March 11, 2010
Hilaire Belloc’s Essay on the Restoration of Property is a fantastic paradigm-rocker. In it, he sets forth the shocking, but ultimately quite sensible claim that, far from being opposites, capitalism and socialism are essentially of the same genus; socialism just takes capitalism a bit further--to it’s logical conclusion. How could this be? Because both are the rejection of private property. But wait, hold on a minute--I thought capitalism was all in favor of private property. Well, not really. With the rise of modern capitalism, the possession of real, productive property, which was once widely distributed among the majority of the population, was rapidly concentrated in the hands of a small minority of the population, leaving very few small proprietors and producers, and enslaving most of those that remained to the control of banks. Socialism is simply taking the next step--if we’ve already dispossessed most people, and concentrated the means of production in the hands of a few, let’s just go ahead and concentrate them in the hands of one entity that is at least looking out for the welfare of everyone.
The result, of course, in either case, is loss of freedom:
“The possessors alone remain to enjoy economic freedom, the disposessed--the very great majority--are deprived of it; but there is already at least security of some revenue for nearly all, and there can, with proper organization, be sufficiency for all as well. The only good lost to the masses, if it be a good, is freedom. For in such a state of society (the Servile State) the determining note is lack of freedom: the determing mass of society have no experience of economic liberty. The master class directs and is free: but society thinks and acts in terms of wage earners. The masses are kept alive, they are taught by a subsidy in childhood, treated by a subsidy in illness, and maintained by a subsidy in old age, widowhood and incapacity from accident. Soon no one of them may be suffering either hunger or cold or lack of any plain material necessity consonant to the type of civilization in which they live. But their activities are at the mercy of their masters.”
In other words, we, who pride ourselves in living in such a very free society, faced with the prospect of boundless choice, are actually like hamsters, so long confined to their cage and fattened by indolence that their hopes, horizons, and imagination have shrunk to the point that they imagine themselves to be living in a paradise of free entertainments, and can wish for nothing more than their prefab food pellets.
The solution, of course (and here Belloc has the Old Testament clearly on his side, although he doesn’t use it--indeed, the almost total lack of reference to Scripture or Church in this book was a big weakness) is to structure one’s economy such that property is once again widely distributed, and big producers are prevented from devouring small producers, so that we have a society of genuinely free men no longer alienated from the products of their labor.
Belloc is eloquently pessimistic about whether this is feasible:
“Respect for reality compels me to say that the Restoration of Property when that institution has all but disappeared is a task almost impossible of achievement. If it were quite impossible of achievement it would not be worth while wasting breath or ink upon it. It is not quite impossible of achievement; at least, it is not quite impossible to start the beginnings of a change. But the odds against a reconstruction of economic freedom in a society which has long acquired the practice and habit of wage slavery is difficult beyond any other political task. I do not know whether it be possible to start even the beginnings of a change. I doubt heavily that it is possible to plant successfully even the small seedlings of economic freedom in our society, here, in England, today. What I certainly know is that, failing such a change, our industrial society msut necesarily end in the restoration of slavery. The choice lies between property on the one hand and slavery, public or private, on the other. There is no third issue.”
Belloc insists that the rise of modern capitalism was by no means a social or economic necessity: “It is not true that capitalism arose inevitably from the necessary development of economic institutions under the doctrine of private proprty. Capitalism arose only after the safeguards guaranteeing well-distributed private property had been deliberately broken down by an evil will insufficiently resisted.” But, on the other hand, he does not thereby believe that the market, left to itself, will continue in an idyllic state of freedom and equality: “once restored, Property must be constantly sustained or it will lapse again into Capitalism. Private property acting unchecked, that is, in the absence of all safeguards for the preservation of the small man’s independence, tends inevitably to an ultimate control of the means of production by a few; that is, in economics, to Capitalism, and therefore, in politics, to plutocracy.”
Here is the reconciliation of these two statements--“Though it is true that unchecked competition must ultimately produce the rule of ownership by a few, yet it is also true that mankind has always felt this to be the danger, has instinctively safeguarded itself against that danger by the setting up of institutions for the protection of small property, and that these institutions have never broken down of themselves, but always and only under the conscious action of a deliberately hostile attack.”
