chattels." (Rerum Novarum, § 5.)

4. Widespread direct ownership of capital, individually or in free association with others. While this is the pillar missing from virtually every economy on earth today, it is the one most clearly stated in the encyclicals, not once, but many times. Leo XIII, however, may have said it most forcefully: "We have seen that this great labor question cannot be solved save by assuming as a principle that private ownership must be held sacred and inviolable. The law, therefore, should favor ownership, and its policy should be to induce as many as possible of the people to become owners." (Rerum Novarum, § 46.)

Since widespread capital ownership is the one pillar missing from every economy today, it would appear to be the key. That makes it all the more critical that a feasible means be found, consistent with natural law, that will enable people to acquire and possess private property in capital. This we find in "Say's Law of Markets," one of the "laws of economics" that tell us what is possible through human effort by following right principles.

Say's Law can be stated very simply. We cannot consume more than we produce. In order to consume, we must produce, either by labor, by capital, or both. Further, we cannot obtain what others produce unless we can trade them something we have produced. This is consistent with the basic principle of economics: the purpose of production is consumption.

Thus, although it is dangerously misleading to summarize Say's Law without understanding this brief explanation, Say's Law can be summarized (and thus misunderstood) as "production (supply) equals income (demand). Therefore, supply generates its own demand, and demand its own supply."

As we can see, then, Say's Law is a combination in economic terms of the natural rights of private property and liberty (freedom of association/contract). Private property says that we have the right to enjoy — consume or dispose of — the fruits of our efforts, whether labor or capital. Liberty says that we can either consume what we produce, or trade with whomever we like to exchange what we produce for what others produce.

This is all well and good. The problem is what do we do if labor is becoming less important than capital as an input to production as technology advances, and people lose their jobs to capital? Obviously, the answer is (as Louis Kelso put it), "If the machine wants our job, let's buy it."

At first, this seems impossible. The general presumption is that the only way to purchase capital is to cut consumption and accumulate cash. Unfortunately, that option is not open to most people. They simply don't make enough in wages to meet their daily expenses, much less set anything aside to purchase a meaningful amount of capital when their labor declines in value or they can no longer find work.

Nor is paying people more money the answer. Increasing wages increases costs, and raises prices. Since part of inflation is the anticipation that prices will go up, prices tend to go up faster and sooner than wages can be increased. Since he buys less with more money due to inflation, the worker is worse off with more money than he was with less.

#30#

Catholic Social Teaching and Economic Justice, VII: The Implications

As promised, today's posting presents brief selections from the social encyclicals that we believe prove that the principles of economic justice (Participation, Distribution and Harmony), while not explicitly stated in Catholic social teaching, are necessarily implied.

Participation. The right of every human being to participate in the economy both as an owner of labor, and as an owner of capital. In Rerum Novarum we read,

"[E]very man has by nature the right to possess property as his own." (Rerum Novarum, § 6.)

"[A] man's labor necessarily bears two notes or characters. First of all, it is personal, inasmuch as the force which acts is bound up with the personality and is the exclusive property of him who acts." (Rerum Novarum, § 44.)

Evidently, Leo XIII held as true and certain knowledge (not opinion) that human beings have the right to own both labor and capital. The phrases "by nature" and "necessarily" tell us that. Further, this necessarily implies the exercise of these rights, for the right to own is meaningless until and unless it can be exercised, whether we are talking capital or labor.

We also know that this right of participation, that is, the right to own and enjoy the use of both labor and capital within the common good is no invention of Pope Leo as some would have it. On the contrary, no pope can contradict another when speaking infallibly, for that would mean that papal infallibility is meaningless.

Distribution. The right of every human being to receive the results of production in direct proportion to his or her inputs to production, whether labor or capital. As Leo XIII explained,

"[I]f he lives sparingly, saves money, and, for greater security, invests his savings in land, the land, in such case, is only his wages under another form; and, consequently, a working man's little estate thus purchased should be as completely at his full disposal as are the wages he receives for his labor. But it is precisely in such power of disposal that ownership obtains, whether the property consist of land or chattels." (Rerum Novarum, § 5)

"To defraud any one of wages that are his due is a great crime which cries to the avenging anger of Heaven." (Rerum Novarum, § 20.)

In other words, not only does everyone have the right to contribute to productive activity, he or she has the right to receive the fruits of his or her efforts — the right of disposal. Someone has just as much right to receive the profits attributable to his or her pro rata share of what he or she owns as capital ("land or chattels") as he or she does to receive what is due for selling labor.

