The Pendulum and the Pits

THE PENDULUM AND THE PITS

by Rupert J. Ederer

-Psalm 88:7

The order is reversed in my title, since I have no wish at all to plagiarize Edgar Allan Poe. What is more, unlike the poor poet, who placed the pit at the center of his inquisitorial dungeon, I see pits at each end of the pendulum's arc. Besides, the alternatives involved are of historic dimensions, and for that reason more momentous than the grim ones posed by the hallucinatory scribe. We are dealing here with the manifest tendency in mankind to react to one unhappy predicament by fleeing to an opposite plight, equally bad or worse. Thus the horrors of a dismal pit lie at each end of the swinging pendulum's arc. Human nature in its fallen state appears to avoid at all costs the happy medium, that state of rest between vicious extremes, shunning the age-old wisdom: In .

A most recent pendulum swing-an egregious one-is taking place now before our eyes. Incredibly, the Communist Party of Russia was the big winner in the Russian elections of December 1995. It won 22% of the votes which, while far from a majority, was twice the percentage won by any other party. The second greatest number went to the Liberal Democratic Party headed by Russia's madman, Vladimir Zhirinovsky who is a cross between Rasputin and Adolf Hitler.

Even more disconcerting is the situation in predominantly Catholic Lithuania where the Communists have been returned to power! But perhaps the most disappointing development of all was the electoral defeat in Poland of Lech Walesa by the ax-Communist Kwasniewski. The underappreciated Cold War hero has been reduced to begging for his old job as an electrician at the shipyard in Gdansk. It was from there that he ventured out, protected only by a thin badge portraying Our Lady of Czestochowa, to slay the heavily armored Soviet Goliath. Perhaps he will end up leading his fellow workers out of the gates of the shipyard once again to rescue Poles from their own folly. Meanwhile the Palm Sunday crowd in his beloved country has rejected him in favor of a sorry band of Communists and ex-Communists, in apparent reaction against uncertainty brought on by an ill-advised swing toward so-called free markets.

The advisors included experts from our own prestigious universities and "think tanks," who scurried posthaste to spread the gospel of the Scrooge and Marley economy across Eastern Europe as soon as the Iron Curtain rusted through to allow entry. The ensuing inflation, economic chaos and insecurity were too much for the Poles who, oddly, have in common with their Prussian neighbors a craving for order. So, at least for the moment, they have decided fatuously to ride the swinging pendulum back to the opposite pit where Big Brother State lurks.

Wild fides aboard history's swinging pendulum are no novelty during the centuries since Western society was bereft of the sound, stabilizing, social principles which are a part of the bedrock of Christian culture. In the 18th century the French moved from the absolute monarchy of the Bourbons to revolutionary chaos, and from there back to military dictatorship under Napoleon. During the 1 9th century, Karl Marx's mad-hatter scheme appeared credible to increasing numbers of people, workers and intellectuals alike, who lost their faith in salvation as promised by freemarketeering capitalism That happened even though the broad outlines of a salvific, centrist position were presented in 1891 by Leo XIII. Liberal capitalism had, in turn, already been a response to the frenzied attempts to regulate economic life in its minutes" details during the preceding era, which economic historians call the Age of Mercantilism.

Early in the present century the German nation rode the swinging pendulum from the political and economic chaos of the Weimar democracy for which Germany was ill-prepared, to the opposite dark pit of Nazism. It's a pity that the Germans did not work harder to apply the proposals drafted for the Catholic Center Party in 1922 by the Jesuit, Heinrich Pesch, whose economic principles were subsequently included in in 1931. If that suggestion seems ingenuous, we need to take a moment to reflect on the horrendous devastation which such a centrist course could have spared Germany and the world!

