Is Distributism the Answer to Ethical and Environmental Issues in the Economy?

Tori Flaherty (Period 1)

There is no perfect system of government. In correlation with this, there will always be issues in the economy. However, it is always necessary to look for solutions to those issues. Two prevalent issues in modern day society are those of ethics and the environment, which are often tied together. Neither capitalism nor communism addresses these issues. As a result, principles fostering ethics and the environment are not implemented, but rather questioned, causing neglect to soon follow. There is another possible form of government that may resolve these issues. It is distributism.

In essence, distributism is the breaking down of property for each individual. This gives the foundation for life to each individual and has the potential to greatly reduce poverty. Because each individual is given property, he or she is not only given the means of attaining the basic necessities for life, but is also given the potential to better himself or herself. Property is the means of fulfilling human dignity. Every human being has the right to life, and life is impossible without the basic necessities. According to Pope Leo XIII, all humans should be “provided with all that is needed to enable them to keep themselves decently from want and misery amid the uncertainties of this moral life.”1 Therefore, distributism is an ethical form of government that gives each and every person the basis for a sustainable life. Distributism will also bring back the traditional home values that have been rapidly fading in today’s society.  By every family owning and living off of their own property, their attention will be drawn inwards towards the home as they work together. There is also the likelihood that families will work harder since it is their own land and their own prosperity that is directly affected by the amount of work that they put in, rather than relying on an employer. Another crucial aspect of distributism is that “ownership of the means of production should be as widespread as possible rather than being concentrated in the hands of a few owners.”2 This gives individuals more opportunities to better their economic status while protecting against monopolies. Consequently, a result of widespread ownership is just wages, as there will be higher competition and less monopolization of businesses. The just wage is a direct indication of ethics since it “gives us a specific standard of judgment for the justice of any economic system.”3 If distributism were to be implemented as a form of government, there is no question that it has potential to solve many ethical issues that are dismissed in modern day economics.

The environment is a necessary and wonderful part of life that is often taken for granted. This should not be the case. If conservation means are not taken, the resources that the environment provides for mankind could be drastically reduced to the point that mankind suffers a grave opportunity cost – the permanent loss of those resources and the nature that possesses them. Pope Leo XIII stated that “the things of earth cannot be understood or valued aright without taking into consideration the life to come.”4 Distributism focuses on sustainability, which can only be accomplished by respecting and conserving the planet. He also specifically says “never to injure the property…[for] that which is required for the preservation of life, and for life’s well-being, is produced in great abundance from the soil.”5 Already, humans have significantly impacted the environment in a negative way. According to the EPA, “half the world’s tropical and temperate forests are now gone and 75% of marine fisheries are overfished.”6 The economic programs in place today put temporary economic needs before those of the environment. Distributism is the only system that respects and lives in conjunction with the Earth.

Although capitalism is the most widely accepted and used form of economic policy, that does not necessarily make it the best one. Let’s examine the two forms of capitalism: neoclassical and Keynesian. Neoclassical capitalism emphasizes laissez-faire, allowing those with capital to make a profit through free trade. However, human nature takes advantage of this system and corrupts it through monopolies and selfishness. If left unregulated, a capitalistic society will be taken over by the “competition of unrestrained desires.”7 This can be seen in the United States during the late 1800’s and early 1900’s. Big businesses boomed due to capitalistic policy. Factories sprang up everywhere, causing human rights issues. In addition to that, this era was horrible for the environment: forests were logged, plains and prairies were taken over for agricultural purposes, large sewer systems were developed that dumped wastewater into freshwater resources, industry consumed clean water and disposed dirty water, and coal was burned, polluting the air.8 It is known as “an era of corruption, conspicuous consumption, and unfettered capitalism,”9 However, “by 1929, companies had expanded to the bubble point. Workers could no longer continue to fuel further expansion”10 and the stock market crashed. This is when Keynesian policies came into place. In order to balance the economy and redistribute money, the government started becoming involved through spending, taxes, interest rates, and other economic policies. This has continued to this day. The issue with Keynesian economics is that it leads to unnatural ties between businesses and the government. Some big businesses are now “judged too important to fail”11 and will be bailed out by the government. As a result, this leads to huge debt. The United States current debt is $17, 488, 533, 976, 823.11 Obviously, this system has flaws.

An alternative to capitalism is communism. However, communism also has many flaws, the first being that there has never been a truly communist state. Rather, there have been dictators who call their regimes communism. In those “communist” regimes, not only have human rights been violated, but also the environment. Take, for example, communist Germany. It is estimated that the Nazis killed between 15,003,000 and 31,595,000 people. 13 In addition to that, the environment was horribly abused. 42 percent of moving water and 24 percent of still waters were so polluted that they could not be used to process drinking water, almost half of the country’s lakes were considered dead or dying and unable to sustain fish or other forms of life, and only one-third of industrial sewage along with half of domestic sewage received treatment.Also, an estimated 44 percent of East German forests were damaged by acid rain, which is not surprising considering that that the country produced proportionally more sulphur dioxide, carbon dioxide, and coal dust than any other in the world.14 Communism is no solution to human rights and environmental issues, nor is it an effective system of government. Currently, there are only 5 communist countries. However, their governments can hardly be considered true communism. The country closest to real communism is North Korea15, and the horrors of North Korea are a known fact to all. It is clear that communism is not the solution for an economically successful, more diplomatic, and environmentally friendly nation.