Harmony is the "feedback" principle that tells us when the system is broken, we must organize, study the situation, discern the proper principles, and set to work fixing it. As Pius XI explained,

"It happens all too frequently, however, under the salary system, that individual employers are helpless to ensure justice unless, with a view to its practice, they organize institutions the object of which is to prevent competition incompatible with fair treatment for the workers. Where this is true, it is the duty of contractors and employers to support and promote such necessary organizations as normal instruments enabling them to fulfill their obligations of justice." (Divini Redemptoris, § 53.)

Father William Ferree, one of CESJ's co-founders, liked to use this passage to illustrate how easy it is for people to misunderstand the encyclicals when they come to the table burdened with preconceptions. As he said, give most people the passage to read, ask them what is stated as the duty of employers in it, virtually every single one of them will say a just wage.

This is absolutely wrong. In fact, the duty imposed on employers to protect the rights of the workers is twice stated as being to organize to ensure justice, not to try and impose justice: "organize institutions the object of which is to prevent competition incompatible with fair treatment of the workers," and "it is the duty of contractors and employers to support and promote such necessary organizations as normal instruments enabling them to fulfill their obligations of justice."

Read that passage as many times as you like, and you will not see any explicit statement to the effect that it is the duty of employers to pay a just wage. That is, in fact, specifically stated elsewhere in the encyclical, but this passage states what an employer's duty is when he cannot pay a just wage! — something entirely different. To insist that the passage means that you must pay a just wage when it is clearly stated that the problem is that you cannot pay a just wage does not even make sense.

Thus, we can see that the Kelso-Adler principles of economic justice, while not explicitly stated in the encyclicals, are clearly implied, or the encyclicals simply don't make sense.

#30#

Catholic Social Teaching and Economic Justice, VI: The Principles of Economic Justice

Yesterday we noted that when the institutions of society are flawed, it is our responsibility to organize, study the situation, and then restructure our institutions so that they once again function properly for the benefit of everyone.

This brings us to the point of this series. The condition of society today, especially the economy, gives evidence that there is something seriously wrong with our institutions. Having the State try to make up for the lack of a properly functioning system has only resulted in the global debt crisis. Obviously we need to step back for a moment, study the situation, discern the proper principles of economic justice, and apply them effectively.

To make certain that we are doing the right thing, we need to correlate our principles and any proposed actions with fundamental principles of natural law. If we don't do this, we risk going against our own nature, and will thus merely be courting disaster.

We have contended that the principles of economic justice discerned by Louis Kelso and Mortimer Adler are not only fully compatible with the natural law (and thus with Catholic, Jewish and Islamic social teaching based on the natural law), but that the principles themselves are implicit in the social teachings of the Catholic Church, notably in the encyclicals of Leo XIII and Pius XI. This contention we are now prepared to prove.

First, we need to examine the three principles of economic justice detailed in Chapter 5 of The Capitalist Manifesto. These are Participation, Distribution and Limitation. Within the framework of the Just Third Way we have changed "Limitation" to "Harmony," or the "social justice" principle.

Participation refers to the right that every human being has to participate in the economy both as an owner of labor and as an owner of capital. As Kelso and Adler demonstrate, it is a false dichotomy to claim that ownership of one's labor is somehow fundamentally different from ownership of one's capital, at least with respect to the fact that both are ownership.

There is, of course, an inherent connection between a person and his or her labor, so that mistreatment of someone's labor is indistinguishable from mistreatment of that person as a person. Harming someone's capital harms a person by infringing on his or her rights, but does not usually physically harm the owner. Speaking of both labor and capital as things that are owned, however, both labor and capital are as fully owned, and are owned in the same way, as anything else that is owned.

Distribution refers to the right that every human being has to receive the results of production in direct proportion to his or her inputs to production, whether labor or capital. In strict justice, and everything else being equal (for example, the bargaining position of employer and employee), the objective value of a person's inputs compared to similar inputs in a free market determines the relative value of those inputs to each other.

There is no free market today for either labor or capital, so what we just said is the pure theoretical case. In practical terms, many things interfere with the standard "ceteris paribus" economic disclaimer — but we are dealing with pure theory here in order to discern the principle, not come up with an application of the principle (at least, not yet).

Harmony is the "feedback" principle that tells us when the system is broken, we must organize, study the situation, discern the proper principles, and set to work fixing it.

These principles are not stated explicitly anywhere in the social encyclicals. If, however, these principles of economic justice and the social teachings of the Catholic Church are based on natural law (as both Catholic philosophers and theologians, and binary economists claim), then they are necessarily in agreement.

