Ironically, it is not out of the realm of possibility that had Theodore Roosevelt won the 1912 U.S. Presidential election, World War I might never have occurred. It might also have occurred to Judge Peter S. Grosscup and the Rough Rider that when the Federal Reserve was finally established in 1914, here was the desperately needed source of financing that could open access to ownership by all Americans of America’s vast corporate wealth without the necessity of past savings and without redistribution or taxation.
As we saw in the previous posting on this subject, Grosscup made the same mistake as Leo XIII, Chesterton and Belloc, and, later, Pius XI. He assumed that the only source of financing for broad-based capital ownership is past savings. He didn’t seem to zero in on weaknesses in the financial system itself.
Certainly, William Jennings Bryan and Carter Glass understood the need for financial reform. Had it not been for their support, it is likely that the Federal Reserve would never have come into being. (William Jennings Bryan, The Memoirs of William Jennings Bryan. Philadelphia, Pennsylvania: The United Publishers of America, 1925, 372; Arthur S. Link, Woodrow Wilson and the Progressive Era, 1910-1917. New York: Harper & Row, Publishers, 1954, 53; Harold G. Moulton, ed., Principles of Money and Banking: A Series of Selected materials, with Explanatory Introductions. Chicago, Illinois: The University of Chicago Press, 1916, II.261.)
|William Jennings Bryan
Neither Bryan nor Glass, however, made the leap to using the commercial and central banking system to finance capital ownership for every citizen. As for Woodrow Wilson, he was an elitist in the pocket of Wall Street. (Link, Woodrow Wilson and the Progressive Era, op. cit., 43-53.) When he was president of Princeton, he instigated controversies that left “a deep scar on the University that did not heal for many years.” (Ibid., 9.)
Wilson’s positivist philosophy of government was, like Keynes’s economics, based on the theories of Walter Bagehot (ibid., 8.), as revealed in his 1885 doctoral dissertation, Congressional Government. (Woodrow Wilson, Congressional Government. Boston, Massachusetts: Houghton, Mifflin and Company, 1885.) He opposed anything that endangered what in a few years Pius XI would call a “despotic economic dictatorship.” (Quadragesimo Anno. §§ 105-106.)
|Archbishop John Ireland
A fascinating sidebar to history is that Grosscup, although a Protestant, was acquainted with Archbishop John Ireland, America’s acknowledged expert on Rerum Novarum, and even served with Ireland on a committee investigating trusts and corporations in 1907. (New York National Civic Federation, Proceedings on the National Conference on Trusts and Combinations Under the Auspices of the National Civic Federation, October 22-25, 1907. New York: The McConnell Printing Company, 1908, 11, 221-231.) Grosscup frequently spoke before Catholic groups and thereby received a great deal of criticism from Nativists. (“Editorial Potpouri,” Blue Grass Blade, October 24, 1909, 11.)
One of Grosscup’s best talks was to a Chicago Knights of Columbus Council in 1907. (“Address of the Hon. Peter S. Grosscup, Judge of the U.S. Circuit Court of Appeals, on ‘Abraham Lincoln’,” Celebration of Abraham Lincoln’s Birthday and Second Anniversary of General James Shields Council No. 967 Knights of Columbus, February 12, 1907 (event program).) This was on Lincoln’s birthday on the importance of the Great Emancipator for people of all faiths and philosophies. In particular, His Honor cited Lincoln’s stand on the natural rights of life, liberty, and private property, contrasted with the attacks on the natural law in France at the time. (“Federal Judge Speaks,” The Irish Standard, February 23, 1907, 1.)
What Lincoln did, and what Leo XIII, Grosscup, Chesterton and Belloc, Sheen, and others proposed, does not invalidate the idea of a Just Third Way. It does, however, demonstrate in the most graphic manner possible not merely the enormous potential for improvement in today’s system, but also the great danger of omitting, ignoring, or misconstruing the essential element of where money comes from and who gets it. That is why the Just Third Way of economic personalism is not merely an advance on, and development of what the popes and others proposed, it is — so far as we know — the only morally sound and financially feasible alternative to the Great Reset and similar initiatives.
Being based on the dignity of the human person as a special creation of God, the Just Third Way at the level of economic justice supplies the omission that hampered the success of other personalist approaches. It combines the economic justice principles discerned by Louis Kelso and Mortimer Adler in The Capitalist Manifesto and the financial techniques described in The New Capitalists, with Pius XI’s breakthrough in moral philosophy described primarily in Quadragesimo Anno and Divini Redemptoris (See Ferree, The Act of Social Justice, op. cit., Introduction to Social Justice, op. cit.) and Wojtyła’s personalism.
|Louis O. Kelso
As a free market system economically empowering every human person within a realistic personalist framework, the personalist Just Third Way offers a logical alternative to both individualistic capitalism and collectivistic socialism. It does this by promoting the formation of structures of virtue in the common good to encourage individual virtue.
This is accomplished by means of the systematic diffusion of power and extension of equal capital ownership opportunities to every person, together with the institutional means of acquiring and possessing private property in capital. Promoting individual virtue by creating systems, structures, and processes that encourage habits of doing good, the Just Third Way conforms to the demands of personalism and respect for human dignity.
In contrast, the Great Reset and similar proposals assume that the goal of material wellbeing justifies any means used to achieve it and would impose desired results by fiat. Thus, while the Just Third Way encompasses more than economic personalism per se, it is fully compatible with respect for the dignity God gave every human person that is the essence of Thomist personalism as developed by Karol Wojtyła.
Is there, however, a way to see that people’s material needs can be met without offending against anyone’s dignity? That is what we will look at in the next posting on this subject.