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G.K. Chesterton and Richard Nixon Talk Economics

 

economics

Luke Phillips

Today’s haul brought in two long, interesting articles that should make free-marketers retch uncontrollably.

The first, on G. K. Chesterton and Hillaire Belloc’s old quasi-utopian scheme of political economy called “Distributism,” argues for policies that place capital in the hands of workers and enables them, in effect, to be self-employed and self-mastered. Distributism, then, starts to resemble what policy dreamers these days sometimes call “universal capitalism-“ a state-sponsored system that puts the means of production in the hands of every citizen and seeks to thereby relieve inequality, poverty, joblessness, and various other social ills. It’s also incidentally something in which Catholics- like Chesterton himself- can find much to like. Here’s the best short description offered:

“Distributism shares with Marxism the goal of the workers owning the means of production and of eliminating the alienation of the worker from his product. (Of course, distributists meant that the workers should really own the means of production—not, as communists usually did, that the workers should “own” them through the intermediary of the state.) And distributist class analysis resembles Marxist class analysis in obvious ways. 

Along with free-market economists, however, distributists recognize the importance of private property. Further, modern distributists recognize the crucial role of something that early advocates such as Chesterton and Belloc did not have the theoretical resources to articulate: namely, the vital role of true market prices in achieving economic efficiency. As Friedrich Hayek put it, market prices are able to incorporate knowledge of the “particular circumstances of time and place” into a worldwide economic system.

Distributism also contains aspects of communitarianism: with capital owned on a local level, owners are more likely to engage with the social and civic life of their community. Chesterton liked to refer to distributism as “real democracy.””

Not exactly your typical economic theory…

The second article, basically an expose of the various elements of state activism that have contributed over the centuries to the “mixed economy,” is fairly straightforward. It argues that various forms of government intervention- from the maintenance of legal and financial infrastructure to investments in education and technology and physical infrastructure to regulations and entitlements that limit the worst effects of capitalism on the poorer classes- have been crucial to making capitalism work better, rather than just restraining its excesses.

It’s a convincing article, one with which I sympathize. I think the authors fail to take into consideration the obvious fact that the expansion of the federal government’s authority has, in the past seventy years, created innumerable problems of its own. But the noisily boisterous Hamiltonian in me agrees wholeheartedly with the notion that the state and market ought to be partners rather than adversaries, and that such an arrangement is not “crony capitalism” but capitalism in its very best and most effective form. The work of Erik Reinert and Ha-Joon Chang reveals that this is economics’s historic norm, too, stretching back to the developmental policies statelets and principalities pursued all the way back to the Middle Ages.

Moreover, this temperament is not reserved to the New Deal-Fair Deal-New Frontier-Great Society Democrats. It has had its great supporters in our own Republican Party, too. Here’s the article’s take on Eisenhower and Nixon:

“The most famous GOP convert was the general turned politician Eisenhower. He understood that the Republican Party needed to make its peace with most of the policy achievements of the previous two decades. In 1954, for example, Eisenhower privately ridiculed the desire of conservatives to roll back the New Deal: “Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. … Their number is negligible and they are stupid.” Eisenhower’s point was that the mixed economy was an established reality and there was no going back. 

Eisenhower’s domestic policy agenda focused on economic growth, and Democrats would criticize him for his reluctance to rely on Keynesian policy to prime the economy. Yet his administration devoted substantial energy to policies designed to improve the country’s long-term economic performance. And on economic issues, the moderate consensus continued after Eisenhower left office. Although John F. Kennedy famously adopted a more Keynesian stance on the budget (built around business-friendly tax cuts), in most respects his economic policies followed the tracks laid down in the 1950s. When the GOP veered right with Barry Goldwater’s candidacy, and Lyndon Johnson tacked left with the inclusionary policies of the Civil Rights Act and the War on Poverty, much of the business establishment went with Johnson.

Richard Nixon was one of the last Republican leaders to embrace the mixed economy, and embrace it he did. Nixon’s efforts to fashion a new majority involved positioning himself to the right of Democrats on issues of race and crime, but he was willing to be a moderate, even an activist, on matters related to the economy. He supported major extensions of the regulatory state, including big new initiatives for environmental and consumer protection. He favored a guaranteed annual income, a huge expansion of Social Security, and health-care reforms way to the left of what Bill Clinton or Barack Obama ever proposed.

Nixon’s moderation was driven in part by political calculations. Encouraged by Daniel Patrick Moynihan, one of his leading advisers on domestic policy, he took the nineteenth-century British prime minister Benjamin Disraeli’s “liberal Tory” stance as a model and sought to appeal to working-class and middle-class whites with his support for social insurance and his cautious backing of many of the new regulatory measures coming out of a Democratic Congress. But it wasn’t all politics. Nixon accepted the notion that in a large and complex society, government had a fundamental role to play in fostering economic growth and social prosperity. This went beyond the macroeconomic management of boom-and-bust cycles and incorporated support for collective bargaining, extensive social insurance and a reasonable social safety net, the provision of crucial public goods, and interventions to tackle thorny market failures.” 

Heretics, right?

Lessened regulations and lower taxes are all good in themselves- in fact, I’m working on a project for Joel Kotkin arguing as much- but they cannot alone make up the core of economic policy. There’s a certain point where the bigger picture- the effects of economics on the state and society- needs to be taken into account, and another where the smaller picture- the effects of economics upon individual character and social life- needs to be taken into account. It’s hard to do that under the free-market dogma pervading the party today.