We have, however, made the claim that the three principles of economic justice are not only consistent with Catholic social teaching, the principles of economic justice are implicit in the encyclicals. There is thus a serious need, especially in today's society and its confusion over what is and is not an infallible teaching or principle as opposed to an application of an infallible teaching or principle, for an in-depth clarification of the principles of economic justice by the pope, possibly in an encyclical.

#30#

News from the Network, Vol. 5, No. 23

There has been a great deal of activity this week as the CESJ Core Group works to surface door openers and prime movers who can advance the Just Third Way, both within the current legal and institutional system, and organize to bring the efforts of the expanded ownership movement to fruition and obtain the passage of a Capital Homestead Act.

As can be seen from the news items gathered from the major media (below), however, there are a number of fixed ideas and attitudes that must be addressed effectively if we are to make progress:

• Monica W. in Cleveland arranged a telephone meeting for the CESJ Core Group with Father Robert Begin, the "Rebel Priest" noted for his championing of the poor and downtrodden. In a good display of the effectiveness of the door-opening strategy, Father Begin gave a number of very valuable leads to potentially key people on which Monica is following up.

• The first issue in the new series of Litir Scéala an tSIG Gaelach, the newsletter of the Irish Special Interest Group (SIG) of American Mensa, is scheduled for publication on Sunday, June 17, 2012. Because the newsletter will include short pieces on Éire from a Just Third Way perspective, readers of this blog might want to subscribe and forward the newsletter and the quarterly publications flyer to their network.

• The wild swings in the stock market suggest that the Kelsonian approach might be a better analytical tool for understanding fluctuations than the Keynesian or the Monetarist. As of this writing (and it will probably change significantly up or down by the end of the day, if not in the next hour), the Dow is down by almost 60.

• The analysis of "Market Watch" is exactly backwards. In article that appeared today, "U.S. Debt Load Falling at Fastest Pace Since 1950s," reporter Rex Nutting claims that the increase in public sector debt is more than offset by the decline in private sector debt. This is wildly misleading. Private sector non-productive consumer debt is still increasing, according to the Federal Reserve along with the massive amount of non-productive government debt. What is decreasing — and what signals a disaster in the making — is debt incurred to finance new and replacement plant and equipment, i.e., to form capital. The bulk of financing for new capital is coming from existing accumulations of savings that came from cutting consumption. This decreases effective demand for what the new and replacement capital is expected to produce, resulting in a greater potential for business failure.

• Nobel Laureate Joseph Stiglitz's new book, The Price of Inequality, accurately pinpoints the growing gap between rich and poor as a serious situation. Unfortunately, as a Keynesian, Dr. Stiglitz has gotten things backwards, confusing cause and effect. According to an article on "The 'American Dream' is a Myth': Joseph Stiglitz on 'The Price of Inequality'," Dr. Stiglitz believes that inequality in education, healthcare and nutrition (among other things) causes income inequality rather than being the result of income inequality. His solution is consistent with his past savings-based Keynesian orientation: equalize opportunity for education, healthcare and nutrition (among other things) — which usually means provision by the State. This will allegedly equalize income opportunity and solve the problem. As has been shown by decades of attempting to force equality of results by government action (the New Deal, the Great Society, etc.), putting the cart before the horse only makes matters worse.

• The Kelsonian prescription for addressing the "opportunity gap" is more straightforward: act directly on the problem by equalizing income opportunity first through democratic access to capital credit, thereby allowing propertyless people to supplement or replace inadequate wage and welfare income with capital income. They can then afford the education, healthcare and nutrition for which prosperity pays. As Pope Leo XIII pointed out, "We have seen that this great labor question cannot be solved save by assuming as a principle that private ownership must be held sacred and inviolable. The law, therefore, should favor ownership, and its policy should be to induce as many as possible of the people to become owners." (Rerum Novarum, § 46.)

• Correlating our analysis of Nutting's and Stiglitz's claims shows us how the "ultimate economic meltdown" could happen. Increasing non-productive debt at the expense of productive debt redistributes existing wealth without making adequate provision for future production of marketable goods and services. Viewing State welfare as a way of life instead of the emergency measure to which Leo XIII referred (Rerum Novarum, § 22) puts the State in place as the primary source of material sustenance — a role the State was never intended to fill: "There is no need to bring in the State. Man precedes the State, and possesses, prior to the formation of any State, the right of providing for the substance of his body." (Rerum Novarum, § 7.) Since the State produces nothing and thus can only redistribute what others produce, governments are going bankrupt, just as labor economist Goetz Briefs observed in the 1930s (The Proletariat: A Challenge to Western Civilization, 1937). As the private sector reduces investment in new and replacement capital, and consumer and State demands on a smaller pool of wealth increase, the strain has the potential to trigger a stock market meltdown that would dwarf that of 1929 — at a time when America's capacity to produce has been almost fatally eroded.

