Towards a True Economic Third Position

There are at present many efforts to create a third position in economics, most of which go from the spectrum of kooky voodoo economics such as Social Credit Theory on the right and Participatory economics on the left, and essentially socialists in third position clothing such as syndicalism and fascism. The goal of this essay is not to deconstruct these false third position models, but to offer a true third position. This will essentially be similar to distributism, though I have some objections to distributism as it is now popularly formulated. For more on that see my essay “Rethinking Christian Economics.”The Biblical Economic ModelWhen we discuss what economic model we should have we first need to discuss what is the nature and end of man. If man has no nature and/or no end, then any old system should work since man would be infinitely malleable and able to fit into any system with sufficient conditioning, ergo none would be better than another. This I reject. I agree with the Shorter Westminster Catechism that, “Man’s chief end is to glorify God and to enjoy him forever.” I will not attempt in this article to give justifications for this assumption, merely assume it as the first principle of anthropology.If we accept this basic principle of anthropology, we then look to the Bible to see what end God directs us to. If we use biblical principles we see that many forms of economic action are condemned as sin. The most significant change would be the outlawing of usury. We see prohibitions in Leviticus 25:36-37; Nehemiah 5:7-10; Psalms 15:5; Proverbs 28:8; Ezekiel 18:8-17; Ezekiel 22:12. We see in Psalms 28:8 and Ezekiel 22:12 that God views usury as akin to extortion. There was an exception for Jews to lend money to gentiles at usury in Deuteronomy 23:20. I believe that Christ in his Parable of the Good Samaritan where the term neighbor is expanded to include not only Jews, but also gentiles closed that gap, since exchanging usury is not a form of love. We see in Luke 6:35 that Christ demands we do not lend expecting anything in return. With such evidences I think that the Gentile loophole has been closed to a complete prohibition on charging of usury.We see in Psalms 24:1 that God owns the earth which implies that property taxes are immoral since the government has no right to extract profit from what it does not own. Eminent domain (legalized state theft of property) is immoral where we see Ahab and Jezebel in 1st Kings 21 first murdering Naboth and then stealing his property, which was given to him as a trust by his father. As we see in Proverbs 13:22 that one should leave an inheritance for one’s children which would imply that the death tax and inheritance tax is immoral. We see in Numbers 36 the right of women to inherit property. From 1st Timothy 5:3-16, in which Paul exhorts families to take care of their elders and if the widow has no family or their family is unable to care for them then the church should do so, we can derive the principle of subsidiarity: a community of a higher order should not interfere in the internal life of a community of a lower order, depriving the latter of its functions, but rather should support it in case of need and help to co-ordinate its activity with the activities of the rest of society, always with a view to the common good.” Socialism is fundamentally evil in that, insofar as it destroys private property and establishes a welfare regime, one is correspondingly less able to maintain one’s elders.Private property is the bedrock of civilization, as Aristotle observed, men take better care of what they possess and that private property facilitates two virtues: continence and liberality. Based on the principle that no man can live in isolation for only animals and gods can live self-sufficiently in isolation, Aristotle argues that people come together to form families and families come together to form states (in his case city-states). We see that in capitalism the individual is the focus of the economy, in socialism the collective, and in distributism the family. The family is the smallest self-sufficient unit in society and thus is the wellspring of society. The word economics comes from the two Greek words Oikos (Household) and Nomos (Law). We see that historically economics was concerned with providing enough for each household to take care of its needs. This principle of self-sufficiency is the foundation of further civilizational development and as such the economy should seek to encourage self-sufficiency. In Joshua 14 and 15 we see that God desires tribes (extended households) to have land to be self-sufficient. In fact that land is not to be sold; for with the implementation of Jubilee every 50 years and the story of Naboth, we see that God desired the dispersion of property not its concentration.How do we Get There?Clearly our current economic model is not distributism and is a mixture of capitalism and socialism with seemingly the worst of both. I propose three possible methods used individually or in conjunction that could allow a transition from our current mixed-economy to a distributist economy: (1) prosecuting firms for criminal action and restoring to the victims fourfold (Luke 19:8); (2) the example shown in the Peasant’s Land Bank, and (3) the Land-to-Tiller Program.I propose that firms that have engaged in criminal action be prosecuted and their assets be redistributed to the aggrieved parties fourfold, what I call the Zacchaeus Plan. This would work to divest the corporations of their ill-gotten gain and serve to chip away at concentrated wealth.The Peasant’s Land Bank was an effort by secretary of finance Nikolai Bunge to give the peasants access to credit to purchase land from the Boyars (nobles) and in conjunction with this effort Stolypin realized that the lack of a middle class would only aid in the fomenting of rebellion and economic stagnation. After seeing the Revolution of 1905 he correctly identified the need for agrarian form. Seeing that a middle class is founded on independent property holders they sought to purchase land from the boyars to distribute the land back to the peasants. While marred by corruption and inefficiencies the process was largely successful, and by 1913 the bank had helped the peasants acquire 46 million acres. For more on the Peasant’s Land Bank and other Russian agrarian reforms see Russian Peasants and Village Lands, 1861-1917: A Summary Compiled by Alan Kimball.In Taiwan’s Land to the Tiller Program, property was peacefully and lawfully transferred from the Chinese landlords to the peasants. Chaing’s land reform can be understood in four parts: (1) leasing to the peasants land owned by the government, (2) reduce rent to 37.5%, (3) selling government land to peasants, (4) Land to the Tiller Program. The Land to the Tiller program transferred land from the landlords to the peasants by compensating the value of the property from the landlords with 70% of the price being paid in rice and potatoes and the remaining 30% in stocks in rising government firms.There are many possible peaceful and lawful means by which to transfer property in a more equitable way to the people without the needless bloodshed demanded by lunatic socialists and anarchists.How Do We Stay There?I have basically two means by which this property regime can be maintained. Firstly, I accept Aristotle’s notion that while man’s desires are potentially infinite, the number of goods available in the world are finite, and that man’s desires should be curtailed by education. So we begin by educating people to be content with what they need. As a practical legal method I argue for a return of biblical Sabbath year and Jubilee. We see in Deuteronomy 15:1-6 that every seven years (Sabbath Year) the tribes of Israel were required by God to free slaves, admittedly only Hebrew slaves, and forgive debts. In Leviticus 25:8-12 we see that land should be returned to its original owner. In practical terms Jubilee could be modeled in using the concept of usufruct. I will use the Investopedia definition of usufruct:

“A legal right accorded to a person or party that confers the temporary right to use and derive income or benefit from someone else's property. Usufruct is usually conferred for a limited time period or until death. While the usufructuary has the right to use the property, he or she cannot damage or destroy it, or dispose of the property.”

If we consider limiting the time period to fifty years I think we have a rough approximation of usufruct-Jubilee contract.ConclusionI assert that third position economics on both the right and the left goes from either kookiness or socialism. I propose an alternative biblical/Aristotelian distributism model. I have provided a few possibilities by which our current property regime can be legally transformed into this new property regime, and how such a regime can be maintained, which is more than any anarcho-socialist on the Left or social credit theorist on the Right can do.