Recently a genuine college professor got in touch with us and asked us if we would mind answering a few questions about the Just Third Way of Economic Personalism. He wanted to know how it stacks up against “distributism.” Yes, we are aware that some (former) distributists now insist on calling the system developed by G.K. Chesterton and Hilaire Belloc “localism.”
 |
| G.K. Chesterton |
The change in terminology is, in our opinion, a shift confusing the issue more than a trifle. We will therefore continue to use the older, more familiar term for what Chesterton described as a system of widely distributed private property (meaning capital in the form of land, other natural resources, and technology), with a preference for small, family-owned farms and businesses.
For our part, what we term the Just Third Way of Economic Personalism is a socio-economic paradigm that seeks to integrate sound principles of natural law and apply them to real-life problems in a consistent and practical manner. We define the Just Third Way as an economic system centered on the dignity and economic empowerment of each human person. It recognizes that human life, dignity, and liberty require each person have the power and independent means to support and sustain one’s own life, dignity and liberty.
Empowerment is best achieved through one’s own private property rights (personal or shared control) and rights to the full fruits or profits in what one owns. In contrast to monopolistic capitalism, collectivist socialism/communism, and the various forms of state or collective ownership of productive capital assets, the Just Third Way of Economic Personalism aims to structurally diffuse economic power by democratizing access to capital ownership for each person.
 |
| Hilaire Belloc |
So, for the professor’s questions and our (brief) answers:
· What lead you to become a proponent of this economic system in the first place? Most people who become attracted to the Just Third Way of Economic Personalism do so because they are dissatisfied with the unrestrained materialism and the essential injustice of socialism/communism. The Just Third Way of Economic Personalism potentially offers a way for every child, woman, and man in society to live in a manner befitting the demands of human dignity without violating anyone’s fundamental rights.
· What are a few of the most important principles of this economic system? In economic terms, there are three (okay, two-and-a-half) key features of the Just Third Way of Economic Personalism which distinguish it not merely from distributism, but the assumptions underlying virtually the whole of modern mainstream economics. These are,
 |
| Louis O. Kelso |
o A “new” understanding of money which includes not merely “money-as-claims-on-existing-unconsumed-production,” but “money-as-claims-on-the-present-value-of-future-production.” This means no one need rely on the rich to be generous to give away what they have or become victims by having their wealth coercively redistributed, but that any financially feasible capital project can be owned by anyone who demonstrates creditworthiness — which Louis Kelso explained could be done using capital credit insurance in lieu of traditional collateral and a tax-sheltered accumulation account or vehicle.
 |
| Mortimer J. Adler |
o A “new” understanding of production (“productiveness”) which recognizes that production by the human factor (“labor”) and the non-human factor (“capital” — technology and nature [traditionally labeled “land”]). The only question is the relative contribution of each of the factors and thus the just compensation due each. Owners of labor and owners of capital are thus treated fairly — with the added feature that if labor is insufficiently productive relative to capital, owners of labor can become owners of capital without having to reduce current consumption by qualifying to purchase newly formed capital using “money-as-claims-on-the-present-value-of-future-production,” which Kelso called “future savings.”
o A “new” understanding of private property. With the advent of what some people called “the New Things” in the early 19th century (not really new, but there were reasons to use the term that needn’t bother us), principally capitalism and its bastard step child socialism/capitalism (we won’t bore you with an explanation of what else the term covered), people developed a distorted understanding of the natural and inalienable right to property (the right to own) and the limited and socially determined rights of property (what an owner can do with what he or she owns and in some cases what can be owned). “Private property” began to mean just about everything and nothing, e.g., anarcho-socialist Pierre-Joseph Proudhon’s “property is theft.” Since theft means a violation of property, Proudhon’s claim amounts to saying “Property is a violation of property.”
· What do you see as the major advantages of this system? The major advantage of the Just Third Way of Economic Personalism over distributism or any of the current mainstream schools of economic thought is:
o By advocating future savings to finance acquisition of new capital,
o Replacing traditional collateral with capital credit insurance,
o Recognizing human labor and capital both produce, and “production” means exactly the same thing whether produced by labor or by capital, and
o Restoring the traditional rights to and of private property,
every child, woman, and man can become an owner of capital to supplement or replace entirely production by labor, and no one need be dispossessed of his or her legitimately gained existing wealth.
· What are the major challenges? While there are many challenges to accepting and implementing the Just Third Way of Economic Personalism, one stands out: the money system. Although there are seemingly endless ramifications and qualifications that go into explaining this simple statement, the basic fact remains that without democratic and just access to money and credit — the principal means by which new capital is formed and thus owned — capital ownership will remain concentrated in a private sector elite (capitalism), a public sector bureaucracy (socialism), or the mix of the two Hilaire Belloc called “the Servile State.”
Okay, that answers the professor’s questions. Our deeper analysis of the differences between distributism and the Just Third Way of Economic Personalism will be in Part II of this posting next Wednesday.
#30#