• As of this morning, we have had visitors from 62 different countries and 49 states and provinces in the United States and Canada to this blog over the past two months. Most visitors are from the United States, the UK, Canada, India, and Australia. People in Syria, Egypt, Belgium, the United States, and Qatar spent the most average time on the blog. The most popular postings this past week were "Thomas Hobbes on Private Property," "Aristotle on Private Property," "The Global Debt Crisis VII: A Permanent Solution." "Stimulus, Part II: An Alternative to Keynesian Economics" and "The Situation in Greece."

Those are the happenings for this week, at least that we know about. If you have an accomplishment that you think should be listed, send us a note about it at mgreaney [at] cesj [dot] org, and we'll see that it gets into the next "issue." If you have a short (250-400 word) comment on a specific posting, please enter your comments in the blog — do not send them to us to post for you. All comments are moderated anyway, so we'll see it before it goes up.

#30#

Catholic Social Teaching and Economic Justice, V: The Task of Social Justice

As we saw in the previous posting, human beings acquire and develop virtue by exercising their rights and meeting their obligations. We can now take that a step further and observe that there must be a hierarchy of rights and duties. Some rights, for example, may be trivial to the point of meaninglessness within the larger context of the common good as a whole, such as the right to lead a club march in a St. Patrick's Day Parade. Other rights, however, are essential if we are to acquire and develop virtue, that is, become more fully human in a manner consistent with our own nature.

There are thus certain fundamental rights without which we cannot be said to participate fully in the common good. That is, without the effective exercise of these rights we either cannot acquire and develop virtue, or have great difficulty in doing so.

Because these rights help us to conform to our own nature and develop that nature more fully, we call them "natural rights." Among the most important of the natural rights are life, liberty (freedom of association/contract) and property. Without life, of course, the whole issue of acquiring and developing virtue becomes moot. Without liberty, there is no question of developing virtue, for the acquisition and development of virtue by its nature must be voluntary, that is, free. Without property, we do not have the right to receive the fruits of our labor or our capital, thereby supporting our lives and vesting us with the power to exercise liberty.

By "property," we do not mean the thing owned, but the natural right each person has to be an owner, and the socially determined bundle of rights that define how an owner may use what he or she owns within a specific context. Typically, the bundle of rights that accompany the right to be an owner in the first place prohibit the owner from harming him- or herself, other individuals or groups, or the common good as a whole.

This brings us back to the common good. We have already defined the common good as the capacity that each human being has to acquire and develop virtue, and thereby become fully human. We acquire and develop virtue by exercising rights and meeting obligations.

It follows, then, that the common good must somehow manifest itself in the social order, or there is no way in which human beings as political animals can acquire and develop virtue. We can therefore take the general definition that we have developed of the common good — the capacity to acquire and develop virtue — and "particularize" it by noting that the common good manifests itself in the social order as the network of institutions (such as laws, organizations, customs, traditions, and so on), within which human beings acquire and develop virtue by exercising their rights and meeting their obligations.

The problem, of course, is that just as each human being has different degrees of different types of virtue because of a failure to develop his or her natural capacity to its fullest, every society has institutions that might not assist people adequately to acquire and develop virtue. In some cases, our institutions might actually prevent people from being virtuous except through heroic effort — which, while it may be noble and consistent with the highest aspirations of humanity, is hardly the way to run a society. We must be ready at all times to exercise such heroic effort, but to require it as a matter of course simply to be able to act in a manner consistent with nature is counterproductive. It should not require an epic quest merely to have enough to eat or to be treated fairly by others.

When our institutions are flawed to the point that they inhibit or prevent us from acquiring and developing virtue, we must take steps to correct or repair our institutions so that we are once again able to exercise our rights, and thereby acquire and develop virtue. Social justice, as the particular virtue directed at the common good, governs this activity. When our institutions are in need of repair, our task is to organize, study the situation to decide which principles are being violated, and then act in an effective manner to bring about the desired restructuring so that the institutions of the common good once again function to the optimal benefit of every member of society.

#30#

Catholic Social Teaching and Economic Justice, IV: The Common Good

In yesterday's posting we pointed out that, contrary to explicit papal statements, there are ways in which non-owning workers can become capital owners other than by exercising industry and frugality. Does this mean that the pope is a liar or a fool?