I’m not saying we ought to throw up our hands and unilaterally surrender to the economics of either G.K. Chesterton or Richard Nixon. (Though surrendering to a mix of both would be intriguing.) I do think it would be nice if our party’s dialogue featured more than simple fealty to Reaganomics, though.

Distributism and the Mixed Economy might be of some help in that regard.

 

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Welcome to the PRL Blog

 

19thcenturyeagleHello, dear reader, and thank you for your interest in the Progressive Republican League Blog. The format will be straightforward- it will mostly consist of daily posts linking to news stories, opinion pieces, longer essays, and other items of interest, providing a bit of Progressive Republican analysis on the side. These daily posts are intended to fill the same role as the old 7E and National Conservative weekly newsletters, in smaller, more digestable doses.

We’ll also be posting excerpts of longer pieces, older pieces from various publications, and original insight from PRL members and affiliated thinkers.

If you have questions or comments about the PRL Blog or are a member who would like to become a contributor, please contact the Editor, Luke Phillips, at lukenathanphillips2012@gmail.com. We look forward to hearing from you.

A Progressive Republican Manifesto in the Pages of Playboy Magazine

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Luke Phillips

Excerpted from “For a Moderate Majority,” Playboy Magazine April 1970, Josiah Lee Auspitz

Yes, you read that title right. The below is excerpted from the last page of Josiah Lee Auspitz’s article, “For a Moderate Majority,” published in the April 1970 edition of Playboy Magazine. 

It fairly well articulates the situation the members of the Progressive Republican League now find themselves in, and beckons potential opportunities.

 You can find the PDF of the original article at Auspitz’s website here. Of additional interest is the Ripon Society’s founding document, “A Call to Excellence in Leadership,” available on my personal blog here.

 

FROM “FOR A MODERATE MAJORITY”

…I feel that the Progressive GOP is the one to work through in an eight-party system; and if it wins the battle for political strategy, the Republican Party that emerges will be unqualifiedly the most worthy of support. If it loses, conservative strategists have predicted gleefully that its constituents will leave the GOP, which will, in that case, probably go the way of the Whigs, who assembled a retrograde coalition that won power for a brief period and then vanished from American history.

The outcome of the struggle would be certain were it not for the lassitude of the moderates. Because the Progressive GOP has mobilized in the past only around personalities, it now lacks the political infrastructure essential to a successful political movement. Because many of its present leaders suffer from a certain prima donna-ism, the new movement will not be built from the top down. This provides a historic opportunity for young leadership. There are already some indications that the harvest can be great. Moderates are best at intelligent discussion, at persuasion, at developing workable proposals. When they decide to cooperate, they are able to pioneer new patterns of collaboration between generations and to achieve results. They are capable of exciting others with ideas and eliciting sustained commitment. If they lead from their strength- not mass demonstration, but reason, competence, persistence, and tough-minded idealism- they can revolutionize the political system.

The experience of the Ripon Society may give some hope for these quiet tactics. Begun in December 1962 with only some 17 members and named after Ripon, Wisconsin, the birthplace of the Republican Party, it is still far from a mass organization; yet it has moved to change the tone of political debate in the 11 cities in which it now has chapters. It attempts to reach out to groups that have never considered voting Republican and to build bridges to the professional, academic, and business communities. It offers politicians research, political aid, and a monthly magazine with independent criticism and positive proposals. Its members adhere to the Republican Party not for what it is but for what they can make it become. They are now working at the White House, in government agencies, and on political staffs at all levels of government, and some will be running for office this year.

Ripon’s mottoes have been simple all along. Its members have sought not expedient slogans but “the ideas whose time is yet to come” and many of their programs for welfare reform, a volunteer Army, revenue sharing, and policy toward China and Vietnam have helped shape national policy. They have sought not heroes to admire but ways to galvanize themselves to action. As the society’s first statement said, well before this author had become a member:

“This, then, is a call to action… The question is often asked, where are the leaders of the new Republican Party? We have shown just how we need such men. If we cannot find them, let us become them.”

This spirit of challenge, from Ripon and other young, engaged groups, is desperately needed to shake up both of America’s decrepit political parties.

POSTSCRIPT

The Ripon Society seeks to attract creative young people to active participation in Republican politics. As the Society has built bridges between the Party and the nation’s campuses and professional communities, it has become an important resource to Republicans who face an ever more youthful and better informed electorate. Ripon also works to infuse the GOP with new ideas so that it may become the party of initiative rather than the party of response. For only in this way can Republicans avoid the equally unsatisfying role of being either the “me too” party or the “not me” party.

The Society believes that the two-party system in America must be preserved and strengthened. A strong and constructive Republican Party is essential to that effort. And just as the American nation is pluralistic, so must a vital GOP be widely diversified. It must more actively involve intellectuals, minority groups, laborers, and urban dwellers. It must win the confidence of those who are not at home in the politics of another generation: the new middle classes of our suburbs, the young who are more concerned with opportunity than security, the moderates of the New South.

Ripon maintains that if the Republican Party is to deserve majority status, it must find means to strengthen state and local governments. It must bring the resources of organized labor and private enterprise to bear on social problems. It must understand and deal creatively with new challenges in fields such as education, computerized information collection, and social welfare. It must be unequivocally committed to the full realization of civil rights for all citizens. In foreign policy, it must reject simplistic thinking, encourage frank debate, and make a serious attempt to understand the foreign cultures with which America will increasingly deal.

The Ripon Society believes that the Republican Party can become the party of adventure and excitement. It can break new ground in American politics and become a flexible instrument for exploring the challenges of the decades to come. Ripon believes that it can help the Republican Party to identify and claim the issues of the future, to raise the questions others do not ask, to grasp ideas “whose time is yet to come.”