Despite their obvious potential advantages, employee owned businesses tend to be rare. In 2004, there were an estimated 300 worker owned cooperatives in the United States. If that sounds impressive, consider that in 2001, there were over 18.3 million nonfarm proprietorships in the U.S. Nor is the situation much different overseas. The Mondragon Cooperative Corporation is typically cited as an example of a successful worker cooperative, and it is indeed quite successful . . . for a co-op. Compared to other types of businesses, however, Mondragon performs well, but not stellar. It is the seventh largest corporation in Spain, and despite being a conglomeration of more than a 100 different companies, it accounts for less than 4% of the GDP of the Basque region of Spain where it is located. When one considers that Mondragon is in all likelihood the most successful worker cooperative on the planet, the idea that the co-op’s success proves the viability of worker cooperatives generally begins to seem doubtful.
There’s nothing legally preventing people from choosing to start a workers-owned cooperative rather than some other form of business, and in fact cooperatives receive more favorable tax treatment than do standard business corporations. Why then, aren’t they more common? The question has actually inspired a fair amount of research, which has identified at least four obstacles to the success of worker owned businesses.
To follow up on my first installment of “Set Me Free (From Ideologies), I am going to draw again from the rich well of Pope Benedict’s powerful encyclical Caritas In Veritate. In this case it would seem that in paragraph #25 the Pope is sounding kinda liberal if we would attempt to fit the views expressed into one or another of our American political ideologies. Continue reading
The U.S. Conference of Catholic Bishops made a determined effort for universal health coverage, without abortion, in the run-up to the vote on ObamaCare. In the end, due to the abortion language in this bill, they condemned it in its entirety.
Now I believe that our bishops had the best intentions of wanting universal health coverage, but this violates the principle of subsidiarity.
The Principle of Subsidiarity is the handling of affairs by small-scale, bottommost, or minutest government.
In 1891 Pope Leo XIII wrote an encyclical, Rerum Novarum, which said that government should undertake only those initiatives which exceed the capacity of individuals or private groups acting independently. Functions of government, business, and other secular activities should be as local as possible. If a complex function is carried out at a local level just as effectively as on the national level, the local level should be the one to carry out the specified function.
And those that are uninsured, can get readily available treatment for a serious illness. Including illegal aliens.
So why the bishops haste and aggressive posturing in pushing for something everybody already has and are satisfied with?
Everyone here at the American Catholic hoped that you all have had a happy Labor Day weekend.
The principle of Subsidiarity states that government should undertake only those initiatives which exceed the capacity of individuals or private groups acting independently.
Pope Leo XIII developed the principle in his AD 1891 encyclical Rerum Novarum. The principle was further developed by Pope Pius XI in his AD 1931 encyclial Quadragesimo Anno.
To learn more about Subsidiarity click here.
To read Pope Leo XIII’s encyclical Rerum Novarum click here.
To read Pope Pius XI‘s encyclical Quadragesimo Anno click here.
For more Dilbert funnies click here.
In the many discussions about socio-economic matters we partake in here at The American Catholic – not all of them as charitable as I would like – the topic of wealth redistribution often comes up. Clearly some of us hold different views as to the effectiveness of wealth distribution, or the forms it ought to take. Catholic social teaching does not attempt to confine redistribution to one set of particular policies, and it does not support the enlargement of “the welfare state”.
But there is no question that the redistribution of wealth through taxation is in itself a morally legitimate practice for government to engage in.
At the request of my friend and fellow contributor to The American Catholic, Darwin Catholic, I will elaborate more on some of the general points I introduced to the discussion over his latest post about economic morality. For those who did not follow the exchange (of me versus everyone, understandable on this somewhat more conservative blog), I questioned the accuracy of any scientific theory of economics that did not take into account class conflict (or, as some insist on saying, “class struggle”). Darwin and others responded by questioning the validity of the very category of class. Hence, we have a great deal of ground to cover – I hope you will bear with me, and that we all end up learning something.
(I was going to wait until later to do this, but I just couldn’t )
After many months of waiting and speculation, Pope Benedict’s third encyclical Caritas in Veritate (Truth in Charity, CV for short) was released to the public today. As I read it this morning, I was grateful that we have been blessed with a Pontiff whose intellectual command of the social and cultural issues of our day is so wide-ranging, dynamic and insightful.