Now, during the post-World War II era, in apparent reaction to the appalling consequences brought on by collectivistic socialism, both Communist and Nazi, significant numbers have demonstrated their willingness to fide the pendulum back to the same individualistic capitalism which provided the pretext for Marx and his tribe in the first place. No one needs to take my word for that. The causal link between liberalism and socialism was identified in 1871 by the pioneer of Catholic social teaching, Bishop Wilhelm Emmanuel von Ketteler. In his essay, "Liberalism, Socialism, and Christianity," the Bishop of Mainz wrote that socialism was "the unruly offspring" of liberalism, pointing out that, "if liberalism were correct in its premises, then socialism's conclusions would be valid." Sixty years later, Pius XI used essentially the same metaphor in , where he stated that "the parent of cultural socialism was liberalism, and that its offspring will be 'bolshevism.'" (Q. A. 122).

Since the word liberalism as used in social teachings poses a problem for some, it may be useful to note what the same Pope said elsewhere in that encyclical:

Therefore there is a double danger to be avoided. On the one hand, if the social and public aspect of ownership be denied or minimized, the logical consequence is "individualism," as it is called; on the other hand, the rejection or diminution of its private and individual character necessarily leads to some form of "collectivism." (Q.A.46.)

That the "double danger" to which he referred still lingers 65 years after those words were written is clear now before our noses. Always a few prophetic beats ahead of those who orchestrate social policy, our Mother and Teacher pointed out that we seem determined to revert again to the mistakes of the past. In his Apostolic Letter, (1971), Paul VI, after warning about the "kind of totalitarian and violent society" to which Marxism leads, stated:

On another side, we are witnessing a renewal of the liberal ideology. This current asserts itself both in the name of economic efficiency, and for the defense of the individual against the increasingly overwhelming hold of organizations, and as a reaction against the totalitarian tendencies of political power.... But do not Christians who take this path tend to idealize liberalism in their turn, making it a proclamation in favor of freedom? They would like a new model, more adapted to present-day conditions, while easily forgetting that at the very root of philosophical liberalism is an erroneous affirmation of the autonomy of the individual in his activity, his motivation and the exercise of his liberty. (para. 35).

In the United States, this neo-liberal swing captivated the imagination of the three successive administrations of Carter, Reagan and Bush, thus transcending traditional party lines. Large numbers of Americans, like latter day converts to Kropotkin-style anarchism, have become convinced that "government is the enemy,- specifically Washington which grew like Topsy since the New Deal. The New Deal, however' was already a wild ride on the pendulum as it swung back from the pit dug during the Harding-Coolidge-Hoover tenures and their capitalism, with its inevitable consequences. The ongoing Gingrich initiative appears to be simply a last-ditch effort to convince hapless Americans that the pit into which our economy has fallen after 12 years of "voodoo economics," is nevertheless the best of all possible pits. And so, if one may be permitted to switch metaphors for a moment, we risk being sucked into the whirlpool of Charybdis on the one side while trying desperately to avoid rocky Scylla on the other, as we vacillate, unguided by sound social principles, or in pursuit of depraved ones.

Unfortunately, among our fellow citizens who have been privy to the social teachings of the Catholic Church for an entire century, many are taken in by that latest pendulum swing back toward the dark hole of liberal capitalism. Either they disclaim those teachings entirely in a frantic desire to swim in their American mainstream, or they appeal lamely to the principle of subsidiarily. That principle, for those who have not seen it lately, or ever, states:

Nevertheless, it is a fundamental principle of social philosophy, fixed and unchangeable, that one would not withdraw from individuals and commit to the community what they can accomplish by their own enterprise and industry.. So too, it is an injustice and at the same time a grave evil and a disturbance of fight order, to transfer to the larger and higher collectivity functions which can be performed and provided for by lesser and subordinate bodies (Q. A. 79).

A corollary statement follows directly:

The State authorities should leave to other bodies the care and expediting of business and activities of lesser moment, which otherwise become for it a source of great distraction. It then will perform with greater freedom, vigor and effectiveness, the tasks belonging properly to it, and which it alone can accomplish directing, supervising, encouraging, restraining as circumstances suggest or necessity demands. (Q. A. 80).

A hint at how "fundamental," "fixed," and "unchangeable" that principle is may be found in an astoundingly similar statement made many years before by Abraham Lincoln in 1854, long before there were papal social encyclicals.

