Productivity

Distributism is often associated with bucolic scenes and G.K. Chesterton’s encomiums of a landed peasantry. Thus, the casual observer might be left with the notion that Distributism is something of a relic, with nothing to say to the high-tech world we have become. But nothing could be further from the truth. Indeed, Distributism is, to date, the only articulated answer to a particular problem that advanced technology has brought upon us.Let it first be said that this answer is not calling a halt to the developments of applied science. While some Distributists (and others) might look wistfully upon a time that was more technologically simple, and more agrarian (neglecting to consider the child mortality rates of those days gone by), the truth is there is nothing that is essential to Distributism that requires any sort of Ludditism. Distributism stands for the widest possible ownership of capital, regardless of the form that capital takes in any particular epoch.But, still, we have to admit that the Luddites had a point. Advancing technology does have a tendency to take away jobs. This is not a problem that was confined to the nineteenth century, but continues today. And this is a problem that Distributism alone has an answer for that does not involve a total absorption of the productive faculties of humanity to the State.Pope Leo XIII made two critical observations that are important for addressing this concern.[note]vatican.va.[/note] The first is that the origin of property is in labor. Property arose through the efforts of human beings extracting their sustenance from nature. The second is that an injustice is done when an employer manages to hire someone at a wage that is insufficient for him to support his family, and set aside a little savings besides.These observations lead inexorably to the conclusion that the employer-employee relationship entails a certain appropriation of the employee’s property interest in the results of his labor. While this can be tolerated morally so long as the wage is fair (since the employer does, after all, supply the capital), the fact remains that the appropriation does take place. And the greater the gap between the employee’s productivity and his remuneration, the greater the appropriation.Now an employer will bring new technology into his business only if it increases productivity. Because of new machinery, what might have taken an hour to make before will now take only a few minutes. And what used to require ten employees will now require only two or three. The employer is now able to save the labor cost of seven or eight employees, and the productivity of the two or three that remain is increased. This can be expected to result in a greater gap between the productivity of the employees and the compensation they receive, that is, in an increase in the amount of appropriation of the employees’ property interest in the results of their labor.The Distributist answer to this is to stop the appropriation. That doesn’t mean that the employer must pay in wages an amount equal to the productivity of each employee, for if he did that he wouldn’t be able to make a profit. It does mean that the employees must be given an ownership interest in the business enterprise for which they are employed that is reflective of their productivity.Two scenarios can arise if this is done. The first is that the employees who are laid off as a result of the new technology will retain the ownership interest in the business enterprise that they earned as a result of their past productivity, with its corresponding profits. Even though the advance of technology has rendered their services superfluous, they will still be entitled to a share of future profits. (Of course, if they have acquired a sufficient ownership stake, they might be able to prevent being laid off in the first place.)But the second scenario is even better, though it requires more out-of-the-box thinking.Prior to the arrival of the new machinery, the employees engaged in a certain level of productivity for a certain amount of remuneration. Now, with the coming of the new technology, they can achieve the same level of productivity in less time.But there is a superstition afoot that gives the impression that the employees are being paid for their time. They are not. They are being paid for their productivity. If this is doubted, consider the fact that if the employees didn’t produce anything, the employer wouldn’t be willing to pay them at all, no matter how long they remained present on the business premises.Now since it is apparent that employees are paid for their productivity rather than their time, there doesn’t appear to be any reason why employees would be paid less for the same level of productivity that they used to achieve prior to the arrival of the new technology, even though it now takes less time accomplish. Only superstition, or mean-spiritedness would insist that it be so.What this means is that the arrival of new technology doesn’t require that those seven or eight employees be laid off at all. All of the employees can remain with the business, produce the same amount in less time, and receive the same compensation, at no real loss to the employer. That means, of course, that they can spend less time at work, and spend the extra time with their families, or engaging in creative, educational, or recreational activities. In other words, they can participate in the very benefits of leisure that advanced technology was supposed to bring to humanity.And so, once again, we see that Distributism has the answer for yet another of society’s seemingly intractable problems.