As of this writing the Dow is up over 13,000. That may or may not be the case by the time the market closes, but for now the "investing community" (i.e., gambling club) is jubilant. The reason given in the news reports (after the gloom and doom of the possibility of the European debt crisis spreading its tentacles into the U.S.) is that the Federal Reserve is contemplating yet another round of stimulus spending. In other words, the market plunged over fears that the European governments were borrowing too much money to spend, and went wild over the possibility that the U.S. government would borrow more money to spend.
This is not as crazy as you might think. The money the Europeans keep pouring into the situation gets spent directly by the governments, usually in the form of some kind of public benefits paid to people who will use it for consumption. There is no possibility of a return on this money, so the Europeans are, naturally, hesitant about printing up more money. All it does is increase inflationary pressure on the economy.
The U.S. situation is a little different. The stimulus money does not get paid directly to people who will use it for consumption, or to companies that will use it to expand operations to produce marketable goods and services. Instead, the stimulus money generally ends up by one route or another in the stock market.
Strange as it may seem, while this fuels speculation and price inflation on Wall Street, it is not the cause of the inflation U.S. consumers are experiencing. That is due to other factors, giving the illusion that, as Keynes asserted, a rise in the price level before full employment is reached is not "real" inflation.
The proposed stimulus would be a boon to the gamblers on Wall Street because it would add to the volatility of the market. This is one instance where the lack of capital ownership in the form of corporate equity by most people is something of a benefit, although of the form the Germans call "Shattenfreude," or "shadow joy." Not owning shares, ordinary people won't suffer the consequences of the inevitable crash. They'll just take a bath from the fact that the productive sector will take a hit — unless Capital Homesteading has been implemented.
Once Capital Homesteading is in place, of course, let the gamblers on Wall Street play all they want, just as long as they use their own money, not something for which the taxpayer is eventually on the hook. To see if we can hurry that day along a little, here's what we've been doing this week:
• This past week the CESJ research library received a copy of Franz H. Mueller's The Church and the Social Question (1984), a brief history of the development of Catholic social thought in the United States. Dr. Mueller was a colleague of Oswald von Nell-Breuning, Gustav Gundlach, Heinrich Rommen and Goetz Briefs of the Königswinterkreis, all of whom were students of Heinrich Pesch. Not surprisingly, much of what Dr. Mueller had to say fits in very well with our analysis of the omission from Vocation of the Business Leader, the recent document from the Pontifical Council for Justice and Peace. What was surprising (given the insistence of some experts who call themselves "solidarists") is that Dr. Mueller drew the same conclusion regarding the tendency among many Catholics and others to push for a return to a social order based on status rather than contract (distribution based on need rather than equivalence or proportionality of inputs), an arrangement that would seriously hamper the functioning of both solidarity and subsidiarity, and necessarily assigns far too great a role to the State.
• Another interesting bit of information from Dr. Meuller's book is that, despite the enthusiasm then and now for the Keynesian New Deal, the Catholic Central Verein of America (the first organization in the U.S. with a mandate for Catholic Action) expressed reservations about the socialist and statist tendencies of the New Deal and Msgr. John A. Ryan's support for it.
• A number of CESJ publications are being featured in the first "issue" of an e-flyer that will be sent out by the Irish Special Interest Group of American Mensa. If you would like to receive the flyer (and forward it to your network, and your network to theirs, and so on), visit the website of the Irish SIG and sign up for the free subscription to the Irish SIG newsletter, Litir Scéala an tSIG Gaelach. Be sure to do this before Tuesday, July 31, 2012 and "validate" your subscription by clicking on the link that Google will send you, or you will not receive the flyer. This is a test to see how well the Just Third Way network can use the social media to help spread the word in the most efficient and cost-effective manner.
• Guy S. in Iowa has been posting a great many items about the compatibility of the Just Third Way with the thought of Bishop Fulton Sheen, a TV personality back when "TV" stood for "thoughtful" and "visionary." Sheen's comments, especially in Communism and the Conscience of the West (1948), are a refreshing change of pace from so much social thought that seems to take for granted that anything social is necessarily socialist — an assumption that neither capitalists nor socialists question.
• As of this morning, we have had visitors from 51 different countries and 48 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 Philippines, Canada, the UK, and India. People in Poland, Germany, Iran, the United States and Australia spent the most average time on the blog. The most popular postings this past week were "Aristotle on Private Property," "Lies, Damned Lies, and Definitions, IX: The Road to Nihilism — Scotus," "Lies, Damned Lies, and Definitions, VIII: Abandonment of the Natural Law," "News from the Network Vol. 5 No. 27," and "Thomas Hobbes on Private Property."
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.