Subsidiarity and the Social Doctrine

"The problem with socialism is that eventually you run out of other people's money [to spend]." Margaret Thatcher

“Too much capitalism does not mean too many capitalists, but too few capitalists.” G. K. Chesterton

Subsidiarity in the Gospels

Friday, February 26, 2010

When FDR's Solidairity trumps Subsidiarity

While the truth about the impact of FDR's policies is complex to calculate, please be aware that one cannot unreservedly state "FDR created jobs" as you seem to be saying. Any job created by FDR's programs was funded by tax money, taken from taxpayers, who would have done something else with that money had they kept it.

Taxpayers whose money is not taken do not, as a rule, stuff it in a mattress. They generally do three things with it: (1.) Spend it, (2.) Save it, (3.) Give it to church and charity.

Therefore every job FDR "created" was generated at the expense of someone's spending, someone's saving, or someone's charitable giving.

Someone's spending generally contributes to the private-sector economy; as spending increases more jobs are generated to accommodate the need for increased production to match higher demand. As spending decreases jobs are lost as the private-sector economy contracts to match lower demand.

Consequently, whenever we credit a public-sector job to FDR and his programs, we must also ask, "What was the cost of creating that job in terms of private-sector jobs?" It may be that every public-sector job created cost the country exactly one private-sector job. In that case FDR did not "create jobs"; he merely transferred them.

Or it may be that every public sector job created cost 1.5 private sector jobs. In that case FDR's job creation was a net job destruction...which would go a long way to explaining how the Great Depression lasted so darned long.

But it may yet be that every public sector job created cost less than one private sector job. Only in that case can one claim net job creation: But not nearly as many jobs as one thinks, if one only looks at the public sector increase. In the meantime, consider that there was also a cost in savings and charity. Setting aside savings for the moment, consider for a moment what it means to cut into charitable giving during an economic downturn. Was the Great Depression the best time to cut into donations, making it more difficult for churches and charitable organizations to afford to operate? Probably not.

At any rate, the uncertainty created in the business environment is another issue. When the future is uncertain, business owners don't expand and entrepreneurs don't start things up. And Amity Shlaes makes a good case that until FDR's tinkering started to taper off, business owners and entrepreneurs stayed out of the market: Jobs which otherwise might have been created, weren't. The folks who would have created them were waiting for calmer seas before setting sail.

Add to that the taxation effect on spending and giving, and you see how very uncertain it is that a "government created job" in any era can ever constitute a net benefit for blue-collar workers. It may have come at the cost of 0.7 private sector jobs which were lost through reduced consumer spending, plus 0.4 private sector jobs which were lost because businessmen weren't willing to risk capital in such a hostile and uncertain environment. In that case, for every thousand jobs FDR "created" he destroyed eleven hundred.

But those are just numbers picked out of a hat. Perhaps the correct numbers are 0.3 and 0.2: In which case for every thousand jobs FDR created, he destroyed five hundred. In that case, what he did was beneficial, but a heck of a lot less beneficial than you might have thought.

And indeed, if what FDR did was beneficial, why did improvement take so long to appear, coming only after the start of the war? It's more likely that, whatever the correct numbers may have been, the net impact was either negative or close to zero. That has more explanatory power, for the longevity of the Depression remains a mystery unless you account for it through such arguments.

At any rate, the idea that FDR "did IN FACT" create jobs is very much open to question. All those happy blue-collar workers were quite grateful to FDR for their shiny new government jobs.

But that may have only been because they had no idea of what those jobs had cost them.
Written by R.C.

Thursday, February 18, 2010

Interesting Solidarity to Subsidiarity viewpoint!

This is why the whole Catholic Social Teaching needs to be taught and implemented. Most anything when only narrowly focused and singularly implemented distorts and fails to attain the originally intended purpose.

"Subsidiarity found its first articulation in Catholic social teaching. Basically it’s the investment of authority at the lowest level of an institutional hierarchy possible, essentially relegating centralized authority to a secondary or subsidiary role. In other words, the group closest to whatever task or problem should tackle that problem first, and only when they’re not able to should a higher authority step in. In social terms, this might break down something like this: first, individuals are responsible for their own social welfare, then families, then communities, then local governments, then state governments, and finally the federal government.