Hardly. It merely highlights the fact that we need to exercise a little common sense when reading the encyclicals, and to realize when the popes are speaking infallibly as pope, and when they are speaking as fallible human beings, and perhaps not choosing the best words so that others may accurately understand their meaning. The popes may even be ignorant of principles of economics and finance that would be more effective in applying the principles of Catholic social doctrine — social justice — that they have discerned as infallibly true.

What, however, are these principles?

To answer that, we must define social justice. Social justice is the particular virtue directed to the common good. That, while relatively simple, needs a lot of explanation.

First, we need to define "common good." The common good is that good that is common to every member of the human race. Put another way, the common good is that which defines us a human beings — our "substantial nature," as the philosophers might say. If something does not have this common good, and have it in its entirety, then it is not human. It might be more than human, other than human, or less than human, but it is not human — by definition.

This means that the common good cannot be the aggregate of individual goods possessed by various members of the human race. It cannot be material goods, for example, for people can and do own such things and can legitimately prevent others from enjoying what they themselves possess, which is the essence of private property. Remember — the common good must be common, it cannot be individual, and each member of the human race must possess it in its entirety.

Even under absolutely pure communism, in which everybody presumably owns everything, material goods cannot constitute the common good. I cannot possess the food you eat in its entirety at the same time that you eat it, any more than you can possess what I eat in its entirety at the same time that I eat it. The common good, then, is to that extent a paradox: it is evidently utterly indivisible at the same time that everyone can possess it completely.

Let us consider for a moment that the common good might be possession of virtue — literally "human-ness." This is only for a moment, though. We soon realize not only that no mere human being possesses the fullness of virtue, each human being possesses different degrees of different virtues.

Yet there must be some connection of the common good to virtue, for virtue — human-ness — is, obviously, a characteristic of humanity. A human being without human-ness is a contradiction in terms. Still, there can be human beings without virtue, for newborns, while they are fully human and thus persons, are in a state of innocence and do not possess virtue.

We conclude, then, that it is not virtue per se that defines humanity as human, but the capacity to acquire and develop virtue. Actual being and potential being are equally stages of being. That being the case, a human being who is potentially virtuous, and a human being who is actually virtuous are both fully and equally human beings, regardless of the degree and type of virtue they have acquired and developed — or the lack thereof. We conclude that the common good of all humanity is the capacity to acquire and develop virtue.

That raises another issue. Every member of the human race may be as fully human, and human in the same way as every other human, and thus by nature have the same capacity to acquire and develop virtue, but that doesn't tell us how human beings acquire and develop virtue, that is, act consistently with their own nature.

Man, as Aristotle pointed out, is by nature a political animal. That being the case, we as individuals act in accordance with our own nature and acquire and develop virtue within a social context by acting consciously of our own volition.

Acquiring and developing virtue is an act. In order to act, we must have the ability to act or "do." That is, we must have power, defined as "the ability for doing."

Power, however, does not mean being able to act any way we choose without regard for our own good or that of others. Rather, power properly used must be circumscribed within specific limits, beyond which it must not go if it is to do its job.

These limits we call rights and duties. A "right" is the power to do or not do something in relation to another. A "duty" is the obligation to do or not do something in relation to another.

Rights and duties are therefore the means by which human beings acquire and develop virtue within a social context, that is, among other people. By exercising our rights or meeting our obligations we develop the "habit of doing good," that is, we acquire and develop virtue — we participate in the common good.

#30#

Catholic Social Teaching and Economic Justice, III: How to Read an Encyclical

In the previous posting in this series we explained how to understand the Catholic doctrine of infallibility. It does not mean that everything the pope says is true simply because the pope says it. Rather (as Catholics believe), infallibility is a special power that the Holy Spirit grants to the pope as pope to discern truth in the area of faith and morals. Nothing is true because the pope says so; the pope says so because it's true.

Even given the correct understanding of infallibility, however, we still have to understand that the pope may teach infallibly, but that does not mean that we learn infallibly — or that the pope did not commit some human error in teaching or otherwise conveying a truth. Just because our faith is strong says nothing about our knowledge or wisdom, our ability to understand a complex or subtle truth, or even to discern when the pope is speaking infallibly as pope, that is, in his official capacity, or when he is speaking as a fallible human being giving an opinion.

The pope as pope speaks infallibly when speaking on matters of faith or morals. Once he gets into applying these principles, however, he is in the area of science, which is beyond the limits circumscribed by the doctrine of infallibility.

