Acton Institute Powerblog

We Don’t Need a ‘Third Way’, We Need More Non-Profits

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Third_wayThe problem with advocating for third way economic system between capitalism and socialism is, as Matt Perman notes, there is no realistic third way. Fortunately, a third way isn’t needed since capitalism can do everything that so-called “third alternative” (e.g., distributism) want their system to do. For instance, one aspect of how capitalism can create a more “people-centered economy” is to increase the amount of capital that is dedicated to non-profits.

When society reaches a point that we have a proliferation of trinkets and other such things, it’s not a sign that capitalism has gone bad. Rather, it’s a sign that we need to use the freedom that capitalism affords us to point our efforts more fully in another direction — namely, the social sectors. We need more non-profit organizations, more churches, and more people going in to ministry and non-profit work in general. We can afford it. It will mean less singing fish, and perhaps less pet rocks. More seriously, maybe we won’t be producing exactly the 1 billion articles of clothing per year (which I am fine with as long as Banana Republic doesn’t go out of business). The point of our prosperity is not simply or mainly to enable us to keep buying more stuff, though the desire to accumulate is not evil in itself. The point of our prosperity is, rather, to divert some of our ability to accumulate more to efforts that focus more directly on using our abundance to meet pressing global needs.

I know there is one important consideration and possible objection here, which is actually a point I’ve made for years and that I make in my book (if I don’t cut the chapter due to length). And the objection is that I may seem to be pitting business against social good, when in reality it is business, not charity, which is the long-term solution to global poverty.

So I want to say clearly that I am not doing that. I do believe that business is the only long-term solution to large global problems like global poverty. And I’m not saying that when a person opens a business and makes money that he is not contributing greatly to the welfare of society. They are. But business cannot do this alone, because not all needs can be met at a profit, and there is injustice blocking the way in many instances. We need to be a society of both excellent businesses and great non-profits.

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Joe Carter Joe Carter is a Senior Editor at the Acton Institute. Joe also serves as an editor at the The Gospel Coalition, a communications specialist for the Ethics and Religious Liberty Commission of the Southern Baptist Convention, and as an adjunct professor of journalism at Patrick Henry College. He is the editor of the NIV Lifehacks Bible and co-author of How to Argue like Jesus: Learning Persuasion from History's Greatest Communicator (Crossway).


  • Clare Krishan

    re: “not rightly understanding the definitions of capitalism and socialism,
    and thus not realizing that there is no “third alternative” here (though
    there are degrees).”
    kettle calling pot black! The US dollar is one humongous socialist-centrally-planned Ponzi scheme applied to the global economy for the benefit of the federal-soviet of US states deficit spending excursions. The third alternative is real, and very much active ‘here’ — its any off-shore sovereign wealth fund able to ride the moral hazard tsunami of the greatest transfer of wealth from the wage-earning-&-income-taxpaying masses to a equity-owning-&-tax-exempted oligarchy of the Fed’s ZIRP quantitative easing policies.

    Using generic terms such as ‘business’ and ‘chariry’ to describe the complex legal and financial structures behind international juridical persons is flimsy at best but actually rests your rhetoric on a deeply flawed logic. The socialism of currency seignorage has permitted Americans to consume way more public services (that kept many so-called private businesses earning profits from market-capital funded operations, Canadian IT company CGI is a case in point re: Obamacare; dividends that go to “capitalists” haven’t been paid for yet, we’re just covering interest, our children will have to figure out the principal with our debtors when they come for their pound of flesh..) that they had actually earned wealth to pay for, they simply borrowed it from the citizens of countries they traded with… “-If you were alive when Jesus Christ was born and you spent one million dollars every single day since that point, you still would not have spent one trillion dollars by now.”
    May I suggest that Acton address the morality of the monetary-metric medium America uses to calculate “profit” “loss” “wealth” or “poverty” as a basis for discerning the benefits of freedom of association and political agency in community labor (remunerated – as employment – or not – as volunteering) that citizens operate under? The accounts payable if you will of settling economic justice?
    “The Biggest Scam In The History Of Mankind – Hidden Secrets of Money”

    Then and only then can any of us debate property distribution via free exchange (both as charity AND as business – the one via ‘gift’; the other via ‘price’) or via fiscal sociology (citizens owe material allegiance to their national patrimony and contribute to the force majeur of political power via legislated fiscal obligations — up to and including expropriation of citizens’ land or assets by tax liens accruing to a socialist aggregate, the State — protected by Divine Right, or not as in the HHS mandate)

  • Nathan

    “it’s a sign that we need to use the freedom that capitalism affords us to point our efforts more fully in another direction — namely, the social sectors. We need more non-profit organizations, more churches, and more people going in to ministry and non-profit work in general.” This isn’t contrary to what Distributism calls for. Exchange the term “capitalism” with the term “distributism here and you do not get two contrary things. If anything, distributists have a better understanding of the concept of subsidiarity, that for which the author is reaching.

  • Clare Krishan
  • Clare Krishan

    “A $15,000 bond for a woman throwing a shoe at her Wall Street
    ex-husband, and a $15,000 bond for a state Supreme Court judge for
    accepting bribes. That pretty much sums it up.”
    Where I call home we have similar problems:

    Corruption in the judiciary of one of the wealthiest per capita counties of America…

    Do we call this “business” as usual or categorize such maternal concern as an expression of “non-profit” charitable activity? Logic, rhetoric and grammar must be seen to be true for liberty to be a generative development for global democracy politically-speaking, if the logic of the currency is otherwise licentious corruption is the inevitable consequence, however accelerated (or tapered) quantitative-easing fiction delays the day…