In many ways, subsidiarity flies in the face of the more universalist notion of solidarity. Subsidiarity requires that small groups and individuals tackle problems, while solidarity demands that we all band together. "

"The nature of health insurance is one of cost-sharing. Lots of healthy people buy into a larger cost-pool in an act of voluntary, if unintentional, solidarity. Insurers, at least in theory, compete against one another for customers, the competition leading to a decentralized system of coverage and care." Any insurance for that matter is one of cost-sharing or risk-sharing!

"The American health care system, however, has instead erected a status quo which relies entirely on employment for health coverage. Coupled with a ban on interstate sale of insurance, this has led to much smaller cost-sharing pools and very little actual competition, with one insurer often dominating entire cities or regions. The sale of insurance is bound to each individual state and fifty different sets of rules and regulations govern insurance sales across the country. Consumers of health care are almost always bound to their employer’s choice for health coverage – and worse, should they lose their job, find themselves suddenly without any insurance at all. Essentially, the American system has eschewed both solidarity and subsidiarity, in favor of an ad hoc system found nowhere else in the industrialized world. In the end, this has led to skyrocketing costs.

Beyond cost-control, solidarity is the driving force behind health care reform. The argument that no modern, industrialized nation should be without universal coverage is compelling. But other Western nations have found ways to take this principle of solidarity, and achieve it through far more decentralized means than Canadian-style single payer, or the expensive socialized medicine of the UK. The Dutch have achieved universal coverage entirely through fierce competition between private insurers, and the Germans use a system of exchanges that allow German workers to move from job to job without losing insurance. The Swiss, who have made an art of subsidiarity, have achieved universal coverage through competing non-profit insurance plans." In fact it can be said that government is a form of insurance. U.S. Constitution Article 1; section 8: The main purpose of the federal government is to regulate commerce among the states and the self-defense of the republic. In this way the Federal Government is an "insurance policy" for the fair play of state economics, foreign invasion and interference.

"In the health care debate, competition and subsidiarity are the best tools to create quality, affordable health care for the most people, and with the right implementation they can be used to achieve universal coverage. In this way subsidiarity, rather than a competing value, becomes a complimentary one, and we find our solidarity through competition and individual choice. Universal coverage can be achieved from the bottom up rather than from the top down. And with this bottom up implementation develops and protects human dignity and the common good completing the Catholic Social Doctrine teachings.

What could be more American than that?" Or more Catholic!

Highlighted blue text are blogger's comments.

The League of Ordinary Gentlemen

Founding Father Quote:
"SOME writers have so confounded society with government, as to leave little or no distinction between them; whereas they are not only different, but have different origins. Society is produced by our wants, and government by our wickedness; the former promotes our happiness POSITIVELY by uniting our affections, the latter NEGATIVELY by restraining our vices. The one encourages intercourse, the other creates distinctions. The first is a patron, the last a punisher.

Society in every state is a blessing, but Government, even in its best state, is but a necessary evil; in its worst state an intolerable one: for when we suffer, or are exposed to the same miseries BY A GOVERNMENT, which we might expect in a country WITHOUT GOVERNMENT, our calamity is heightened by reflecting that we furnish the means by which we suffer. Government, like dress, is the badge of lost innocence; the palaces of kings are built upon the ruins of the bowers of paradise. For were the impulses of conscience clear, uniform and irresistibly obeyed, man would need no other lawgiver; but that not being the case, he finds it necessary to surrender up a part of his property to furnish means for the protection of the rest; and this he is induced to do by the same prudence which in every other case advises him, out of two evils to choose the least. Wherefore, security being the true design and end of government, it unanswerably follows that whatever form thereof appears most likely to ensure it to us, with the least expense and greatest benefit, is preferable to all others."

Common Sense, Thomas Paine

Sunday, February 14, 2010

ENVOY INSTITUTE REMARKS, Archbishop Charles J. Chaput

"I have three simple points I want to talk about: the nature of the state; the nature of our Christian faith; and the nature of the lay vocation...."