This is true even when the science involved is theology, once called the "Queen of all sciences." This presents Catholics with a seeming paradox. Is not the pope as pope the final authority on matters of faith and morals? And isn't theology, well, the pope's job? How could what the pope says in the field of theology not be automatically infallible?

Because the Holy Spirit protects the pope as pope from error when discerning the basic principles on which theology is built, not in his theology. The pope may be (and frequently is) a very fine, even great theologian — a "theological scientist" — and we must be very careful when arguing with him when the subject is theology, the same as you would when discussing physics with Albert Einstein.

That does not mean that the pope is necessarily correct in his theology as a matter of course. Were that the case, the popes would hardly open up theological questions to debate, or present their arguments in order to convince people, and engage in debate with other theologians. He would simply make a declaration, take it or leave it. As a theologian, the pope is a fallible human being applying principles that he as pope discerned infallibly. He is therefore subject to error — not in the discernment of the underlying principle or truth, but in what he does with it.

If that is the case with respect to theology, often the pope's special area of expertise as a human being, it is all the more the case when the subject is economics or finance, our areas of concern. Fortunately, the popes recognize their own limitations, even if some of their supporters do not. Consider, for example, the following passage from Pope Pius XI's Quadragesimo Anno:

"As We have already indicated, following in the footsteps of Our Predecessor, it will be impossible to put these principles into practice unless the non-owning workers through industry and thrift advance to the state of possessing some little property. But except from pay for work, from what source can a man who has nothing else but work from which to obtain food and the necessaries of life set anything aside for himself through practicing frugality?" (§ 63.)

This could not be a better example of what we are talking about. The pope mentions principles he has previously stated. It doesn't matter what those principles are for our purposes. The only thing we are interested in at this point is that they are principles. They are thus to be construed as infallibly true — as absolutely certain knowledge, without question.

The pope then explains that — in his personal, fallible opinion — these principles cannot be applied unless non-owning workers become capital owners. He then goes out on a limb, so to speak, and claims that (again, in his opinion) the only way for non-owning workers to own capital is to practice "industry and thrift."

This is demonstrably not the case. A non-owning worker may become a capital owner in any number of ways. He can inherit wealth and use it wisely to purchase capital. He might win the lottery. Someone might make him the object of charity and give him a fortune. He might steal it. He might even, if the financial and legal system were restructured properly, acquire capital on credit, secure it with capital credit insurance, and pay for the capital with the profits realized from the capital itself.

Obviously we have to use a little common sense here. The pope is not denying that non-owning workers can become owners other than by practicing frugality and thrift. He is saying that, in his opinion and as a usual thing, workers aren't going to become capital owners except by practicing frugality and thrift.

Given this understanding of what the pope is saying, the next sentence becomes a little problematical — at least, if we're looking for infallible declarations. As he says, "[E]xcept from pay for work, from what source can a man who has nothing else but work from which to obtain food and the necessaries of life set anything aside for himself through practicing frugality?"

In other words, unless a propertyless worker makes enough in wages to be able to meet his responsibilities and set aside a sufficient amount to purchase capital, how can he purchase capital, thereby redeeming himself and his dependents from what Pope Leo XIII called "a yoke little better than that of slavery itself." (Rerum Novarum, § 3).

Well . . . by inheriting it, receiving it as alms, gambling, stealing, or gaining access to the same means by which the rich became rich: capital credit.

#30#

Catholic Social Teaching and Economic Justice, II: Understanding Infallibility

In the previous posting in this series we took a look at the different types of apprehending reality, and the difference between opinion and knowledge. We then (at least for our purposes) put to rest the tired accusation that faith and reason are somehow in conflict simply because you cannot prove or disprove the tenets of one in terms of the other. Both reason and faith — science and religion — are (given adherence to logic) equally true, and true in the same way, as everything else that is true. The principles of one do not necessarily apply to the other, but that does not change their objective truth.

Faith and reason, while they can illuminate each other, are two different areas of knowing. While adherents of a particular religion necessarily accept articles of faith as true, those outside that frame of reference just as necessarily regard them as matters of opinion because they do not accept the fundamental principles as true. An adherent of a particular religion may, through God's grace, have true and certain knowledge of an article of faith, while at the same time that knowledge must be regarded by those outside that frame of reference as opinion because the two systems do not share the same principles.

This does not render articles of faith any less true, of course, but it does mean that you cannot use faith to prove matters of reason, nor reason to prove the principles on which articles of faith are based. The problem is convincing sincere but unthoughtful religious people that, however firm their faith and how well they justify their position on religious principles, the fervor of their convictions does not prove or disprove anything in the realm of science. Similarly, sincere but unthoughtful scientific people cannot declare religion false simply because they cannot put God or Revelation into a test tube and subject Him or it to scientific analysis.

