Posts tagged with: capitalism

Conservatives need to stop shying away from principled, as opposed to merely utilitarian, defenses of economic freedom and its associated institutions, says Acton research director Samuel Gregg in an article for Public Discourse:

Some fiscal conservatives are certainly too sanguine about creative destruction’s unintended negative effects on our lives. But these side effects are not sufficient reasons to try to slow or even stop the process, let alone assume that higher taxes and the welfare state (which itself breeds plenty of dysfunction) are the appropriate response.

Still, it doesn’t seem wise to play down these negative impacts. Given the conservative commitment to limited government, it would seem that the authentically conservative response would be to investigate and apply Tocquevillian “civil society” solutions to such problems before looking to the state for remedies.

Read more . . .

As Michael Novak observes in The Spirit of Democratic Capitalism, “A successful corporation is frequently based upon the principle of subsidiarity. According to this principle, concrete decisions must be made on the level closest to the concrete reality. Managers and workers need to trust the skills of their colleagues. A corporate strategy which overlooks this principle–and many do–falls prey to all the vices of a command economy, in which all orders come from above.”

According to a study by Melba J. Duncan in the Harvard Business Review, such delegation makes economic sense: “Generally speaking, work should be delegated to the lowest-cost employee who can do it well.”

A recent BusinessWeek article updates the case for executive assistants. Anyone who has had significant contact with corporate settings knows that the EAs are the ones who really get things done. But for such delegation to be effective and efficient, it must be empowering. As Duncan writes, “The most effective executives think deeply about the pieces of their workload that can be taken on—or restructured to be partially taken on—by the assistant.”

Even the “lowest-cost employee” has a stewardship responsibility.

Of course, delegation can go too far, too.

The Pavilion End pub with St. Paul’s Cathedral in the background

Last week following Acton’s seminar on morality, virtue, and Catholic social teaching with a group of financiers, bankers, and other business executives in London, I was invited to attend a private eulogy service organized by the Freedom Association for the late Lady Margaret Thatcher.

The eulogy service was organized in “proper British fashion” while sharing memories and more over ales at a pub—The Pavilion End—located right behind St. Paul’s Cathedral where Britain’s conservative elite gathered for formal prayer, hymns, and a sermon given by the Bishop of London at Margaret Thatcher’s elaborate state funeral.

A few hundred in attendance at The Pavilion End pub listen to the impressive speakers

A few hundred in attendance at The Pavilion End pub listen to the impressive speakers

I joined this unique opportunity, of course, to pay my own international respects as an adopted American son of Britain’s great Mother of Liberty. It was during my 1980s Catholic conservative upbringing that I gained immense respect for the Iron Lady, who joined forces with our own President Ronald Reagan and Rome’s John Paul II. In the end, this powerful triumvirate won the Cold War and effectively rolled back the Iron Curtain to inspire unprecedented economic growth and human flourishing in the modern world. (more…)

1. “Pennies don’t fall from heaven, they have to be earned here on earth.” (Speech at Lord Mayor’s Banquet, 11/12/79)

2. “If a Tory does not believe that private property is one of the main bulwarks of individual freedom, then he had better become a socialist and have done with it.” (Article for Daily Telegraph, “My Kind of Tory Party,” 01/30/1975)

margaret-thatcher-43. “I came to office with one deliberate intent: to change Britain from a dependent to a self-reliant society – from a give-it-to-me to a do-it-yourself nation. A get-up-and-go, instead of a sit-back-and-wait-for-it Britain.” (Speech, 1984)

4. “My policies are based not on some economics theory, but on things I and millions like me were brought up with: an honest day’s work for an honest day’s pay; live within your means; put by a nest egg for a rainy day; pay your bills on time; support the police.” (The News of the World, 9/20/81)

5. “The choice facing the nation is between two totally different ways of life. And what a prize we have to fight for: no less than the chance to banish from our land the dark, divisive clouds of Marxist socialism and bring together men and women from all walks of life who share a belief in freedom.” (Speech, 1983)
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A friend at church recently loaned me the New York Times bestseller Same Kind of Different as Me, which tells the story of how a wealthy art dealer named Ron Hall and a homeless man named Denver Moore struck up a friendship that changed both their lives. I’m only half way through it, but it’s already instructive on several levels that connect to the work of Acton.

Denver grew up as an illiterate sharecropper in Louisiana, an orphan who loses a series of guardian relatives while growing up and eventually finds himself in a class a notch below sharecropper—the field laborer who isn’t entitled to a share of the crops he works but simply works dawn to dusk for the food, clothing and minimal shelter he’s given on credit. In Denver’s case, since he couldn’t read, write, or do arithmetic, he couldn’t determine how much he owed, what the interest was, what his labor was worth, or even that he’d been denied his right to an education.

Economic conservatives talk a lot about the morality of the free economy, and the power of the markets to better the lives of the poor. It’s stories like Denver Moore’s that underscore why Acton spends so much time talking about a free and virtuous society, about the importance of ordered liberty. You see, in the book, at no point did anyone put a gun to Denver’s head and make him pick cotton dawn till dusk. At a superficial level, he was a participant in an un-coerced labor market (slavery had been abolished generations ago, after all). But any thoughtful look at Denver’s extraordinary story of struggle, despair, and escape will register the fact that Denver’s liberty had been violated in a host of subtle and not-so-subtle ways during his youth. These were like the strands of a spider web: individually they are of little consequence and hard to see, but taken together they have the power to bind. (more…)

ForbesAlejandro Chafuen, president and chief executive officer of Atlas Economic Research Foundation and board member of the Acton Institute, recently wrote a piece for Forbes.com about crony capitalism.