"Christians have always believed that civil authority has a rightful degree of autonomy separate from sacred authority. In Christian thought, believers owe civil rulers their respect and obedience in all things that do not gravely violate the moral law. When Jesus told the Pharisees and Herodians to “render unto Caesar the things that are Caesar‟s, and to God the things that are God‟s” (see Mt 22:15-21), he was acknowledging that Caesar does have rights.
Of course, he was also saying that Caesar is not a god, and Caesar has no rights over those things which belong to God…. To put it in modern terms: The state is not god. It‟s not immortal. It‟s not infallible. It‟s not even synonymous with civil society, which is much larger, richer and more diverse in its human relationships than any political party or government bureaucracy can ever be. And ultimately, everything important about human life belongs not to Caesar, but to God: our intellect, our talents, our free will; the people we love; the beauty and goodness in the world; our soul, our moral integrity, our hope for eternal life. These are the things that matter. These are the things worth fighting for. And none of them comes from the state..."

"The Christian vocation to love each other is never simply an emotion, or it isn‟t real. Real love is an act of the will; a sustained choice that proves itself not just by what we say or feel, but by what we do for the good of others.
Working to defend the sanctity of human persons and the dignity of the human family is an obligation of Christian love. Therefore, the Church can‟t be silent in public life and be faithful to Jesus Christ at the same time. She needs to be a mustard seed in the public square, transforming every fiber of a nation‟s social, economic and political life..."

"There may be many times when a bishop or group of bishops needs to speak out publicly about the moral consequences of a public issue. But the main form of Catholic leadership in wider society – in the nation‟s political, economic and social life – needs to be done by you, the Catholic lay faithful. The key word of course is faithful. We need to form Catholic lay leaders who know and love the teachings of the Church, and then embody those teachings faithfully in their private lives and in their public service. But once those lay leaders exist,
clergy cannot and should not interfere with the leadership that rightly belongs, by baptism, to their vocation as lay apostles..."

Full Text:

Wednesday, February 10, 2010

Is the subsidiarity movement growing?

What is the Catholic social justice principle known as “subsidiarity”?
If you’re an American and you’re unfamiliar with subsidiarity in this day and age in which the federal government is about the only segment of the economy that’s growing; you better find out in a hurry.
In a nutshell, the principle of subsidiarity states that matters impacting the human person should be addressed by the smallest, least centralized, most localized, competent personal authority possible. The opposite situation is realized when personal affairs are managed by larger; more centralized and detached public authorities.
At the heart of the matter lies a concern for the protection of individual freedom as an inalienable right associated with human dignity, and a prime example of how crucial it is to understand subsidiarity (and to demand that it be duly observed) is staring Americans directly in the face as I write.
Case in point; when it comes to making decisions about which medical treatment options are best pursued in a given circumstance, the principal of subsidiarity states that these are best left to individuals, families and caregivers to the extent that the demands of necessity and the competency of each party makes it possible.
Where the principle of subsidiarity is well observed, public authority is exercised in a limited, supporting role; i.e. it recognizes and “subsidizes” the authority of individual persons; it does not usurp it.
Did you get that? Memorize it and share it with every Catholic you know, because a full court press is on to tell you otherwise as it relates to government run healthcare, and not just from our friends in the White House.
Yes, it seems as though every new election and legislative cycle brings politicians eager to secure the support of Catholic voters by painting their agendas as fitting expressions of the Church’s social doctrine, even when such isn’t necessarily the case. Unfortunately, we have come to expect as much from politicians, but when the bamboozlement comes to us courtesy of Catholic News Service — a wholly owned official organ of the United States Conference of Catholic Bishops, funded by faithful Catholics — it’s high time we sat up and paid attention.
Reading my local diocesan newspaper last week, I encountered an editorial piece written by a notoriously liberal CNS columnist who in an effort to sell the benefits of a government takeover of healthcare informed readers, “The Church’s teaching of subsidiarity insists that higher levels of government and social organizations must take action and do what individuals and smaller groups cannot do for themselves.”
I am certain that this struck many a Catholic reader as believable enough; after all, it came from Catholic News Service in a column syndicated for distribution to diocesan newspapers from coast-to-coast. It must be true, right?
The well-informed reader (of whom you are now one) will have noticed immediately that the writer has twisted it almost exactly backwards — subsidiarity properly understood is not a mandate for government action; it is a warning against government interference!
Pope John Paul II, echoed his predecessors in warning about the dangers of an overbearing public authority in his Encyclical Letter, Centesimus Annus, saying:

