In his 2009 encyclical Caritas in Veritate, Benedict XVI maintained that “every economic decision has a moral consequence.” The Pope (now Pope Emeritus), wrote forcefully, as have his predecessors, in support of a humane economy: an economy that recognizes both the limits of economics and that economics is inescapably entwined with ethics. He saw clearly that a just economy would avoid the snares of socialism on the one hand and the miseries of unrestrained capitalism on the other. Such language recalls Pope Leo XIII’s 1891 encyclical Rerum Novarum, which sent so many on a quest for a viable third-way economy in the twentieth century.
But it has not been an easy road: its travelers are often accused of suffering from vapid centrist fancies and of clinging to crystal ideals that shatter when brought into contact with reality. After all, aren’t dreams of third-way economies simply wishful thinking?
No, argues Allan Carlson in his book Third Ways: How Bulgarian Greens, Swedish Housewives, and Beer-Swilling Englishmen Created Family-Centered Economies—and Why They Disappeared (ISI Books, 2007). To those who think alternative economies are mere fairy tales, he answers that they are fairy tales that can—and have—come true.
Carlson tells seven stories of family-centered economies from recent history, from family-wage systems in Belgium and Norway, to agrarianism in Eastern Europe, to present-day movements of Christian Democracy in Britain and elsewhere. They are engaging stories—but not every tale ends happily.
The first chapter opens with a discussion of “‘ChesterBelloc’ and the Fairy Tale of Distributism.” Distributism (or distributivism), the ungainly term that describes the economic philosophy spearheaded by Hilaire Belloc and championed by G.K. Chesterton, is based upon the widespread distribution of private property and “is premised on the family, the kingdom of the home.” Believing that the household is “the foundation of liberty,” Belloc and Chesterton were equally opposed to socialism and to the excesses of capitalism, and they feared the merging of the two into one formidable monster—what Chesterton called Business Government, and what Belloc named the Servile State. Unfortunately, by the twenty-first century, much of what the ChesterBelloc feared has materialized.
Family-wage regimes in Belgium and the United States similarly tried to oppose “the inherent tendencies of industrial capitalism to subordinate all social relationships to monetary exchanges and all human activity to the test of efficiency.” Family-wage advocates recognized capitalism’s power, but recognized also that capitalism is not enough: it cannot become an all-encompassing economic philosophy and remain good for human beings.
Carlson also tells the story of Alexander Chayanov. Chayanov, a Russian agrarian and student of the peasant economy, was also the author of a fictional account of an agrarian paradise. His School for Analysis of Peasant Production and Organization was, however, no fiction. He formed this organization in the 1920s to study the peasantry in hopes of rebuilding Russia’s economy. The group was increasingly convinced that “peasant economic behavior in the Russian countryside was not consistent with the simple allocation models of classical political economy.” Maximization of profit and marginal utility, for example, seemed quite foreign to the peasantry’s economic activity.
These studies led Chayanov to develop the idea of a natural economy, wherein “the unit of production is also the unit of consumption and where profits and wages play no role,” and which finds its full flourishing in the “fully natural family farm,” which could best coexist with capitalism. Chayanov believed the natural family farm could thrive only through the creation of multifarious cooperatives, such as today’s Mondragon Cooperative movement in Spain.
Carlson’s history of alternative economies is a series of short-lived successes, but he argues that the achievements of third-way economics have often been threatened by non-economic factors: religious, political, and cultural. The flourishing of family-centered economies has frequently been cut short by national unrest, world war, or fierce ideological opposition.
But Third Ways does not end tragically. Christian Democracy is alive and active, and distributist thought continues to affect economic policy and to inspire grassroots movements, including the Catholic Worker Movement.
Carlson finally leaves us with six principles for building a family-centered economy. These are: private property as the foundation of freedom, the importance of the natural family economy, the limits of the state and of the competitive process, the centrality of religion and culture, and the need to begin with small acts. “In the end,” writes Carlson, “the Family Way means reconnecting everyday tasks with the great purposes of the Creator. Only then do common deeds bend toward transcendence.”
What the family-centered economy ultimately does is reintegrate economic life into the life of humanity. It is not an easy task. But the ideal lives on, and Carlson puts forward the hope that the Family Way can offer “a way, perhaps, to overcome much of our alienation, to reconcile humankind with its created nature, to bring about a simple and yet profound coming home.”