The reaction, thus far, has been more or less what I expected: people of various ideological persuasions attempting to take away what they can from it. I will have more to say about that below. For now, though, I want to highlight what I thought were the most important themes.
First, the Pope reminds us that Catholic social teaching cannot be arbitrarily divided into different categories. Of the Church’s social doctrine, Benedict says: “there is a single teaching, consistent and at the same time ever new” (12). Nothing in this encyclical, then, will fundamentally alter or revise anything that has been said before since the publication of Rerum Novarum in 1891.
[Updates at the bottom of this posting.]
The much anticipated new encyclical that Pope Benedict XVI recently signed, his third, on June 29th titled Caritas in Veritate, or Charity in Truth, will be released soon by Ignatius Press (the English version) on July 6th or 7th of 2009 A.D. In searching for information regarding this encyclical I found bits and pieces here and there but nothing exhaustive or concise that came close to satisfying my curiosity. So I’ve gathered all of my information and have presented it the best way possible in this posting. With tongue in cheek I labeled this preview of Caritas in Veritate as an ‘Exclusive Sneak Peek’*.
Caritas in Veritate will be a social encyclical examining some of the social changes that have occurred since Pope Paul VI’s encyclical Populorum Progressio, particularly globalization. The encyclical will have Pope Benedict XVI articulating the need to bolster humanism that brings together the social and economic development of humans and to reduce the disproportionate gap between poor and rich. One other major theme of this encyclical will be that of global justice.
I am going to provide everyone with a nice blast from the past- everyone I know respects Pope John Paul II- most orthodox Catholics refer to him as John Paul the Great. So I think what he thought officially as Pope on the question of Capital/Labor/State as part of the tradition deriving from Pope Leo XIII’s Rerum Novarum- is incredibly interesting and relevant. Here is Chapter One of Centesimus Annus with no personal commentary- let the “man” speak without any interference from me:
A typical question, as a previous post here at American Catholic, with regard to worker’s cooperatives has been: if these firms are so great, why aren’t there more of them?
The short answer to that question is that there are more of them, in several countries, than there ever has been before. The trend towards worker ownership of businesses is on the increase, in the United States and elsewhere, and has been for sometime. Gar Aplerovitz, in America Beyond Capitalism, gives us an overview of cooperatives in the United States:
I can’t seem to go to any Catholic website or forum and talk about Distributism without at least one person accusing me of being a communist.
So, I post this not only for myself, but for anyone reading who is also sympathetic to the idea of spreading, by voluntary means, greater workers’ ownership of the means of production throughout society. Keep these in mind if you ever find yourself backed into a corner.
Rerum Novarum, 46 & 47. Excerpt:
“We have seen that this great labor question cannot be solved save by assuming as a principle that private ownership must be held sacred and inviolable. The law, therefore, should favor ownership, and its policy should be to induce as many as possible of the people to become owners.”
Quadragesimo Anno, 65. Excerpt:
“Workers and other employees thus become sharers in ownership or management or participate in some fashion in the profits received.”
Mater et Magistra, 75-77. Excerpt:
“[I]t is especially desirable today that workers gradually come to share in the ownership of their company, by ways and in the manner that seem most suitable.”
Laborem Exercens, 14. Excerpt:
“We can speak of socializing only when the subject character of society is ensured, that is to say, when on the basis of his work each person is fully entitled to consider himself a part-owner of the great workbench at which he is working with every one else.”
If this is communism, then the Church is the original communist international, and the Bolsheviks were just wasiting their time. Or, maybe, the people who call these ideas ‘communist’ don’t know what they’re talking about. It’s probably that.
I’ve noticed a few posts dealing with the problems of taxation and government spending. With the social teaching of our Church clearly warns against the dangers of burdensome taxation, it nonetheless remains that tax rates have been cut dramatically in the last 30 years, even as government spending has increased. The losses of tax revenue were offset by a massive accumulation of debt, because a society such as ours requires a great deal of wealth to continue functioning.
I will be the one to point out, then, that far more perilous to the position of the working American family is the stagnation and overall decline of real wages – wages adjusted for inflation – during that same stretch of time. Both global pressures as well as corporate and government offensives against the social position of the American worker have contributed to a decline in real wages and have caused a build up of consumer debt that rivals the government’s debt.
We were told by endless propaganda no different in its shrillness and anxiousness that cutting taxes on the incomes of the wealthy, on dividends and capital gains, on estates and every other business venture, would create jobs and prosperity for all.