Could distributism really become a third type of government? Yes, it is already working as we speak. One example is the Mondragon Cooperative Corporation of Spain. It is composed of many co-operative enterprises grouped into four areas. The co-op members, who average 80-85% of all workers per enterprise, collectively own and direct the enterprise.16 The members of the Mondragon Cooperative Corporation must confer and decide with all other enterprise members what general rules will govern it and all its individual enterprises. What really makes it different from capitalism is that worker-members collectively choose, hire and fire their directors. It has become very successful and is one of Spain’s top ten biggest corporations.17 There are also thousands of cooperatives. The most well-known cooperative economy, Emilia Romagna, has been a huge success in Italy. Co-op Italia, Italy’s largest food retailer, is based in Emilia Romagna and is controlled by 155 cooperatives, serving 6 million members throughout Italy.18 Not only that, but Co-op label programs emphasize products that are fairly traded, organic, environmentally safe, ethical, and sustainably produced.19 These examples prove that distributism is not a fantastical solution, but rather an effective system.

Economists have always struggled to deal with ethical and environmental issues alongside what is best for the economy. In capitalistic and communist societies, these issues are often put aside, as they are not considered a priority. Indeed this is a wrong way of thinking; it is time for a change – a change for the betterment of all of society and for the marvelous, but limited, Earth we live on. Distributism may provide the solution to all of these issues while bringing the economy to a balance. There is no guarantee that this will work on a grand scale, but it is certainly an option. The world needs answers, quickly, so it is time for us to distribute hope.

 

  1. Pope Leo XIII, Rerum Novarum.
  2. http://www.medaille.com/distributivism-encyclopedia.pdf
  3. John Medaille, “Distributivism,” http://www.medaille.com/distributivism-encyclopedia.pdf. (accessed May 4, 2014).
  4. Pope Leo XIII, Rerum Novarum.
  5.  Pope Leo XIII, Rerum Novarum.
  6. “Environmental Facts.” Eco-Facts. https://ecocycle.org/ecofacts (accessed May 4, 2014).
  7. John Medaille, On Truth and Trade Economics and the Catholic Vision of the Good Life.
  8. “Environment Chapter.” Environment Chapter. http://www.nationalatlas.gov/environment.html (accessed May 4, 2014).
  9. “Digital History.” Digital History. http://www.digitalhistory.uh.edu/era.cfm?eraid=9 (accessed May 4, 2014).
  10. Independence Hall Association. “The Great Depression.” ushistory.org. http://www.ushistory.org/us/48.asp (accessed May 5, 2014).
  11. John Medaille, On Truth and Trade Economics and the Catholic Vision of the Good Life.
  12. “National Debt | The Concord Coalition.” National Debt | The Concord Coalition. http://www.concordcoalition.org/node/58 (accessed May 5, 2014).
  13. “Nazi Genocide and Mass Murder.” NAZI GENOCIDE AND MASS MURDER. http://www.hawaii.edu/powerkills/NAZIS.CHAP1.HTM (accessed May 4, 2014).
  14. Grabow, Colin. “If You Think Communism Is Bad For People, Check Out What It Did To The Environment.” The Federalist. http://thefederalist.com/2014/01/13/if-you-think-communism-is-bad-for-people-check-out-what-it-did-to-the-environment/ (accessed May 4, 2014).
  15. Porzucki, Nina. “Can you name the five remaining communist countries in the world?.” Public Radio International. http://www.pri.org/stories/2013-12-10/can-you-name-five-remaining-communist-countries-world (accessed May 5, 2014).
  16. Wolff, Richard. “Yes, there is an alternative to capitalism: Mondragon shows the way.” theguardian.com. http://www.theguardian.com/commentisfree/2012/jun/24/alternative-capitalism-mondragon (accessed May 4, 2014).
  17. Wolff, Richard. “Yes, there is an alternative to capitalism: Mondragon shows the way.” theguardian.com. http://www.theguardian.com/commentisfree/2012/jun/24/alternative-capitalism-mondragon (accessed May 4, 2014).
  18. Aleman, Richard. “The Distributist Review: Emilia-Romagna Cooperatives.” The Distributist Review: Emilia-Romagna Cooperatives. http://distributism.blogspot.com/2008/11/emilia-romagna-cooperatives.html (accessed May 5, 2014).
  19. Aleman, Richard. “The Distributist Review: Emilia-Romagna Cooperatives.” The Distributist Review: Emilia-Romagna Cooperatives. http://distributism.blogspot.com/2008/11/emilia-romagna-cooperatives.html (accessed May 5, 2014).
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