The legitimate object of government is to do for a community of people whatever they need to have done but cannot do at all, or cannot so well do for themselves in their separate and individual capacities. In all that people can individually do as well for themselves, government ought not to interfere.

The statement of the principle of subsidiarily as presented in merits careful study, since it was presented there in definitive form for the first time. That is all the more important now that use of the expression has gone beyond the narrow enclave of those who cherish the social encyclicals. E. F. Schumacher quoted it verbatim in his best-selling ; and more recently it was the subject of a full-page essay in (Jan. 16, 1995). The principle of subsidiarily should not be exploited simply to bolster one's own preferred ideology. Note that government, including the central government, is nowhere condemned as "bad." Indeed, the last sentence reserves a significant role to it. There is nowhere a call for Manchester liberalism's "night watchman state," where the poor are left at the mercy of the economic royalists, who are uniquely situated to exploit free markets, free trade, and free competition in their own interests.

What the encyclical does not say, and what I now venture to state as my own opinion, is that this principle can be violated by omission as well as by commission. The latter occurs when overly aggressive State authorities, captives of some warped ideology like Communism or Nazism, simply arrogate to themselves functions which individuals and lower social bodies, businesses, labor unions, etc., are perfectly capable of taking on by themselves. In a federal system such as exists in the United States, due allowance must also be made for state and local governments to fulfill their proper roles without being elbowed aside by our federal government.

We are all painfully aware of such outcomes and their consequences, and enough has been written about "Big Brother" to dramatize the excesses in recent history. On the other hand, we tend to lose sight of the manifold sins of omission by the "little brothers" who fail to do what they themselves could do better if they chose to do so. Such lapses can give rise to warped ideologies; and in less ideology-prone cultures like our own, they have generated pragmatic drifting toward initiatives like the New Deal, the Fair Deal, the Great Society, and on the other side, the Contract with America.

In our federalist structure, it is especially incumbent on state governments and their local political subdivisions to see to their own proper responsibilities. Unfortunately, the hallowed competitive ethos has been at work also at that level. Too often states have competed in laxity to foster their own imagined advantage over neighbor states. This applied in the area of regulation, as in labor legislation and in laws governing transportation, banking, and the chartering of corporations-the real reason why Delaware became the preferred habitat for corporate headquarters. It also affected the way states exercised or affected the way states exercised or failed to exercise more positive functions that were left to them, like welfare and unemployment insurance.

The Interstate Commerce Act of 1887-recently abolished-was first passed, not merely because railroads crossed state lines, but because the states did a poor job of regulating the carriers during the era of the "robber barons." The National Banking Act and its succeeding Federal Reserve Act were passed because state banking laws competed in laxity leading to the era of "wildcat banking." The Wagner Act and other federal labor laws were passed and bolstered by "liberal" court interpretations simply because state labor laws were either inadequate or lacking entirely. State legislation governing wage and hours, child labor, or the lack of such, was designed all too often to entice industries away from neighboring states with more stringent laws and controls.

In fairness to Ronald Reagan, the man may have displayed a certain, vague deference to the principle of subsidiarily (as stated by the founder of his own Party), when he promised to get an outsized federal government off the backs of the American people. Unfortunately, state and local governments failed to pick up the slack that his administration provided for them. Functions traditionally entrusted to state and local governments, e.g., in the areas of education, police protection, health and welfare, highway construction and maintenance, and patronage of the arts, were left to languish.

Accordingly, when the federal government began cutting funds to the states, instead of raising the taxes needed to pick up the slack, these in turn reduced funds to counties, towns and municipalities. Inevitably local services began to deteriorate; or else some, like welfare, were maintained at the expense of others. Partially at fault were the generally regressive tax structures in place at the state and local levels of government, along with the unwillingness and in some cases the inability to compensate for the federal tax cuts. Politicians there were even less anxious than "Read-my-lips" George Bush to commit political suicide by raising taxes to finance functions transferred back to them from Washington. Again, at this point the traditional competitiveness among the states cut in as they eagerly sought to attract industry, tourists, retirees, etc. from other states.