Probably the strongest section in the book is his account of the seven reasons why the market, unfettered, will tend toward increasing centralization: 1) overhead charges; the larger an organization, up to a very considerable size at least, the lower its overhead costs will generally be, proportionately. One can administer ten thousand retail stores under a single corporation for a much lower average cost than ten thousand men can administer ten thousand independent retail stores. 2) Information. The larger an organization, its ability to publicize itself will be exponentially greater (there’s some great remarks on the evils of advertising in this section). 3) The power to obtain credit: a larger entity can get credit much more easily, at much lower rates of interest, and can continue to hold a line of credit even when insolvent, because the lenders are afraid of letting it collapse. 4) Underselling. We all know this phenomenon with Wal-mart; the bigger organization sells at a loss for a while in order to drive the smaller competition out of business. 5) Ease of accumulating capital. This one’s a bit more complicated, but the essence is that a big wealthy organization can afford to set aside money to accumulate capital much more easily than a small producer. 6) Political influence. The large organization can easily put all sorts of pressure on a parliamentary political system to enact laws and policies friendly to it. 7) Judicial influence. The larger organization can often afford to take legal advantage of the smaller organization, because the latter simply cannot afford the costs of carrying on a court case, even one they ought to win. (It’s particularly remarkable that Belloc had already noted this danger in 1936, a danger that has spiralled out of control since.)
There is, however, a weakness in the book, and that is that Belloc’s pessimism about seeing this restoration of property mean that he rests what little hope he has on the State. This is odd, given that he sees so clearly the collusion of state and big business, and even says at the end, “Parliaments are necessarily the organs of plutocracy. There is no approach through them whereby the small man can have effect in the economic field.” Apparently he hopes for the ending of the Parliamentary system of government, being convinced that monarchy is much more favorable to distributism. Early on, he seems to say that a top-down fix is not the answer: “The evil has gone so far that, though the preaching of a new doctrine is invaluable, the creation of new and effective immediate machinery is impossible. The restoration of Property must essentially be the product of a new mood, not of a new scheme. It must grow from seed planted in the breast. It is too late to reinfuse it by design, and our effort must everywhere be particular, local, and in its origins, small.”
But later on, he explicitly rejects the idea that the solution is to be found in changing the philosophy, the religion, of the society; it’s too late for that, he says. If anything is to be done, it will have to be done soon, and resolutely. “No such reformation as we are contemplating can be undertaken or continued without State power....We shall find as we proceed in our search for Economic Freedom, that we cannot follow it for any distance without calling in the powers of the State, to contrast with, and as far as possible to destroy, the usurped powers of Big Business.”
To this end, he recommends a system of differential taxation, carefully calculated to make life more difficult for the big producer and easier for the small producer. “It will be objected, of course,” he says, “that for such a system you would need an extension of bureaucracy, that the definition of the various categories will be difficult, etc. It is true that in all these reforms we shall have to extend, for the moment, bureaucratic action. The nature of the modern world is such that we cannot escape from being helped by the State in our reforms.”
In general, he would prefer to avoid State ownership, but says that it will be necessary in certain situations. Repeatedly he speaks of the need for the State to artificially foster the isolated and feeble seedlings of small property ownership at the expense of the rest of society, and is unapologetic about what this requires: “You cannot start a new peasantry save at the expense of the diseased society surrounding it; and if you are not prepared to impose that sacrifice your peasantry will never be established. It must begin as a social luxury, and, while it remains in that initial ‘luxury’ stage, it must like all luxuries, be extravagantly paid for.”
Now, I am perhaps not so opposed in principle to all of this as you might think. If the government is responsible for administering justice and providing for the common good, and there is indeed a serious structural injustice, one that the government helped create, then there is certainly something to be said for having the government go to work to undo the harm it did, and “artificially” restore a juster order. I am certainly not wholeheartedly in favor of that proposition, but I could seriously entertain it. But on a pragmatic level, I have deep doubts. If it be true, as Belloc recognizes clearly, that governments, at least of the sort we now have to reckon with, are almost chronically unable to avoid getting in bed with big corporations, how could we genuinely trust them with such a project? In this irreligious and secular age, how can we hope that more corruption, rather than more care for their citizens, will be the end result? And, if society as a whole is screwed up, how will a top-down imposition work? It will simply prompt an uprising by the monied interests, who will use all the means at their disposal to bring the government back under their control; plus, it simply will not take root among a citizenry indisposed to take on the responsibilities of real property-ownership.
Personally, I think Distributism’s best chance for success lies in being “particular, local, and in its origins, small,” in particular, focusing on local church initiatives. Church communities and denominations, if they’re really serious about these ideals, can go a long way to nourishing free, just, well-distributed economic organizations in their midst. Of course if the State really desires to help out in some way, they should rejoice, but they shouldn’t put too much hope there. It will be a long, slow, hard process of swimming upstream, but it seems more likely to pay off in the long run.