Malfunctions and defects in the Social Assistance State are the result of an inadequate understanding of the tasks proper to the State. Here again the principle of subsidiarity must be respected: 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 coordinate its activity with the activities of the rest of society, always with a view to the common good (CA 48).

There is certainly a place for public authority to be exercised within the framework of subsidiarity; the challenge is striking a balance between a collective effort — assisted by government only to the extent truly necessary — and individual prerogative as demanded by the pursuit of the common good. This would necessarily preclude, however, any proposal that would rob individuals of the freedom and responsibility that naturally flow from human dignity. As the Second Vatican Council warned:

Citizens, for their part, either individually or collectively, must be careful not to attribute excessive power to public authority, not to make exaggerated and untimely demands upon it in their own interests, lessening in this way the responsible role of persons, families and social groups (Gaudium et Spes - 75).

Is the state of healthcare in America in such dismal condition as to merit a government takeover, or will less extreme measures provide the surer path to justice?
Catholics of goodwill can certainly disagree on how best to improve the nation’s health care system, but as we debate this important issue one thing we should all be able to agree upon is this: media organs and others that carry the name “Catholic” — especially those that operate on the faithful’s dime — owe it to their audience to represent the doctrine of the faith clearly and accurately — yes, even when it might undermine the argument for a personal pet political cause.

Louie Verrecchio writes for Catholic News Agency and is the author of Harvesting the Fruit of Vatican II; an internationally acclaimed adult faith formation tool, endorsed by George Cardinal Pell, that explores the documents of the Second Vatican Council. For more information please visit:

Sunday, February 7, 2010

Hooray! For Bishop Lori!

WASHINGTON, D.C., January 25, 2010 ( - Asked by (LSN) this past week to sound off on President Obama's health care overhaul, Bishop William Lori of Bridgeport, Connecticut singled out the bill's anti-life policies and massive government expansion for criticism.
"The turn of events that has made it necessary for the congressional leadership to go back to the drawing board is a good thing," Lori told LSN at the Vigil Mass for Life Thursday evening at the Basilica of the National Shrine of the Immaculate Conception.
The surprise victory of Republican Scott Brown of Massachusetts Tuesday night, robbing Senate Democrats of their filibuster-proof majority, has left the health care overhaul's supporters scrambling to find a way to keep it alive. In addition to containing several provisions that are of concern for pro-lifers - such as possibly encouraging health care rationing and physician-assisted suicide in some states - the bill would unleash federal funding of abortion.
"One of the things to remember is that two polls - a Gallup poll and a Pew Poll - have shown that the majority of Americans are pro-life, and the vast majority want some restrictions on abortion," the bishop continued.
"If health care should be passed in any form that uses government money to fund abortions, they are certainly going against the will of the American people."
While the U.S. bishops "certainly favor helping those who are poor and uninsured, and maybe cannot get insurance," he said, "we certainly are resolutely opposed to using government money to take innocent human life."
LSN asked Lori to elaborate on his position regarding the health care bill aside from the federal abortion funding issue.
"The bishops have long supported some form of access - that's the key word, access - to health care," said Lori. "That doesn't mean we favor the government taking over one sixth of our economy - but it does mean that intelligent ways should be found to help those who need the help to get health insurance and adequate medical care."
Lori said that any health care reform ought to avoid a centralization of power and respect what is known as the principle of subsidiarity, which states that matters should be handled by the lowest level of competent government possible - a principle upheld in several papal encyclicals.
"It's long been one of our positions that we've advocated for the issue is really how do you do it in a way that respects life, and in a way that respects the principle of subsidiarity," the bishop concluded.