The reason for going into this somewhat esoteric area is that the social teachings of the Catholic Church are often presented in documents called "encyclicals." "Encyclical" is from the Greek for "circular letter," meaning a letter meant to be circulated or sent around.

From the contemporary perspective, encyclicals are unusual documents, to say the least. They contain matters relating to both faith and moral philosophy, that is, reason. They detail certain principles of faith and reason, and then usually some applications of these principles. This causes massive confusion among both Catholics and non-Catholics who have failed to distinguish between opinion and knowledge, and faith and reason.

The first area of confusion comes from the doctrine of "infallibility." Very briefly stated, the doctrine of infallibility is that what the pope teaches in matters of faith and morals is infallibly true — you can, indeed must accept it as true as an article of faith if you wish to be a Catholic. This is logical if you accept that the pope is God's personal choice (through the Holy Spirit inspiring the College of Cardinals to select the right individual), and is necessarily protected from teaching error if he is to do his job to God's satisfaction.

This is the first hurdle. IF you accept the pope as the successor of St. Peter, head of the Universal ("Catholic") Church established by Christ while physically present here on earth, then you necessarily accept what the pope says in the area of faith and morals to be infallibly true.

This brings in the second hurdle. Even many Catholics believe that the doctrine of infallibility means that something is true because the pope says it. Nothing could be further from the truth. The correct — and rational — understanding of the doctrine of infallibility is not that something is true because the pope said so, but that the pope said so because it is true. Infallibility is protection against error in discerning truth in the areas of faith and morals, not a protection against making a mistake in some other matter.

A third hurdle is, while Catholics believe the Holy Spirit grants the pope a special power to discern truth in the area of faith or morals, that power does not extend to how we discern what the pope says, or even how the pope says it. We can misinterpret the pope's words, especially in translation, itself an interpretation, particularly if they happen to come into conflict with some deeply held prejudice or opinion of our own. We will naturally understand the pope's teaching in terms of our chosen framework, rather than take the proper course and try to understand our chosen framework in terms of the pope's teaching.

The Holy Spirit does not guard the pope against misspeaking or using the wrong words to convey what is infallibly true. Nor does infallibility guarantee that the pope cannot commit a purely human mistake and sign off on a document prepared by someone else containing errors that he missed, or passages inserted without his knowledge or consent after his review. None of this changes the infallibility of a truth the pope attempts to convey, however red faces might become as a result.

A fourth hurdle is that, while the pope teaches infallibly on matters of faith and morals, he can err in applying those same principles, regardless of their objective truth. The pope is infallible when teaching the substance, that is, the principles. He is not impeccable when, as a human being as fallible as the rest of us in practice, he applies those same principles. Some of the popes, for example, have been very bad or ignorant men indeed — but it has never been shown, however bad their faith, morals or science, they ever taught error in the area of faith or morals.

#30#

News from the Network, Vol. 5, No. 22

As of this moment (around noon, EDST), the Dow is holding "steady" at a loss of 200. This may be due to the usual slow trading as staff go to lunch. (Believe it or not, the noon lunch break actually helped slow some of the frenzy in 1929, at least the first couple of days.) What will happen in the afternoon is anybody's guess. The panic mode may inspire the politicians to announce another round of "quantitative easing," or news from Asia or Europe may change the picture — but what that means will only be determined by how the gamblers choose to interpret matters.

In the meantime, we keep moving forward to try and get the doors opened to the gatekeepers and prime movers:

• The "Jobs Data" are out for May. Instead of the anticipated estimate of 158,000 new jobs forecast by the economists, there were only 69,000. This is a net loss, and the official unemployment rate went up a tenth from 8.1% to 8.2%. The obvious solution is to stop relying on jobs and switch to ownership, but word hasn't seeped through to the prime movers yet.

• In response to the "weak" jobs report, as of 11:15 am (EDST), the Dow was down over 200 points. We have no idea what this means or what it will be by the end of the day, for the stock market, while categorized as a leading economic indicator, seems to react a little too quickly to unemployment, a lagging economic indicator. In other words, cause and effect — logic — are reversed. If we realize that the stock market is not actually an economic indicator, but an emotional indicator of gambling fever, this begins to make a little sense — although it doesn't explain why we are asking gamblers for their opinion as to the health of the economy. The purpose of economic activity is to produce marketable goods and services for consumption. The purpose of gambling is to have the luck to take what someone else has produced without having to offer anything in exchange that you have produced.

