Saturday, January 21, 2017

The Absurdity of “Values-Free” Economics

Image source: marketoracle.co.uk.
While reading John C. Médaille’s Toward a Truly Free Market: A Distributist Perspective on the Role of Government, Taxes, Healthcare, Deficits, and More (Wilmington, Delaware: ISI Books, 2010), I couldn’t help thinking of Pascal-Emmanuel Gobry’s admission three years ago that “economists actually know very, very little, and that a lot of what we thought we knew [prior to the last recession] turned out to be wrong.” Yet the defenders of what Gobry calls “the Washington consensus” still talk and think as though their economic dicta were enshrouded in papal infallibility. Toward a Truly Free Market helped me to realize that the economists were wrong because the entire discipline is not (and never could be) “values-free”; the very notion is inherently absurd. And the values enshrined in modern economic theory not only blind economists to impending market failures but make them inevitable.

What is Distributism?

Distributism holds that a community’s economic health is better secured when the ownership of capital — the means of production, including everything from office ball-point pens to factories, especially land — is spread out (distributed) widely among the population. It champions smaller, more localized businesses, especially cooperatives and employee-owned corporations, and considers globalism and the huge multinational conglomerates positive evils.

Distributism is not, however, a form of socialism. It rejects state ownership of property and demands a reordering of government power to prioritize the community over the nation. Nor does distributism necessarily require a forced redistribution of capital by the government, though Médaille doesn’t rule it out (see pp. 243-245).