Chafuen used to spend his summers in Argentina, so he begins his article with a story about a friend from Argentina. Enrique Piana, known to his friends as “Quique,” was heir to “Argentina’s oldest and most respected trophy and medals companies.”

During part of the ’90s, the government of President Carlos Menem, and then-Minister Domingo Cavallo, had a policy for the importation of gold and exports of gold fabrications that amounted to a major subsidy for exporters. Attracted by the incentives, Quique, who had become CEO of his company, became a key player in a scheme whereby exporting overvalued gold-plated products netted them 30 million in subsidies for fake transactions. As it seems that none of the medals were sold at artificial value to true customers, the only victims here ended up being the Argentine tax-payers.

The scheme involved a “business” in the United States. As there is still substantial respect for rule of law in the United States, Quique was indicted, captured, and—after some months in a U.S. jail—extradited to Argentina. In his book, he lists the government officials who he claims knew about the scheme and who received bribes for his fraudulent activities. I will not mention them here. None of them were sentenced to jail. (more…)

John Mackey, the well-known CEO of Whole Foods, sat down for an interview with Reason TV’s Nick Gillespie this week and I found a few quotes from their exchange particularly interesting. You can watch the full interview here: John Mackey Video

When asked what the original “higher purposes” of his business were when Whole Foods began, Mackey responded:

“Sell healthy food to people. Make a living for ourselves. Have fun. But our purposes have evolved over time…I would say one of our higher purposes now is to heal America.”

Mr. Mackey writes all about such things in his recently-released Conscious Capitalism. Citing familiar statistics regarding the millions of Americans who are overweight and suffering from diseases that “correlate directly with diet and lifestyle choices,” he feels that his chain of high-end groceries are a very real contribution to the betterment of the nation.

I applaud much of what Mackey says publicly when it comes to free enterprise and the moral case for capitalism (more on that in a minute), but the idea that ultra-expensive, cage-free items – in a store that is primarily frequented by already-healthy (and wealthy) patrons – will “heal America” is a bit over-the-top. (more…)

Samuel Gregg recently spoke with Marie Stroughter from African-American Conservatives. They discuss Gregg’s new book, Becoming Europe: Economic Decline, Culture, and How America Can Avoid a European Future. 

Stroughter asked Gregg about the dichotomy between “cuddle capitalism” (the European social model) and a dynamic market economy.  Gregg says that Americans are more and more choosing a ‘Europeanized’ economy favoring security over economic liberty.

Listen to the full audio here:

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You can purchase the hardcover or eBook version of Becoming Europe here.

JMM_15.2_WebThe newest issue of the Journal of Markets & Morality has been published. The issue is available in digital format online and should be arriving in print in the next few weeks for subscribers. This issue continues to offer academic engagement with the morality of the marketplace and with faith and the free society, including articles on economic engagement with Pope Benedict XVI’s encyclical letter Caritas in Veritate, biblical teaching on wealth and poverty, schools as social enterprises, the Reformed philosopher Herman Dooyeweerd’s economic theory, and much more.

As we have done in the past, Jordan Ballor’s editorial is open access, even to non-subscribers. In “Between Greedy Individualism Editorial and Benevolent Collectivism” he examines the enduring impact of Michael Novak’s The Spirit of Democratic Capitalism, writing,

At the time of its publication, Novak’s work must have been like a window thrust wide open in a dank room, introducing a breath of fresh air and the sanitizing rays of sunlight. Against ideologies that posit state power as a neutral or even benevolent force arising of necessity against the rapaciousness of the market, Novak observed instead that it was democratic capitalism that arose first as a system designed to check the invasiveness of state tyranny. The “founders of democratic capitalism,” wrote Novak, “wished to build a center of power to rival the power of the state.” Indeed, “they did not fear unrestrained economic power as much as they feared political tyranny.” Still more would they fear the union of economic and political power that we find all too often today in corrupt and cronyist regimes.

You can read his full editorial here. (more…)

Over at Fieldnotes Magazine, Matthew Kaemingk offers a good reminder that in our social solutions-seeking we needn’t be limited to thinking only in terms of market and state. By boxing ourselves in as such, Kaemingk argues, Christians risk an overly simplistic, non-Biblical view of human needs and human destiny:

When presented with almost any social problem (education, health care, poverty, family life, and so on), today’s leaders typically point to one of two possible solutions—a freer market or a stronger state. But in opposition to these rather myopic solutions, I think there is a more complex and biblical lens through which leaders can consider the social eco-system and the people who move around in it.

Instead of simplistic descriptions of human beings as either clients of the state or competitors in the market, the Christian Scriptures present humanity in a refreshingly complex way. We find a complex creature with a wide variety of gifts, abilities, interests, aspects, loyalties, and solidarities. Created in the image of God, human beings in the Bible are anything but simple. They are musical, communal, religious, artistic, familial, charitable, scientific, literary, moral, athletic, fun, and funny. The robust anthropology found in the Bible depicts a creature that could never be fully defined, controlled, content, or nourished by the market or the state alone—thank God.

This perspective ties in well with Rev. Robert Sirico’s final chapter in his book, Defending the Free Market, where he criticizes the popular notion of homo economicus, from which plenty of bad economic policy and market decision-making has been generated:

Any man who was only economic man would be a lost soul. And any civilization that produced only homines economici to fill its markets, courts, legislative bodies, and other institutions would soon enough be a lost civilization. Familial love, voluntary dedication to philanthropy and faith, the creation of art and music would be at their most minimal level, and whole sectors of life would completely vanish. Focusing the whole of life on the acquisition of quantifiable goods does not bring true happiness or peace, as almost everyone knows. We all have material appetites, but we do not (pray God) always feed them…Human beings find ultimate fulfillment not in acquisition but in developing, sharing, and using their God-given creative capacities for good and giving themselves to others. (more…)