Mr. John Médaille's lecture in Oakland for the Manhattan Forum

Mr. John Médaille was here in the Bay Area this weekend to give a talk for the Manhattan Forum of the St. Anthony of Padua Institute. I was happy to go out to Oakland yesterday afternoon in order to see him in person and meet him afterward. He corrected me when I addressed him as "Doctor"; nonetheless, he is worthy of my respect as I have learned much from him. I must admit that because of my messed up body clock and the lack of sufficient sleep the previous night, I did fall asleep during part of the lecture. I hope he didn't notice or if he did, wasn't offended. In the past I had fallen asleep from time to time during a talk or a class. I thought there might be something wrong with my energy level. Changing to the primal blueprint has helped with that problem to an extent, but the primal blueprint also prescribes an adequate amount of sleep. Sigh. I hope it is a physical problem and not a spiritual one involving a bad habit.

The lecture itself was very interesting. He briefly discussed the idea of a gift economy found in Pope Benedict's encyclical Caritas in Veritate, and how our first response to the benefits we have received should be one of gratitude. He talked about caritas, not justice, being the principle virtue of economics. He then went on to develop the practical implications for companies and business owners. The Q&A session after his lecture had many good questions, some asking for his predictions, others asking what responsibilities consumer/customers and employees have.

We are accustomed to thinking of justice as being the central virtue of economics (or politics)-- it is, after all, the virtue that governs exchanges (and relations) between people. It is also the virtue most related to positive law. It seems to me that the legislator and the virtuous man who is concerned with good laws will be thinking of economic matters primarily in terms of justice. Nonetheless, the Christian cannot stop with justice, since all things must be ordered to God, to the love of God and the love of neighbor. But, the observance of caritas as a virtue presupposes that a society has been successfully evangelized. Mr. Médaille reminded us that the laity are called to be the leaven of society. If our political economy needs to be reformed, this is the sort of work with which Christians should be engaged.

I was fortunate to be able to talk to him a bit after Mass at the reception. We talked a little about my education, and I mentioned my dissertation topic. He asked if I thought there was anything of an account of [subjective] right in Aquinas, as he did not think so. I brought up rights of the Anglo-American political tradition--he thinks that the Anglo-American political tradition is mostly identical to liberalism (with Jefferson being the exception?). Culturally I think Americans are liberals. But is there more to the Anglo-American political tradition than liberalism?

He does not think that the Austrian analysis of the business cycle or of the current economic crisis has much to offer. Moreover, the Austrian school puts most of blame on the Fed instead of fractional reserve banking. Mr. Médaille believes that that the problem lies with fractional reserve banking itself, and that given its existence some sort of institution like the Fed is required. The cycle between bust and boom is not caused by the Fed, but by usury. I'm always up for raising awareness of usury as a sin, one that hurts a political community.

He recommended one book dealing with fractional reserve banking: The Lost Science of Money. (See also the American Monetary Institute.) As the book is rather thick and expensive, he suggested that I take a look at the books listed in the bibliography in order to get something shorter.

Dr. Cordova asked him a question about academics and the question of remuneration -- they had an interesting discussion about self-interest. Mr. Médaille holds that the desire for self-respect a greater motivator for action than what is called "self-interest," referring to traditional societies in which honor was one of the important parts of ethical thinking.

He does not believe that the current system can endure much longer -- it is not sustainable, and predicts that things will really start to fall apart in 2012. He thinks that there will be false signs of improvement until August, as the stimulus package plays itself out, and then it will get interesting. Given the current price of oil with the economy as it is, he thinks we have reached the peak in global oil production. I didn't follow up with the objection I've read that the price of oil is more a reflection of the devaluation of the US currency, rather than production and supply.

While the US may be in bad shape, China is in even worse shape, and it is better to be in the US than in China. Chinese government policies should have focused on China's peasants and developing an internal market, instead of the export market. China cannot help but buy US bonds and spend money at home through its own stimulus packages in order to keep things going. If China hits a severe economic crisis, so will Australia, since its fortune is tied up with China's. I haven't read anything about this, though my friend told me that China is investing much in western Australia. Mr. Médaille explained that Australia is China's source for many natural resources.

I asked him if his judgments of the current situation ever got him down -- he said it used to, but now he sees it more as a time for opportunity. (Having an active faith life undoubtedly helps.) But the question is what we are made of, and he's doubtful about the character of the American people. What does someone who does not have much money do? He can't really be an entrepreneur.

He said it make take a while to persuade people, 5 or more years. There is much value in asking them questions they cannot answer so as to prompt them to reconsider their beliefs.

Mr. Médaille has new book coming out from ISI in the Summer: Toward a Truly Free Market:
A Distributist Perspective on the Role of Government, Taxes, Health Care, Deficits, and More