Meanwhile, the federal government itself shifted to massive increases in defense spending in an all-out effort to win the Cold War. The result was a serious deterioration in the close-to-home, relevant government services in favor of nuclear submarines, rehabilititated battleships, and surrealistic space ventures. All of these mean little to people directly as contrasted with their schools, their libraries, and their highways. To finance its chosen extravaganzas, Washington remarkably embarked on a tax-cutting program. It also emulated the states by returning the federal government to an economically enervating, regressive tax structure, which led directly to the largest deficit-spending spree in our history and perhaps in the history of the world. This tax-cutting policy was launched despite the fact that the United States ranks below its main industrial competitors, Japan, France, Germany, Canada, and Britain in the marginal tax rates it imposes on the personal income of persons in the top income bracket. (We are higher only than Great Britain in our marginal tax rates levied on corporations). The whole enterprise was remarkably Keynesian also inasmuch as the tax cuts are supposed to stimulate the investment function and thereby assure economic growth and full employment. John Maynard, were you watching this episode? It calls for someone with Jonathan Swift's talents to do an adequate caricature!

Getting from macroeconomics down to the microeconomic level, aside from a drastic correction in the way state and local governments act and conduct their tax policies, sound non-governmental structures also need to be in place for the principle of subsidiarily to work properly. This precludes, first of all, "the structures of sin," about which Pope John Paul II speaks repeatedly. In the late Middle Ages, craft and merchant guilds- non-governmental social organs- relieved city governments of many of the functions which overworked commissars and bureaucrats perform in socialist societies. Those included the determination of wages and prices, as well as quality control and the regulation of competitive practices. After the guilds atrophied and were gradually dismantled, hyperactive government commissioners installed by absolute monarchs moved in to fill the vacuum.

Subsequently, after the Mercantilistic structure gave way to liberal capitalism, which imposed a new serfdom on the working class spun off by the Industrial Revolution, the employers were more than happy to rely on the "free markets" to govern economic life and make things come out right (for themselves!). As the treatment of the workers became more and more outrageous, militant and defensive trade unions gradually emerged. Unlike the guilds, these did not include both the employers and the employees in the same trade or industry, only the latter. Their objective was to co-determine the conditions of employment-a journey which was not without great difficulty and many setbacks. In the United States the labor movement never achieved the levels of membership that it did in the older industrial countries of Europe, at least in terms of sheer percentages of their work forces. Nevertheless, the aspect of their performance in our society that is often overlooked is that, like their predecessor guilds, labor unions can play a significant role in a salubrious functioning of the principle of subsidiarily.

In the typical collective-bargaining agreement the parties involved established wage rates, wage increments, hours of work-all matters which are resolved by assiduous government bureaucrats in socialistic societies. In addition, the more progressive labor contracts typically provided significant welfare measures like pensions and health insurance. One can only imagine how our extensive and expensive government welfare apparatus could have been reduced if all or most workers had been covered by such agreements, instead of a scant 25 percent of them at the peak of union power in our country, or the paltry, intimidated 1 percent at present. Then the government could have been left free to provide for the small percentage of desperate cases, like young widowed mothers of small children, unemployables, etc., who are not covered by labor contracts. In such a context, the principle of subsidiarily would have a fighting chance to work as it is supposed to.

Beyond such substantive provisions, each labor contract also included a formal grievance procedure up to the level of arbitration by neutral outsiders. That enabled the parties themselves, without government intervention, to resolve disputes arising under the agreements. Governments at the state and federal levels provided standby-if-needed mediators in accordance with proper application of the principle of subsidiarily. Bad press notwithstanding, the preponderant majority of such disputes were resolved by the parties themselves. In fact, even the negotiation or renegotiation of the contracts themselves was in most cases concluded successfully by the parties, usually without government intervention, at least up to the level where deadlocks gravely impacted on the overall public interest.