• Kicking retirees and potential retirees in the teeth is that, in response to the weak jobs report, yields on ten-year U.S. Treasuries fell to less than 1.5%. In the words of one analyst, this "will mean major product changes to the fixed annuity marketplace." Financial advisors are being warned to lock their clients in to current yields before they go even lower, especially if there is another round of "quantitative easing" to cheapen retiree's holdings of government debt and people refuse to buy any more in the face of falling yields.

• The financial emotionalism (we'd say "panic," but that has a specific meaning in this context which is not what we're talking about) has given fuel to those who want another round of "quantitative easing" as the solution. That is, print up more money with nothing but government debt behind it (i.e., counterfeit), and hope that the Keynesian system finally starts to function as advertised, although that has yet to happen in the 80 or so years they've been trying to get it to work.

• The "jobs situation" is actually almost exactly 300% worse than the official statistics let on. Wednesday's Washington Post had an article ("Prime-Age Workers Still Lost in the Recession's Undertow," A1, A12). The aggregate unemployment rate for all workers in the age 24-54 range is (check it yourself) 24.3%. The official statistic is 8.2%, up from 8.1%. Do the math. Unemployment during the worst of the Great Depression of the 1930s was almost the same as today.

•We had a very good telephone conversation on Tuesday with a Harvard Law School professor who thanked us for alerting her to a body of thought on law and economics (the Just Third Way) of which she had previously been unaware. We sent her links to The Capitalist Manifesto (pointing out the importance of Chapter 5), Father Ferree's Introduction to Social Justice, and the brief outline of Capital Homesteading.

• Daniel Moore, a CESJ National Field Secretary in Ohio, has made a number of important connections in the labor movement in Ohio and in the national office of Catholic Charities in Washington, DC — simply by being persistent and targeting key individuals. Dan did not try to "sell" the connections on the Just Third Way himself. Instead, he said enough to intrigue the people and get them interested in talking to Norman Kurland.

• Russell Williams, a CESJ National Field Secretary in Connecticut, has been named Social Justice Coordinator for his region's Baptist Convention. By taking advantage of the political outreach techniques outlined in Father William Ferree's Introduction to Social Justice and providing substance in the form of the three principles of economic justice and the four pillars of an economically just society of the Just Third Way, Russell now has the position to be able to reach out effectively first within the Baptist community, and then to other churches and religions to gather interfaith support for the Just Third Way as applied in Capital Homesteading — and to free all Americans and people everywhere from economic slavery to the State.

• On a somewhat lighter note, CESJ's Director of Research, Michael D. Greaney, has managed to get CESJ mentioned in a number media outlets from Northern Virginia to Valley City, North Dakota in connection with his appointment as new "Coordinator" of the Irish SIG of American Mensa. Bringing in CESJ and the Just Third Way as a secondary issue or bit of information can sometimes be effective in helping to spread the word, even if it is a little indirect.

• In connection with his appointment, Michael is planning on integrating Just Third Way material into the SIG's newsletter, Litir Scéala an tSIG Gaelach, when appropriate. Subscriptions to the "e-zine" newsletter are free, and you don't have to be a member of Mensa either to subscribe or to register as a SIG member. Subscribers will get a monthly newsletter to be published on the 17th of every month, quarterly publications flyers, and occasional special announcements. You can forward all material to your network via e-mail, especially if there is some Just Third Way material brought in. It might prove to be an effective means of spreading the word. A special effort is being made to get organizations to sign up as "Institutional Members" that can then circulate the newsletter among their members.

• As of this morning, we have had visitors from 62 different countries and 51 states and provinces in the United States and Canada to this blog over the past two months. Most visitors are from the United States, the UK, Canada, India, and Australia. People in Syria, Egypt, the United States, Taiwan, and Brazil spent the most average time on the blog. The most popular postings this past week were "Thomas Hobbes on Private Property," "Aristotle on Private Property," "The Global Debt Crisis I: What is the Problem?" "The Global Debt Crisis V: What's Really Going On?" and "The Global Debt Crisis VII: A Permanent Solution."

Those are the happenings for this week, at least that we know about. If you have an accomplishment that you think should be listed, send us a note about it at mgreaney [at] cesj [dot] org, and we'll see that it gets into the next "issue." If you have a short (250-400 word) comment on a specific posting, please enter your comments in the blog — do not send them to us to post for you. All comments are moderated anyway, so we'll see it before it goes up.

#30#