I recently finished reading John Mêdaille’s Toward a Truly Free Market, and have been transcribing some notes from it. It was both a helpful review of economics (in which my formal education is minimal, much as I enjoyed it) and a fairly powerful brief for Distributism as a “Third Way” economics. A conservative temperament doesn’t rush into things, so I’m taking it slow, but I like Distributism more and more.
The family is in some ways at the center of Distributist thought — unlike standard-issue modern economics:
If economics requires fully socialized participants, and if economics is about social provisioning, then the question of the family cannot be divorced from economic questions. For economic actors, producers, and consumers are “produced” and socialized within the confines of the family; without the family there will be no next generation, and hence no future, for the economists to worry about. Therefore, it is the family that is the basic economic unit as well as the basic social unit. Modern economics tends to ignore the role of the family completely to focus on the individual. However, the individual, by himself, is sterile and not a self-sustaining entity. Neoclassical economics thus has no way to explain how new workers come into the economy, and hence it has no way to explain growth. John Mueller has characterized these shortcomings in economics as “The Economic Stork Theory.” In the stork theory, workers arrive in the economy fully grown, fully trained, and fully socialized. These storks born workers are a “given”; that is, there is no way to explain the growth in workers or their level of training and socialization, and hence little reason to support them with political or fiscal policies
…
It is an oddity of modern economics that it depends on treating the worker as just another commodity (labor) for purposes of pricing that labor, but treats the production cost of that “commodity” as something beyond the price system. If we take any other commodity, say a bar of pig iron, it is assumed that the price must cover the cost of production, maintenance, and depreciation, or the product will be withdrawn from the market. But in regards to labor, this assumption is never examined. For labor has its own “production cost” (the family) and its own “maintenance” cost (subsistence and healthcare) and its own “depreciation” costs (sickness and old age). Labor cannot simply be withdrawn from the market when these requirements are not met. Therefore, labor – and the family – does not even gain the dignity of the bar of pig iron in modern economic theory.
(Pages 39-41)
In order to accomplish the material provisioning of society, the economy must provide for the material provision of the family, because the family is the basis of both the social and economic orders; it is the reason for having an economy and the indispensable condition of an economy.
(Page 43)
However, we need to note that that this [supply and demand] model applies only to commodities, that is, reproducible, elastic objects and services that are made mainly to be exchanged in the marketplace.
Obviously, many things do not fall under the category of a commodity in that sense. The supply of rare wines and fine paintings is not affected by the price. Even when a Monet fetches $30 million, Mr. Monet will not supply the market with any new pictures. Now the importance of Monet’s to the market is not very great, and we can ignore the impact, no matter how high the price. But there are three things of great importance to the market, which also have no equilibrium point; these things are money, nature, and man. Their price and quantity are not regulated by supply and demand, and they are not “manufactured” for the market …
(Page 72)
In chapter 4, we introduced John Mueller’s economic stork theory (EST), which demonstrated that economists have no way to account for arrival of workers in the economy. Even as they “commodify” the workers, economists have no way to account for the “production” of this “commodity”; the worker just mysteriously “appears” in the economy. Economists are willing to talk about the production of other “commodities,” such as pigs or pig iron. They know that the price of these commodities must cover the cost of production, maintenance and depreciation, or the commodity will simply disappear from the market. When it comes to labor, however, they are reluctant to concede that this too is “produced” and has production, maintenance and depreciation costs. In other words, they can modify labor, and then refused to speak of it as they would any other commodity. Hence, even under its own terms, the neoclassical theory is incomplete; it cannot account for this rather basic “commodity” per se, but must accept its creation out of thin air.
Mueller’s economic stork theory has a rather curious corollary. Under the EST, The only useful work done in the economy is work done for wages or other economic rewards, and hence there are only two kinds of economic activity, work and leisure. Thus, there are only two kinds of individuals in this theory, what I call Partially Useful Individuals (PUIs) and Totally Useless Individuals (TUIs). The PUIs are partially useful because they spend some of their time at “work” producing things in the exchange economy. The TUIs, However, don’t “work” at all. Rather, some of the TUIs, otherwise known as “mothers,” spend their time in such leisure activities is taking care of household pets, some of these pets are called “cats” or “dogs,” and others are called “children,” another form of TUIs.
(Page 98)
Mêdaille, an economist, sticks fairly closely to his economic points. I, a curmudgeon (slightly younger than Mêdaille, actually), don’t need to. If Mêdaille is right, I don’t see how this standard market theory can engender enthusiastic support from any serious Christian believer to whom family also is central. (There are multiple ways in which our economy disrupts family. This only scratches the surface.)
In their appreciation of the importance of the family to children (future “labor” to economists, “human resources” to personnel departments), the French have shown themselves to be far more sophisticated than increasing numbers in the U.S. and than standard-issue “capitalist” economic theories.
The French! God works in mysterious ways His wonders to perform!
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Tipsy Teetotaler ن 