As a one-time research director for a small national railroad union, I was able to observe firsthand how the failure of "little brother" leads to the invasion by "Big Brother." I witnessed how the all too frequent unwillingness of the parties themselves to engage in good- faith contract negotiations and grievance handling led to the process being virtually federalized in our once great railway industry. I am not referring to the actual federal government takeover and operation of the railroads during World War I, although that was already symptomatic of the failures of the "little brothers" of the Railroad Brotherhoods to do what they could have done. Indeed, many insiders within the industry suspect that episode as having spoiled the industry beyond repair for sound grassroots labor relations. In any case, repeated breakdowns in on-site negotiations. along with the prospect of nationwide tie-ups, led to inevitable intervention by the federal government through national mediators, presidential emergency boards, etc. That closed the vicious circle, because the very availability of recourse to federal boards in bargaining breakdowns often undermined the will of the parties themselves to get down to serious collective bargaining. Perhaps the ultimate example of "Big Brother" having to step in when the "little brothers" fail to act as they ought occurred in a railroad strike during World War II. The inimitable Harry Truman threatened to draft the locomotive engineers into the Army if they did not go back to work promptly. They did!

Unfortunately, employer-worker relations in our present labor- management structure were seen, with rare exceptions, in the unhealthy context of an adversarial relationship. It reflected the antagonism between classes that became a hallmark of liberal capitalism. In the United States it also took on the pragmatic coloration typical of our society. Union leaders at times became intoxicated with their power and exercised the kind of muscle that they developed in dealing with pragmatic capitalist employers. Concern about right-or-wrong and the general welfare took a back seat. Here too, therefore, the pendulum has now swung back to the labor-baiting, union-busting 1920s. And that brings us to our final consideration.

Unless one wishes to march under the black flag of anarchy, governments are indispensable. Nor are they a necessary evil; they are a necessary good. Nevertheless, social organs below the level of government are also desirable, if not inevitable, to make the principle of subsidiarily operate properly. The "functional groups" proposed in , as successors to the guilds are, in the words of that encyclical's author: "if not essential to civil society, at least a natural accompaniment thereof"(Q.A. 83).

In the final analysis, however, underlying the sound operation of all such organs of society and also governments, are social attitudes. Pius XI expressed this delicately using the word, "manners." (). "However, all that we have taught about reconstructing and perfecting the social order will be of no avail without a reform of manners." (Q.A. 97) If these are orderly, i.e., virtuous, then governments can function properly; and the various subsidiary organs of society can perform better the many tasks that affect them immediately, precisely because they are closer to them. On the other hand, if the social attitudes-"manners"-are not orderly, then neither governments nor subsidiary organs of society, whether they be guilds, or modern labor unions, or the vocational orders proposed in Catholic social teachings as successors to guilds and unions, can perform satisfactorily.

The latter state of affairs identifies the plight of our world since it has vacillated back and forth between too much centralized control and the economic anarchy that best describes liberal capitalism. Clearly, the "manners" which Pius XI had in mind were precisely the social virtues: justice and charity. He invited those who seek "to reform society according to the mind of the Church" to do so on "a firm basis of social justice and social charity. " (Q. A. 126.). But here's the catch, and perhaps this explains why the world, a century after Leo XIII pointed out the problem and its solution, still moves from one sorry extreme to the other. Pius XI indicated that ". . . this longed-for social reconstruction must be preceded by a profound renewal of the Christian spirit. . . ." (Q. A. 127 ). To emphasize that, he repeated the words of Leo XIII in "And if society is to be cured now, in no other way can it be cured but by a return to the Christian life and Christian institutions." (R.N. 22). Those are hard sayings in a world which has seen its Christian culture regress ever since the house of Christianity, i.e., Christendom, was divided nearly five centuries ago.

Now, in the post-Christian wreckage roundabout us, it should be clear why the pendulum of recent history swings from left to right, without coming to rest in the center. In . The social virtues-especially social justice and social charity-are scarcely understood and therefore not in widespread practice. The former was first defined for us by Pius XI as the virtue whose very essence demands from each individual "all that is necessary for the common good" ( 41). Unfortunately the concept, social justice, was bowdlerized in various ways, so that it eventually came to mean many things, even strange things, for different persons. Social charity, on the other hand was largely ignored and forgotten, even though Pius XI clearly intended it to be the twin social virtue with social justice. (Q. A. 88 & 126). Now happily Pope John Paul II has equated social charity with solidarity ( 10) which he explained in painstaking detail and termed "undoubtedly a Christian virtue" ( 38-40).

Neither liberal capitalism, which its enthusiasts have been working hard to restore in the years since World War II, nor socialism in its various forms, embodies these principles in the social system That is precisely why we swing helplessly back and forth between the two pits at the end of the pendulum's precarious arc. Virtue stands in the middle: in this case the twin social virtues of social justice and social charity (solidarity). Our purblind society will not arrive at a state of rest, i.e., social order, until it seeks out and adapts them into a social system therefore in harmony with Christian principles.

If there is any puzzlement about the latest pendulum swing back towards perhaps collectivist socialism in Eastern Europe, and liberal capitalism in our own country, the words of both Leo XIII and Pius XI calling for "a profound renewal of the Christian spirit," should make the reason abundantly clear. When the golden hour struck in the lands formerly behind the Iron Curtain, what were needed were missionaries of the stature of Benedict, Patrick, Cyril and Methodius, Boniface, and Leo the Great. A latter-day Leo the Great we have! And he has provided a splendid trilogy of encyclicals for restoring social order.

Instead, the jaded Western nations have sent out architects of 19th- century economics. It sent them into Russia, into Poland, and wherever else poor, relieved victims of decades of Communist oppression were receptive after drawing their first deep breaths of freedom. The results of this dismal economics were predictably dismal! They leave in their wake a Weimar-like chaos. Perhaps Poland, after giving us our great missionary Pope and our leading Cold War hero, deserved better. Or perhaps there too, as in post-Christian America, what is needed first is that "reform of manners" which Pius XI called for back in 1931 in a world that was even then reverting to barbarism.

SOFTER THAN STEEL

O harp and altar of the fury fused, (How could mere toil align thy choiring strings!) from , Hart Crane.

God's body is not built of stainless steel Bridging exotic clouds and sterling earth, Yet we have seen a spirit in the cross Of gleaming girders, history to shore, Erecting dreams to bell San Salvador.

New York across the prairies, patriot's dream As far as the Pacific high-rise stripes Red, white, and blue-Maria, sing!-this man Columbus, insightful search life-long: Silence is more like God than any song.

Golden seeds and dragons' teeth all sown Broadcast to bloom the green delightful farms With health, while concaine cities knife and blot Alabaster bodies black and blood- Silent and screaming, infantile, a flood

Washing the face of amniotic life with filth Contrary to apple-cheeks, this last home run Ends at the clinic, arms and legs cut off Team play. Time-out, America! to kneel: Bodies unbridged by doctor's stainles steel.

ii

Time tests the tensile strength of cables fling Across our credence. A six-lane open road Now legislates a host of towering spires To plant most high a white-starred flag or heaven; The future nation's toxin, smoke, or leaven.

Fields of flowers falling from the skies Inseminate tomorrow, child-incarnate words, Cooing with grace, star-spangled round the courts Supreme where judges smash the Sinai stones And trash the bridges built on Moses' bones.

Vison of cities, playgrounds, factory fumes, Babylon of girders, cemetery flowers Structures that strive person to span to person, The boiling river underneath-its song- Pollutes the children, Wait, you wanted strong.

Night falls on Nazareth, the logos boy Shines tall, connects the farthest reach of flesh With shores above. O Christ, eternal link to life, Accept our bent-steel offering past sin: Reweld us, broken, cross the space again!

Charles M. Campbell

Rupert J. Ederer is professor emeritius of economics from SUNY Buffalo and a frequent contributor to "Fidelity". His latest book is "Economics as if God Mattered" (Fidelity Press, 1995).

Taken from the April 1996 issue of "Fidelity" Magazine, 206 Marquette Avenue, South Bend, IN 46617. Subscription price is $25.00 per year. Letters to the editor may be sent by fax, 219-289-1461, or by electronic mail to CompuServe 71554,445.

Copyright (c) 1996 EWTN

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